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Useful information about Wellington City and informative real estate resource links.

Glossary of real estate terms

A list of common real estate terminology is below.
 
 
 
Agency Agreement A contract between the owner of the home and the Real Estate Company selling the house. It is normally for a set number of days and sets out the commission rate and any additional costs. This states whether it's an exclusive, general, tender or auction listing.
Agent  A licensed person employed to facilitate the sale of the property on behalf of the seller.
Appraisal (CMA)  An opinion of your property's saleability and estimated market value based on current market conditions and your property's characteristics.
Assets  What you own.
Auction  A three to five week programme using a high-profile marketing campaign. The sale of the property goes to the highest bidder or is passed in if your Reserve price is not met.
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 for theirs to sell. The security is usually over both properties.
Building Regulations  These are designed to uphold the standards of public safety, health and construction. These are put in place by local authorities (usually councils) to control the quality of buildings.
BEO  Buyer Enquiries Over $.....
Caravan  The agent that is marketing the property takes the rest of the salespeople in the office through the property so that they can familiarise themselves with the property and market it to their buyers.
Caveat  A document lodged with the titles office, by any person with a legal interest in a property, to ensure the property is not sold without their knowledge.
Common Property  Areas on a title which have joint ownership with another property, often common with cross-leased, strata-title and unit-title properties.
Conditional Contract  A contract 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 or both parties, e.g. it is subject to the purchaser raising finance within a few days or subject to the lawyers consent of the title etc.
Contract of Sale
(Further Terms of Sale) 
A written document that sets out the terms and conditions for the purchase or sale of land, and all improvements [buildings etc.] thereon.
Cross Lease Title  This gives you ownership of a piece of a larger property with cross lease rights over defined improvements [house/unit etc]. You can sell or dispose of your unit as you desire.
Capital Gain  The monetary gain obtained when you sell a property for more than you paid for it.
Caveat Emptor  Latin for 'Let the Buyer Beware'. In certain cases, this puts the burden on to the buyer to be satisfied before purchasing a property.
Certificate of Title  A document which details the ownership of a property along with property dimensions and other details.
Chattels  Any removable items that are sold with a home, typically carpets, light fittings, curtains, dishwaher etc.
CMA  Comparable Market Analysis (Appraisal) is the price comparison of your home with others that are currently for sale and those that are similar in size and location that have sold.
Commission  The fee payable to a real estate agent for selling a property.
Conveyancing  The legal process of transferring the ownership of a property and money, making sure that everything is legally correct, as the property transfers from one owner to another. This is usually done by your solicitor.
C.T.  Certificate of title. Document that shows the legal ownership of a property. All land in New Zealand has a Certificate of Title.
Covenants  Rules and regulations governing the use of property.
Deposit  A defined percentage of the purchase price paid by the purchaser which is held in trust as confirmation of intention to buy.
Escape Clause  This allows the Vendors to issue notice to a conditional purchaser that unless that purchaser confirms the sale as unconditional within a short stipulated time, then the vendor can proceed with another offer from another party.
Exclusive Listing/Agency  Only the agency appointed has the rights to sell the property.
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 its use or transfer.
Equity  The value you hold in your home. The total value less any mortgage or other liabilities on a property.
F.S.B.N.  For Sale By Negotiation. This is a non price marketing strategy where often a price bracket is used to advertise the property.
General Listing  A listing that is open for any agent in any company to work.
Interest-only Loans  A loan on which interest only is paid periodically and the principal is paid at the end of the term.
Investment  The purchase of any asset, such as real estate, with the ultimate goal of producing capital gain on the resale of the asset.
Joint Tenants  Joint tenancy is the equal holding of property by two or more persons.
Land Transfer Office  Government department where all property records are held and any changes are registered. It is a public record and therefore you can go there and look at any title to a property.
Lease  A document granting possession of a property for a stated period without transferring ownership. The lease document specifies the terms and conditions of occupancy by the tenant, including period of occupancy, rent payable etc.
Liabilities  The outstanding debts you owe.
LIM  Land Information Memorandum - a report which can be requested from your local authority which provides information regarding the property - things like consents, rates owing, drainage and building plans.
Listing Authority A contract between the owner of the home and the Real Estate Company selling the house. It is normally for a set number of days and sets out the commission rate and any additional costs. This states whether it's an exclusive, general, tender or auction listing. Now called an Agency Agreement. 
Loan Period
 
 The number of years that a home loan is for.
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 the money for the property.
Mortgagor  One who borrows the money to purchase property.
MREINZ  Member of the Real Estate Institute of New Zealand. The institute provides training and advice for real estate agents.
Negative Gearing  Where your mortgage repayments exceed the income received from a rental property.
Offer to Purchase  A formal offer for a specified price for a specified property, normally made on a sale and purchase agreement.
Passed In  A property is passed in at auction if the highest bid fails to meet the vendor's reserve price.
Plan  This shows the house design, elevation of the house, number and size of rooms, kitchen, bathroom and laundry layout, position of the house on the land.
Possession Date  The day the purchasers take occupancy of the home, normally when the ownership of the property transfers and the balance of the purchase price is paid to the vendor.
Principal  The actual amount of money that has been borrowed to buy a property.
Private Sale  The seller does not engage an estate agent but acts on his own behalf, dealing directly with the buyer and in preparation of the agreement.
Private Treaty Sale  Sale of a property via an agent through private negotiation and contract.
P.O.A  Price On Application
PBN  Price By Negotiation
Property File  Your local authority has a file for every property which contains potentially important information that is not contained in a LIM.
Purchaser  The eventual buyer of the home.
REAA Real Estate Agents Authority. The regulatory body for the real estate industry. 
REAA 2008 Real Estate Agents Act 2008. The laws governing the real estate industry.
Realtors  American term for Real Estate Agents
Real Property  Land, with or without improvements.
Reserve Price  The amount below which a home owner will not sell on the day of Auction.
Right of Way  Right of access across a property.
Strata Title/Unit Title  Most commonly used for flats and units, this title gives you ownership of a small piece of a larger property including "air space". You have 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 maintenance and has stipulated rules governing occupation.
Stratum Title  This title gives you legal ownership over a piece of property and also a share in the common land of the area of flats or units. It does not include "air space".
Subject to Finance  A condition inserted into a contract, for the benefit of the purchaser. This makes the contract subject to the purchaser's confirming that they have raised finance within a certain amount of time.
Survey  Confirmation of the property boundaries and improvements.
Subdivision/development  Special Project that involves mulitple sections/properties that are for sale.
Sale and Purchase Agreement  The contract between the buyer and the purchaser.
Security  Property offered as backing for a loan. In the case of a home loan, the property itself usually acts as security.
Semi-detached  Two buildings joined by a common wall.
Settlement  Completion of a sale when the balance of the contract price is paid to the vendor and the buyer is legally entitled to take possession of the property.
Sole Agency  Only the agency appointed has the rights to sell the property. (See Exclusive Listing/Agent)
Tender  A tender is a programme similar to an Auction, with an increased level of marketing. A tender involves potential purchasers placing confidential bids for a property. The bids may or may not include conditons, and any bid can be accepted by the vendor.
Title Search  The process of examining the land title to ensure the vendor has the right to sell and therefore transfer 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 the sale of a specific property that the vendor and purchaser has agreed upon that has no conditions, or if any conditons they have been confirmed as being met, and therefore constitutes a sale.
Vacant Possession  When 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, usually by a registered valuer.
Vendor  The person who owns the property for sale, i.e. the seller.
Zoning  Control of the use of land exercised by local authorities or the responsible planning authority.