Landlord Central’s comprehensive Real Estate Glossary gives definitions for all the property terms you need to know from gazumping to the cooling off period.
Allotment: A small area of land sufficient for building a house. An allotment is also referred to as a building block, lot or block of land.
Appreciation: The increase in the value of a property due to changes in market conditions, inflation or other causes.
Auction: An auction is a public sale, usually conducted by an estate agent acting as auctioneer. It is advertised for a specific place, time and date. Prospective buyers bid and the property is sold to the highest bidder, provided the seller accepts the bid.
Body corporate: The collective ownership of the common areas in a block of apartments or multi-dwelling complex. It is responsible for the administration and upkeep of the areas shared by all the owners (common property).
Capital gain: Profit you make from the sale of property.
Capital gains tax: A Federal Government tax on the monetary gain made on the sale of an asset bought and sold after September 1985.
Capital growth: The increase in the value of a property.
Caveat: A note on the title that an interest in the land is claimed by a third party.
Caveat emptor: A Latin phrase for ‘let the buyer beware’. In other words the onus is on the buyer to be satisfied with what they are purchasing.
Certificate of title: A document that shows who owns the property, the size of the land and whether there are any limitations on the title such as mortgages, easements or encumbrances.
Chattels: Chattels are personal property. There are two types of chattels, real and personal. Real chattels are property such as buildings and fixtures. Personal chattels are property such as clothes and furniture.
Common property: An area used by many, not an individual. Owned by the tenants in common.
Commission: A proportion (usually a percentage) of the sale price of a property paid to a real estate agent for negotiating a real estate transaction.
Construction loan: a loan specifically granted for the purpose of funding the building of a new dwelling.
Conveyancing: Legal process of transferring the ownership of a property from one person to another.
Covenant: Terms, conditions and restrictions noted on the title.
Cooling off period: Usually a three business day period available to a purchaser to withdraw from a contract for the sale of residential land.
Depreciation: The decline in the value of a property.
Easement: A right held by one person to make use of the land of another. Drainage and sewerage pipes are examples.
Encroachment: Part of a house or establishment illegally overhanging the street or a neighbour's property.
Encumbrance: A third party’s right that obstructs the unencumbered use or transfer of a property. Examples are easements, mortgages or caveats.
Gazumping: A slang term to describe the practice of reneging on an oral commitment to buy or sell a property because a better offer or opportunity was presented after the oral commitment was made but before a legal sales contract was consummated.
Green title: Green title refers to land that generally has no common areas (unless indicated on the title) and may include a freestanding dwelling. The term green title refers to the sketch on the certificate of title that used to be shaded green.
Joint tenants: Equal holding of a property between two or more people. If one party dies, their share is passed on to the other parties.
Landlord: A person who rents property to another.
Land tax: a State Government tax charged to the owners of any property over a stipulated value, unless it is their principle place of residence.
Lease: A written agreement between a landlord and a tenant granting a period of tenancy of a property under specific terms and conditions.
Lessee: A person leasing a property.
Lessor: The owner of a property that is leased to another person.
Lien: A legal claim against a property that must be paid off when the property is sold.
Negative gearing: Where the return on an investment is not sufficient to cover the costs on the investment.
Off the plan: The purchase of a property before being fully constructed.
Positive gearing: When you borrow to invest in an income producing asset and the returns (income) from that asset exceed the cost of borrowing.
Private sale: The seller does not engage an estate agent but acts on his own behalf, dealing directly with the buyer.
Real estate agent: A person licensed to negotiate and transact the sale or lease of real estate on behalf of the property owner.
Semi-detached: two houses that share a common wall or walls.
Settlement: Settlement is the date on which the balance of the purchase price is paid to the seller, and the title of the property is handed over to the buyer. The seller sets the date of settlement in the contract. The settlement period is usually between 30 to 90 days but a buyer may be able to negotiate an alternative settlement period with the seller prior to signing the contract.
Stamp duty: A state government tax, based on the sale price of a property and paid by the buyer when property ownership is transferred. Each state and territory has a different rate of duty. Some States offer discounts to first home buyers.
Strata title: Title that grants ownership of a section or a ‘unit’ of a larger building. This ‘unit’ can be sold or transferred by the owner.
Torrens title: Known as Certificate of Title. Records ownership of a property.
Valuation: A written analysis of the estimated value of a property prepared by a qualified valuer.
Vendor: The person selling the property.
Zoning: Local council authority guidelines as to the permitted uses of land and buildings.