The real estate industry, like all industries, has its own terms that mean specific things. We've put together this glossary to help you understand the types of terms used during property transactions.

A - E

Acceptance: Agreement by the person receiving the offer to abide by the terms and conditions of the person making the offer to purchase.

Auction: A program of accelerated marketing, usually three to four weeks in length, which ends with 'auction day'. On auction day, the property is sold to the highest bidder provided it reaches the reserve price.

Body Corporate: A body consisting of the owners of a group of units or apartments in a strata building. A committee (the Body Corporate) is appointed by the owners to oversee the administration and maintenance of the site.

Caveat: A warning on a title to a purchaser that there may be some interest or right in the property by a third party.

Certificate of Title: A description of a property with the name of the registered owner and a list of encumbrances (for example, mortgages or easements on the property). This must be presented by the vendor before the sale of the property.

Commission: The fee payable by the vendor to the real estate agent, for selling a home. The commission is usually a percentage of the sale price.

Conditional contract: A contract in which one or more conditions need to be met by the vendor and/or the buyer before the sale is able to proceed. For example, the sale can be subject to the buyer having finance arrangements approved within a week.

Contract of sale: A written document setting out the terms and conditions relating to the sale or purchase of a property. It is also the purchase document signed at auction.

Conveyancing: The process of transferring money and title, ensuring that all details are legally correct, as a property transfers from one person to another.

Deposit: A percentage of the purchase price provided by the buyer to secure the purchase of real estate.

Dual occupancy: A block of land zoned so that two distinct dwellings may be built on it.

Duplex: Also called a semi-detacheda property where two buildings are attached by a common wall.

Encumbrance: An obstacle to the use or transfer of a property in the form of an interest or right in the property (e.g. a caveat).

E - Z

Exclusive authority: A written contract between the owner of the home and the real estate agent, providing the agent with the exclusive right to sell the property within a specified time period.

Fittings: Objects that can be taken from a property without causing damage.

Fixtures: Items that cannot be removed without damaging either the property or the fixture itself (e.g. wardrobes).

Gazumping: a) when a seller agrees to sell to one buyer but then either sells to another buyer or b) when a seller raises the price when two or more buyers are interested in the property.

GST: Goods and Services Tax, the federal tax payable on the real estate commission charged for a sale (not usually on the price of the home, unless it is new).

Inclusions or chattels: Everything that is sold with the property (carpets, light fittings, curtains etc.).

Market value: The price at which a seller is willing to sell their property and a purchaser is willing to buy.

Offer: Conveyed intent by one party to form a contract with another party.

Open listing: A type of listing agreement in which more than one real estate agent may be employed to sell the property. Commission is usually paid only to the agent who introduces the buyer and affects the sale.

REI: The Real Estate Institute of Australia is the national representative body of real estate agents. REIT is the representative body in Tasmania.

Reserve price: The minimum price that a seller will accept at auction. Bidding must reach this price in order for the property to be sold.

Settlement: This is when a property sale is finalised by the legal representatives of the vendor and the purchaser, costs are paid and the new owner takes possession of the property.

Stamp duty: A state tax on conveyance or transfer of real estate, calculated on the total value of the property (including chattels). The method of calculation varies from state to state.

Strata title: A title to a unit or lot on a plan of subdivision associated with townhouses, units and blocks of flats. Owners have a certificate of title, are absolute owners of a freehold flat and have an undivided share of the common property.
Unconditional contract: A contract that has no conditions and must, therefore, be proceeded with.

Valuation: A written estimated value of a property prepared by a qualified valuer (not by a real estate agent).