Real Estate Terms Explained

We know how stressful buying and selling a property can be and it doesn’t help that there is so much jargon to deal with! To make things easier we have created this index of terms you will likely come across as a buyer, seller or renter.

Still confused? We’re here to help. Contact us today and discover how we can help you sell your home or find a new one!

 

Acceptance: An acceptance of an offer according to terms, which usually leads to a binding agreement or contract.

Acreage: Typically a 4,000 to 8,000 m2 property with town water and on-site waste treatment, such as a Biocycle. 1 acre = 4,046m2

Agent: A person authorised to act on behalf of a client for the sale, purchase, letting or management of real estate.

Appreciation: An increase in the value of real estate, caused by supply and demand.

Architrave: The moulding surrounding a door or window opening.

Auction: A public sale where property is offered for purchase through a competitive bidding process.

Bearer: A timber or steel beam that supports floor joists.

Body Corporate: A group of owners in a block of units. The council of the body corporate – elected by property owners – meets at regular intervals to discuss various matters including repairs, maintenance and security.

Boundary: A line separating adjoining properties.

Breach of contract: Breaking the conditions of a contract; usually has financial penalties.

Brick Veneer: The most common building method on the Gold Coast; a timber frame supports the roof and an outer brick wall provides protection from weather.

Bridging Finance: Finance that is obtained for a short period of time as a ‘bridge’. This kind of funding may be required if a home purchase completes before the buyer has sold their own property.

Building Regulations: A set of rules that ensure public health and safety by specifying legally required standards for construction.

Caveat: Warns a person buying real estate that a third party has some right or interest in the property.

Caveat Emptor: This principle of law requires that the buyer is satisfied with the property they wish to buy before completing the transaction.

Certificate of Title: A document that confirms the ownership of land, showing who owns it and whether there are any outstanding mortgages or loans against it.

Chattels: Property other than real estate included in a sale, including any items of furniture or other fittings.

Clear Title: A title that isn’t encumbered with outstanding mortgages or loans.

Commission: A fee or payment made to a real estate agent on completion of the sale of a property.

Common Area: A shared area that is available for use by more than one person. For example: the garden surrounding an apartment block or the stairwell of a set of units.

Consumer Protection Laws:  The Competition and Consumer Act 2010 stipulates the way real estate agents can interact with customers and clients. It replaces the old Trade Practices Act 1974.

Contract of Sale: A document that lists the terms and conditions of a property sale between the vendor (seller) and the purchaser (buyer).

Conveyance: The legal process of transferring the ownership of property from the seller’s name to the purchaser’s name.

Covenant: A requirement noted on the title of a property that compels the property’s owner to adhere to named terms, conditions and restrictions relating to the property.

Deed: A legal document that is a record of an agreement, obligation or conveyance of property.

Deposit: A sum of money – typically between five and ten percent of the final purchase price – which is paid by the buyer when they sign a contract and held in the real estate agent’s trust account.

Dual occupancy or Dual living: A property with two separate living quarters that cannot be sub-divided (i.e. a home with an attached self-contained unit).

Duplex: A residential property with two apartments on different titles, both of which have separate entrances and can be sold separately.

Fittings: Goods or articles that can be removed from a property without causing damage or an obvious reduction in value. Fittings aren’t usually included with a sale and may include items like furniture, lampshades or ride on mowers.

Fixtures: Items that form part of the property and cannot be removed without causing damage (i.e. taps, toilets and air conditioning units). Fixtures typically remain with a property upon sale.

Free Standing: A property that stands independently of others, the most common example being a house.

Gazumping: The withdrawal from a verbally agreed sale by the vendor in favour of a quicker or more profitable sale. Common in NSW, but unlikely to occur in Queensland where the contract is prepared by the real estate agent and is a quicker process for both parties.

Interest only loans: Loans where the principal amount is not repaid until the end of the agreed term. Usually limited to five years.

Joint Tenants: Joint tenancy is the holding of property in equal shares by two or more persons. This is the most common method of ownership for a married couple.

Land Tax: A state government tax payable by owners of property based on the unimproved land value. The threshold in Queensland is currently $600,000, not including the land where you live.

Listing Agreement: Referred to as Form 6 in Queensland. A contract between a property owner and real estate agent that sets out the terms, conditions and commission for the sale of a property.

Mortgage: A legal document that provides lender’s with security allowing them to take possession of a property to secure the repayment of a loan.

Mortgagee: An entity that lends money on the security of a mortgage. A mortgagee sale occurs when a bank takes over the property to recover the money owed on an unpaid loan.

Mortgagor: An entity or individual, usually a homeowner, who borrows money as part of a mortgage loan.

Option to buy: A legal document which provides a person with a right (but not obligation) to buy property or land at an agreed price with predetermined conditions. Sometimes used for development site investments.

Principal and interest loan: A loan whereby the lender repays a combination of interest and the principal borrowed throughout the term of the loan.

Private Treaty Sale: Sale of property through a real estate agent on the open market. Not an auction sale.

Property Management: The management of a property on behalf of the owner. Includes finding a suitable tenant, collecting rent, conducting inspections every three months, organising maintenance, and paying the owner.

Rates: The amount charged by the local council or water authority to provide services to a property.

Reserve Price: This is the minimum price a vendor will accept when selling their property at auction.

Search: The process of investigating the title to an area of land in order to ascertain if the seller has the right to transfer ownership.

Settlement: When the sale of a property is legally finalised.

Skirting board:  The narrow length of wood that runs along the bottom of a wall, forming a border between the walls and the floor.

Stamp Duty: A government tax administered by individual states. It is calculated according to the property value on the contract of sale.

Strata Title: A system of title that allows the owner of a property to have separate title for that specific part of the complex. Can apply to apartments, duplexes and houses in a gated community.

Survey: Shows the dimensions and boundaries of land and the exact location of buildings.

Tenancy: The right to occupy land or buildings as provided by the terms of a lease or other agreement.

Tenants in Common: The holding of property by two or more owners; for example, one party may have a 25% share and the other a 75% share (see also Joint Tenants).

Torrens Title: The name of the government system of recording ownership of land.

Townhouse: A two-storey attached dwelling, usually registered under a strata title.

Transfer: A document registered at the Land Title Office recording the change of ownership to a property.

Unencumbered: Usually describes a property free of secured loans and mortgages.

Valuation: A written opinion of a property’s value, usually by a real estate agent.

Vendor: A legal property owner who offers the property for sale.

Villa: A single-storey dwelling, usually registered under strata or community title.

Zoning: Description of the allowable uses of land, as set out by Gold Coast City Council in the City Plan.

 

Please follow and like us: