Real Estate Vocabulary

General Real Estate Terms

1. Appraisal – A professional estimate of a property’s value.

2. As-Is – Selling a property in its current condition.

3. Buyer’s Agent – A real estate agent who represents the homebuyer.

4. Closing Costs – Fees paid at closing, such as title insurance and lender fees.

5. Comparative Market Analysis (CMA) – A report estimating a home’s value based on similar sales.

6. Contingency – A condition that must be met for a contract to be binding.

7. Deed – A legal document that transfers ownership of a property.

8. Down Payment – The initial payment toward a home purchase.

9. Earnest Money – A deposit made by the buyer to show serious intent.

10. Equity – The difference between a property’s market value and the mortgage balance.

11. Escrow – A third party holding funds/documents until a sale is complete.

12. Fair Market Value (FMV) – The price a property would sell for under normal conditions.

13. Fixed-Rate Mortgage – A mortgage with an interest rate that stays the same.

14. Foreclosure – The legal process where a lender takes ownership due to missed payments.

15. Home Inspection – An evaluation of a home’s condition before purchase.

16. HOA (Homeowners Association) – A governing body that enforces rules in a condo or planned community.

17. Listing – A property that is for sale.

18. MLS (Multiple Listing Service) – A database of properties for sale.

19. Offer – A formal proposal to purchase a property.

20. Open House – A scheduled event where potential buyers can tour a home.

21. Principal – The original amount of a loan before interest.

22. Property Tax – A tax based on a property’s assessed value.

23. Realtor® – A licensed real estate professional who is a member of NAR.

24. Seller’s Market – A market where demand is higher than supply.

25. Short Sale – A home sale where the lender agrees to accept less than the owed mortgage.

26. Title – Legal ownership of a property.

27. Underwriting – The lender’s review of a borrower’s financials before mortgage approval.

28. Zoning – Local rules that define how land can be used.

Condominium (Condo) Terms

29. Condominium (Condo) – A privately owned unit in a building with shared common areas.

30. Common Elements – Areas in a condo building shared by all unit owners, such as hallways, pools, and gyms.

31. Condo Association – A governing body of elected unit owners responsible for managing the condo complex.

32. Condo Fees – Monthly maintenance fees paid by unit owners for building upkeep and amenities.

33. Assessment – A one-time or temporary fee charged to condo owners for special repairs or improvements.

34. Reserve Fund – Money set aside by a condo association for future repairs or emergencies.

35. HOA Rules & Regulations – The guidelines condo residents must follow, such as pet policies and noise restrictions.

36. Limited Common Elements – Shared areas that only specific owners have access to, such as a private balcony or designated parking space.

Co-op (Cooperative) Terms

37. Cooperative (Co-op) – A type of housing where residents own shares in a corporation that owns the building instead of owning their unit outright.

38. Co-op Board – A group of elected residents who manage the building and approve potential buyers.

39. Shareholder – A person who owns shares in a co-op and has the right to occupy a specific unit.

40. Proprietary Lease – A lease that grants a co-op shareholder the right to live in their unit.

41. Board Approval – The process by which the co-op board reviews and approves or denies potential buyers.

42. Maintenance Fees – Monthly payments made by shareholders to cover building costs, including taxes, utilities, and repairs.

43. Flip Tax – A fee that sellers in some co-ops must pay when selling their unit, used to fund building maintenance.

44. Sponsor Unit – A unit in a co-op that is owned by the original developer and may have fewer purchase restrictions.

45. House Rules – Regulations set by the co-op board regarding noise, renovations, and other building policies.

Expanded Real Estate Vocabulary - Market & Pricing Terms

1. Absorption Rate – The rate at which available homes are sold in a specific market during a given time period. A high absorption rate indicates a seller’s market, while a low rate suggests a buyer’s market.

2. Asking Price – The initial price a seller lists their home for sale.

3. Bidding War – When multiple buyers submit competing offers, often driving the sale price above the asking price.

4. Buyer’s Market – A market condition where the supply of homes exceeds demand, giving buyers more negotiating power and potentially lower prices.

5. Days on Market (DOM) – The number of days a property remains listed before it goes under contract. A high DOM may indicate an overpriced or less desirable property.

6. Expired Listing – A property that was listed for sale but did not sell before the listing contract expired.

7. List Price – The price at which a property is currently being marketed for sale.

8. Lowball Offer – A significantly lower-than-asking-price offer made by a buyer, often in a buyer’s market.

9. Multiple Offers – When a property receives offers from more than one buyer at the same time, which can lead to bidding wars.

10. Off-Market Property – A home that is for sale but not listed on the MLS, often sold privately or through exclusive marketing.

11. Pending Sale – A property that has an accepted offer and is under contract but has not yet closed.

12. Pocket Listing – A property that is for sale but not publicly listed on the MLS, typically marketed only to select buyers.

13. Price per Square Foot – The sale price divided by the total square footage of the home, often used for market comparisons.

14. Price Reduction – A decrease in a property’s list price, often used to attract more buyers.

15. Real Estate Market Trends – Data and analysis showing current conditions and predictions for the housing market, such as rising or falling home prices.

16. Seller’s Market – A market condition where demand for homes exceeds supply, leading to faster sales and higher prices.

17. Sold Price – The final price at which a property was sold.

18. Withdrawn Listing – A property that was removed from the market before selling, either temporarily or permanently.

Negotiation & Offer Terms

19. Appraisal Contingency – A clause in a purchase contract that allows a buyer to renegotiate or back out if the home’s appraised value is lower than the agreed-upon price.

20. Backup Offer – A secondary offer that a seller accepts in case the first offer falls through.

21. Best and Final Offer – A term used in bidding wars where buyers submit their highest offer, often with no further negotiations.

22. Cash Offer – An offer to purchase a property without financing, often making the transaction faster and more attractive to sellers.

23. Closing Date – The agreed-upon date when the sale of a property is finalized and ownership is transferred.

24. Counteroffer – A response from a seller (or buyer) modifying terms of the original offer.

25. Escalation Clause – A clause in an offer that automatically increases the buyer’s offer price if higher competing offers come in, up to a maximum limit.

26. Inspection Contingency – A contract clause allowing the buyer to back out or negotiate repairs if the home inspection reveals significant issues.

27. Loan Contingency – A clause stating that a buyer’s offer is contingent upon obtaining financing.

28. Non-Contingent Offer – An offer made without any conditions, often used to compete in a seller’s market.

Mortgage & Financing Terms

29. Adjustable-Rate Mortgage (ARM) – A mortgage with an interest rate that changes periodically based on market conditions.

30. Amortization – The gradual repayment of a loan through scheduled monthly payments.

31. Balloon Mortgage – A short-term loan with small monthly payments and a large final payment due at the end of the loan term.

32. Debt-to-Income Ratio (DTI) – A financial metric lenders use to determine a borrower’s ability to repay a loan, calculated by dividing total monthly debt payments by gross monthly income.

33. Escrow Account – A bank account used by a lender to hold funds for property taxes and homeowner’s insurance.

34. Fixed-Rate Mortgage – A home loan with an interest rate that remains the same for the entire term.

35. Jumbo Loan – A mortgage that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac.

36. Loan-to-Value Ratio (LTV) – A measure of mortgage risk calculated by dividing the loan amount by the property’s appraised value.

37. Mortgage Pre-Approval – A lender’s commitment to provide financing up to a certain amount, based on a buyer’s financial profile.

38. Private Mortgage Insurance (PMI) – A fee charged to borrowers who put down less than 20% on a conventional mortgage to protect the lender against default.