| A |
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| Account Sales |
A statement
provided by an agent to the vendor's legal adviser giving full
account of moneys received less disbursements in a sale. |
| Adjustments |
Apportionment
of rates, taxes, body corporate, rent, insurance etc. usually
completed by a solicitor up to the date of possession or settlement
on a sale. |
| Agents Representative |
A real estate agent's employee who
is authorised in writing to act on behalf of an estate agent
and to perform the functions of that agent as specified. This
person is not a licensed agent. See Training
- Agents Representative. |
| Agents in Conjunction |
Estate agents from unrelated agencies, working
together to undertake a transaction and who share the commission
for that transaction. |
| Architrave |
A decorative moulding around doors
or windows. |
|
Appraisal
|
An opinion of the market worth of
a property. This is not a valuation. |
| Assignment of Lease |
The transfer of a lease from one tenant to another
tenant. |
| Auction |
See details under Auction on the navigation
bar. |
| Authority to Sell |
A legally binding document that is signed by the
vendor(s). It details the agreement between the vendor and the
agency. Many aspects of the "Authority to sell", such
as commission, advertising costs and the authority period, are
by law negotiable between the parties. See Selling
- Documentation. |
| B |
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| Body Corporate
|
The collective ownership of the common areas in
a subdivision of land or buildings. It is responsible for the
administration, upkeep and insurance of the common areas shared
by all the owners (the common property). |
| Bond |
An amount paid as an assurance that the tenant
will not breach the conditions of the tenancy, for example the
tenant will pay rent and on vacating will leave the premises
in a state of good repair and order. See security deposit and
further details under Renting on the navigation bar |
| Breach
of Contract |
The breaking of one or more of the terms or conditions
of a contract. |
| Bridging Loan |
A short term loan (usually at a higher interest
rate) taken out to cover the financial gap between buying a
new property and selling an existing property. |
| Building
Permit |
A permit issued by local government authorities
or an authorised person/organisation for the erection of a building
or for structural alterations to a building. |
| Business |
A commercial operation ranging from a small retailer
to a large manufacturing or service organisation. The business
includes the goodwill, which is its reputation and clients,
any plant, equipment, chattels, stock and other assets. |
| Business
Day |
A standard day for conducting business, a day
other than a Saturday, Sunday or a gazetted public holiday.
|
| Buyers
Advocate |
An estate agent who acts solely for the purchaser
by sourcing suitable properties and representing the purchaser
throughout the buying process. See Services
- Buyers Advocates. |
| C |
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| Capital Gain |
The gain on the sale of a capital asset. |
| Capital Improvement |
Any structure or addition to a property erected
as a permanent improvement that adds to its value and useful
life. |
| Caveat
Emptor |
Means
"buyer beware". It warns that prospective buyers
and mortgagees who propose to deal in the land, that a third
party may have some right or interest in the land. Therefore
it is the purchaser's responsibility to assess the quality of
the purchase (property or business) before buying. |
| Certificate
of Occupancy |
A document issued by a building surveyor, which
shows that the building is suitable for occupation. It is not
evidence that the building complies with the Building Act of
building regulations. . |
| Certificate
of Title |
The
document of title to land held under the Torrens System.
It consists of duplicate deeds stating the fact and extent of
the interest of a person (the registered proprietor) of the
land. |
| Chattels |
Moveable personal property or furniture. |
| Clear Title |
A title
which is not encumbered or burdened with defects, eg easements,
restrictive covenants, mortgages, caveats or unregistered dealings. |
| Commission |
The
fee paid by the principal (usually the vendor or landlord) to
the estate agency for undertaking a transaction relating to
the sale, purchase, lease or management of the property. The
amount of commission is negotiable between the principal and
the agency. It may be either a flat fee or a percentage (or
a combination of both) of the purchase price or the rental collected. |
| Common Law |
An unwritten body of law based on general custom
in England and used to an extent in Australia. |
| Common
Property |
Areas of a property that are used by and belong
jointly to all of the owners of a strata title property. This
applies to common driveways, paths, courtyards, stairs, passageways,
lifts, lobbies, fences, common garden areas and other facilities
in multi-dwelling complexes. |
| Condition
Report |
A report on the condition of residential property
to be leased where a bond is to be taken. The condition report
must be completed by the agent and given to the tenant before
the tenant takes possession of the property. The tenant must
sign and return one copy of the condition report within three
business days of occupying the premises. |
| Contract
Note |
A legal document detailing the terms and conditions
of the sale. The contract note is legally binding when signed
by both parties. The contract note may be prepared by an estate
agent or an agent's representative. See Selling
- Documentation. |
| Contract
of Sale |
An agreement
relating to the sale of property, which expresses the terms
and conditions of sale. |
| Conveyancing |
Transferring the ownership of a property from
the vendor to the purchaser. It is often performed by a solicitor
or conveyancer. See A
Complete Guide to Conveyancing. |
| Cooling
Off |
The period of three clear business days after
the purchaser signs the contract of sale or contract note for
residential or rural property or not more than 20 hectares,
during which the purchaser may withdraw from the purchase. The
cooling-off period does not apply in certain circumstances,
including where property is sold by auction. See Buying
- Rights & Responsibilities. |
| Co-owners |
Where a number of people have joint ownership
of a property. See Buying
- Documentation. Also see Joint
Owners. |
| Counter
Offer |
A new
offer as to price, terms and conditions, made in reply to a
previously unaccepted offer. |
| Covenant |
An agreement
or promise by deed, by which one party pledges to the other
that something has been done or will be done. |
| Cul-de-Sac |
Also called a "court" or a "dead
end" street. A street with only one entrance with the other
being closed. Often valued for the privacy provided to homes
within the street. |
| D |
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| Demographics |
The statistics of a population, or section of
a population. |
| Depreciation |
A decline in the value of property due to changes
in market conditions or other causes. |
| Disbursements |
Money
paid out for expenditures eg. Advertising expenses, rates and
taxes, insurance, etc paid by an agent on behalf of an owner. |
| Door Jams |
The vertical sides of a door frame. |
| Dummy Bid
|
A false bid made or accepted by the auctioneer.
Dummy bidding is illegal. See Auction
- Rules of Conduct |
| E |
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| Easement |
A right
which a person has to use land belonging to another in a particular
manner. The most usual easement is rights of way, easements
for light, and easements for flow of water and easements of
support. |
| Encumbrance |
A
third party's right that obstructs the unencumbered use or transfer
of a property. Examples are easements, mortgages and caveats. |
| Estate
Agent |
A licensed person who is authorised to act on
behalf of another person to bring about the sale, purchase,
lease or management of a property or business. |
| Estimated
Selling Price |
The price an estate agent estimates a property
will attract. It must be recorded on the "Authority to
sell" as either a single figure or as a price range where
the difference between the top and bottom figures does not exceed
10%. For example $300,000 to $330,000. It is illegal to quote
more than a 10% price range. See Selling
- Documentation for sample authorities. |
| Equity |
The
difference between the market value of the property and any
loans which still have to be paid. |
| Exclusive
Agency Authority |
The principal appoints a single agency and, regardless
of who is the effective agent of the sale or lease (including
the principal or another agency), the appointed agency is entitled
to the commission. See Selling
- Documentation for a sample exclusive authority. |
| Executor |
A person named in a will to administer an estate. |
| F |
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| Fee
Simple |
The highest possible ownership of real property.
Ownership is of unlimited duration and ownership passes to heirs
or beneficiaries on the owner's death. "Theoretically"
an owner can do what they want to the property. |
| Fibro Cement |
Building material made of compressed fibres cemented
into rigid sheets. |
| First
Home Owners Grant |
A scheme providing first home owners with a non-means
tested one-off payment. See Resources
- Buying. |
| Fixed
Term Tenancy |
A tenancy where there is an agreement that ends
on a specified date. Except where the tenant has breached the
law or the tenancy agreement, the landlord is not entitled to
terminate the tenancy agreement before the expiry of the fixed
term. On expiry, a fixed term tenancy automatically continues
as a periodic tenancy. See Renting on the navigation
bar. |
| Fixtures |
Items that are attached to the property and cannot
be removed without causing damage to the property, for example
a kitchen stove, hot water service. They are usually included
in the sale. |
| Footing |
The footing supports a building on its foundation. |
| Foreclosure |
The legal process by which a borrower in default
under a mortgage is deprived of his or her interest in the mortgaged
property. This usually results in the mortgagee selling the
property by auction and the proceeds being used to service the
mortgage debt. |
| Freehold |
The highest possible ownership of real property.
Ownership is of unlimited duration and ownership passes to heirs
or beneficiaries on the owner's death. "Theoretically"
an owner can do what they want to the property. |
| G |
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| Gable |
The triangular part of a building's end wall which
extends up to meet the two slopes of a roof. |
| General
Agency Authority |
The principal (vendor or landlord) appoints an
agency but reserves the right to appoint other agencies or to
personally sell or lease the property. Of the agencies appointed,
only the agency that is the effective cause of the sale or lease
is entitled to commission. Often referred to an an open listing. |
| General
Law Title (old system title) |
The original system of land titles. A General
Law title comprises all the documents that show a property's
complete historical record of title ownership. For the title
to be 'clear' it must be traceable for a minimum of 30 years
without a break, up to and including the current ownership.
When the property is resold the title will be converted to a
"Torrens Title". |
| H |
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| Habitable
|
Suitable for occupancy. Local building codes ensure
that structures are habitable through requirements for building
permits and certificates of occupancy. |
| I |
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| Implied
Easement |
An encroachment upon property that is not expressly
noted on the title but is needed, for example for access or
a source of light. |
| Industrial
Property |
Property zoned and used for factories and warehouses
etc. |
| Insolvent |
A person who has ceased to pay debts in the normal
course of business and is bankrupt or in an administrative arrangement
with creditors. |
| J |
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| Joint
Tenants |
Also known as Joint Proprietors is
a very common property ownership arrangement. Each person has
an equal share of the property and in the event of the death
of either party "the rule of survivorship" applies.
In other words the survivor automatically becomes the sole proprietor
or sole owner. See Buying
- Documentation. |
| K |
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| Key
Safe |
A lock
box used to store a key at the site of the property. |
| L |
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| Landlord |
The owner or head lessor of leased property. |
| Land
Usage |
The use being made of land or the uses permitted
under the current zoning ordinances. |
| Laminated Timber |
Layers of timber glued and pressed together to
increase rigidity or to use as bench tops or cupboard doors. |
| Leasehold |
Property held under a lease that is to continue
for an agreed period of time. |
| Lessee |
A person paying rent in exchange for accommodation. |
| Lessor |
The owner or head lessor of a leased property
(offering a property for rent). |
| Life Estate |
Also known as Tenancy for Life - a freehold interest
(in property) that expires upon the death of the owner or some
other specified person. |
| Listing |
The estate agency obtains the written authority
of the principal (usually vendor or landlord) to act on the
principal's behalf and records details of the property or business
for sale or for lease. |
| Loan
to Valuation Ratio |
The amount of the loan financed as
a proportion of the property value, expressed as a percentage. |
| M |
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| Market
Value |
The
highest price estimated in terms of money, which a property
will bring if exposed for sale in the open market allowing a
reasonable time to find a purchaser who buys with knowledge
and assumes a willing buyer and seller. |
| Managing
Agent |
An estate agent who manages the property on an
ongoing basis on behalf of the landlord. Management may include
collecting the rent, lodging and claiming the bond, inspecting
the property and advising the landlord on maintenance, mediating
and resolving disputes. |
| Mortgage |
A written contract giving the lender of finance
certain rights over specific property, for example, the house
being bought by the borrower being encumbered as security for
the loan. |
| Mortgage Insurance |
A policy that insures the lender against the borrower
defaulting on a loan. Most lenders will require insurance when
borrowing more than 80% of the property value. |
| Mortgagee |
Person or organisation that lends money under
a mortgage agreement. |
| Mortgagee
Sale |
If the mortgagor (borrower) defaults on the mortgage,
the mortgagee (lender) can seek to recover the debt by selling
the property that was the security for the loan under the mortgage. |
| Mortgagor |
The person who takes out a mortgage on a property. |
| N |
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| Negligence |
A failure to exercise a duty of care that is the
direct cause of another person loss or injury. The injured person
may make a claim for damages. |
| Null
and Void |
That which cannot be legally enforced, as with
a contract provision that does not conform with the law. |
| O |
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| Off
the Plan |
Purchasing "off the plan" means buying
a property before it has been built or subdivided. Such purchasers
are usually based on the designer's or surveyor's plans and
models. See Buying - Where &
What. |
| Office
in Effective Control |
The title given to the principal estate agent
responsible for the financial and day to day management of real
estate agency business that is a corporation. |
| "On
the Market" |
Available for sale, often a term used at auction
where a price is reached, at or above which the vendor is prepared
to sell. |
| Off
the Plan |
To purchase a property before it is
completed after having only seen the plans. |
| Open
Listing |
A type of listing agreement in which
more than one real estate agent may be employed to sell the
property. The owner pays a commission only to the agent who
finds the buyer. This listing is also known as a general listing
and the owner is not obliged to pay anyone a commission if the
owner personally sells the property. |
| Outgoings |
- Any costs incurred by the vendor or landlord in addition
to the agent's commission. For example, advertising costs.
- Any costs in addition to the rent, for which a tenant
is responsible under the terms of the lease. For example,
rates.
|
| Overquoting |
The illegal practice of overstating the estimated
selling price of a property. This is usually done to encourage
a vendor to list their property for sale. The law in Victoria
states an estate agent cannot quote a price range greater than
10%. |
| P |
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| Party
in Default |
The party to the contract that is in breach of
the contract or terms of the contract. |
| Passed
In |
If
a property is not sold at auction because the owners reserve
has not been reached, it is passed in. |
| Penalty
Unit |
Under Victorian legislation, a penalty unit is
currently $102.25. Under Commonwealth legislation, a penalty
unit is $110.00. The value of the penalty unit is updated annually
(as at February 2005 and subject to change). |
| Periodic
Tenancy |
Where the tenancy carries over from one rental
period to another. Notice to terminate the agreement may be
given by either party during this period. |
| Power
of Attorney |
The person who has the authority to
execute documents on behalf of the grantor of the power. |
| Prime
Rate |
The interest rate that banks charge
their preferred customers. Changes in this rate can influence
other rates including mortgage interest rates. |
| Principal |
- The person who engages the services of an agency and to
whom the agency should look for payment of the commission.
- The estate agent in charge and responsible for the day
to day administration of an estate agency.
|
| Principal Office |
The head office of the estate agency. The principal
agent or officer in effective control of a corporation administers
the day to day operations of the agency from its principal office. |
| Private Sale |
A property or business sold by direct negotiations
undertaken privately with prospective purchasers. For example,
not sold by auction. Also where an agent might or might not
be involved in the sale between the vendor and purchaser. |
| Professional
Indemnity |
Provides protection for the estate agency against
legal liability arising from the conduct and practice of the
business and its employees. |
| Property Management |
The activities of leasing property, collecting
rents, selecting tenants and maintaining and managing the property
on behalf of a landlord. |
| Purchase Price |
The amount agreed between the vendor and the purchaser
for the sale of a property. |
| Purchaser |
The buyer. The person who acquires title to or
ownership of a property of an interest in a property. |
| Q |
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| Quantity Surveying |
Provides advice at every stage of the development,
construction and ownership cycle to developers, building owners,
investors, financial institutions, architects, engineers and
project managers |
| R |
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| Rafter |
Part of a framework of the roof, the rafters slope
down from the ridge to the eaves. |
| Real
Estate |
Land and its improvements. |
| Rebate |
Discount received, usually for bulk purchases
such as advertising. Any rebate received by an agent must be
passed on to the vendor. It may be monetary or non-monetary.
It is illegal for an estate agent to keep any rebate. |
| Registered Proprietor |
The person whose name appears on the title to
the property. |
| Rent |
The amount paid by a tenant to a landlord to occupy
premises and to use facilities and services under a tenancy
agreement or lease. |
| Requisitions
on Title |
Questions about the title of the property that
the purchaser asks the vendor after the contract has been signed.
Usually with the help of a solicitor or conveyancer. |
| Rescission |
The act of canceling a contract or putting a contract
aside. |
| Reserve
Price |
The
vendor's minimum sale price for the property. It must be recorded
on the authority to sell appointing the agency. See Selling
- Documentation. |
| Residential Property |
Property zoned and used for dwellings such as
houses, townhouses, flats and apartments. |
| Residential Tenancy
Agreement |
Lease prescribed under the Residential Tenancies
Act for residential property. |
| Right of Way |
A right of one property or the general public
for access to or across another property. |
| Roof Pitch |
The angle or slope of the roof. |
| Rural Property |
Property zoned for non-urban uses, including farmland
and bush blocks. |
| S |
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| Sash |
The frame in which a pane of glass is set to form
a window. |
| Section 32 |
A common name for a vendor statement, a document
required prior to selling a property. See
Selling - Documentation. |
| Security Deposit |
A bond for a commercial lease. |
| Semi-detached |
Also known as Duplex. A type of construction where
two buildings are attached together by a common wall. |
| Settlement |
The
occasion when ownership of a property passes from the vendor
to the purchaser and the balance of the purchase price is paid
to the vendor. |
| Shingles |
Thin pieces of wood or other material set in overlapping
rows to form a roof or wall cladding. |
| Skillion |
A roof shape consisting a a single sloping surface
without a ridge. |
| Special Condition |
A condition that must be met before the contract
of sale is legally binding eg if buying a home the purchaser
may specify that the contract is not legally binding until the
purchase has obtained a building/termite inspection, or a finance
condition. |
| Stamp Duty |
A state government tax based on the sale price
of a property and paid by the purchaser when ownership of the
property is transferred. See State
Revenue Office for more information. |
| Statute |
An Act as made by Parliament. |
| Statutory Body |
A government agency established through an Act
of Parliament. |
| Stock and Station Agent |
A person who is involved in the sale and purchase of farmer's
livestock, wool, farm produce and farm merchandise and who
generally assists the farmer to become a viable primary producer.
The stock and station agent must also be a licensed estate
agent to deal in real estate.
|
| Stratum Title |
Each owner has a certificate of title and is the
absolute owner of a freehold flat. A service company has the
title to the common property and each flat title holder has
a responsibility to the service company. The service company,
in which each flat title holder has shares, administers, manages
and maintains the property in which each owner's flat is registered. |
| Studs |
The uprights in the wall of a building. |
| Subdivision |
Dividing land or buildings into lots. The subdivision
must be approved by local council. See Resources
- Government - Local. |
| T |
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| Tenant |
Any person paying rental in exchange for accommodation
or in possession of property with the owner's permission. |
| Tenants in Common |
Tenants in Common (also known as Proprietors in
Common ) is an alternative form of co-ownership. The share in
the property may be equal or unequal ie. one person may have
10% another 30% and so forth. In this form of ownership, each
person deals separately with their share of the property. They
may Will or sell their share to whomever they choose as the
rule of survivorship in this instance does not apply. Very importantly,
all persons are liable for any debt secured over the property
and legal and financial advice must be sought before entering
into a proprietorship of this nature. |
| Title |
A legal document that identifies who has a right
of ownership of a property. |
| Torrens Title |
A system of title by registration that is governed
by the Transfer of Land Act. |
| Transfer of Land |
A document that records the change of ownership
of a property from the vendor to the purchaser. |
| U |
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| Underpinning |
Supports placed under an existing wall to provide
added strength. |
| Underquoting |
The illegal practice of understating the estimated
selling price to prospective purchasers, either directly or
through advertising, to encourage greater interest in a property. |
| Utilities |
The private or public service facilities such
as gas, electricity, telephone, water, sewer, and internet that
are provided as part of the development of the land. |
| V |
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| Valuation |
An estimate of the value of a property prepared
by a valuer, usually for a fee. See Resources
- Valuers. |
| Vendor |
The person selling the property. |
| Vendor Bid |
A bid made on behalf of the vendor. Vendor bids
can only be made by the auctioneer and only when the auction
rules allow it. The auctioneer must make this statement before
bidding starts and announces each vendor bid as, or before it
is made. See Auction - Rules
of Conduct. |
| Vendor's
Statement |
Information
that the vendor must provide in writing to the purchaser advising
of restrictions such as covenants and easements, outgoings such
as rates, services and any other notices such as compulsory
acquisition. The required information is specified under section
32 of the Sale of Land Act and commonly known as a section 32.
See Selling - Documentation.
|
|
Vendor's Terms
|
Also known as a terms contract, where finance
is supplied by the vendor rather than by an established credit
provider. Under a vendor terms contract, the purchaser takes
possession of the property before paying the final installment
of the purchase price. |
| Void or Voidable |
An agreement that may be void (unenforceable)
at the option of one of the parties. |
| W |
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| Wall Cavity |
The space between the inner and outer sections
of a wall. |
| Water Course |
A natural stream of running water being fed by
a natural source such as a stream or river. |
| Wear and Tear |
The depreciation of an asset due to ordinary usage. |
| Working Day |
Any other day than a Saturday, Sunday or Public
Holiday. |
| Y |
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| Yield |
The interest earned or return by an investor or
an investment, stated as a percentage of the amount invested. |
| Z |
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| Zoning |
The system of controlling the use to which the
land may be put. A local authority's guidelines for the permitted
use of land. |
