Which of the following defines the term ‘residual value’ in property management?

Residual value in property management refers to the estimated value of an asset at the end of its useful life after accounting for depreciation. This value represents what the asset is anticipated to be worth when it is no longer in use for its intended purpose. It is essential for property managers and investors to understand residual value because it plays a significant role in determining the financial viability of acquiring and maintaining an asset.

When calculating residual value, factors such as the asset's lifespan, the expected wear and tear, and market conditions will influence the final figure. This value is critical for making informed decisions on investments, calculating depreciation for accounting purposes, and understanding the potential returns upon disposition of the asset.

The other concepts mentioned do not define residual value accurately. The initial cost represents the purchase price, maintenance costs relate to the ongoing expenses of managing an asset, and market value when sold refers to the potential sale price but may not align with the assessment of the asset's worth at the end of its useful life. Therefore, identifying residual value as the depreciated value at the end of its useful life provides correct and relevant context within the framework of property management.