A latent variable model is a statistical model that relates a set of variables (so-called manifest variables) to a set of latent variables.
DEFINITION of 'Functional Obsolescence'. A reduction in the usefulness or desirability of an object because of an outdated design feature, usually one that cannot be easily changed.The term is commonly used in real estate, but has a wide application.Next Up. reduction in the usefulness or desirability of an object because of an outdated design feature, usually one that cannot be easily changed. The term is commonly used in real estate, but has a wide application. Next Up.
Then thereâs âeconomic obsolescence,â also referred to as environmental, external, or location obsolescence, which is a type of depreciation that occurs outside the subject property. Typically, this form of obsolescence occurs sometime after the property is built, as the environment around the home changes. Examples include airport noise, toxic waste, nuclear power plants, freeway noise, dust and air pollens, changes in zoning, and more.