RE Jargon Reference
A few terms and descriptions to assist in buying or selling your home..
Some commonly used Abbreviations
OFP = Open Fire Place
WWC= Wall to wall carpet
OPH= Off peak heating
WC = Water closet (toilet)
BIR= Built in robes
OSP = off street parking
WIR = walk in robe
WH = Wood heater
AC = Air conditioning
Heat Pump = Reverse cycle air conditioning unit
Agent – a licensed person who is qualified to operate a real estate agency/office.
Allotment – a section of land subdivided from a larger portion of land generally referred to as a “lot”
Appraisal – an opinion of your property saleability and estimated sale price based on current conditions and your property characteristics, not to be confused with a written authorized valuation.
Assets – What you own
Auction – the sale of a property by a bidding process on a given day. Properties usually have a reserve(minimum) price and if a bid doesn’t reach this minimum the property is “passed in”
Breach of contract – Not fulfilling any terms of the contract.
Bridging finance – a short term loan, usually at a higher rate of interest, which helps people to cover the purchase of a property while waiting to sell or settle on theirs. the security is usually on both properties.
Building regulations – these are designed to uphold the standards of public safety, health and construction. they are put in place by local authorities to control the quality of buildings.
Buyer – the eventual purchaser of the home.
Capital gain – the monetary gain obtained when you sell an investment property for more than you paid for it.
Caveat – a document lodged by a person with a legal interest in a property, to ensure the property is not sold without their knowledge.
Certificate of title – a document which details the ownership of a property along with the dimensions and other details.
Chattels – any removable items which are sold with the home typically carpets, light fittings, curtains, dishwasher, garden sheds, clothesline, e.t.c.
Commission – the fee payable to a real estate agent for selling a property
Common property- areas on a title which have joint ownership with another property, often common on strata title properties.
Conditional contract – a contact that is agreed to by the seller and the buyer, but where one or more conditions need to be met, usually within a specified time period, by either the buyer or seller. E.g. it is subject to the buyer raising finance within a set time period, usually 14 days from contract date.
Conjunctional sale – a sale which is arranged by an agent working on behalf of the buyer and the agent who has an exclusive listing to sell the property, in other words they are working in conjunction or together.
Contract of sale – the contract between the buyer and seller. a written legal document that sets out the terms and conditions for the purchase or sale.
Conveyancing – the legal process transferring the ownership of properties and money, making sure that everything legal is correct, as the property transfers from one owner to another. This is usually is done by a settlement agent or a solicitor.
Covenants – special rules and regulations which might apply to a property regarding it’s use and design.
Deposits – a defined percentage of the purchase price or an agreed amount paid by the buyer which is held in trust as confirmation of intent to buy.
Easement – a right held by someone to use land belonging to someone else for a specific purpose. Mains, drains,and water pipes are usually covered by an easement.
Encumbrance – an easement, mortgage, or other liability on a property which impedes it’s use or transfer.
Equity – the value you hold in your home. the total value less any mortgage or other liabilities on a property.
Exclusive listing – only the agency appointed has the right to to sell the property.
Interest only loans – a loan in which only interest is periodically and the principle is paid at the end of the term.
Investment – the purchaser of an asset such as real estate with the ultimate goal of producing capital gain on a the resale of the asset.
Joint tenants – the equal holding of property by two or more persons,
Land title office – a government department where all property records are held and any changes are registered. These are public records and therefore you can go there and look up any title to a property.
Lease – a document granting possession of a property for a stated period of without transferring ownership. the lease document specifies the terms and conditions of occupancy, rent payable etc.
Liabilities- the outstanding debts you owe.
Listing authority – a contract between an owner of a home and a real estate company selling the property. It is normally for a set number of days and sets out the commission rate and any additional costs. this states whether it is an exclusive, open or sole. Also the selling method – auction, private treaty etc.
Maturity date – the last day of the term of the home loan agreement. the home loan must then be paid in full or the home loan agreement renewed.
Mortgage – the security over property given to the lender for the repayment of the loan. the lender(mortgagee) has the right to take the property if the borrower (mortgagor) fails to repay the loan.
Mortgagee – one who lends money for the property
M ortgagor – one who borrows money to purchase property
Negative gearing – where the mortgage repayments exceed the income received from the rental property.
Passed in – a property is passed in at an auction if the highest bid fails to meet the vendors reserve price.
Plan – this shows the house design, elevation of the house, the houses floor plan and positioning on the land.
Possession date – on the day following settlement for owner occupied properties or as soon as practically possible after settlement for vacant properties.
Principle – the actual amount of money that has been borrowed to buy a property excluding interest
Principal – the owner of a real estate agency
Private sale – the sale of a property without the assistance of a real estate agent
Private treaty – sale of a property via an agent through private negotiations and contract with a buyer.
Real property – land , with or without improvements.
Representatives – a registered person employed by real estate agency to facilitate the sale of a property
Reserve price – the amount below which a home owner will not sell on the day of auction.
Right of way – right to access across of property.
Security – properties offered as backing for a loan. In the case of a home loan, the property itself usually acts as security.
Seller – a person who owns the property for sale.
Semi-Detached – two buildings joined by one common wall
Settlement – completion of a sale when the balance of the contract price is paid to the seller and the buyer is legally entitled to take possession of the property.
Sole agency – only the agent appointed has the right to sell the property
Strata title – a title which gives you ownership of a small piece of a larger property, including “air space” you have the sole right to a particular unit and can lease, sell or dispose of your unit as you desire. you also have an undivided share of the common land and become a member of the body corporate which controls the maintenance and has stipulated rules governing occupation.
Subject to finance – a condition inserted into a contract for the benefit of the buyer. this makes the contract subject to the buyers confirming that they have raised finance within a certain amount of time
Survey – confirmation of the property boundaries and improvements.
Tenants in common – the owners of the property may own different proportions of the property. Right of survivorship does not apply. Your share may be sold in life or willed in death to another party.
Tender – a tender involves potential buyers placing confidential bids for a property by a specific date. The bids may or may not include conditions and any bid can be accepted or rejected by the seller.
Title search – the process of examining the land title to ensure the seller has the right to sell and therefore transfers ownership. It details the names of the owners and other information about the property, such as encumbrances or caveats on the title.
Unconditional contract – a contract for sale of a specific property that the seller and buyer have agreed upon that has no conditions or the conditions have been confirmed as having been met and therefore constitutes a sale.
Vacant possession – when the ownership is transferred from the sale of a property there will be no tenants living in the property, or leases giving someone else use of the property.
Valuation – assessment of the value of a property given in a written report by a licensed valuer.
Zoning – control of the land exercised by the local authorities.