80+ Real Estate Terms To Know In 2024

Brief

There is a lot of specialist language used in real estate. Terms like escrow, beacon, amortization, and mortgage can be confusing to consumers as well as marketers. It is not unusual to find oneself in need of a fast Google search to gain a deeper understanding of these concepts.
We have decided to create a dictionary of real estate terms for you, to ensure you are well-prepared when making real estate decisions.

Business Terms

The business side of real estate covers financial and legal aspects, ensuring secure transactions and educated decisions.

Addendum

This is an additional document attached to the original contract that specifies additional information, modifications, or clarifications.

Agent

This is a licensed professional who assists clients in buying, selling, or renting properties. One who has completed more advanced training and licensing requirements is called a broker

Amortization

This is the process of paying off a debt over time in regular instalments.

Appraisal

This is an assessment of a property’s value by a qualified professional.

Backup Offer

This is an offer made on a property that is already under contract with another buyer.

Blind Offer

This is an offer made by a buyer to purchase a property without seeing it in person.

Bridge Loan

This is a short-term loan used to bridge the gap between the sale of one property and the purchase of another property.

Closing

This is the final step in a real estate transaction where the property title is transferred.

Contingency

This is a condition that must be met for the contract to be binding.

Counteroffer

This is a response to an offer with modifications.

Contract

This is a legally binding agreement between two or more parties specifying the terms and conditions of a real estate transaction.

Debt

This is the borrowing of funds to finance the purchase, development, or improvement of properties.

Deed

This is a legal document transferring ownership of property.

Contract

This is a legally binding agreement between two or more parties specifying the terms and conditions of a real estate transaction.

Discount Point

This is a fee paid to the lender at closing in exchange for a lower interest rate.

Down Payment

This is the initial payment made by the buyer towards the purchase of a property.

Debt to Income Ratio

This is the percentage gotten after you divide your monthly debt payments by your monthly gross income.

Due Diligence

This is the process of investigating a property's condition.

Earnest Money

This is a deposit made by a buyer to show serious intent to purchase a property.

Escrow

This is a financial arrangement where a third party holds funds or documents until certain conditions are met.

FHA Loan

This is a mortgage insured by the Federal Housing Administration.

Fixer-Upper

A property in need of repairs or renovations.

Foreclosure

The process by which a lender takes control of a property from a borrower who has defaulted on their loan.

Hard Money Loan

This is a type of loan that is secured by real property, such as real estate.

Home Equity

The difference between the market value of a property and the amount owed on the mortgage.

Lease

This is a contractual agreement between a landlord (lessor) and a tenant (lessee) that grants the tenant the right to use a property for a specified period, usually in exchange for rent payments.

Lien

This is a legal claim to retain possession of the property until the debt owed by the owner is fully paid off.

Listing

This refers to a property that is for sale or rent and is represented by a real estate agent or broker.

Multiple Listing Service(MLS)

This is a database used by real estate brokers to share listings with other brokers.

Mortgage

This is a type of loan specifically used to finance the purchase of real estate.

Offer

This is a formal proposal to buy a property.

Outright

This is a one-time payment made for the full ownership of a property.

Lien

This is a legal claim to retain possession of the property until the debt owed by the owner is fully paid off.

Purchase Agreement

This is a legal document outlining the terms and conditions of the sale.

Proof of Funds

This is a document that confirms the availability of funds for a certain transaction by a person or business.

Short Sale

This is a situation when someone sells shares they have borrowed in the hopes of profiting from a drop in price before they need to pay back.

Project Terms

The project side of real estate focuses on property management and development, crucial for acquiring and maintaining properties.

Beacon

This is a marker erected at various points on a plot of land to indicate its borders to the general public.

Building Plan

This is a set of detailed plans submitted to authorities for approval, showing how a proposed building will be constructed, including its structure, systems, and layout.

Condominium

This is a property where individuals own their units and share common areas.

Duplex

This is a building with two separate living units.

Fixer Upper

This is a property in need of repairs or renovations.

Listing

This refers to a property that is for sale or rent and is represented by a real estate agent or broker.

Plot

This is a parcel of land. A typical plot size in Nigeria varies but is usually between 500 and 800 square meters.

Subject to Inspection

This is a condition in real estate contracts that allows the buyer to arrange for a professional inspection of the property before the transaction.

Green Area

This is an open area within a real estate development that is reserved for parks, gardens, and recreational activities to enhance the environment.

Excision

This is the process of removing a particular area from the government's acquisition list so that it can be developed and owned by individuals.

Land Use Act

This is a 1978 Nigerian law that controls land use and ownership, giving the state governor authority over all land in each state.

Title Documents or Title

This is the legal ownership of a property.

Real Estate Portfolio

This is a collection of real estate properties and investments owned by an individual, company, or investment group.

Real Estate Bubble

This is a market condition characterized by rapid increases in property prices then followed by a sharp decrease.

Property Rights

This is a set of entitlements that grant individuals or entities the authority to control, use, and transfer real estate or personal property.

Zoning

These are laws that dictate how a property can be used (e.g., residential, commercial)