Useful real estate vocabulary
Auction: Public sale of property to the highest bidder, providing the reserve price is met or exceeded.
Breach of contract: Breaking terms of a signed contract
Caveat: A document lodged with the Titles Office by any person to ensure the property is not sold without their knowledge.
Caveat Emptor (Buyer beware): Places the responsibility of the buyer to be satisfied with the item before buying a property.
Chattels: Personal property. There are two types. Real Chattels include buildings and fixtures. Personal Chattels include clothes, furniture etc.
Common Property: Strata Titles areas shared by all owners.
Contract Note/Terms and Conditions: Written agreement outlining terms and conditions of a property sale.
Contract of Sale: A legal document that sets out all the terms and conditions the seller and purchaser have agreed on.
Conveyancing: The legal process of transferring property ownership from seller to buyer.
Covenant: Conditions affecting the use of property or land written into the title.
Deposit: Approximately 10% of the purchase price placed in trust as evidence of intention to buy. Non-refundable after the contract becomes unconditional.
Easement: The right held by a person to use land belonging to someone else for a specific purpose. Mains, drains and water pipes are usually covered by an easement.
Encroachment: When a building overhangs someone else's property or a fence is built over the dividing line between two properties.
Encumbrance: A mortgage, easement or liability over a property impeding its use or transfer.
Exclusions: Any item not specified as part of the sale of the property. i.e. dishwasher
Equity: The difference between the market value of the property and any outstanding loans on the property.
Freehold: An owner's interest in the land where the property and the land on which it stands both belong to their owner indefinitely.
Highest Bidder: The person who posts the highest bid at an Auction will purchase the property provided the reserve price had been met or passed.
Offer to purchase: A formal legal agreement, which offers a specified price for a specified property.
Passed In: A property will be passed in at Auction if it does not meet the Reserve Price.
Private Treaty Sale: Sale of a property through an agent, involving private negotiations and contracts.
Reserve Price: The minimum price the seller has specified they will accept at Auction.
Stamp Duty: A state government tax calculated on sale price, varying between states.
Settlement: A date is set for the settlement of the sale. At this point the balance of the purchase price is paid and ownership of the property transfers from the seller to the buyer.
Transfer: A document registered at the Land Title Office and noted on the Certificate of Title, which verifies change of ownership of a property.
Unconditional/Exchange of Contracts: When signed copies of the Contract of Sale are physically swapped between the seller and the purchaser.
Vendor: The seller