If you're new to the industry or just need a refresher course, you've come to the right page. The Property.CoZa Real Estate glossary is your ultimate guide to commonly used jargon, terms, and words that every real estate professional should know. So grab your favorite drink and start scrolling.
By comparing two properties in the same property market, this method is used to estimate the value of a property.
An additional section added to an original sale contract including specific points agreed to by relevant parties.
A property professional who has completed a qualification with the Institute of Estate Agents of South Africa. Agents receive a certificate annually that confirms their compliance with the code of conduct. Find out more about selecting an estate agent.
A percentage of the selling price paid by the seller to the agent for services performed in selling a property.
An addition or appendix to a legal document.
The property price chosen by a seller and advertised to potential buyers.
A calculated value of a property which is conducted by a professional valuator for local municipalities to assess the taxes a homeowner will pay on the property. This is commonly known as a municipal valuation and may not be the same as the market-related value applied when the property is presented to the market for sale.
A tax charged on the profit earned from appreciation of a property from the time of purchase. This article may provide more details on CGT.
The amount of money it takes to maintain a property over time
A caveat is simply a warning that is acquired by a person or organisation through a statutory injunction to protect their ownership of a property and registering this on a Title Deed in terms of the Real Property Act 1900. A caveat can prevent the registration or changes to a Title Deed unless the person or organisation who registered the caveat is made aware and agrees to these changes, e.g. a mortgage bond.
A percentage of a property transaction amount that a property professional is owed for their service surrounding a completed property transaction.
The Conveyancing process has several steps starting with a signed Offer to Purchase through to transfer of the property from the seller to the buyer via registration at the Deeds Office. This article may provide more information on the conveyancing process.
There are always costs, whether you are buying, selling, leasing or renting:
Assessing income versus loan payments on a property to ascertain if it can pay for its own debt.
An affordability calculation reflecting a buyer’s monthly repayment amount and monthly income as a ratio.
In real estate, the Deeds Office is where property is registered, and records are managed and maintained, it is the South African property registry.
A steal! A property listed for sale far below its current value or value following improvements.
A given address of a party to a contract which will serve as the address for written legal notice.
Permission given by a seller to two different agencies to market and sell their property.
A deposit put down as an indicator of seriousness by the buyer.
The point at which sale agreements are exchanged between buyer and seller – a landmark event in the binding nature of the agreement.
Permission given by a seller to one agency to market and sell their property exclusively and foregoing their own right to sell their own property.
This is the common terms for the Financial Intelligence Centre Act 38 of 2001, which requires any institution that is party to a financial transaction to gather specific information to keep on record relating to the parties, i.e. a buyer and seller are required to provide a copy of the National Identity Document or Passport and proof of residence in the form of a rate account or rental agreement.
A valuation consideration that assesses the anticipated income-generating potential of a property.
The difference between a property’s value and the purchase price.
Any deposit paid by a buyer will be put into a saving account, which accrues interest over time. A short-term investment can also be made. This is done by an attorney or real estate agent.
An agent who is registered at the Estate Agency Affairs Board who is in the process of qualifying and therefore assigned to a Mentor Agent, who is fully qualified.
A defect that is not clearly apparent when inspecting a property, and may only be discoverable at a later stage, for instance, a leak in a pool pipe or electrical issues.
A mandate is a contract between a seller and a real estate agency to list, market and sell/rent their property for an agreed commission. There are different types of mandates, e.g. Exclusive, Sole, Joint/Dual and Open and each type of mandate is a commitment to pay commission to the agent in the event that they conclude a contract with a buyer/tenant.
A fully qualified agent, registered with the Estate Agency Affairs Boards, who oversees the training and support of an Intern Agent who is in the process of qualifying.
The exact boundary points of a property.
An illegal act of moving large amounts of money acquired from criminal activity and using legitimate sources to ‘clean’ the money, for instance, paying cash for high value assets.
A statute used to oversee the standards and acceptable norms of consumer credit.
Where one party’s use of land interferes with a neighbour’ s use and enjoyment of his or her land.
A legal term meaning the final cancellation or lapse of a contractual agreement. All parties involved return to the positions they were in before they signed the agreement without any further legal obligations to each other.
A listing where the commission is only payable if the agent produces a buyer before the seller or another agent.
A defect that is clearly apparent when inspecting a property, for instance, a cracked window or a broken tile.
Permission granted by a legal party for another party to act and make legal decisions on their behalf. This can either be comprehensive or restricted to certain acts and/or lasting only for a certain amount of time.
A preferential interest rate charged by banks.
A duly qualified estate agent registered with the Estate Agency Affairs Board as the responsible agent required to abide by all applicable laws and regulations.
When title in the property legally changes from the seller to the buyer, upon registration at the Deeds Office.
The amounts calculated by the municipality in terms of a property using the municipal valuation, as well as services to the property.
The legal process of registering ownership of Title Deeds of a property from one owner to another, once prepared by an attorney and lodged at the Deeds Office. The date of registration is the date on which the transfer is conclude and ownership changes hands.
The rate at which the Reserve Bank lends money to private banks which, in turn, affects the rate of interest charged to consumers on credit agreements. Read more about the Repo Rate.
If a clause refers to the terms being null and void, terminate on a given date, etc. the clause will only be in effect until the time given has expired. If the requirement is not met by the given time and date, the contract will be considered terminated.
Conditions in the Title Deed that restrict improvements or use of the property.
A limited real right over immovable property which is registered on the Title Deed and can be transferrable. A servitude gives rights to the holder of the servitude over another person’s property, which may include access right or water rights.
A sole mandate is granted by a seller to only one agent or agency to market and sell their property for commission. The seller retains the right to sell their own property with a sole mandate. Find out more about the benefits of sole mandates.
A clause that is included in an Offer to Purchase relating to conditions that need to be met in order to advance with to a final and binding contract. For instance, subject to the sale of the buyer’s property or the granting of a mortgage bond.
A legal document that confirms ownership of a purchased property which is registered at the Deeds Office.
Transfer duty depends on the price of the property. From 2020, transfer duty is only paid by buyers of property over R1 million, and this is adjusted from time to time.
0%: up to R1,000,000
3%: R750,000–1,250,000
5%: R1,250,000–1,750,000
8%: R1,750,000–2,250,000
11%: R2,250,000+
A bond with one interest rate for the first five to seven years and another for the balance of the loan term.
A unit is what a sectional title property owner owns. This is made up of his section (generally apartment/townhouse) and his undivided share of the common property.
The right to use a property.
A valuation can only be carried out by a qualified and registered member of the South African Council for the Property Valuers Profession (SACPVP), often contracted by banks or municipalities to provide for property valuations.
A legal document whereby the signer voluntarily surrenders or relinquishes certain contractual rights and privileges.
The monetary return or interest accrued by an investment, taking into account the annual income and its current capital value.
Zoning relates to the permitted use and development of property, and the rules and regulations set out by the local authorities of cities and towns to manage the land-use rights in their areas. Zoning can include commercial and residential rights as well as building restrictions.
