Question

Spending money to improve a property beyond the point where the improvements add value to the property is an example of the principle of________

Answer 1

Overimprovement occurs when someone spends money to improve a property beyond the point where the improvements add value to the property.

Step-by-step explanation:

Overimprovement occurs when someone spends money to improve a property beyond the point where the improvements add value to the property. In other words, the additional money spent on the improvements does not yield a proportional increase in the property's value.

For example, let's say someone invests $50,000 in renovating their home with high-end fixtures and finishes, but the market value of similar homes in the area does not increase by the same amount. This would be considered overimprovement.