Nanaimo Real Estate Glossary

I have included a real estate glossary to help Buyers and Sellers read the contracts that they will be signing.

If you are planning on buying or selling a home in Nanaimo in the near future, take the time to learn some of the words you are unfamiliar with. Nanaimo's real estate market can be very hectic at times and being prepared and confident can save you not only money but time as well.

An abbreviation for air conditioner or air conditioning.
Absorption Rate
The rate at which listed homes are sold during a given time period. It is calculated by dividing the total number of available homes by the number of sales per month. This rate will show how many months supply is on the market. More than a six month supply indicates a buyers market.
A measurement of land equal to 43,560 square feet.
Adjustment Date
The day from which all calculations of interest, tax adjustments, utility bill adjustments ( if applicable) are made to the credit of either the buyer or the seller. This is usually (but not always) the same as the possession date.
The period set to pay down a loan. The normal amortization period for a mortgage in Canada is twenty five years, but can be as short as five years or as long as twenty five years.
An estimate of a property’s value performed by a professional appraiser.
Appraised Value
An estimated value of a property that is completed by a certified appraiser for mortgage financing.
The relationship between principal and real estate agent which arises out of a contract, written or oral wherein an agent is employed and authorized by the principal to represent him/her in business transactions with a third party.
Taking over a loan and becoming personally liable for the repayment Assessment - An appraisal for the purposes of taxes.
Assurance Fund
A fund set up by the B.C. Government to compensate any person deprived of land where there has been fraud, a mistake or error by the registrar of titles.
Agreement for sale
An agreement between the vendor and purchaser for the purchase of real property.
The replacement of excavated earth into a trench around or against a basement /crawl space foundation wall. Bay window Any window space projecting outward from the walls of a building.
Balanced Market
Where demand for property equals the supply of available property. Usually this is when we have a 6 month supply of homes in inventory.
Balance due on completion
The amount the purchaser needs to pay the vendor after all adjustments have been made. Bearing wall A wall that supports any vertical load in addition to its own weight.
Blended Mortgage Payments
Payments consisting of principal and interest component of a mortgage.
Breach of Contract
Violation of any of the terms or conditions of a contract without legal excuse; default, non-performance, such as failure to make payment when due.
Bridge Financing
A short-term loan for borrowers, sometimes used when a borrower buys a second home before the first one has been sold.
Building Permit
A document that must be obtained from the city by the property owner or contractor before a building can be built or repaired. It must be posted until the job is completed and passed by a city building inspector.
Buyer Agent
An agent representing the buyer in a home purchase.
Buyers' Market
Where demand for property equals the supply of available property. Sellers usually accept reasonable offers and houses generally sell in sufficient time periods. Prices remain stable and there is usually a good number of homes to choose from.
Capitalization rate (or "cap rate")
Is the ratio between the net operating income produced by an asset and its capital cost (the original price paid to buy the asset) or alternatively its current market value.
Cap Rate
= Net Operating Income / Property Value
A notice registered against the title of land that there is an outstanding claim.
Articles of personal property such as household goods, furnishings, and fixtures that are not permanently affixed to the house.
Closing Costs
All the charges that are attached to the closing . These one-time fees include charges for title search and insurance, attorney's fee, lender and/or broker fees. Common Area An area in a strata that is owned by all residents. i.e.:the swimming pool, roof or lobby. (see limited common area).
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. also known as “Subject-to” Clause Consideration - The legal term used for what reason which induces a party to enter into a contract. It can take the form of financial payment or the a promise to do or not do something.
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. Cornice Overhang of a pitched roof , usually consisting of a fascia board, and soffit.
A promise contained within an agreement. (a restrictive covenant ant is a restriction placed on land i.e. restricted building heights). (A local millionaire actually bought the rights from all his neighbors to not block his view).
Something of value given or pledged as security for a debt or obligation. The collateral for a real estate mortgage loan is the mortgaged property itself.
Short vertical "2 by 4's or 6's" frame lumber installed above a window or door.
A sum of money that is required to be paid with an offer to purchase as a symbol of the purchaser's commitment.
A registered limited right of use of another's land by a landowner for that benefit of his land. i.e.: the use of a common driveway.
Any claim, lien, charge or liability attached to and binding upon real property which may lessen the value of the property but will not necessarily prevent transfer of title.
Is the term used for something that illegally invades property such as a fence or wall.
The difference between the value of a property and the amount of financing on that property.
Horizontal boards attached to rafter/truss ends at the eaves and along gables.
Personal property that becomes real property when attached in a permanent manner to real estate.
A legal procedure whereby property used as security for debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document.
The end, upper, triangular area of a home, beneath the roof.
One who becomes contingently liable for another's debt.
An abbreviation for Heat, Ventilation, and Air Conditioning.
High-ratio Mortgage
A mortgage loan that exceeds the normal limit of 75% LTV (loan to value) of a conventional mortgage.
Hold back
A portion of each payment that remains unpaid until such time as the job is completed and/or any liens placed against your property by the contractor's debtors are discharged.
Interest adjustment date
The date on which the mortgage really begins, usually the first of the month. The interest owed for the number of days between the closing date and the last day of the month is paid on the closing date by cheque or by deduction from the mortgage advance and covers.
Joint Tenancy
Property held by two or more persons with an undivided interest. If one owner dies, the property passes automatically to the other / others.
The science of juridical law; the knowledge of the laws, customs, and rights of men in a state or community, necessary for the due administration of justice.
Latent Defect
A defect that is hidden or concealed and would not be visible during reasonable inspection.
A less-than-freehold estate which a tenant possesses in real property.
A charge registered against a property.
A horizontal piece over a door or window that carries the weight of the structure above it.
Life Estate
An interest in land during a persons life and ends upon their death.
Limited common area
An area in a strata that is owned by all residents but has limited use i.e. parking stall or balcony.
Listing Agreement
The contract between the vendor and the licensee to sell the property.
Is a type of roof that has four sides that slope up from the edge to the square peak. (Also known as a hip roof.)They were first conceived by the architect François Mansard in the1850's. The roof incorporates an additional floor usually with dormers. (French buildings were taxed on their height not the number of floors).
Market Value
The value of a property based on what the market will bear. Determined by a comparison of the subject property to others in a similar area that have sold recently.
A document evidencing a debt towards by the borrower. When it is registered in the land title office, It transfers ownership of the land from the mortgagor to the mortgage until the debt is paid
Open Mortgage
contains a provision allowing partial or full prepayments.
Closed Mortgage
cannot be paid out before its term has expired.
Convertible Mortgage
A fixed-rate mortgage similar to a closed mortgage, but which can be converted to a longer, Closed mortgage at any time without penalty.
Blanket Mortgage
A mortgage that covers more than one property owned by the same borrower.
High Ratio Mortgage
A mortgage in which the loan-to-value ratio is above 75%.
Variable Rate Mortgage
A mortgage where the rate of interest changes during the term depending on the market rate at that time.
Mortgage Broker
A person or company that arranges mortgages. The mortgagor pays the broker a fee for arranging the mortgage. Appraisal and legal services may or may not be included in the fee.
The borrower of the funds from a mortgage.
Multiple Listing Service, MLS®
A service that combines listings of all available homes in an area into one directory.
Non-Conforming Use
A permitted use which was lawfully established and maintained but which no longer conforms to the current use regulations because of a change in the zoning.
A creditors' acceptance of a third party assuming someone's debt and thereby releasing that debt.
Principal, Interest, and Taxes - payments due under the terms of a mortgage agreement. Generally, payments are made monthly and include one-twelfth of the estimated annual property taxes.
Prime Rate
The interest rate that banks charge to their preferred customers.
The mortgage amount initially borrowed or the portion still owing on the mortgage. Interest is calculated on the principal amount.
Restrictive Covenant
A Covenant restricting the use of land of the covenantor for the benefit of the covenantee.
Real Estate Investment Trust (REIT)
A REIT is a company dedicated to owning, and sometimes operating, income-producing real estate, such as apartments, shopping centers.
Statement of Adjustments
A closing statement to add all debits and credits up. Adjustments are made for items such as interest, taxes owed, agent commission etc.
“Subject-to” Clause
A statement of a condition to be fulfilled before the contract will become firm and binding; must include a specific deadline for removal. also known as "Condition Precedent".
Strata Fee
The monthly fee to pay the common costs of the strata corporation. A strata can be several condos in one building, three buildings in one complex or a group of building lots using a common road. The word strata is just a way of saying that the real estate has been subdivided into more than one unit. It is actually an Australian word and is only used in B.C., Alberta and a few other countries.
Tax Rate
The rate per $1000 of land value that property tax is calculated.
Tenancy in Common
The ownership of property by two or more persons, where on the death of one, his share does not automatically go to the other(s) but is credited to his estate.
The actual life of a mortgage contract. It also indicates when the principal balance becomes due and payable to the lender.
A private wrong or injury other than breach of contract, i.e.: trespass.
Torrens system
A land registry system, based on a ship registry system. It removed the need for historical research into land title. Named after Robert Richard Torrens.
Charging a rate of interest in excess of that permitted by law. (60%) in B.C.)
Having no legal force or binding effect; not enforceable.
A measure of the electrical requirement of an appliance calculated by multiplying the voltage times the amperage. i.e.: 20 amps x 110 volts = 2200 watts.

Doug Belcher REMAX Nanaimo

Have a questions? Need to Buy or Sell a home? Give me a call.

I post both my cell and office number so my clients can reach me anytime. I am always happy to discuss your Nanaimo real estate needs.

Office 250-751-1223

Cell 250-619-6012

Fax 250-751-1300

Office 1-5140 Metral Dr. Nanaimo