Every term below is used somewhere else on this site. Definitions are general and describe ordinary usage rather than any statutory definition.
- Achieved price
- The amount actually paid at completion, after any renegotiation. The only price that is evidence of what a market did.
- Affordability assessment
- A lender's evaluation of whether repayments are sustainable, including a stress test at a higher rate than the one being offered.
- Agreed price
- The figure accepted when a sale goes under offer. In most of the UK it is not binding until contracts are exchanged.
- Arrangement fee
- A lender's charge for setting up a loan, payable up front or added to the balance, in which case interest is paid on it for the term.
- Asking price
- The advertised figure. A marketing decision rather than a valuation.
- Backland development
- New housing built on the rear part of deep existing plots, usually reached by a side access.
- Boundary
- The physical or legal edge of a property. Registered plans show general position, not precise legal lines.
- Break-even horizon
- The length of stay at which the unrecoverable costs of buying and selling are outweighed by the saving against renting.
- Building line
- The consistent distance from the street at which the fronts of buildings sit along a stretch of road.
- Building regulations approval
- Confirmation that work met construction standards. Distinct from planning permission, and frequently the missing document in a transaction.
- Building survey
- The most detailed buyer survey, covering construction, defects, their causes and likely remedies. Suited to older or altered buildings.
- Capital
- The amount borrowed, as distinct from the interest charged on it.
- Chain
- A sequence of linked transactions in which each purchase depends on a sale. The main source of fragility in residential transactions.
- Chain-free
- A buyer whose purchase does not depend on selling a property, or a seller with no onward purchase.
- Completion
- The transfer of funds and title, and the point at which possession passes.
- Condition report
- The lightest form of buyer survey, giving element-by-element gradings without detailed advice or, usually, a valuation.
- Conservation area
- A designated area where additional controls apply to demolition, alteration and trees.
- Contract
- The agreement for sale. Until it is exchanged, either party may withdraw without liability in most of the UK.
- Conveyancing
- The legal work of transferring ownership, covering title, searches, enquiries and completion.
- Covenant
- A promise attached to land that restricts or requires something, binding on later owners.
- Deposit
- The buyer's own contribution to the purchase price, and separately the sum paid on exchange of contracts.
- Drainage and water search
- An enquiry establishing connection to public sewers and mains water and the position of public sewers relative to the boundary.
- Easement
- A right over someone else's land, such as a right of way or a right to run services beneath it.
- Early repayment charge
- A fee for repaying a loan, in whole or part, during a fixed or discounted period.
- Environmental search
- A desk-based assessment of contamination, flood, ground stability and landfill risk. Not a site inspection.
- Equity
- The difference between a property's value and the debt secured on it.
- Exchange of contracts
- The point at which a sale becomes legally binding and a completion date is fixed.
- Fixed rate
- A mortgage rate held constant for an agreed initial period, after which the loan reverts to a variable rate.
- Freehold
- Ownership of the land and the building on it, without a limited term.
- Frontage
- The width of a plot along the street. A primary determinant of density and of what a plot cost to develop.
- Gazumping
- A seller accepting a higher offer after agreeing a sale but before exchange, which the absence of a binding agreement permits.
- Ground rent
- A periodic sum payable by a leaseholder to the freeholder under the terms of a lease.
- Homebuyer survey
- A mid-level inspection of visible and accessible parts, with gradings and commentary, often including a valuation.
- Illiquidity
- The property of an asset that cannot be sold quickly or cheaply. A defining feature of housing.
- Indemnity policy
- Insurance used to cover a defined legal risk, such as a missing consent, rather than resolving the underlying issue.
- Infill
- New building within an already developed area, on gaps, garden land or redundant sites.
- Interest-only
- A loan on which no capital is repaid during the term, leaving the full balance outstanding at the end.
- Leasehold
- Ownership of a property for a fixed term under a lease, with obligations to a freeholder.
- Lender's valuation
- An inspection commissioned by the lender to confirm the property is adequate security. Not a condition survey for the buyer.
- Loan to value
- The loan as a percentage of the property's value. Determines which rate bands are available.
- Local authority search
- An enquiry covering planning history, building regulation records, road status and notices affecting the property itself.
- Major works
- Substantial repairs to a leasehold building, recharged to leaseholders and capable of producing very large individual bills.
- Mortgage offer
- The lender's formal commitment to advance funds, subject to conditions and with an expiry date.
- Negative equity
- The position where the debt secured on a property exceeds its value.
- Offer
- A buyer's proposed price. Information rather than an obligation until contracts are exchanged.
- Overage
- An agreement that a further payment falls due if a defined event, usually a planning consent, occurs after sale.
- Planning permission
- Consent for development or change of use. Distinct from building regulations approval.
- Plot depth
- How far a plot extends back from the street. Determines capacity for extension or later development.
- Portability
- The ability to transfer an existing mortgage to a new property, subject to the lender's conditions at the time.
- Redemption
- Repayment of a mortgage in full.
- Remortgage
- Replacing an existing loan with a new one, usually at the end of an initial rate period.
- Reserve fund
- Money collected from leaseholders in advance towards future major works.
- Retention
- A sum a lender withholds until specified works are completed.
- Search
- An enquiry made of a body holding information about a property or its surroundings, each answering one narrow question.
- Service charge
- A leaseholder's contribution to the costs of maintaining and managing a building and its shared parts.
- Setback
- The distance between the front of a building and the street edge.
- Stamp duty or land transaction tax
- Tax payable on property purchases, varying by jurisdiction, value and buyer circumstances.
- Standard variable rate
- A lender's default rate, applying when an initial deal ends and typically the most expensive position.
- Stress test
- An affordability check asking whether payments would remain sustainable at a materially higher rate.
- Subject to contract
- A statement that terms are agreed but not binding until contracts are exchanged.
- Tenure
- The legal basis on which a property is held: freehold, leasehold, commonhold or a form of rental tenancy.
- Term
- The period over which a loan is scheduled to be repaid.
- Time on market
- How long a property has been advertised. Often more informative about local conditions than price alone.
- Title
- The legal ownership of land, together with the rights and burdens registered against it.
- Tracker rate
- A rate that follows a published reference rate by a fixed margin, moving as that rate moves.
- Turnover
- The proportion of the housing stock changing hands in a period. Usually small, which is why prices are set at the margin.
- Under offer
- The status of a property whose sale has been agreed but not exchanged.
- Valuation
- An opinion of value, formed by adjusting comparable evidence for differences in the specific property.
- Variable rate
- Any rate the lender may change, whether tracking a benchmark or set at the lender's discretion.