Ever felt so lost or confused reading about real estate contents? Welcome to the club! With the industry burgeoning the last couple of decades it is to no surprise one is constantly met with real estate jargons anywhere they go, that most of the time they have little to no idea of.
With infrastructures being erected here and there, having the need to keep up is understandable. That is why we are here to help. We have listed the most common terms or jargons to help ease things for any individuals who are struggling to navigate themselves around these words. This is truly helpful as it not only expands one’s vocabulary, but also helps anyone with a growing interest in real estate become more knowledgeable, especially if they ever find themselves in the middle of a real estate transaction.
APPRAISAL – Is the process by which appraisers estimate the market value of a property given or based on the sales in the market.
ASKING PRICE – The amount for which the property is listed.
BACKUP OFFER – A backup offer is an offer that a buyer gives to a seller who is already committed to another buyer (the first). This offer is put to work when the first seller’s buyer does not push through with the transaction or if the transaction fails in general.
BLIND OFFER – Refers to offers made by buyers to properties they have not yet seen.
BRIDGING LOAN – In the words of Gary Hemming of ABC Finance, “bridging loan is a type of short-term property-based finance.
BUILDING INSPECTION – A process by which a building inspector fully inspects the quality of a home. From roof to exterior walls, to plumbing and electrical. Everything is thoroughly checked.
BUYER’S AGENT – Buyer’s agents are the agents that help buyers find the property they are looking for. They are also responsible in dealing with all the transactions needed to acquire the property.
BUYER’S MARKET – Refers to when the supply exceeds the demand giving buyers the privilege/advantage to negotiate price.
CERTIFICATE OF TITLE – According to Landgate, it is “an official ownership record”.
CLOSING – Refers to the final step of the transaction in real estate. It is in this step everything that is needed is complied—signatures, payments, documents, etc.
COMMISSION – In real estate, commissions are what pays the agents/brokers for their services. At times, this is a percentage of the sale price. At times, it is a fee on its own.
CONTRACT OF SALE – Often confused with Contract to Sell, Contract of Sale is an agreement between the buyer and the seller in which the buyer agrees to pay, and the seller agrees to deliver. In contracts like this, the transfer of ownership happens the moment the buyer pays, and the seller delivers.
CONVEYANCING – Simply refers to the process of transferring ownership of a property from one party to another. This may also refer to a written document—a deed or a lease, that states the transfer of legal title from the seller to the buyer.
DEEDS – A written document that proves that the ownership of a property/asset is transferred from the seller to the buyer.
DEPOSIT – In real estate, deposit is the percentage of a property’s selling price at which the buyer gives the seller to represent good faith in their transaction.
EASEMENT – According to FindLaw’s team of legal writers and editors, an easement “is a property right that gives its holder an interest in land that’s owned by someone else”.
EQUITY – In real estate, equity is the difference (the subtracted total) between your property’s market value and the amount you owe your mortgage.
EXCHANGE OF CONTRACTS – Refers to the actual exchanging of contracts between the buyer and the seller, which also in turn, commits them to the transaction. Furthermore, once an exchange of signed contract takes place, there is no going back.
FITTINGS – Free standing items that do not cause any damage to a property.
FIXTURES – Are items fixed to the walls or floors that when removed can cause damages to a property.
GAZUMPING – Happens when a seller verbally agrees to selling a property to a buyer, but later sells it to another buyer offering a much higher price.
JOINT TENANTS – Refers to the individuals who equally share ownership to a single property.
LISTING – A listing could be defined as simple as “a property advertised”. Though, it can also be defined as an agreement that represents the right of an agent/broker to sell a property with which he/she will receive commission from.
There are also different kinds of listing:
Open listing – A kind of listing that more than one agent/broker is given the right to sell simultaneously.
Exclusive Agency Listing – A listing that has only one agency given the right to sell a property apart from the owner.
Multiple Listing – Is when an agent shares the information of a property to its members, ultimately sharing the commission to whoever finds a buyer.
Net Listing – Is a kind of listing that has an arrangement with the seller establishing a minimum price for the property and for which the commission of the agent will be based upon—above the minimum price it sells.
LISTING AGENTS – Listing agents are those who help sellers market and sell their properties.
MARKET VALUE – Considering that a market value is determined by the fluctuations of supply and demand in the market, market value then refers to the price the open market is willing to pay for a property.
OFF-PLAN/OFF-THE-PLAN – Refers to the property that buyers purchase but is still yet to be constructed.
REALTOR – Realtors and real estate agents are often interchanged. This is most true since they are the same in the sense that they help people/consumers buy and sell commercial and residential properties. Though, they greatly differ in the aspect that the term “Realtor” is trademarked, and such person is an active member of the National Association of Realtors (NAR).
RESERVE PRICE – Refers to the most minimal amount a seller prices a property. This protects any seller from unfavorable outcomes as reserve price serves as a basis, thus not going below the said amount.
STUDIO – Refers to an apartment unit that is comprised of a single room and a bathroom.