What does the principle of value imply about property worth?

The principle of value reflects the idea that the worth of property is significantly influenced by the dynamics of supply and demand. This means that when there is more demand for property than there are available properties (a seller's market), prices tend to rise. Conversely, if there is an excess of properties available for sale compared to buyer interest (a buyer's market), prices may decline. This relationship illustrates how market conditions affect property values, emphasizing that value is not static but rather responsive to economic factors.

In a healthy market, potential buyers and investors make decisions based on their perceptions of value, which can fluctuate based on a variety of external factors such as economic trends, interest rates, and local market behaviors. This fluidity highlights the importance of understanding how supply and demand directly impacts the worth of real estate.

While other options may touch on aspects of value, they do not encapsulate the comprehensive and fundamental relationship between supply and demand that drives property values in the marketplace.