What does TEL stand for in property appraisal calculations?

In property appraisal calculations, TEL stands for Total Effective Life. This term refers to the period during which a property is expected to provide economic benefits or generate income before it experiences significant depreciation or becomes unusable. Total Effective Life considers not only the chronological age of a property but also factors in any enhancements, renovations, or market conditions that may affect its longevity and utility.

Total Effective Life is critical in appraisal as it helps in determining the value of a property based on its anticipated lifespan. Understanding this concept allows appraisers to make informed decisions regarding depreciation and the overall valuation of property, taking into account both physical attributes and economic factors. This ensures that the appraisal reflects the true market potential and realistic longevity of the asset.