Ace the UBC Real Estate Exam 2026 – Unlock Your Property Potential!

Depreciation is a tax and accounting concept used to allocate the cost of assets that have a finite life and wear out over time. Land, on the other hand, has an indefinite life and does not wear out from use, so its value doesn’t systematically decline. That’s why land isn’t depreciated.

In real estate, buildings and equipment are tangible assets that do wear down or become obsolete and are therefore depreciated. Intangible assets, while they can lose value, are typically handled through amortization because they have a finite life or contractual duration, not through depreciation. So land stands out as the asset that never depreciates.