FAQ’S

• Agent

  The person or firm appointed in writing by you to act on your behalf with third parties, and thereby receive a commission.

•  Agents in conjunction

  You (as a vendor or landlord) may appoint more than one agent; or an appointed agent may act with another agent who introduces a purchaser or tenant, to your property.

• Allotment

  A small site for home building, sometimes called a block.

• Appreciation

  An increase in property value triggered by inflation, improvements or increased demand.

• Arrears

  Usually considered a debt in rent, which have not been paid on time.

• Assets

  The sum of a person’s real and personal property, including equities.

• Assignment

  The transfer of a property, a lease, rights or an interest and sometimes a liability from one party to another.

• Auction

  Sale of a property in public to the highest bidder at a set time and date.

• Bond

  In rentals, a sum of money which is paid by the tenant to ensure against damages to the propert

• Building Approval

  This is the first stage of building a home on land where the approval has been made by the council that the land can be built on.

• Bridging Finance

  A temporary loan to bridge the time-gap between paying for one property and receiving payment from a previous property.

• Building Line

  The uniform distance, usually from a road, behind which buildings must be erected.

• Building Regulations

  Laws laying down standards in materials and construction methods which you must observe to maintain health, safety and certain design minimums in any building or alteration.

• Buying Commission

  The money you pay to an agent for helping you to acquire a specific type of building.

• Breach of Contract

  Breaking the terms of the contract.

• Capital Gain

  The profitable difference between your buying price and selling price, now subject to Capital Gains Tax.

• Client

  A person who engages an agent or valuer, and who is obliged to pay that agent or valuer commission or fees.

• Commercial Property

  For business purposes office buildings, shops, warehouses, hotels etc.

• Commission

  A percentage payable to real estate agent for selling a property by the person authorising the sale.  Usually a percentage of the sale price.

• Conditional Sale

  Subject to conditions such as finance, building inspections etc.

• Construction Costs

  The sum of labour and material costs, plus contractors overheads and profits in the erection of improvement of a property.

• Contemporary Home

  New/21st century/modern.  Very geometric, diverse and open planned.

• Contract of Sale

  Written agreement setting out the terms and conditions of a property sale.

• Counterpart

  An identical copy of an original document.

• Covenant

  An agreement between landlord and tenant, or vendor and purchaser, covering specific things which will be done or cannot be done to a property.

• Cover Note

  Immediate insurance cover, often issued by an insurance broker on the insurance company’s behalf, for a property which has just been bought.

• Conveyancing

  Legal process of transferring the ownership of a property from one person to another.

• Date of Settlement

  The day, under the terms and conditions of the contract, when a vendor is obliged to transfer a property to the purchaser.

• Deposit

  Usually 5% – 10% of the purchase price of a property placed in trust as evidence of intention to buy.  Non-refundable, after exchange of contract, it goes towards the purchase price when the sale goes through.

• Depreciation

  Drop in a property’s value due to passage of time, deterioration, or changes to neighbouring properties.

• Developer

  A person who buys property and by improving it through sub-division or construction for instance lifts it’s value.

• Easement

  The contractual right of one person to use a portion of another persons land, usually as a drive for access or as a run off for water.

• Economic Life

  The potential number of years a property could be profitable.

• Effective Rate

  The real rate of return or repayment, as opposed to the nominal rate.

• Encroachment

  When a building overhangs someone else’s property, or a fence is built over the dividing line between two properties.

• Encumbrance

  An easement, mortgage, or other liability on a property which impedes its use or transfer.

• Environmental Impact Study

  An experts assessment of long-term environmental effects of a particular land-use scheme.

• Equity

  The percentage of a property an owner holds after outstanding loans have been deducted from the market value.

• Facade

  The front face of a building.

• Fixtures

  Items that can not be removed without being damaged.  Refers to items in or around a property.

• Freehold

  A property which is owned outright and for unlimited duration.

• General Law Title

  Such a title pre-dates the Torrens Title System under which ownership is government-recorded by Certificates of Title; it is based on a comprehensive history of ownership.

• Head Room

  The distance from floor to ceiling.            .

• Hectare

  The metric measurement of land area equal to 10,000 square metres, or 2.47 acres.

• Height Density

  Another zoning regulation limiting the height of buildings in a particular area.

• Holding Deposit

  One weeks rent on the property applied for which secures the perspective tenants interest.

• Home Units

  Individually-owned homes in a development of two or more homes.

• Investment Return

  The rate per month (or year) of return on investment produced by rental and resale.

• Irrevocable

  Cannot be undone.

• Joint Venture

  Two or more people or companies combine to carry out a project or enterprise.

• Landlord

  The owner of a property for leasing.

• Land Usage

  Determined by zoning regulations residential, industrial etc.

• Lease

  The formal arrangements by which one party has use of another’s property in return for rent.

• Lease with option to purchase

  A lease embodying the right of the lessee to buy the property at an agreed price within an agreed time.

• Lessor

  The party who grants a lease.

• Listing

  A property available for sale or rent.

• Maintenance

  The expenditure required to keep a property in an efficient operating condition.

• Managing Agent

  A real estate agent authorised by you to manage your property.

• Market Price

  The price paid for a property it is real, whereas “market value” is only an estimate.

•  Mezzanine

  An intermediary floor, usually between the ground and first floors.

• Mortgage

  A document pledging a property as security for the repayment of the money you borrow on the property.

• Mortgagee

  The lender on the mortgage.

• Mortgagor

  The borrower.

• Multiple Listing

  System of selling the property through many agents.  The buyer pays only one commission.  This goes to the agent who lists the property on an official multiple listing form and is shared between the first agent and the agent who actually finds the buyer.

• Net Lease

  Where your lessee is responsible for all building outgoings on top of the agreed rent.

• Offer to Purchase

  A formal legal agreement which offers a specified price for a specified property.  The offer may be firm (no conditions attached) or conditional (certain conditions apply).

• Option

  In selling, the right (secured by a payment) to purchase a property at an agreed price on or before an agreed date.  In leases, the right to renew at a mutually agreed rent.

• Outgoings

  All expenses on a property.

• Passed In

  When a property fails at auction to reach the vendors reserve price.  (The highest bidder has the right to meet the reserve price or try to negotiate an acceptable price).

• Prestige

  A perception.  Up market.  High quality of living.  Refers to area’s and housing.

• Plot Ratio

  The ratio of building area to site area.

• Presentation

  Refers to an agent presenting themselves and the company they represent in a good light to a perspective buyer.

• Private Sale

  The sale of a property without the assistance of a Real Estate Agency.

• Property Management

  A real estate agent manages properties for landlords ensuring the property complies with legislation and regulations at all times, selecting tenants, collecting rents, arranging maintenance and so on.

• Public Liability

  The insurance taken by companies and private individuals to protect themselves against claims made by members of the public, who might be injured in some way on the property.

• Rateable Value

  The estimated value of a property on which rates are assessed.

• Real Property

  The ownership of physical real estate land and buildings.

• Redevelopment

  The updating of urban property, usually by demolition and rebuilding.

• Reserve Price

  Price below which an owner is not prepared to at auction.

• Restrictive Covenant

  Land is sold with,perhaps, the covenant that only one home can be built upon it or that the home must be built at a specified cost or height.

• Rezoning

  A planning term in which the local authority can alter a planning scheme to allow, say commercial rather than residential building.

• Sale and Lease Back

  An investor buys a property and leases it back to the seller – a practice which is on the increase.

• Settlement

  Completion of sale when balance of contract price is paid to the vendor and the buyer is legally entitled to take possession of the property.

• Site Value

  The amount an unencumbered piece of land, less any improvements, is likely to realise at the time of a muncipal valuation; the land component of a developed property.

• Sole Agency

  One agent or agency has the sole rights to sell a property.

• Speculator

  A punter who buys property in the ecpectation of selling it later for a higher price.

• Stamp Duty

  A State Government Tax imposed on the sale of real estate.  It is determined by the sale value, and it varies between states.

• Strata Title

  The title for a segment of a property, flat, unit, office in which there are several owners.  (Nowadays, a separate Torrens Title is issued).

• Sub-division

  The division of apiece of property into building lots; inevitably required several official approvals.

• Sub-lease

  A property which is already leased is  leased again, but not for a longer period that the unexpired part of the original lease.

• Survey

  The accurate measurement and description of a piece of land, usually showing structures and contours.

• Tenant

  Occupant of a property whether it be a house, unit or apartment.

• Title Deeds

  The documents proving ownership of property.

• Valuation

  An estimated value of a property based on features and renovations etc.

• Vendor

  Person offering a dwelling for sale.

• Vendor Terms Contract

  When a property is paid for over time usually a deposit and then regular payments of the balance, plus interest over several years.

• Vendor Statement

  Statement setting out particulars of the property, made by the vendor.

• Without Prejudice

  These words, used during negotiation, mean that any suggestion or plan put forward cannot be used as evidence later if the negotiations fall down.

• Yield

  The money you derive by way of income or profit from a property deal.

• Zoning

  The method by which councils or planning authorities control property use residential, industrial etc.