| February 2004
Getting familiar with real estate terms
Buying or selling a home, whether for the first time or the fifth time, can be a little confusing. This glossary of some of the most common real estate terms that you're likely to encounter will help you better understand the language of real estate. Contact your REALTOR® for further explanation of these terms.
Adjustment Date: The day from which all calculations of interest, tax adjustments, utility bill adjustments (if applicable) are made to the credit of either the buyer or the seller. This is usually (but not always) the same as the possession date.
Appraised Value: An estimate of a property's market value, used by lenders in determining the amount of the mortgage.
Assessed Value: The value of a property, set by the B.C Assessment Authority, and used by the local municipality for the purposes of calculating property tax.
Closing: The real estate transaction's completion, when the parties involved agree that all legal and financial obligations have been met and the deed to the property is transferred from the seller to the buyer.
Conveyance: The term used to describe the process of transferring the sellers title to the buyer and indicates all the necessary steps to complete the transfer. A conveyancing lawyer is a lawyer (or notary) responsible for the conveyance process (this is normally the buyers lawyer).
Counter offer: An offer made by the seller back to the buyer altering one or several terms and/or conditions of the offer as originally written.
Deed: A legal document that conveys (transfers) ownership of a property to a buyer.
Easement: A legal right to use or cross (right-of-way) another person's land for limited purposes. A common example is a utility company's right to run wires or lay pipe across a property.
Encroachment: An intrusion onto an adjoining property. Common examples are a neighbour's fence, storage shed, or overhanging roof line that partially (or even fully) intrudes onto your property.
Foreclosure: A legal process by which the lender takes possession and ownership of a property when the borrower doesn't meet the mortgage obligations.
Land Transfer Tax: Payment to the provincial government for transferring property from the seller to the buyer. See Property Transfer Tax.
Lien: Any legal claim against a property, filed to ensure payment of a debt.
Multiple Listing Service® (MLS®): A current and comprehensive listing system for relaying property information to Greater Vancouver Real Estate Board REALTORS®. This service offers the widest exposure to properties listed for sale.
Property Disclosure Statement: This form enables sellers to disclose known defects. If the seller decides not to complete the form and does not disclose known defects, he or she can still be held liable. The form also serves as a checklist for buyers enabling them to address concerns about the property's condition on the spot.
Property Taxes: This levy is affected by location and the value of the property as determined by BC Assessment. The rate of taxation is determined by local government. Property taxes are paid on an annual basis.
Property Transfer Tax: Payment to the provincial government for transferring property from the seller to the buyer. In the 1994 provincial government's budget, the PTT was eliminated for first-time buyers under certain circumstances.
Realtors: Real estate professionals licensed by the Real Estate Council of BC who are members of the various Real Estate Boards and the British Columbia and Canadian Real Estate Associations. Only these professionals can call themselves REALTORS®.
RealtyLink On Line: located at www.realtylink.org, the site provides REALTORS® and consumers with up-to-date real estate listings, statistics and community information
Rights of Way: Are indicated on title at the Land Title Office; often for use of utilities or city or municipality in order to make repairs to pipes, etc.; no permanent structure may be built on a right of way.
Statements of Adjustments: Closing statements in a real estate transaction that set out the sources of funds that make up the purchase price, adjustments to and from the purchase price, the final amount required from the purchase and the amount due to the seller. Lawyers will prepare a statement for the seller and the buyer.
State of Title Certificate: A copy of the title which lists charges against the property, e.g.: liens, mortgages, rights of way, etc.
"Subject-to" Clause: A statement of a condition to be fulfilled by the benefiting part which must include a specific deadline for removal.
Title Search: A detailed examination of the ownership documents to ensure there are no liens or other encumbrances on the property, and no questions regarding the seller's ownership claim.
Zoning Regulations: Strict guidelines set and enforced by municipal governments regulating how a property may or may not be used.
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