Buying

A Property

  • Aspect

 

A compass direction.

e.g. a northerly aspect or westerly aspect.

 

  • Cash Rate / Bank Rate

 

The cash rate is the rate at which the Reserve Bank

of Australia sets interest rates.

The bank rate is the interest rate banks offer and is above

the cash rate to allow for a profit margin.

 

  • Certified Copy

 

A true copy of an original document that has been authorised in writing by a Justice Of The Peace, Commissioner for Declarations or Notary Public.

 

Glossary

With you Every Step

Of The Way

  • Commission

 

The fee payable to the real estate agent for the work performed during the sale (or property management)

of the property.

The fee is paid by the person who authorised the agent to act on their behalf (usually the seller - or land lord,

in the case of propert management) and is payable upon settlement of the property (or during the course of the 

property management period).

 

  • Conditions Of Sale

 

The conditions under which a purchaser takes property sold to him.

Where real property is the subject of sale the conditions contain provisions as to title to be accepted by the purchaser

and how it is to be proved and the amount of deposit.

When a sale is concluded, the purchaser signs a memorandum endorsed on the conditions, the whole becomming

the contract of sale. Conditions of sale are frequently attached to goods specifying what warranties attach or do not attach and generally, the purchaser will be deemed to have notice of such conditions and they will affect the sale 

accordingly.

 

  • Contract Of Sale

 

An agreement relating to the sale of property which contains terms and conditions of sale.

All contracts must be in writing.

 

  • Cooling Of Period

 

A period of time given to the purchaser to legally withdraw from buying a property.

The length of time varies in each of the states and territories.

 

  • Covenant

 

Is a promise executed under a seal whereby one party promises to another that something has, or will be, done.

Covenants can be positive in nature, such as an undertaking by a landlord to perform certain structural alterations

to make leased premises suitable for the tenant.

 

  • Deposit

 

Money paid as evidence of good faith for the future performance of a real estate transaction

It is normally held by a third party, usually the agent, in a Trust Account or by the developer's solicitor in a Trust Account.

If the purchase is completed, it will be paid towards the purchase price of the property (or in the case of property

management, a holding rental deposit).

  • Due Diligence

 

Ensuring that sufficient analysis has been conducted before recommending an investment to a client.

 

  • Easement

 

Right to use the land of another.

The most common easements are Right Of Way.  For example, where a property owner grants a Right to an adjoining

owner for that owner to use part of the land to gain access to the adjoining owner's land.

 

  • Encumbrance

 

An interest or right in property, which usually diminishes the value of the land but does not prevent the transfer

of ownership.  Any impediment to the use of the land including such things as easements, mortgages, caveats,

notices of intention to resume, or leases, which are registered on the title are encumbrances.

 

  • Established Home

 

A home that has been lived in previously.

 

  • Fittings

 

Items that can be removed from a property.

 

  • Fixtures

 

Items affixed to the structures of the land, usually in such a manner that they cannot be removed without damaging

the property.  The agent must list all fixtures to be included on the contract.

 

  • Freehold Or Fee Simple

 

Highest form of ownership.  

An owner can use the land in any way desired, subject to unusual zonings and other government controls.

 

  • Group Title

 

Similarto freehold except that title also includes common property owned jointly.

This must involve a body corporate.  Each lot has its own certificate of title and a registered number of entitlements.

Entitlements include voting rights and contribution of levies to the body corporate.  

These may not always be equal.  The body corporate owns roads, common areas, facilities and equipment supplied.

 

 

  • Investment Property

 

Land or a building, (or part of a building), held to earn rental income or for capital appreciation, or both.

An investment property generates cash flow largely independently of other assets held, and is the characteristic

that distinguishes investment property from owner-occupied property.

 

 

  • Investor

 

A person who invests money prudently and productively over the longer term with the investment objectives being

achievement of a reasonable return and capital growth (appreciation) to preserve purchasing power.

Also the opposite of a speculator, who will sacrifice safety of principal, for the possibility of larger gains.

 

  • Joint Tenant

 

Two or more ways in which two persons may own property together.

The rule of survivorship applies.  When a joint tenant dies then the surviving joint tenant automatically gains entitlement to the deceased person's share of the property.  joint tenants have equal share.

 

  • Market Value

 

As defined by the courts, the highest price estimated in terms of money which a property will bring if exposed for sale

in the open market allowing a reasonable time to find a purchaser who buys with knowledge of all the uses to which

it is adapted and for which it is capable of being used and assumes a willing buyer and willing seller.

 

  • POA

 

Price On Applicatio.

You may see this in a real estate advertisement.

 

  • Portfolio (As In Property Portfolio)

 

The number and type of investment properties you own.

 

 

  • Self Manged Superannuation Fund

 

A superannuation fund can be an SMSF if it meets the following conditions:

 

  • Has less than five members

  • Each individual trustee of the fund is a fund member

  • Each member of the fund is a trustee

  • No member of the fund is an employee of another member of the fund, unless those members are related; and

  • No trustee of the fund receives any remuneration for his or her services as a trustee

 

 

An SMSF can also have a company as a trustee (known as a corporate trustee) if:

 

  • Each director of the company is a member of the fund

  • Each member of the fund is a director of the company; and

  • The fund has less than five members, no member is an employee of another member (unless related) 

  • The trustee does not receive remuneration for their services as a trustee

 

  • Strata Title

 

System of land title based on the horizontal sub-division of air space whereby all the owners combined own the land,

but have absolute right to sell / transfer their strata titled property to a new owner.

The most common form of strata title is a home unit.

 

  • Torrens Title

 

Most common and simplest form of an individual certificate of title to a property.

 

  • Torrens System

 

This is the name given to a system whereby title to land is evidenced by one document issued by a Government

Department.

 

  • Trust Account

 

Bank account relating to monies received or held by an agent or a developer for or on behalf of another person.

Monies held in trust are protected by law.

 

  • Vendor / Sellor

 

Person / entity that offers a property for sale.

 

Investor

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