An undesirable house design requiring significant renovation but not returning equivalent value represents which type of depreciation?

The type of depreciation represented by an undesirable house design that requires significant renovation but would not return equivalent value is incurable functional obsolescence. This form of depreciation occurs when a property has design features or characteristics that are no longer considered desirable, and addressing these deficiencies would not result in a cost-effective improvement in value.

In this scenario, the undesirable design indicates a fundamental flaw in the property's layout or functionality that would require extensive renovation to correct. However, even after investing in renovations, the property may not increase in value sufficiently to justify the costs incurred. This aligns with the definition of incurable functional obsolescence, where the deficiency is inherent to the design and cannot be effectively corrected or does not provide a reasonable return on investment.

Functional obsolescence encompasses issues related to the utility or desirability of the property design, and when such issues are deemed incurable, they reflect limitations that resist mitigation. Thus, this depreciation type captures the loss in value due to the house's design inadequacy, highlighting the importance of function and practicality in real property valuation.