The concepts of most efficient use (MEU) of real estate objects and functional wear and tear are closely interrelated and cannot be considered separately. The application of the MEU principle allows the expert to account for this type of wear and, vice versa, without the wear and tear, the expert cannot properly apply the MEU principle in all approaches.
In the article, special attention is paid to the scheme of interaction of MEU analysis with valuation approaches through the elimination of wear and the connection of the latter with the concepts of reconstruction, modernization and repair of the object of assessment. The performance (characteristics) of buildings and structures, which are the main objects of functional wear, are considered. The place of functional wear in the structure of the accumulated wear of the objects of evaluation is shown. Ways of simplification of calculation, the situations in which it is recommended to take into account wear are considered.
Key words: real estate, performance, valuation, most efficient use, wear and tear.