Hawaii Pre-Licensing National Practice Exam 2026 – Your Complete Prep Guide

Factors such as crime rates, environmental hazards, and poor school districts can significantly detract from a property's value. When prospective buyers assess a neighborhood, these concerns often weigh heavily in their decision-making process. High crime rates instill fear and uncertainty about safety, which can lead to decreased demand. Similarly, environmental hazards—such as proximity to toxic sites or flood zones—raise serious concerns about health and property integrity. Additionally, properties located in school districts that are considered inferior can deter families who prioritize education for their children, thus reducing overall property demand in those areas.

In contrast, while high demand in the housing market and recent renovations typically contribute positively to property values, and increased interest rates on mortgages can affect buyer affordability, they do not intrinsically impose a negative value on a property itself. Therefore, option C identifies external factors that can have detrimental consequences on property valuation, making it the correct answer.