Market appreciation is passive. You wait. Forced appreciation is active. You make the property worth more by doing something to it. Typical forced appreciation plays include cosmetic rehabs that bring a property from distressed to rent ready, functional improvements like adding a bedroom or finishing a basement, operational improvements like raising rents to market rate on below market leases, and repositioning like converting a long term rental into a mid term furnished rental at higher margins. Forced appreciation is the engine of the BRRRR strategy and of small multifamily value add. The key distinction is that forced appreciation does not depend on the market going up. You create the value through your own work, which means you can generate returns in flat or declining markets as long as your execution is solid.
Example
You buy a distressed duplex for $80,000 and spend $45,000 rehabbing it. After the rehab, it appraises for $165,000. Forced appreciation = 165,000 - 80,000 - 45,000 = $40,000 of equity you created through the rehab.