Which is an example of functional obsolescence?

Functional obsolescence refers to a decrease in the value of a property due to outdated features or a design that is no longer desirable or practical for current buyers. A one-car garage is often considered an example of functional obsolescence because modern homebuyers typically prefer larger garages that can accommodate two or more vehicles. In contemporary real estate markets, a one-car garage may not meet the expectations of potential buyers, leading to a lower perceived value of the property.

In contrast, a multi-car garage is generally seen as an asset, and a newly remodeled kitchen is appealing and can enhance a home's value, making them examples of functional utility rather than obsolescence. Likewise, an exclusive waterfront property is often viewed as highly desirable due to its location and amenities, so it does not exemplify functional obsolescence.