Define “replacement cost new” in the context of property appraisal.

Replacement cost new refers to the cost associated with constructing a property that serves a similar purpose or utility as the original, using contemporary construction methods and materials at current pricing. This concept is vital in property appraisal as it helps establish the value of a property based on what it would cost to build a comparable structure today.

This definition emphasizes the intention to replicate the function of the existing property, rather than its specific architecture or historical features. The focus is on functionality, thus aligning with modern standards and codes. By considering current construction methods and regulations, appraisers can arrive at a more accurate valuation reflective of today's economic environment.

The other options do not align with this definition. Renovating an existing property encompasses upgrades and modifications rather than a new construction cost and thus deviates from the definition. Market value refers to the price at which a property would sell in the open market, taking into account numerous factors beyond just construction costs. Lastly, replacing fixtures and fittings specifically targets interior components and does not encapsulate the broader context of constructing an entire property.