Real Estate

Glossary of Real Estate Terms

Ad valorem—A Latin phrase meaning “according to value” that is usually used in reference to real estate taxation.

Appraisal—An estimate or opinion of value of a specific property as of a specific date resulting from an analysis of the facts about that property by a qualified impartial third party.

Appraiser—A person who is in the business of making appraisals for a fee or salary and who is qualified to estimate the value of real and personal property based on education, training, experience, judgment of facts and the use of the formal appraisal processes.

Assessment—The valuation of property for the purpose of levying a tax or the amount of the tax levied.

Assessor—An official whose responsibility is to discover, list and value real property for ad valorem taxation.

Bona fide—In good faith, without fraud or deceit; authentic; sincere.

Carrying costs—Charges for holding property, such as the expense of property tax on vacant land or on property under construction.

Certificate of title—A written document issued by an attorney or a qualified person who has examined the record of the real estate title reporting the state of that title.

Commercial—Non-residential; commerce or business related.

Covenants—Agreements written into deeds and other instruments promising performance or non-performance of certain acts or stipulating certain uses or non-uses of the property.

Deed—A written instrument which when properly executed (signed) and delivered (accepted) conveys title to real property from one party, the grantor to another party, the grantee.

Due diligence—The making of every reasonable effort to provide accurate, complete information. A study that often precedes the purchase of property, which considers the physical, financial, legal and social characteristics of the property and expected investment performance.

Easement—A right, privilege or interest limited to a specific use or control purpose which one party has in the land of another party and which run with the land and are not a personal right of an individual.

EPA—Environmental Protection Agency.

Fair market value—The amount of money that would be paid for a property offered on the open market for a reasonable period of time with both buyer and seller knowing all the uses to which the property could be put and with neither party being under any pressure to buy or sell.

Hazardous waste—A type of contaminant regulated under CERCLA (Comprehensive Environmental Response, Compensation, and Liability Act).

Indemnity agreement—An agreement by the maker to repay the beneficiary of the document up to the stated limit for any loss due to a named unforeseen event.

Inspection—A physical scrutinizing of documents or property done to assure correctness of paperwork such as loan papers, compliance with building codes or absence of termites, etc.

Legal description—A written description by which property can be located definitely by reference to government surveys or approved recorded maps.

Lien—A form of encumbrance which usually makes specific property security for the payment of a debt or discharge of an obligation such as judgments, taxes, mortgages, deeds of trust, etc.

Radon gas—An odorless, radioactive gas which is produced by the decay of other radioactive materials in rocks under the surface of the earth.

SRA—Senior Residential Appraiser.

Survey—1. The method by which a surveyor of real property identifies the boundaries of a parcel of land. 2. The map prepared by an engineer or surveyor charting a particular piece of real estate.

Tax costs—A forced contribution of wealth to meet the public need for government.

Title search—The process of checking the public records and legal proceedings to disclose the current state of ownership of a real property.

Warranty deed—A deed used to convey real property and contains warranties of title and quiet possession and by which the grantor agrees to defend the property against the lawful claims of third persons. It is commonly used in many states but in others the grant deed has replaced it due to the modern practice of securing title insurance policies which have reduced the importance of express and implied warranty in deeds.