TOP
Absorption rate
:
Estimate or forecast of the expected annual sales or lease of a particular property.
|
Abstract of Title
:
A brief history of the transfers for a piece of land, including all claims that could be made against it.
|
Acre
:
4,046.85m2 of land
|
Addenda
:
Something added or to be added, especially a supplement to a contract.
|
Adjustable rate mortgage
:
Mortgage in which the interest changes periodically according to fluctuations in an index such as the CPI.
|
Administrator
:
A person who is appointed by the court to settle an estate of a person who dies without a will.
|
Affidavit
:
A written statement sworn by a person making it to be true.
|
Agent
:
One empowered to act for or represent another - a real estate agent.
|
Amenity
:
Tangible or intangible benefits derived from real estate such as parks, community centres, swimming pools etc.
|
Amortised Loan
:
A loan in which the principal and the interest are both payable in periodic payments over the loan term; usually monthly.
|
Annual Percentage Rate (APR)
:
The annual percentage rate is the cost of credit paid to the lender, expressed as a simple percentage.
|
Appraisal
:
The classification of something according to its worth.
|
Appreciation
:
An increase in value of a property due to changes in market conditions. This could be caused by the economy or related causes. Opposite of depreciation.
|
Assessment
:
Imposition of taxes or charges going by established rates.
|
Assessment valuation
:
The value and established for property tax purposes.
|
Assignment
:
The transfer of a claim, right, interest, or property from one company or individual to another.
|
|
TOP
Balloon Payment
:
The final lump sum payment that is due at the termination of a balloon mortgage.
|
Bill of sale
:
A written document that transfers title to personal property.
|
Building Code of Australia (BCA)
:
Is a uniform set of technical requirements and standards for the construction of buildings and other structures.
|
Breach of Contract
:
Violation of any terms or conditions in a contract without legal excuse; for example, failure to make a payment when it is due.
|
Break even ratio
:
The point at which income equals expenses.
|
Bond
:
Usually an amount of money, security deposit or deposit bond on a purchase or lease. Usually used as security and usually non refundable.
|
Building efficiency ratio
:
The ratio of net listenable area to the grossly suitable area
|
Business Broker
:
One that acts as an agent for others, as in negotiating contracts, purchases, or business sales in return for a fee or commission.
|
Build to Suit
:
A method of leasing property whereby the lessor builds to suit the tenant (according to the tenant's specifications). The cost of construction is figured into the rental amount of the lease, which is usually for a long term.
|
Buyer Agent
:
An agent is hired by a prospective purchaser or tenant to find an acceptable property for purchase. The broker/agent represents the buyer and negotiates with the seller or the seller's agent for the sale or lease of the real estate acting in the purchaser's best interest.
|
|
TOP
Capital Gain
:
A profit made from buying property and reselling it at a higher price.
|
Capital
:
Money or property that is invested in assets from the purpose of creating more money
|
Cap Rate
:
Percentage at which a future flow of income converts to a present value figure
|
Capitalisation Rate
:
The rate of return a property will produce on the owner's investment.
|
Cash Flow
:
A measure of a company's financial health. Equals cash receipts minus cash payments over a given period of time; or equivalently, net profit plus amounts charged for deprecation, depletion, and amortization.
|
Caveat Emptor
:
Buyer beware
|
Certificate of occupancy
:
A document issued by a local government council to a developer permitting the structure to be occupied.
|
Certificate of Title
:
A written statement regarding the status of a property title.
|
Clear title
:
A title that is free of liens or legal questions as to ownership of the property.
|
Co-borrower
:
An additional individual who is both obligated on the loan and is on title to the property.
|
Collateral
:
The placing of something of value pledged to secure a loan.
|
Commission
:
A fee charged by a broker or agent for his/her service in facilitating a transaction.
|
Comparative Market Analysis (CMA)
:
A method of estimating a property's value by comparing the sale prices of similar recently sold properties.
|
Community Title
:
Allows subdivision of land into privately owned blocks with other blocks to be retained as community property such as parks and sporting facilities for the use of all owners in the subdivision.
|
Consideration
:
Something of value, such as money or personal services, given by one party to another in exchange for an act or promise.
|
Construction loan
:
A short-term, interim loan for financing the cost of construction. With this loan the lender makes payments to the builder at periodic intervals as the work progresses.
|
Contingency
:
An event that may occur but that is not likely or intended; a possibility.
|
Contract
:
An agreement between two or more parties, especially one that is written and enforceable by law.
|
Cooling off period
:
Following an exchange of contracts, the purchasers of residential property have cooling off rights given by legislation for a period of 5 days. This allows a purchaser to make any necessary inquiries about the property, arrange finance or simply change of mind.
|
Co - Agent/Broker
:
A real-estate agent who is jointly working with an existing agent who finds a buyer or tenant for a property and initiates a negotiation and shares in a commission.
|
Core
:
The area of the building that often has the mechanical, electrical and plumbing that are non-revenue generating.
|
Counteroffer
:
A new offer made in response to an offer received. It has the effect of rejecting the original offer, which cannot be accepted thereafter unless revived by the one who originally made it.
|
Covenant
:
A written agreement between two or more parties in which a party or parties pledge to perform or not perform specified acts with regard to property; usually found in such real estate documents as deeds, mortgages, leases, and contracts for deed.
|
|
TOP
Deed
:
The written legal document conveying title to a property.
|
Deed of trust
:
A voluntary lien to secured debt
|
Deed Restrictions
:
Clauses in a deed limiting the future uses of the property. Deed restrictions may impose a vast variety of limitations and conditions; for example, they may limit the density of buildings, dictate the types of structures that can be erected, prevent buildings from being used for specific purposes, or from being used at all.
|
Default
:
The failure of the buyer to meet a condition in the contract.
|
Designated Development
:
Development that is listed in an environmental planning instrument or in the regulation made pursuant to the Environmental Planning and Assessment Act which is subject to special development control proceedures.
|
Depreciation
:
A decrease or loss in value because of age, wear, or market conditions.
|
Designated Agent
:
One or more licensees designated by a broker to act at the exclusive agent(s) for the principal to the exclusion of all other licensees within the company.
|
Developer
:
A person who develops real estate, especially by preparing a site for residential or commercial use.
|
Development
:
Physical work in relation to land.
|
Development Application
:
An application for consent or permission to carry out a development.
|
Development Consent
:
A decision to allow a development.
|
Development Control Plan (DCP)
:
Sets out detailed controls that apply to a particular type of development or a particular area.
|
Draft Plan
:
A plan prior to approval being granted by a miinister.
|
Due diligence
:
Doing your research or homework
|
|
TOP
Easement
:
A right, such as a right of way, afforded a person to make limited use of another's real property.
|
Encroachment
:
To take another's possessions or rights gradually or stealthily.
|
Encumbrance
:
One that encumbers; a burden or impediment.
|
Equitable Title
:
The interest held by a buyer under a contract for deed or an installment contract; the equitable right to obtain absolute ownership to property when legal title is held in another's name.
|
Equity
:
The difference between the market value of a property and the claims held against it.
|
Environment Impact Statement
:
A detailed assessment of the effect of all aspects of a development on the environment in which the development will occur.
|
Estoppel
:
When a person by their words or actions (specific performance) has led another person to believe in a particular state of affairs. They will not be allowed to go back on it when it wold be unjust or inequitable for them to do so. For example in a lease agreement. A court may rule that there is a lease in place even though it is not in writing.
|
Executed Contract
:
A contract that has been completely carried out or signed by the parties.
|
|
TOP
Facade
:
The front of a building.
|
Fee Simple
:
The absolute total interest in real property.
|
Fiduciary Relationship
:
A relationship of trust and confidence between two people in which one person (the fiduciary) holds much more power, knowledge, or skill than the other and is, therefore, held by the law to a higher standard of conduct.
|
Fixed rate mortgage
:
A mortgage in which the interest rate does not change during the entire term of the loan.
|
Fixtures
:
An item of personal property that is physically attached to real property so that it cannot be removed without damage to the real property. It therefore becomes a part of the property and consequent sale.
|
Floor Space Ratio
:
The ratio of the total floor space of a building area of the land on which the building is, or is proposed to be erected.
|
Forfeiture (Lease)
:
Means the entitlement to terminate a lease because the lessee committed a breach of some of its conditions.
|
|
TOP
Gross Lease
:
A lease which obligates the lessor to pay all or part of the expenses of the leased property, such as taxes, insurance, maintenance, utilities, etc.
|
|
TOP
Highest and Best Use
:
The property use that at a given time produces the greatest net worth return.
|
|
TOP
Improvement
:
A structure or building on the property.
|
Income Approach
:
Method used by an appraiser to estimate the value of a property based on the income it generates.
|
Independent Contractor
:
A legal term for a person who is hired to do work for another person but who is not an employee or agent of that person. The hiring person is not responsible for the actions of the independent contractor nor does he/she owe that.
|
Independent Contractor
:
The same legal duties owed by an employer to an employee under labor and employment laws.
|
Imdemnification
:
Protection or security against damaged or loss.
|
Interest
:
A fixed charge for borrowing money; usually a percentage of the amount borrowed.
|
|
TOP
Joint Tenancy
:
A form of co-ownership that gives each tenant an equal undivided ownership in the property, including the right of survivorship.
|
Joint Venture
:
An agreement between two or more firms to undertake the same business strategy and plan of action.
|
Judgment
:
The legal document stating the reasons for a judicial decision.
|
|
TOP
Latent Defect
:
An invisible problem in a piece of property such as bad wiring, termite damage or lead paint.
|
Lease
:
A contract granting use or occupation of property during a specified time for a specified payment.
|
Lease Option
:
Agreement, specified in the lease, which provides the tenant the option to renew the lease for a given time period upon the expiration of the initial lease. Most lease options include the landlord's right to increase the rent upon renewal.
|
Legal Description
:
A property description, recognised by law that is sufficient to locate and identify the property without oral testimony.
|
Lessee
:
The party to a lease agreement who is obligated to pay the rentals to the lessor and is entitled to use and possess the leased property during the lease term. Also known as tenant.
|
Lessor
:
A person who rents property to another under a lease. Also known as landlord.
|
Leverage
:
The use of credit or borrowed funds to improve one's speculative capacity and increase the rate of return from an investment, such as real estate.
|
Lien
:
A claim or change against property.
|
Liquidated Damages
:
The amount required to satisfy a loss resulting from breach of contract.
|
Listing Broker
:
The real estate broker who is responsible for the listing of a property and who is to represent the interests of the seller or lessor.
|
|
TOP
Market
:
The world of commercial activity where goods and services are bought and sold.
|
Market Value
:
The amount that a seller may expect to obtain for real estate in the open market.
|
Month-to-Month Tenancy
:
A periodic tenancy where the tenant rents for one month at a time. In the absence of rental agreement (oral or written), a tenancy is deemed to be month-to-month.
|
Mortgage insurance
:
Ensures that covers the lender against some of the losses incurred as a result of a default on the loan.
|
|
TOP
Net Lease
:
A lease in which the costs of maintaining the asset, including common area charges, taxes, and insurance, are paid by the lessee.
|
Net Operating Income (NOI)
:
Income after deducting for operating expenses but before deducting for income taxes and debt service.
|
Nonconforming Use
:
The use of a property which does not conform to the zoning of an area.
|
|
TOP
Offer and Acceptance
:
Components of a contract, applicable to the real estate situation where a purchaser or lessee may make an offer on a property and the seller or lessor may accept that offer. Major elements of a contract.
|
Offeror
:
One who makes an offer.
|
Offeree
:
The one to whom the offer is made.
|
Option
:
A contract that permits the owner, depending on the type of option held, to purchase or sell an asset at a fixed price until a specific date. Depending on how an investor uses options, the risks can be quite high.
|
|
TOP
Passive investor
:
Investor who wants to invest funds to earn income but does not want to pursue an active role in the operations.
|
Power of Attorney
:
Legal document authorizing one person to act on behalf of another.
|
Principal
:
The amount of the entire mortgage loan, not counting interest.
|
Procuring Cause
:
That effort which brings about the desired result, as in producing the buyer for the listed property or the tenant for the listed space.
|
Promissory Note
:
A written promise to repay a specified amount over a specified period of time.
|
Purchase agreement
:
Written contract signed by the buyer and seller stating the terms and conditions under which the property will be sold.
|
|
TOP
Quantity Surveyor
:
A surveyor Who is able to determine that monetary value of capital and equipment for depreciation purposes.
|
|
TOP
Rate Cap
:
A limit on how much the interest rate can change, either at each adjustment period or over the life of the loan.
|
Real Estate
:
A piece of land, including the air above it and the ground below it, and any buildings or structures on it. Also called realty.
|
Registrar
:
The principal administrative officer of a court.
|
Replacement Cost
:
The cost to replace damaged personal property without a deduction for depreciation.
|
Restrictive Covenants
:
A covenant acknowledged in a deed or lease that restricts the free use or occupancy of property (as by forbidding commercial use or types of structures).
|
|
TOP
Sale and Leaseback
:
The sale of a fixed asset that is then leased by the former owner from the new owner. A sale and leaseback permits a firm to withdraw its equity in an asset without giving up use of the asset.
|
Sales Comparison Approach
:
Method of estimating value of a property by comparing similar properties that have been sold recently.
|
Security Deposit
:
Amount of collateral a customer deposits with a broker.
|
Secure Landfill
:
Land disposal in impermeable cells to prevent leaching into water on the surface or underground.
|
Selling Agent
:
Someone who sells real estate (on commission) for others.
|
Setback
:
A line within the property line; boundaries beyond which a permanent structure cannot be built.
|
Straight-Line Method
:
Method of calculating depreciation by taking an equal amount of the asset's cost as an expense for each year of the asset's useful life.
|
Strata Title
:
Pat of a building which is subdivided into common property with full ownership.
|
Subagent
:
An agent who is appointed by another agent and for whom the principal agent is responsible or liable.
|
Subdivision
:
An area of real estate composed of subdivided lots.
|
Sublease
:
A lease that is given by a tenant or lessee to another party of part or all of the leased premises for a shorter term than that of the original lease and under which some interest is retained. The tenant or lessee is now the landlord - a sub-lessor.
|
Specific Performance
:
A legal action compelling a party to comply with contract terms.
|
Statute
:
An Act of Parliment.
|
Subpoena
:
A writ issued in a court action that requires a person to be present at a certain time time and place for a specific purpose.
|
Supply and Demand
:
Creating a rise in price by supplying a wanted product or service.
|
Survey
:
To determine the boundaries, area, or elevations of land or structures on the earth's surface by means of measuring angles and distances, using the techniques of geometry and trigonometry.
|
|
TOP
Tenancy in Common
:
Type of asset ownership for two or more persons in which, upon the death of one owner, his or her share passes to heirs (if a will is left) or to the estate (if no will is left), rather than to the co-owners.
|
Tenant Improvements (TIs)
:
Improvements made to the leased premises by or for a tenant.
|
Title
:
The means or right by which one owns or possesses property.
|
Title Insurance
:
Insurance that compensates for loss from title defects or encumbrances (as liens) that were unknown but should have been discovered at the time the policy was issued.
|
Title Search
:
A search of public records to determine the condition of title to real property, usually that is the subject of a transaction.
|
Toxic
:
Poisonous.
|
Trade Fixture
:
An article installed by a tenant under the terms of a lease and removable by the tenant before the lease expires.
|
|
TOP
Undivided Interest
:
Interest in property owned by tenants whereby each tenant has an equal right to enjoy the entire property.
|
|
TOP
Valid Contract
:
A contract that contains all of the necessary elements and is enforceable in a court of laws.
|
|
TOP
Warranty deed
:
Is a deed that warrants good and clear title to the real estate transferred.
|
|
TOP
Zoning
:
A restriction of land uses within a particular area.
|
|