An absentee owner is an individual or entity that owns real estate but does not personally manage or reside at the owned property. Such ownership requires the delegation of management tasks and often involves the hiring of property managers.
An administrator is a person appointed by courts or by private arrangement to manage the property and affairs of another person, particularly in cases involving deceased individuals without a will or debt administration.
An apartment building is a structure with multiple individual apartment units accessed through a common entrance and hallway. It may also contain commercial spaces, such as stores, typically on the ground floor.
An unethical practice in real estate development and property management where project costs are manipulated for excessive profit or property value is compromised for immediate income.
Commercial property refers to real estate intended for use by retail, wholesale, office, hotel, or service users, or for manufacturing or other industrial purposes. Examples include shopping centers, office buildings, hotels and motels, resorts, and restaurants.
A common area is a portion of a property that is used and enjoyed by all owners or tenants within that property. Typical examples include clubhouses and pools in condominium developments, hallways and stairs in apartment buildings, elevators in office buildings, and the central mall area in shopping centers.
Common elements in a condominium refer to those portions of the property not owned individually by unit owners but held in an indivisible interest by all unit owners. These typically include the grounds, parking areas, recreational facilities, and the external structure of the building.
A community association is an organization of property owners that oversees common interests and responsibilities within a community, such as managing common elements in a condominium or enforcing deed covenants in a subdivision.
An organization of all unit owners in a condominium responsible for overseeing common elements and enforcing the condominium's bylaws.
A conservator is a court-appointed custodian of assets belonging to someone determined by the courts to be unable to manage his or her own property.
Contract Rent refers to the amount of rent that has been explicitly stipulated in a lease agreement between a tenant and a landlord.
A converter is an active real estate entrepreneur who changes the ownership and/or physical configuration of property.
Curable Depreciation in appraisal refers to deterioration or depreciation that can be corrected at a cost less than the value that will be added.
Custody refers to the condition of holding a property or person within one's care and control. This comprehensive term has applications in various fields, from property management to legal and family contexts.
Distressed property refers to real estate that is under foreclosure or impending foreclosure due to insufficient income production. Such properties often require unique strategies for recovery, including potential workouts.
Economic Life refers to the period during which a machine or other property is expected to generate more revenue than operating expenses, thereby staying profitable and justifying its use.
Effective Gross Income (EGI) represents the potential gross income generated from rental real estate, adjusted for a vacancy and collection allowance, plus any miscellaneous income.
Estovers refer to the right of a tenant or life tenant to use timber on the leased premises for proper maintenance of the property.
Facilities Management involves the process of operating corporate- or government-owned property that is occupied and used for the corporation's or government's own purposes.
Furniture, fixtures, and equipment (FF&E) are movable assets essential to the operation of a business, often found in hospitality industries such as hotels and motels. These items typically wear out faster than other properties, necessitating detailed management of their condition, cost, and replacement frequency.
The General Services Administration (GSA) is a federal government agency responsible for purchasing and managing property occupied by other federal government agencies. It plays a crucial role in providing products, services, and facilities to enable federal agencies to efficiently fulfill their missions.
A type of lease agreement that includes predetermined rent increases at specified intervals.
Gross Leasable Area (GLA) is the total floor area of a building available for rental to tenants, usually measured from the outside walls without deducting for hallways, lobbies, or other common areas.
A guardian is an individual assigned with the responsibility of protecting another person or property, either via general duty or legal appointment.
A Guardian Deed is a legal document used for the sale or transfer of real estate by a person appointed by a court to manage the personal affairs or property of an individual who is not capable of such duties.
A Homeowners' Association (HOA) is an organization of homeowners in a particular subdivision, planned unit development, or condominium. It is generally formed for the purpose of enforcing deed restrictions and managing the common elements of the development.
Ingress and egress refer to the rights and means of entering and leaving a property. These terms are crucial in real estate, law, and property management, as they dictate the accessibility and usability of properties.
An inside lot, located within a subdivision, is characterized by being surrounded by other lots on each side. This is in contrast to a corner lot, which has road frontage on at least two sides.
Investment Management involves the selection and overseeing of various financial assets to meet specified investment goals for the benefit of investors.
A landlord is a property owner who rents out their property to another party, known as the tenant, in exchange for rent. The landlord retains ownership of the property while granting the tenant the right to use it as specified in a lease agreement.
A leaseback transaction involves a property owner selling the property and then leasing it back from the buyer. This allows the original owner to continue using the property while receiving an influx of capital from the sale.
Leasehold refers to the right acquired under a lease to use land and buildings for a specified period in return for the payment of a specific rental. Understanding leasehold agreements is crucial for both residential and commercial tenants, as it determines the terms and conditions under which they can use the leased property.
Leasehold Improvements are fixtures attached to real estate that are generally acquired or installed by the tenant. Upon expiration of the lease, the tenant can generally remove them, provided such action does not damage the property or conflict with the lease agreement.
A long-term lease generally refers to a commercial lease of five years or longer, or a residential lease longer than one year. It involves a contractual agreement between a landlord and tenant for the use of a property for a prolonged period.
A maintenance fee is a periodic payment made by property owners or account holders to cover the costs of upkeep and operations, particularly in real estate or financial accounts.
A management fee is a charge against assets for the administration and management of portfolios, funds, or real estate properties. It encompasses services such as investment management, shareholder relations, administration, rent collection, maintenance, and bookkeeping.
A Master Lease is a primary lease agreement in which the lessee (tenant) holds significant control over the leased property, and it sets the terms under which the lessee can sublease the property to a subtenant.
A month-to-month tenancy is a lease agreement that allows tenants to reside in a property on a month-by-month basis, with the option to extend or cancel the agreement at the end of each month.
Multifamily housing refers to a type of residential structure that contains multiple housing units within the same building, suitable for families or individuals.
An organization of REALTORS® dedicated to promoting professionalism in real estate activities. With over 1 million members, 50 state associations, and several affiliates, NAR members must adhere to the NAR Code of Ethics.
Net Leasable Area (NLA) refers to the portion of a commercial building that is available for lease to tenants. It excludes common areas such as lobbies, restrooms, and utility rooms.
A net lease is a real estate lease agreement in which, in addition to the stipulated rent, the lessee (tenant) agrees to cover other expenses such as taxes, insurance, and maintenance. This arrangement results in the landlord receiving rent net of these expenses.
Net Operating Income (NOI) is a critical metric in the real estate industry that assesses the profitability and financial health of income-generating properties. By calculating NOI, investors can evaluate the operating performance of properties without considering financing, taxes, or capital expenditures.
Normal wear and tear refer to the physical depreciation arising from the age and ordinary use of a property. Understanding this concept is critical in fields such as accounting, real estate, and property management.
A legal document issued to inform a tenant or landlord of the intention to vacate a rented property. The notice can be initiated by either party, detailing the date by which the property must be vacated.
Understanding the concepts of occupancy and occupants is essential for various fields, including real estate, property management, and law.
Operating statements are financial reports detailing the cash flow of a business or property. These reports are crucial for understanding the financial performance and health of the entity.
Physical life refers to the expected duration an asset, such as real estate improvements, can exist physically. It contrasts with useful life, which considers the period the asset remains functional and economically viable in its usage.
A multi-faceted term used across various fields such as physical display, bookkeeping, civil procedure, commercial law, and property management.
Potential Gross Income (PGI) represents the maximum rent a property could generate if it were fully leased at all times throughout the year, without any deductions for vacancies or uncollected rents.
Property management involves the operation of real estate as a business, including activities such as rental, rent collection, maintenance, and numerous other tasks related to the ownership and oversight of properties.
Protective covenants are conditions written into real estate deeds or leases to protect the property owner's interests by regulating use, controls, and restrictions.
A Real Estate Investment Trust (REIT) is a company resident in the UK that owns at least three properties let to third parties and distributes at least 90% of its profits to shareholders. REITs are exempt from UK corporation tax, and distributions are taxed as rental income to shareholders.
A REIT, or Real Estate Investment Trust, is a company that owns, operates, or finances income-producing real estate.
Real Estate Owned (REO) refers to property acquired by a lender, typically a bank or other financial institution, through foreclosure. This property is then held in the lender's inventory and goes through an asset management process to either sell it off or put it into productive use. REOs are common outcomes of non-performing loans which lead to foreclosure actions.
Real Estate Owned (REO) refers to properties that have been repossessed by lenders, typically banks, following a foreclosure sale where the property did not sell at auction, thus becoming part of the bank's inventory.
A professional in real estate who subscribes to a strict code of ethics as a member of the local and state boards and the National Association of Realtors.
Realty, also known as real estate, encompasses land and the buildings on it, as well as natural resources like crops, minerals, or water. It involves various facets such as acquisition, sale, management, and legal transactions concerning properties.
Reconditioning property involves restoring it to its original specifications to improve its value through repairs or enhancements.
A relocation clause is a stipulation in a lease agreement that allows the landlord to move the tenant to another unit within the same building.
A payment made for the use of land or property, usually, but not necessarily, based on a lease agreement. Rent is typically paid on a periodic basis and provides tenants the right to temporary use and occupancy of certain real property.
A rent roll is an essential document for property management, providing comprehensive information about tenants, leased properties, rental amounts, and lease expiration dates.
A portion of the term of a lease when no rent is required. This is often offered by a landlord as a rental concession to attract tenants.
The rent-up period refers to the timeframe between the completion of construction and the point at which a newly constructed property becomes fully occupied.
Rentable area refers to the total space a tenant can lease in a commercial property, including both usable space and a proportion of common areas like lobbies, restrooms, and hallways.
The periodic charge per unit for the use of a property. The period may be a month, quarter, or year. The unit may be a dwelling unit, square foot, or other unit of measurement.
A replacement reserve is an amount set aside from net operating income to pay for the eventual wearing out or replacement of short-lived assets.
A resident manager supervises the care and maintenance of an apartment complex while residing in one of its units. Their responsibilities include showing vacant units to prospective tenants, ensuring the building's cleanliness, and providing access to repair personnel.
Residential rental property refers to rental units utilized for dwelling purposes, excluding transient lodging like hotels or motels. To qualify as residential for income tax purposes, at least 80% of a building’s income should come from dwelling units. This type of property is eligible for a 27½-year life for tax depreciation purposes, compared to a 39-year life for nonresidential property.
Retaliatory eviction refers to the act of a landlord forcing a tenant to vacate a rental unit in response to complaints from the tenant about the condition of the property. This practice is illegal in many jurisdictions under landlord-tenant laws.
A sandwich lease is a lease held by a lessee who becomes a lessor by subletting the leased property. Typically, the sandwich leaseholder is neither the owner nor the end-user of the property.
A security deposit is a nontaxable cash payment received by a landlord to be held during the term of a lease to offset damages incurred due to actions of a tenant.
A Single Property Ownership Trust (SPOT) is a legal fiduciary structure where a single real estate property is held within a trust, managed on behalf of the beneficiaries. This arrangement aims to maximize property value, simplify management, and offer estate planning benefits.
A step-up lease, also known as a graduated lease, is a type of lease agreement where the rental rate increases at specified intervals throughout the term of the lease.
A sublease is a rental arrangement in which the original tenant leases out part or all of the rented property to a new tenant.
Surrender is the cancellation of a lease agreement by mutual consent of both the lessor (property owner) and the lessee (tenant), effectively ending their contractual lease obligations.
A tenement refers to any type of dwelling inhabited by a tenant, including both corporeal and incorporeal real property. In modern contexts, it commonly denotes multi-occupied buildings, often in poor conditions, such as dilapidated apartment dwellings.
A Triple-A Tenant refers to a tenant with an excellent credit record, typically used in commercial real estate to indicate high financial stability and reliability.
A trust fund refers to real property or personal property held in trust for the benefit of another person. The trust fund's principal or body is called the corpus.
In real estate and property management, vacancy refers to the state of a property that is unoccupied. A vacant building or unit is one that is presently empty and not leased or rented out.
Vacant land refers to land not currently being used for developed purposes. It might have utilities and off-site improvements but lacks significant buildings or structures.
Vacant property refers to real estate that is currently unoccupied and not being used, whether it is residential, commercial, or industrial. Such properties can present unique challenges and opportunities for owners and managers.
