COMMON
REAL ESTATE TERMS
Agent:
A
real estate professional registered in Alberta to facilitate the
sale, lease or exchange of a property.
Alberta Real Estate Association:
An association of real estate industry members
who belong to real estate boards in Alberta.
Appraisal: An
estimate of a property's value performed by a professional Appraiser.
Asking (List) Price: The price placed on the property for sale by the seller.
Assessed Value: The value of a property set and used by each municipality for the
purposes of calculating property tax.
Attached
Goods:
An item that is attached to real property so as to form, in law,
part of the land. Attached goods belong to the buyer and are also
known as fixtures.
Broker:
A person licensed by the provincial or territorial government to
trade in real estate. Real estate brokers may form companies or
offices which appoint sales representatives to provide services
to the seller or buyer, or they may provide the same services themselves.
In parts of Canada, brokers are referred to as agents.
Buyer's
Agent (also known as "Buyer's Broker" or "Purchaser's
Agent"):
A person or firm representing the buyer. A buyer's agent's primary
allegiance is to the buyer. The buyer is the buyer agent's client.
Buyer
Brokerage Agreement:
A written agreement between the buyer and the buyer's agent, outlining
the agency relationship between the two parties and the manner in
which the buyer's agent will be compensated. In Alberta, a buyer
agency relationship arises automatically without a written agreement
establishing the relationship.
Certificate
of Compliance:
A stamp issued by the municipality which states that the improvements
comply with the local building bylaws and requirements.
Client: The person being represented by an agent. The agent owes
the client fiduciary duties including utmost care, integrity, confidentiality
and loyalty.
Client:
The person being represented by an agent. The agent owes the client fiduciary duties including utmost care, integrity, confidentiality and loyalty.
Closing
Costs:
Expenses in addition to the purchase price for buying and selling
a property.
Comparative
Market Analysis (CMA):
The most widely used technique for REALTORS to establishing the
value of residential properties. It uses sales, competitive listings
and expired listings to try to determine a probable selling price
for the subject property. Used synonymously with Competitive Market
Analysis.
Completion
Day:
The day from which all calculations of interest, tax adjustments,
utility bill adjustments (if applicable), etc. are made to the credit
of either the buyer or the seller. All legal and financial obligations
are met on that day and the title to the property is transferred
from the seller to the buyer. Completion day is usually (but not
always) the same as the possession date.
CMHC:
Canada Mortgage and Housing Corporation. A Crown corporation providing
information services and mortgage loan insurance.
Commission:
An amount agreed to by the seller and the real estate broker/agent
and stated in the listing agreement. It is payable to the brokerage
on closing and shared, if applicable, among those agents involved
in the sale.
Condition
Precedent:
A statement of a condition to be fulfilled before the contract will
become firm and binding; must include a specific deadline for removal.
May also be called a "subject to" clause.
Condominium
Ownership:
Shared ownership in a strata-titled property. Owners have title
(ownership) to individual units and a proportionate share in the
common property.
Conveyance:
The term used to describe the process of transferring the seller's
title to the buyer and indicates all the necessary steps to complete
the transfer. A conveyancing lawyer is a lawyer responsible for
the conveyance process.
Counter
Offer:
An offer made by the seller back to the buyer altering one or several
terms and/or conditions of the offer as originally written.
CREA:
The Canadian Real Estate Association. A national association representing
the real estate industry on federal public policy matters, providing
member services and education. CREA promotes adherence to a strict
Code of Ethics and Standards of Business Practice.
CREA
Code of Ethics:
Rules of behavior or conduct that provide a standard of fair, moral
practice and a guide by which a REALTOR's behavior or conduct is
evaluated.
Customer:
A person who receives valuable information and assistance from a
real estate broker or agent, but is not represented by that individual.
Down
Payment:
The difference between a property's purchase price and the amount
financed.
Dual
Agent:
A real estate brokerage that acts as agent for both the seller and
the buyer in the sametransaction. Both buyer and seller are the
brokerage's clients.
Dual
Agency Disclosure:
The information that a dual agent must disclose and explain to both
buyer or a seller when he or she is acting as a dual agent.
Easement:
A legal right to use or cross (right-of-way) another person's land
for limited purposes. A common example is a utility company's right
to run wires or lay pipe across a property.
Edmonton
Real Estate Board:
The Edmonton Real Estate Board is a professional association of
over 2,300 Brokers and Agents in the greater Edmonton area. The
Board enforces a Code of Ethics, Standards of Business Practice
and disciplinary action, when necessary, for its members. The EREB
provides professional education to its members, administers the
Multiple Listing Service®, and advertises property listings
on the Internet at www.mls.ca, as well as in the Real Estate Weekly
and on their website at www.rewedmonton.ca for the benefit of REALTORS
and their clients. Commercial listings are advertised on cls.ca
and AlbertaFirst.Com.
Encroachment:
An intrusion onto an adjoining property. Common examples are a neighbor's
fence, storage shed, or overhanging roof line that partially (or
even fully) intrudes onto your property.
Encroachment Agreement: An agreement that allows the encroachment
to remain. The owner of the development that encroaches onto the
adjoining property is granted the right to enter onto that property
to maintain or repair the construction.
Encroachment
Agreement:
An agreement that allows the encroachment to remain. The owner of the development that encroaches onto the adjoining property is granted the right to enter onto that property to maintain or repair the construction.
Encumbrance:
A restriction that is either a monetary claim against the land (such
as a lien, mortgage or lease), or a non-monetary one (such as an
easement).
Estoppel
Certificate:
A written statement of a condominium unit's current financial and
legal status.
Fee
Simple Estate:
Ownership where the owner owns the land now and for all time in
the future, and the owner's rights are subject only to restrictions
by the government.
Fiduciary
Duty(ies):
The duties of loyalty, disclosure, confidentiality, obedience, reasonable
care and diligence, and full accounting that are required by law
of any agent relative to his or her principal.
GE Capital Mortgage Insurance Company: a private sector source of
mortgage insurance to lenders in Canada.
GE Capital Mortgage Insurance Company:
a private sector source of mortgage insurance to lenders in Canada.
Joint
Tenancy:
A form of ownership in which two or more individuals (often spouses)
have an equal share in the ownership of a property. In the event
of one owner's death, his or her share is automatically transferred
to the surviving owner(s); and does not become part of the deceased's
estate.
Lien:
Any legal claim against a property, filed to ensure payment of a
debt.
Listing
contract:
The legal agreement between the listing brokerage and the seller,
setting out the services to be rendered, describing the property
for sale and stating the terms of payment. A commission is generally
payable to the brokerage upon completion of a sale.
Listing
Agent:
The REALTOR who signs a contract (on behalf of the brokerage) with
an owner to sell the property.
MLS®,
Multiple Listing Service®:
Trademarks owned by The Canadian Real Estate Association. They are
used in conjunction with a real estate database service, operated
by local real estate boards, under which properties may be listed,
purchased or sold.
MLS®
Online™ aka mls.ca:
Carries MLS® property advertisements and consumer-related information
supplied by individual real estate boards and associations across
Canada.
Mortgage:
A contract between a borrower and a lender. The borrower pledges
a property as security to guarantee repayment of the mortgage debt.
Lenders consider both the property (security) and the financial
worth of the borrower (covenant) in deciding on a mortgage loan.
Click here for more on mortgage terminology.
Organized
Real Estate:
Refers to the various bodies or groups (CREA, AREA, local boards)
who work together to bring about structure, standards and accepted
practices in real estate.
Property
Taxes:
The value of the property as determined by local municipalities
affects this levy. Local government determines the rate of taxation.
Property taxes are paid on an annual basis.
Purchase
Contract:
The document through which the prospective buyer sets out the price
and conditions under which he or she will buy the property.
Real
Estate Board:
A non-profit organization representing local real estate brokers
and agents which provides services to its members and maintains
and operates a MLS® system in the community. It offers orientation
and other continuing education courses to its members and represents
local real estate matters at the municipal level.
Real
Property Report:
The legal outline of the property and location of all buildings
and improvements on the land (formerly called the Surveyor's certificate).
REALTOR:
Trademark identifying real estate professionals in Canada who are
members of The Canadian Real Estate Association, and as such, subscribe
to a high standard of professional service and to a strict Code
of Ethics.
Rights
of Way:
Are indicated on title at the Land Title Office; often for use of
utilities or city or municipality in order to make repairs to pipes,
etc. No permanent structure may be built on a right of way.
Seller's
Agent:
The seller's agent represents the seller as a listing agent under
the listing contract. His or her primary allegiance is to the seller.
The seller's agent does not represent the buyer.
Single
Agency:
The practice of representing either the buyer or the seller, but
not both in the same transaction.
Statements
of Adjustments:
Closing statements in a real estate transaction which set out the
sources of funds which make up the purchase price, adjustments to
and from the purchase price, the final amount required from the
purchase and the amount due to the seller. Lawyers will prepare
a statement for the seller and the buyer.
Tenancy
in Common:
The owners each own a part of a common land. If one owner dies,
the interest goes to his or her heirs rather than the other owner(s).
Title:
The legal evidence of ownership in a property.
Title
Search:
A detailed examination of the ownership documents to identify the
owner and any liens or other encumbrances on the property.
Torrens
system:
Alberta's land registry system.
Unattached
Goods:
Moveable personal property that goes with the seller (also known
as chattels).
Zoning:
Land use Bylaw specifies in great detail every aspect of how property
within a particular area of the municipality may be used.
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