According to the principle of change, what are the three life stages that properties go through?

The principle of change in real estate acknowledges that properties undergo various life stages that influence their value over time. These stages represent the cyclical nature of real estate and illustrate how properties can evolve based on market demand, economic conditions, and physical wear.

The identified life stages are Development, Equilibrium, and Disintegration.

• Development refers to the initial phase where land is prepared and constructed upon, marking the beginning of a property's lifecycle. During this stage, investments in infrastructure and facilities are made, leading to increased value and attractiveness of the property.

• Equilibrium is the stage where the property reaches a balance between supply and demand. At this point, the property is fully utilized, and its market value stabilizes as it serves its intended purpose effectively without excess vacancy or underutilization.

• Disintegration, on the other hand, is when the property begins to decline in value and utility. This decline can result from physical deterioration, changes in the neighborhood, or shifts in market preferences. At this stage, properties may require significant intervention to restore their value or may ultimately need to be redeveloped or replaced.

Understanding these three stages aids appraisers and assessors in evaluating properties accurately, anticipating future needs, and making informed decisions regarding property investments and assessments.