Which of the following is an example of functional obsolescence?

Functional obsolescence refers to a reduction in a property's value due to outdated features or inefficiencies that impact its usefulness or desirability. This can occur even in the presence of physical deterioration. In the context of the options given, outdated plumbing exemplifies functional obsolescence because it can lead to inefficiencies, insufficient water pressure, or safety issues, making a property less appealing to potential buyers or tenants.

In contrast, a new roof installation, a modern electrical system, and upgraded flooring are examples of improvements that enhance a property's functionality and value, demonstrating that they contribute positively rather than indicating a loss of utility or appeal. Therefore, outdated plumbing is clearly identified as functional obsolescence since it highlights an aspect of the property that is no longer adequate by current standards.