New York City is like no other. And when it comes to real estate in this glorious city, it's good to have an experienced broker whether you're buyng or selling ... and it's good to know basic terminology.
Glossary of Terms
Abstract of Title
A historical summary of the recorded instruments and proceedings on the title of a property.
Air Rights
The right to use or control the space above a property. Air Rights can also be sold, rented or leased to another party.
Amenities
The benefits from home ownership, such as a feature that enhances value.
Appraisal
An estimate of the value of the property. One may have an appraisal to determine the offering price during a sale.
Assignment
The process by which a right or contract is transferred from one party to another. Assigned contracts include mortgages, leases and deeds of trust.
Broker
A state licensed sales agent who acts for property owners and prospective purchasers in Real Estate transactions.
Brownstone
A 19th century house which shares a common wall with the neighboring property.
Building Amenities
The assets that buildings offer its owners or tenants. These can include a doorman, health club, club, garage etc.
Building Restrictions
Requirements in building codes that affect the size and appearance of the building.
Capital Expenditure
An improvement that will have a life of one year or more and will increase the value of the property.
Certificate of Occupancy
In New York City, each building is required to have a Certificate of Occupancy which permits the structure to be occupied by members of the public. This means that the building is in compliance to health and building codes.
Closing
The transfer of ownership of a property from the seller to the buyer according to the sales contract.
Co-Broke
This is the term used when a broker sends out their listing to other brokers and other firms. The brokerage community then receives the listings and the commission will now be split evenly between the seller's broker and the firm that provides the buyer of the property.
Combination
Refers to when an owner combines two adjoining apartments into one to enhance the value and the space.
Commission
Payment to the broker for his or her efforts on marketing and selling the property it is usually a percentage of the total purchase price.
Commission Split
The sharing of commissions between the listing agent and the broker of the buyer.
Common Area
The area on the property or in the building that is available for use to all owners and tenants.
Comparables
Used in assessing or establishing the fair market value of a property, a property which has been sold recently that is similar in size, condition, location and amenities.
Condominium
A building where individuals own individual units but share common areas with the other unit owners of the building. A more liberal type of ownership than Coops, Condominiums also have more lenient policies regarding subletting and pets.
Contract
A legally binding agreement between two parties. To have a valid contract for the sale of Real Estate there must be:
- an offer
- an acceptance
- competent parties
- consideration
- legal purpose
- written documentation
- description of the property
- signatures of the principals
Conversion
Property changing to a different form of ownership, such as a condominium to a cooperative or a commercial building to a residential building.
Convertible
A one or two bedroom apartment that has space to make another bedroom. The other bedroom can be made with the construction of a wall; however, the new bedroom must have a window in order for it to be legal.
Cooperative
A type of ownership of property. This is when the individual unit owners own shares in the cooperative building and do not own the actual property. The amount of shares owned is determined by the value and size of the apartment. The cooperative building owns all of the units and the purchaser is buying stock in the building.
Deed
A written document by which title of property is expressed from one party to another.
Duplex Apartment
An apartment that has two levels.
Escrow
A state where consideration, benefits, legal rights, money, documents or other valuables are transferred to another party in advance of that party's legal claim to them, on the basis that the legal claim will arise at a given point in the future. It is a form of trust.
Estate
The word used to describe the collection of all assets of a deceased person. Also, the extent of interest a person has in real property.
Estate for Life
The interest of real property that ends with the death of a person.
Excellent Condition
This is used to describe the condition of the apartment; mint is another word for excellent meaning the apartment is in great shape.
Exclusive Listing
A contract whereby the owner of a property grants a single broker the right to market the property for sale.
Façade
The exterior front wall of a building.
Financing
Borrowing money to purchase a property.
Firm Price
An asking price for a property that is not open for negotiation.
Fixed-Rate Mortgage
A loan where the interest rate remains constant over the entire term of the loan.
Flip Tax
Tax imposed on the cooperative apartment by the cooperative, this tax can either be paid by the seller or purchaser and is usually a percentage of the purchase price.
Floating Rate
A loan where the interest rate is not fixed over the term but is allowed to vary according to the change in a specified index.
Floor Plan
A scale diagram of the arrangement of rooms and their sizes drawn by an architect.
Foreclosure
An enforcement process in which the lender under a defaulted mortgage takes title to the property for the purposes of selling it to recoup moneys owed under the mortgage.
Full Bath
A bathroom with a bath or a shower.
Grandfather Clause
If a new law is passed or an old is changed those people whose activity was legal under the previous law are allowed to continue because of this condition. This law is common with pets; some buildings that do not allow pets now, did in past, therefore, those owners are allowed to keep their pets.
Half Bath
A bathroom without a bath or a shower.
Interest Rates
The cost of borrowing money from a lender. Rates change over time and are set by the Federal Reserve.
Lease
A written agreement to rent a property or part of a property from the owner.
Lien
A legal claim against property for money owed.
Listing
The agreement that allows a real estate professional to market a property. Available apartments are also referred to as listings.
Loft
A loft refers to open living space that was converted from commercial space to residential space. Lofts contain very high ceilings, large windows and open space. In New York City, most lofts and converted commercial space is located downtown.
Lot
A measured section of land.
Maintenance
Monthly charges paid by the owner or tenant of a cooperative building for that person's share of costs of keeping the common-use portions of the building in good condition. This includes the daily cost to operate the building and it is calculated based on each individual unit.
Managing Agent
An independent company that is hired to manage a property. In New York City, most of the cooperative and condominium buildings are managed by a company which is responsible for the building operations. Brown Harris Stevens manages over 160 buildings in Manhattan.
Market Value
An estimation of the price for a property in relation to the current real estate market.
Mortgage
Money borrowed from a lender in order to purchase a piece of property. Mortgages vary in terms of length as well interest rates.
Negotiation
The process of discussing an issue between two parties who are working towards the same goal. Successful negotiation usually leads to a contract and then a sale.
Notarize
To verify the authenticity of a signature by a certified Notary Public.
Offer
An expression of the desire to purchase a property at a specific price. Once an offer is made and then accepted it leads to the purchase of the property.
Offer Accepted
The term refers to when the owner of the property agrees and accepts the offer and terms of the purchaser.
Open House
A specified time when a property that is for sale is advertised by opening its doors to prospective buyers. A broker advertises an open house to help the sale of the property.
Open Listing
A listing where the owner of the property hires more than one broker and only pays commission to the one that provides the purchaser.
Ordinance
A law enacted by the local government.
Penthouse
A luxury apartment in a high rise building.
Pied a Terre
A French term that refers to an apartment that is not the primary residence of the owner. A Pied a Terre is used when a person lives in another location and comes to New York several times a month or a few weeks a year to either work or enjoy this great city.
Post War
A post war building is one that was built after World War II.
Pre War
A pre war building is one that was built before World War II. Common characteristics of a pre war apartment are fireplaces, moldings and hardwood floors.
Property Tax
The tax issued on the ownership of property.
Points
A charge levied by the lender on the borrower for the mortgage for prepaid interest. Each point is equal to 1% of the principal of the mortgage.
Powder Room
Also known as a half bath. A powder room is a bathroom without a shower or a bath.
Quadraplex
An apartment that has four levels.
Referral
A recommendation made to a client about the services of a particular agent or firm.
Rental Building
A building where the apartments are only rented and not sold.
Rent Control
Laws that regulate the amount of money that is charged to rent out space.
Reserve Fund
An account reserved to provide funds for future expenses in order to maintain the cooperative or condominium building.
Sale Price
The amount of money paid by the purchaser to the seller. Also known as the purchase price.
Security Deposit
A payment required by a landlord to guarantee that the tenant meets his or her obligations under the lease and to guard against any potential damages that may be incurred during the term of the lease.
Shares
When one purchases an apartment in a cooperative building he or she is actually purchasing the shares in the cooperative. They represent the proportion of the building owned by the unit owner based on the size and value of the apartment.
Square Footage
The area measured in square feet of a certain property. Square footage can be measured in different ways and is usually considered approximate. Condominium apartments have specific laws that determine the way which the apartment is measured therefore condominium measurements are more accurate.
Sublet
The term used when an owner of an apartment decides to rent the apartment to a tenant.
Tax Deductible
An expense that reduces taxable income. Each year, shareholders in cooperatives apartments are able to deduct a certain amount from their personal taxes. The amount is determined by the amount of shares that are owned.
Term
A specified period of time.
Term, Amortization
The term in which the interest and principal payments of a loan must be made.
Title
The legal term for the evidence that the owner is in lawful possession of the land and property.
Townhouse
A townhouse is a private residence where at least one wall is shared with another residence. In New York City, townhouses are a very popular and a more private way of living.
Triple Mint
Refers to the condition of the residence. Triple mint condition means that the residence is in immaculate condition.
Triplex
An apartment that has three levels.
Unit
A single residence within a building.
Utilities
Services such as water, gas, electricity, telephone and television. Utilities in some buildings throughout the city are included in the maintenance charges.
Vacate
To move out and leave the property.
Walk Up Building
A building that does not have an elevator. Most walk up buildings are four to six floors.
Walk Through Inspection
The inspection of a property immediately before the closing to ensure that the property does not have any new damages.
Zone
An area set by local law for specific use with certain rules and regulations.
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