HomeownershipHomebuying Glossary
Depreciation
A decrease in a property's or asset's value over time, or a tax deduction for investment property wear.
In plain English
Depreciation describes an asset losing value over time due to age, wear, or market conditions. For rental/investment properties, it's also a specific tax deduction that lets owners write off a portion of the property's value each year.
Why it matters
For a primary residence, depreciation mostly matters conceptually (insurance uses it for payouts); for investment property owners, it's a meaningful tax planning tool.
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