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.
The Real Estate Settlement Procedures Act (RESPA) is a federal law that regulates the real estate settlement process to protect consumers from abusive practices and ensure fair and transparent transactions.
A real estate transaction entails a sale or exchange of reportable real estate for money, indebtedness, or property other than money or services, regardless of whether the transaction is currently taxable.
Real property encompasses land and anything permanently attached to it, including buildings, trees, and certain rights issuing out of, annexed to, and exercisable within or about the land. It forms an essential part of property law.
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.
A reappraisal lease is a type of lease agreement where the rental level is periodically reviewed by independent appraisers to ensure the lease payments reflect the current market value.
Reassessment involves reviewing and updating a policy or a decision, often used in the context of real estate to revise property value estimates for tax purposes.
The recapture of depreciation is a tax provision that allows the IRS to tax the portion of gains on the sale of property that represents 'excess' depreciation.
Reconveyance is a process in which a lender transfers the title of a property back to the borrower once the mortgage debt is fully paid off. This legal document ensures the borrower's ownership of the property is unencumbered by the lender’s lien.
Recording refers to the act of entering a transaction in a book of public records, particularly those affecting the title to real property. This process gives public notice of the facts recorded.
A recovery fund is a financial safety net for aggrieved persons in the real estate sector who are unable to collect from brokers for wrongdoings. Funded by licensee contributions, it is generally administered by a state Real Estate Commission.
Redlining is an illegal practice of refusing to originate mortgage loans in certain neighborhoods on the basis of race or ethnic composition. The term derives from the alleged practice of drawing a red line on a map around certain neighborhoods to designate them as off limits for loan approvals.
The Registry of Deeds is an officially maintained book that provides a place and mechanism for registering evidences of conveyances of interests in real property, so that constructive notice may be available to all third parties that there has been a change in the ownership of property effected by a conveyance of that property.
Rehabilitation refers to the process of restoring something, such as a structure, to a good condition. It can be applied to various fields such as real estate, healthcare, and law, involving steps to improve, reconstruct, or repair.
The Rehabilitation Tax Credit encourages the preservation of historic buildings through tax incentives. It offers a 10% tax credit for the rehabilitation costs of certain older, non-residential buildings and a 20% tax credit for certified historic structures.
A release can signify different forms of authorization or versioning across various fields such as general permissions, real estate, and computing software updates.
A clause in a mortgage that gives the property owner the privilege of paying off a portion of the mortgage indebtedness, thus freeing a portion of the property from the mortgage.
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 Remainderperson is an individual who has an interest in an estate that becomes possessory after the termination of a present possessory interest, often referring to one who holds a remainder interest, whether vested or contingent.
Renewal is the continuation in force and effect of a previously existing arrangement for a new period, either on the same or different terms.
A renewal option is a provision in a lease agreement that grants the tenant the right, but not the obligation, to continue renting the property under specified terms and conditions, including rent, for an additional period.
Laws that govern the maximum rate that may be charged for space. Though popular among tenants, rent control can be economically detrimental to an area because it distorts the forces of supply and demand.
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 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.
Reproduction cost refers to the cost required for an exact duplication of a property, whether real or personal, taking into account the original materials, design, and workmanship as of a specific date. It is distinct from replacement cost, which involves replicating the functional utility of a property rather than creating an exact copy.
Resale proceeds refer to the financial gains obtained from selling a previously owned item. This term is particularly significant in contexts such as real estate, vehicles, or other high-value assets, where tracking gains from resale can impact financial planning and tax considerations.
The net amount received by a former owner upon selling an asset after covering transaction costs, settling any remaining debt, and potentially paying income taxes.
The highest price a buyer can pay and still achieve their primary objectives, such as keeping monthly payments affordable or paying no more than the market value for the property.
A reserve fund in real estate refers to an account maintained to provide funds for anticipated expenditures required to maintain a building. It may also serve as an escrow to pay upcoming taxes and insurance costs.
In the context of taxation and real estate, a residence refers to a place where someone lives. It can be classified into various types including personal residence, principal residence, and qualified residence.
A residential broker is a real estate professional who specializes in listing and selling houses or condominiums. They aid clients in buying, selling, or renting residential properties.
A residential mortgage is a loan secured against a residential property, such as a house or apartment, primarily used for the borrower's personal housing needs. It allows individuals to finance the purchase of a home by gradually paying off the debt over an agreed period.
In real estate brokerage terminology, residential property refers to owner-occupied housing. These can range from single-family homes to larger multi-family units like duplexes and apartment buildings.
Residential property refers to real estate designated for human habitation, including both single-family homes and multi-family buildings. These properties are typically zoned for private living and can encompass houses, apartments, townhouses, and condominiums.
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.
A restraint on alienation refers to a restriction on the ability to convey real property interests. Such restrictions often infringe on the common law policy that favors the free transferability of property.
A specification that limits the use or enjoyment of property or rights, often found in real estate dealings, legal documents, and contracts.
Reversionary interest refers to the interest a person holds in a property upon the termination of the preceding estate. This future interest in the property typically arises when the preceding estate, such as a life estate, comes to an end.
Reversionary value refers to the estimated value of a property at the end of a predefined period of time, typically used in real estate and financial projections.
A contractual opportunity granted to a specific party to match the terms of a proposed contract before it is executed with another party.
The Right of First Refusal (ROFR) is a contractual right that gives its holder the option to enter into a business transaction with the owner of an asset before the owner is entitled to enter into that transaction with a third party.
The right of redemption allows a property owner to recover their property that has been transferred due to a mortgage or other lien by repaying the debt, typically before or shortly after foreclosure. This right is also known as the equity of redemption.
The right of survivorship is a legal concept in property ownership that permits the surviving co-owner(s) to automatically inherit the property upon the death of a fellow co-owner. This principle is particularly applicable to joint tenancy and tenancy by the entirety.
Riparian rights refer to the entitlements vested in landowners whose property abuts bodies of water, such as rivers and lakes.
A type of mortgage commonly used in Canada in which the amortization of the principal is based on a long term, but the interest rate is established for a much shorter term. The loan may be extended, or rolled over, at the end of the shorter term at the current market interest rate.
Refers to perpetual rights or restrictions that affect all current and future owners of a property, as opposed to personal agreements not transferred with the deed.
Rurban areas are regions on the fringe of urban development that are in the process of being developed for urban uses.
The S&P/Case-Shiller Index, also known as the Case-Shiller/S&P Home Price Index, is a widely respected measure of the U.S. residential housing market. It provides crucial insights into home price trends across major metropolitan regions, thereby influencing both market participants and economic policy makers.
A sale or exchange refers to the disposition of property in a value-for-value transaction, as opposed to a disposition by gift, contribution, or similar means.
A salesperson is an individual whose primary responsibility is selling products, services, or investments. Salespersons in various industries, such as real estate, insurance, and securities, are often required to hold licenses.
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.
An instrument for recording and acknowledging final payment of a mortgage loan. The lender acknowledges that the debt has been satisfied.
A residence that is not one's principal residence. A taxpayer may deduct interest up to certain limits on two personal residences, provided certain occupancy requirements are met.
Secondary financing refers to additional loans or mortgages taken out on a property that already has an existing or primary mortgage. This type of financing is often used to cover down payments, renovations, or other expenses.
The secondary mortgage market is a market for buying and selling mortgages that have already been issued or originated, providing significant liquidity to the mortgage market.
Section 1031 of the Internal Revenue Code addresses tax-free exchanges of certain properties, primarily real estate, provided specific conditions are met.
A section of land, as defined in the Government Rectangular Survey, is one square mile. This system divides land into a grid where each township contains 36 sections, each being one square mile or 640 acres in area.
Seisin refers to the legal possession of a property by an individual who asserts ownership, typically in the form of a fee simple estate, life estate, or other saleable interest.
A Selling Agent, also known as a Selling Broker, is a licensed real estate professional who represents the buyer in a real estate transaction.
In various contexts, the term 'settlement' refers to different but related processes involving the distribution, resolution, or agreement on various matters such as estates, legal disputes, or real estate transactions.
The term 'Settlement Date' refers to the specific date on which a transaction is finalized and the respective assets are transferred between the buyer and the seller. This term is relevant in various domains such as real estate and securities trading.
A Settlement Statement is a detailed document that outlines the funds payable by each party involved in a real estate transaction, showing how these funds are distributed.
Ownership of real property held individually, separate from co-owners or other entities.
A specialized home loan arrangement where the lender is granted a share of the equity in the property, allowing them to participate in the proceeds from its resale.
A short sale can refer to both an arrangement within financial markets involving the sale of securities, as well as an arrangement between a mortgagor and mortgagee involving a real estate transaction.
A spec house is a single-family dwelling constructed by a builder or developer in anticipation of finding a buyer. It is built speculative, without having a specific buyer signed before construction starts.
A special agent can refer to either a professional engaged to act on behalf of another with limited authority, such as a real estate broker, or an Internal Revenue Service employee tasked with investigating potential fraud.
A compulsory levy or fee imposed on specific properties to fund public improvements that are assumed to increase the value or utility of the assessed properties.
A type of property conveyance deed in which the grantor limits the title warranty given to the grantee to claims arising only by, from, through, or under the grantor, and does not cover defects arising before the grantor's ownership.
A special-use permit is a right granted by a local zoning authority to allow specific activities within a zoning district. These activities, considered conditional uses, require special approval from the zoning authority.
Square footage refers to the area, measured in square feet, of a property available for sale or rent. It is a critical metric in real estate, used to determine the size and value of buildings or land.
Squatter's rights refer to the legal allowance to use the property of another in the absence of an attempt by the owner to force eviction. Under certain conditions, this right may eventually be converted to a title to the property over time by adverse possession, if recognized by state law.
Staging refers to the process of remodeling and interior decoration to enhance the marketability of a house preparatory to sale.
Stamp Duty Land Tax (SDLT) is a tax levied on the purchase of property or land in the United Kingdom. The tax is paid by the buyer and varies depending on the value and type of property.
Stamp Duty Land Tax (SDLT) is a tax charged on the purchase price of property or land in the UK. The rates and thresholds vary depending on several factors such as property value, type, and buyer's status.
The Standard & Poor's Case-Shiller Home Price Index tracks changes in the value of the residential real estate market, measuring the health and fluctuations in property values in various regions across the United States.
The Statute of Frauds is a statutory requirement that mandates certain kinds of contracts to be in writing to be enforceable. Contracts such as answering a creditor for another's debt, contracts made in consideration of marriage, contracts for the sale of real estate, or contracts not to be performed within a year must be written and signed by the party to be bound.
Statutory Foreclosure, also known as non-judicial foreclosure, is a legal process by which a lender can foreclose on a property without court intervention, authorized by state statutes.
The ability of an investor to retain their investment during periods of declining value, ensuring that short-term market fluctuations do not force premature sales.
Steering is an illegal practice in real estate where real estate agents or brokers guide prospective home buyers or renters towards or away from certain neighborhoods based on their race or ethnicity.
In the context of real estate and construction, a structure refers to any built improvement made on a site. These include buildings, fencing and enclosures, garages, gazebos, greenhouses, kiosks, sheds, and utility buildings.
The process of dividing a tract of land into smaller parcels to facilitate development, often accompanied by the installation of utilities and streets.
A subdivision is a tract of land divided into individual lots that are suitable for homebuilding or other development purposes. Most states and localities require that a subdivision plat be recorded to ensure proper and compliant land use.
The condition of sale of real estate property whereby the purchaser takes property encumbered by a pre-existing mortgage, and the purchaser's obligation to the mortgagee is limited to the property subject to the mortgage, unless the purchaser becomes personally liable on the debt by assuming the mortgage.
A sublease is a rental arrangement in which the original tenant leases out part or all of the rented property to a new tenant.
Subletting refers to the act of a tenant leasing out part or the entirety of a property to another party under the conditions of their own lease agreement with the landlord.
Subordination refers to the process of establishing the priority of one claim or debt over another. It is commonly used in various fields including finance and real estate to manage the hierarchy of obligations and claims.
The concept of substituted basis is crucial in taxation, especially when dealing with property that has either an exchanged basis or a transferred basis. It helps in determining the tax implications of property transfers and exchanges.
Detailed explanation of subsurface rights, their importance in real estate and mineral extraction, and how they differ from surface rights.
A subtenant is an individual or entity that leases a part or whole of a rented property from the original lessee for a period that is equal to or shorter than the term of the original lease. The original lessee, in this arrangement, becomes the sublessor.
Summary possession is a legal term referring to an expedited court proceeding used by landlords to regain possession of rental property from tenants, commonly referred to as an eviction.
A surveyor is a professional who measures and maps out the position, dimensions, and contour of the land or structures on the surface of the Earth. This role is crucial in various industries including construction, real estate, and civil engineering.
Sweat equity refers to the value added to a property by improvements resulting from work performed personally by the owner. It is a non-monetary investment that enhances the worth or appeal of an asset through manual labor and personal effort.
Syndication is a method of selling property whereby a sponsor, or syndicator, sells interests to investors. It can take various forms including partnerships, limited partnerships, tenancy in common, corporations, limited liability companies, or S Corporations.
A Tangible Asset is any asset with physical existence, such as real estate, gold, or machinery.
Tangible assets are physical items that hold value and can be seen and touched, used by businesses to generate revenue.
Tangible personal property refers to objects that can be physically touched and are not classified as real estate. When determining whether a fixture is real estate or tangible personal property, the method of attachment is pivotal.
