Property Glossary


View glossary definitions, descriptions and jargon for the most popular real estate sales and lettings property terms in London



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Property Glossary

[A]

ACCEPTANCE
An agreement that needs to be signed and returned to the mortgage lender when accepting a mortgage offer.

AGENT
A person appointed and who acts on behalf of someone else in the sale or letting of their property.

AMORTISATION
A process by which the loan principal decreases over the life of a loan - as mortgage payments are made, part of the payment is applied towards reducing the principal and part of it is applied towards paying the interest on the loan.

ANNUAL EQUIVALENT RATE (AER)
A notional rate that is quoted on the interest paid on savings and investments to show which account will give you the best return.

ANNUAL PERCENTAGE RATE (APR)
The APR is a compound interest rate figure expressed as an annual rate for the whole year and is used to compare different mortgages.

APPLICANT
A term used by Estate Agents to describe a person looking to buy or rent.

APPRAISAL
The value of a property, as estimated by an Estate Agent or Surveyor.

APPRECIATION
A rise in the value of property or goods.

APPLICANT
A person or company looking to rent or buy a property.

ARRANGEMENT FEE
An amount charged by the mortgage lender to cover the administrative costs of processing a mortgage application.

ARREARS
The part of a debt that is overdue and missing one or more payments - if this happens with a mortgage lender they may take action to repossess the property.

ASSET
A property or item owned by a person which has an exchange value.

ASSIGNMENT
A transfer of a right, interest or title from one party to another.

ASSURED SHORTHOD TENANCY
A type of tenancy, also known as an AST, that gives the Tenant a legal right to live in the accommodation rented for a period of time, and offers the Landlord the right to repossess their property at the end of the term stated in the tenancy agreement.

AUCTION
A public sale where goods are sold to the highest bidder.

AUCTIONEER
A person conducting an auction who introduces and offers each lot for sale and agrees the final bid price

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[B]

BASE RATE
The lowest rate of interest a bank will charge when it lends money, used as a benchmark to set interest rates for borrowers. This rate is set by the Bank of England and is reviewed several times a year. Lenders will charge borrowers a margin above the base rate.

BEAR MARKET
A bear market is a decline in the stock market over a period of time where share prices can fall steeply, typically 15 to 20%.

BENEFICIAL OWNER
This is a legal term that refers to a person who owns land and is entitled to it for their own benefit.

BID
An offer to buy a property at a specific price.

BLOCK MANAGEMENT
The management service offered by an Agent for blocks of apartments involving service charge and ground rent collection, maintenance and redecoration of communal areas etc.

BREAK CLAUSE
A clause written into the tenancy agreement which gives the Tenant and/or Landlord the right to terminate the tenancy subject to a specified notice period.

BRIDGING FINANCE
This is a temporary method of financing used for a short period when purchasing a property in order to cover the gap in cash flow if the property you selling does not complete at the same time as the one being purchased.

BUILDING SURVEY
A building survey is a wide ranging inspection of a property which is done before you buy a property, and is carried out by a qualified surveyor who is a member of the Royal Institute of Chartered Surveyors.

BUILDING INSURANCE
A building insurance policy covers the cost of damage to the structure of your property.

BULL MARKET
A bull market is an increase in the stock market over a period of time where share prices can rise steeply and is the opposite to a bear market.

BUY TO LET
A term used to describe a mortgage specifically designed for buying a property with the intention of letting it.

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[C]

CHARGE
If a property owner uses his security in the property to service a loan, a charge is registered and certified. This entitles the lender to be regarded as a secured creditor to be paid out of the proceeds of a sale in the event of a default on the loan.

CLEARED FUNDS
Monies passed through the banking system and received, which cannot be re-called by the sender.

CLIENT ACCOUNT
A bank account set up to specifically hold money on behalf of Clients.

COLLATERAL
A borrower's pledge of a specific property to guarantee against repayment of a loan.

COMMISSION
Monies paid to the estate agent by the Seller upon completion of the property sale.

COMPLETION
When the balance of monies due are paid to the Seller by the Purchaser and the contracts are finalised for the sale of a property.

CONTRACT
An agreement entered into by two or more parties with the intention of creating a legal obligation to sell something, i.e. a property.

CONTRACT RACE
When two or more Purchasers want to buy the same property.

CONVEYANCING
The transfer of a legal title from one person to another i.e. Seller to Purchaser.

COVENANT
A legal agreement to do or not do something in connection to a property.

COMMON PARTS
Communal areas of buildings which is shared use between more than one resident e.g. hallway, gardens, parking areas etc.

COMMON HOUSEHOLD
If two or more Tenants share a self-contained property under a tenancy agreement they are usually jointly and severally liable for the rent and dilapidations.

COMMON LAW TENANCY
A type of tenancy agreement used when an Assured Shorthold Tenancy cannot be granted e.g. when the annual rental is in excess of £100,000.

COMPANY LET (OR TENANCY)
A tenancy where the Tenant is a company and there is no statutory protection because the agreement falls outside of the Housing Act 1988.

CONTENTS INSURANCE
Insurance policy which covers the contents of a property e.g. furniture, applicances etc.

CONTRACT
An agreement entered into by two or more parties with the intention of creating a legal obligation to let something.

CONVERSION
A residential property that is divided into self-contained apartments.

CORPORATE RELOCATION
The transfer of employees and their families from one location to another.

COUNCIL TAX
Monies due per annum to the Local Authority which are the responsibility of the resident.

CREDIT HISTORY
Details of the financial payment history of a person or company.

CREDIT SEARCH
A type of reference which checks the credit history, employment reference and provides a report on the financial status of the proposed Tenant.

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[D]

DELAYED COMPLETION
If completion takes place after 28 days it is known as a Delayed Completion.

DEPOSIT
An amount of money paid by the Purchaser to the Seller of a property upon exchange of contracts.

DETACHED
A description of a property which is separated from other properties.

DEVELOPMENT
The renovation of old buildings or building of new ones.

DILAPIDATIONS
A the term is normally used to describe defects or disrepair to a rental. Costs for the dilapidations are normally deducted from the security deposit.

DISBURSEMENTS
Monies paid by the Purchaser's solicitor on their behalf for items such as Stamp Duty, search fees etc.

DRAFT CONTRACT
A sample of the tenancy agreement with terms detailed ready for checking by both parties.

DUPLEX An apartment spread over two floors.

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[E]

EDWARDIAN
A style of property from the period 1901-1910 when Edward VII was King of England.

ELECTRICAL EQUIPMENT (SAFETY) REGULATIONS 1994
Regulations that require all electrical appliances and installations to be well maintained and regularly checked for safety by an appropriate registered engineer.

END OF TERRACE
A house set at the end of a row of terraced houses.

ENERGY PERFORMANCE CERTIFICATE (EPC)
An EPC gives information on how to make your home more energy efficient and reduce your energy costs by measuring the energy efficiency on a scale A-G. It is a legal requirement to have an EPC for properties being marketed for rental and it is valid for 10 years.

ENGROSSMENT
A document prepared by a Solicitor for signing following agreement of the final draft between the parties.

EN-SUITE
A bathroom or shower room which is accessed from the bedroom.

ESTATE AGENT
A person or company that sells properties for someone else.

EXCHANGE OF CONTRACTS
The legally binding stage of an agreement for purchase and sale of a property at the agreed price when both Purchaser and Seller are committed to the transaction.

EXECUTION
A deed which is signed, sealed and delivered in front of an independent witness.

EXECUTE THE TENANCY
The tenancy is executed, or completed, when it has been signed by both the Landlord and Tenant, dated and exchanged.

EXTENSION
A tenancy can be extended for a further fixed term and this is know as an extension or renewal.

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[F]

FINANCIAL SERVICES AUTHORITY
The FSA is the regulator of the financial services industry in the UK.

FIXED RATE MORTGAGE
A mortgage where the interest rate is fixed for a set period of time.

FIXTURES & FITTINGS
Items included in the sale e.g. electrical items, carpets etc.

FLAT
A self-contained housing unit on one level set within a larger building.

FLEXIBLE MORTGAGE
A type of mortgage that is linked to your savings and allows you flexibility with payments - also called an offset mortgage.

FLOORPLAN
A drawing of the layout showing the dimensions, but not always to scale.

FLYING FREEHOLD
When part of a freehold property overhangs or extends over or under another property.

FREEHOLD
The owner of the land upon which a property is built.

FURNITURE AND FURNISHING (FIRE)(SAFETY) REGULATIONS 1988 (AMENDED 1989, 1993, 2010)
Regulations that deal with the fire safety compliance of furniture, furnishing and upholstery.

FURNISHED
Used to describe if the property is being rented with furniture included.

FIXTURES AND FITTINGS
The actual items included in the letting i.e. furniture, carpets, appliances etc.

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[G]

GAS SAFETY (INSTALLATION AND USE) REGULATIONS 1998
Regulations that deal with the gas safety compliance of gas appliances.

GAZUMPING
When a Seller has accepted an offer to sell but then accepts a higher offer from another Purchaser before the exchange of contracts.

GEORGIAN
A style of property from 1714 to 1811 when Kings Georges I, II and III were on the throne.

GROUND RENT
An amount of money paid each year to the Freeholder by the Leaseholder.

GUARANTOR
A person who guarantees to repay the Purchaser's/Tenant’s debts if they default.

GUIDE PRICE
An indication of the price that the Seller/Landlord is hoping to achieve.

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[H]

HMO (HOUSES IN MULTIPLE OCCUPANCY)
A building of three floors or more which is to be occupied by three or more people and where these people live as more than one household and share facilities such as bathrooms, toilets or cooking facilities.

HOUSE A place of residence building which people, usually one family, live in.

HOUSING ACT 2004

HOUSE BOAT A boat used as a residence and normally situated on a canal or riverbank.

HOUSEHOLD CONTENTS INSURANCE An insurance policy which covers most of your household possessions and personal belonnings against loss or damage.

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[I]

IFA
An Independent Financial Adviser who gives independent advice on financial matters and is regulated by the Financial Services Authority.

INFLATION
A general rise in the prices of goods over a period of time.

INHERITANCE TAX
A tax paid to the government based on wealth (money, property, etc.) passed from one person to another during their lifetime or as part of their estate after death.

INITIAL TERM
The first period of the tenancy.

INITIAL RENT
The first amount of rent payable for the tenancy.

INSTRUCTION
An estate agency term used to describe when a Seller or Landlord has formally agreed for their property to be marketed for sale and/or letting.

INTEREST
The money which is charged by a bank or other financial organisation for borrowing money and calculated as an amount of the money borrowed.

INTEREST ONLY MORTGAGE
A mortgage repayment type, where the borrower repays the interest only on the amount borrowed for the term of the loan. At the end of the term the full capital loan amount needs to be repaid.

INVENTORY
An inventory is a report of the contents and condition of a property together with it's furniture, furnishings and effects, at the start of a tenancy which is provided in written and/or photographic format.

INVENTORY CHECK-OUT
An inventory check-out is checking of the inventory at the end of a tenancy to establish if there are any dilapidations.

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[J]

JOINT & SEVERAL LIABILITY
Joint responsibility for payment of all rent, liabilities and breach under the terms of the tenancy.

JOINT SOLE AGENCY
The use of more than one estate agent.

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[K]


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[L]

LAND CERTIFICATE
A certificate issued by the Land Registry as proof of ownership.

LANDLORD
A person or company that owns the property and has the right to let it out.

LAND REGISTRY
A government department which maintains and updates records of land ownership, property ownership and charges.

LAND REGISTRY FEE
The amount payable for the registration of the Land Registry documentation.

LEASE
A legal document which details ownership via a leasehold interest in a property for a fixed term and a ground rent is usually payable each year.

LEASEHOLD
An ownership of land given by the Freeholder to the Leaseholder to possess and use the building or land for a specific period of time.

LEGAL CHARGE
A document held by Land Registry which outlines who holds the first charge.

LENDER
A mortgage company, bank, building society or individual who loans money to a Borrower.

LESSOR
Someone who grants a lease.

LETTING
An agreement to let a particular property.

LETTING AGENT
A person or company that lets properties for someone else.

LIBOR
The average interest rate that leading banks in London charge when lending to other banks.

LIFETIME MORTGAGE
A special type of equity release loan for people over 55 years which allows them to release equity from their home by means of a secured loan which is paid back once the property has been sold.

LISTED BUILDING
A listed building that has been placed on the Statutory List of Buildings of Special Architectural or Historic Interest may not be demolished, extended or altered without special permission from the local planning authority.

LOAN TO VALUE (LTV)
The mortgage amount divided by the value of the property expressed as a percentage.

LOCAL AUTHORITY SEARCH
A proceedure carried out by a solicitor as part of the conveyancing process which checks with the local authority if any plans or enforcements are outstanding which may affect the property.

LOFT
A space at the top of a building used for storage and sometimes converted into a room.

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[M]

MANAGING AGENT
A person or company who looks after the day to day queries and problems relating to the property.

MORTGAGE
A loan taken out to buy a property.

MORTGAGE DEED
The legal document which secures the loan against the property.

MORTGAGE OFFER
The mortgage offer letter is a formal document which contains details of the final loan amount together with any conditions.

MULTIPLE AGENCY
A situation when two or more agents are acting for the Seller to sell the property, but only the Agent who introduces a Purchaser will obtain a fee.

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[N]

NON-RESIDENT LANDLORD SCHEME
The Non-Resident Landlords (NRL) Scheme is a scheme operated by HM Revenue & Customs (HMRC) for taxing the UK rental income of non-resident landlords.

NOTICE PERIOD
The amount of notice that the Landlord must give the Tenant to end the tenancy and vice versa. The Landlord has to give a minimum of two month's notice to quit at the end of an Assured Shorthold Tenancy.

NRL 1
A Non- Residence Landlord Scheme form which is sent to the Inland Revenue to allow rent to be paid without deduction of tax.

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[O]

OFFER
A proposal to buy on specific terms.

OFFICE COPY ENTRIES
A copy of the details relating to a property held by the Land Registry.

OWNER OCCUPIER
A person who owns the property and who lives in the property as his sole or principle residence.

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[P]

PARTIES
The people or companies who are the Landlord and Tenant, and Guarantor if applicable, who come together to sign a tenancy agreement.

P.C.M
Per calendar month.

PEPPERCORN RENT
A ground rent of a trivial amount paid yearly.

PERIODIC TENANCY
A periodic tenancy is a tenancy that runs usually from month to month, or occasionally from week to week.

PIED A TERRE
A small living unit kept as a secondary or temporary home for occasional occupation.

PRELIMINARY ENQUIRIES
A set of questions asking for clarification on specific points about the property which are raised by the Purchaser's solicitor and sent to the Seller’s solicitor before an exchange of contracts.

PREMISES
The buildings and land including common parts belonging to the Landlord unless they have been specifically excluded from the Tenancy.

PREMIUM
The monthly amount payable for an insurance policy.

PROBATE
Applying for the right to deal with a deceased person's affairs and proving a will is valid.

PUBLIC LIABILITY INSURANCE
An insurance that covers costs, legal fees and expenses for injury, death or damage.

PURCHASER
The person or company buying.

P.W.
Per week.

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[Q]


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[R]

REAL ESTATE
A term used describe property comprising land and the buildings on it.

REFERENCES
Checks made with the Tenant's employer, bank, previous Landlord etc. to ascertain suitablility for renting.

REGISTERED LAND
Land (and buildings on it) which is registered at the Land Registry and confirms legal ownership.

RESIDENT LANDLORD
A Landlord who occupies part of the dwelling as his main or principle home and lets the rest of it.

RETAIL PRICES INDEX (RPI)
A measure of inflation published monthly by the Office for National Statistics.

RETENTION
A proportion of the initial mortgage loan is held back by the Lender until essential repairs or improvements have been completed.

RIGHT OF WAY
A legal right to use a particular part of another property to gain access to your own.

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[S]

SEARCHES
Enquiries requested by the Purchaser's solicitor from the Local Authority/Land Registry which provide information about the property being purchased.

SECURITY DEPOSIT
An amount of money paid by the Tenant, usually equivalent to 6 weeks rent, held for the duration of the tenancy in case of any dilapidations.

SEMI-DETACHED
A property that is joined to another house.

SHARE OF FREEHOLD
Owning a share of the limited company that owns the freehold.

SOLE AGENCY
When only one agent has been instructed to sell or let a property.

SOLICITOR
A legal professional registered with The Law Society who can handle the conveyancing for the sale or purchase of a property.

STAMP DUTY
A tax paid by the Purchaser to HM Revenue and Customs (HMRC).

START DATE
The day that the tenancy commences.

STANDING ORDER
A method of regular payments (usually monthly) from one bank to another.

STUDIO FLAT
A self-contained flat comprising a combined living room and sleeping area, open-plan or separate kitchen and a separate bathroom/shower room.

SUBJECT TO CONTRACT
A term used when negotiating terms before contracts have been exchanged.

SUPERIOR LEASE
The lease given by the actual freeholder of the land.

SURVEY
An inspection of a property, (i) Homebuyers Survey and Valuation or (ii) Building Survey, carried out by a RICS surveyor.

SURVEYOR
A property professional registered with The Royal Institute of Chartered Surveyors who can carry out valuations and surveys of a property.

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[T]

TAX EXEMPTION
Approval number issued from HM Revenue & Customs that rent can be passed to the Landlord without deduction of tax.

TENANCY AGREEMENT
A legal contract detailing the terms of a property rental between the Landlord and Tenant.

TENANT
A person or company renting a property.

TENANCY DEPOSIT SCHEME
A mandatory scheme set up by the government for the protection of security deposits and the resolutions of disputes.

TENDER
This is the situation where the asking price is not actually stated, but offers (in writing) are invited. Details of the property are prepared, circulated and advertised. The closing date for the tender is noted. In most cases the vendor will reserve the right to refuse the highest offer, thereby not being committed to sell. Offers tendered are usually opened in the presence of the vendor's solicitors, at a prescribed date and time. An acceptance of an offer by the vendor constitutes an immediate contract, and in most cases, the party tendering will have made their financial arrangements and have had a structural survey carried out in advance.

TENURE
The terms on which a property is held i.e. leasehold, freehold.

TERRACED HOUSE
A property connected to other houses on either side.

TERM OF THE TENANCY
The length of the rental period.

TERMINATION
The end of the tenancy.

TITLE ABSOLUTE
The highest form of tenure available.

TITLE DEEDS
The legal documents that prove ownership of a property.

TITLE SEARCH
A process carried during conveyancing to determine ownership, restrictions, liens and unpaid claims against the property.

TRACKER MORTGAGE
A mortgage that tracks it's interest charges against the Bank of England base rate.

TRANSFER DEED
A document used in conveyancing that transfers ownership from the Seller to the Purchaser.

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[U]

UNDER OFFER
The Seller has accepted an offer to sell the property but contracts have not yet been exchanged.

UNFURNISHED
Used to describe if the property is not being rented with furniture included.

UTILIES
The services to the property i.e. gas, electricity and water. Sometimes, council tax and telephone are regarding as services.

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[V]

VACANT POSSESSION
This is a legal obligation for the previous occupants to vacate the property and ensure that the property is in a fit state to be occupied.

VALUATION
An estimation of the price of a property carried out by a property professional.

VALUE
The price a property is worth in normal market conditions.

VENDOR
The Seller of a property.

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[Y]

YIELD
The amount of income generated from a property calculated as a percentage.

 

 

 

 

 

 

 

 

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