Definition
Depreciation is a decline in a property's value, often caused by physical wear, outdated features, or a softening local market. For rental property owners, it's also a tax accounting concept — an annual deduction taken against income to reflect the building's aging over time. As a homeowner preparing to sell, the version of depreciation you'll feel most directly is deferred maintenance: every year a roof, furnace, or bathroom goes unaddressed, it chips away at what buyers are willing to pay. This matters because buyers and appraisers both factor in the cost and hassle of bringing a home up to date, and that discount is often larger than the actual repair bill. If you've inherited a property or simply couldn't keep up with upkeep, depreciation is often the biggest gap between what you hoped to get and what the market will actually offer. Selling as-is to a cash buyer is one way to avoid absorbing more of that decline while you search for financing to make repairs yourself.
Example
Angela inherited her uncle's rental house, which hadn't seen a kitchen or bathroom update since the late 1990s. When she compared it to similar homes nearby that had been renovated, hers appraised noticeably lower because buyers would need to replace aging systems, flooring, and fixtures throughout. She got a couple of contractor quotes just to see what a full update might cost, and the numbers came back well over $45,000 for the kitchen, both bathrooms, and new flooring, not counting the time it would take to manage the work from out of state. Angela realized that spending money to fix everything herself would eat into any gain she made from a higher sale price, and she didn't have the time or local connections to oversee months of renovations. She ultimately weighed a direct cash sale that let her skip the repairs entirely and close within a few weeks.