Reproduction cost is the estimated expense to construct an exact replica of an existing structure using the same materials, design and construction methods as the original, priced at current costs. It differs from replacement cost, which estimates the expense to build a functionally equivalent structure using modern materials and methods.
In the cost approach to value, reproduction cost is used when preserving the original design is essential to the analysis, such as with historic properties or architecturally significant structures where replication of specific features is necessary to support the value conclusion.
Because reproduction cost includes the expense of duplicating outdated materials or obsolete design elements, appraisers must account for any resulting functional obsolescence through depreciation adjustments. When those adjustments are difficult to support, replacement cost is generally the more practical and defensible choice — making the selection between the two methods a meaningful analytical decision.