A
- Affordable Housing: Housing made available at reasonable prices for individuals with low to moderate incomes.
- Amenities: Features such as pools, gyms, or parking spaces that enhance a property’s comfort and appeal.
- Apartment: A rental unit or set of rooms within a larger building or complex.
- Appraised Value: The professional assessment of a property’s value, typically conducted by a licensed appraiser.
- Appreciation: The increase in a property’s value over time.
- Asset Allocation: The strategy of distributing investments across various asset classes to manage risk.
- Assessed Value: The valuation placed on a property by tax authorities for determining property taxes.
B
- Brownstone: A building or structure made from a specific type of soft sandstone, often seen in urban areas.
- Buy-and-Hold Strategy: A real estate investment approach where properties are purchased and held long-term.
- BRRR (Buy, Rehab, Rent, Refinance, Repeat): A strategy for acquiring, improving, and leveraging rental properties.
- Bridge Loan: A short-term loan used to finance a property until permanent financing is secured.
- Building Codes: Regulations that determine construction standards to ensure safety and functionality.
C
- Cap Rate: A metric that helps evaluate the profitability of an investment property, expressed as a percentage.
- Capital Expenditure (CapEx): Funds spent on major property improvements or repairs that add value.
- Capital Gain: The profit earned when a property is sold for more than its purchase price.
- Capital Improvement: Upgrades or renovations to a property that increase its value or utility.
- Cash Flow: The net income generated by a property after all expenses are deducted.
- Cash-on-Cash Return: A measure of a property’s annual return based on the cash investment made.
- Certificate of Occupancy: A document certifying that a property complies with building codes and is safe to occupy.
- Certificate of Title: A legal document establishing ownership of a property.
- Closing Costs: Fees and expenses incurred during the purchase or sale of a property.
- Co-Applicant: A secondary applicant who shares responsibility for a mortgage or loan.
- Commercial Property: Real estate used for business purposes, such as offices or retail spaces.
- Common Area: Shared spaces within a property, like lobbies or hallways, accessible to all tenants.
- Common Area Maintenance: Expenses associated with maintaining shared areas of a property.
- Comparative Market Analysis (CMA): A report used to determine a property’s market value based on similar properties.
- Condominium: A property type where individuals own their units within a shared building or complex.
- Contract for Deed: An agreement where the buyer pays for a property in installments while the seller retains the title until full payment is made.
- Crowdfunded Real Estate: Pooling funds from multiple investors to purchase real estate projects.
- Curb Appeal: The visual attractiveness of a property when viewed from the street.
D
- Depreciation: The loss of a property’s value over time due to wear and tear or aging.
- Down Payment: A partial upfront payment made when purchasing a property, usually a percentage of the total price.
- Due Diligence: The thorough investigation process conducted before purchasing or investing in a property.
- Duplex: A building with two separate residential units, typically side by side or one above the other.
E
- Effective Rent: The average rent collected after factoring in promotions or concessions.
- Escrow: A financial arrangement where a third party holds funds until conditions are met.
- Estoppel Certificate: A document verifying the terms and conditions of a tenant’s lease.
- Equity: The value of an owner’s interest in a property, calculated as the difference between market value and owed debt.
- Eviction: The legal process by which a landlord removes a tenant for violating lease terms.
F
- Fair Market Rent: The estimated rental price a property can command in the open market.
- Fix-and-Flip: A strategy where properties are purchased, renovated, and sold for a profit.
- Floor Area Ratio (FAR): A zoning measurement of building floor space relative to the size of the property lot.
- Foreclosure: The legal process in which a lender takes ownership of a property due to unpaid debt.
G
- Gross Lease: A lease where the tenant pays a fixed rent, and the landlord covers property expenses like utilities.
- Gross Rent: The total rental income collected before deducting expenses.
- Ground Lease: An agreement where the tenant rents the land and may build on it but does not own the land.
- Guarantor: A person who guarantees payment if the tenant fails to pay rent.
H
- Hard Money Loan: A short-term loan secured by real property, often used by investors.
- Home Equity Line of Credit (HELOC): A revolving credit line secured by a property, allowing homeowners to borrow as needed.
- Homeowners Association (HOA): An organization that governs properties in a community and collects fees for maintenance and services.
I
- Income Property: A property purchased to generate rental income or profits from appreciation.
- Inspection Contingency: A condition in a real estate contract allowing the buyer to back out based on property inspection results.
- Internal Rate of Return (IRR): A measure of an investment’s overall profitability over time.
- Investment Property: Real estate purchased primarily for earning rental income or appreciation.
J
- Joint Tenancy: A type of property ownership where two or more people share equal ownership rights.
L
- Landlord: A property owner who rents out their property to tenants.
- Landlord Insurance: A type of insurance policy protecting landlords from property damage and loss of rental income.
- Lease Agreement: A binding contract between landlord and tenant outlining rental terms.
- Leasehold Estate: A tenant’s right to occupy a property for a specific period under a lease.
- Legal Description: A formal property description used in official records.
- Lessee: A tenant who rents property from a landlord.
- Lessor: A landlord or property owner leasing a property to tenants.
- Likely ROI: An estimate of the potential return on investment for a property.
M
- Market Rent: The rental price a property can achieve in the current market.
- Master Association: An overarching HOA responsible for managing larger community developments.
- Modified Gross Lease: A lease structure where property expenses are shared between tenant and landlord.
- Mortgage: A loan used to purchase property, with the property itself serving as collateral.
- Multi-Family Property: Residential buildings with multiple separate living units, such as duplexes or apartment complexes.
N
- Net Operating Income (NOI): A calculation of rental property profitability after deducting operating expenses.
- Non-Recourse Loan: A loan where the lender cannot pursue the borrower personally if the borrower defaults.
O
- Occupancy: The state of a property being occupied by tenants.
- Operating Expense Ratio: The proportion of operating expenses to a property’s income.
- Opportunity Zone: A tax-advantaged area designated for economic development.
P
- Passive Income: Earnings generated without active involvement, such as rental income.
- Percentage Rent: An additional lease payment based on a tenant’s revenue in commercial properties.
- Pet Deposit: A refundable or non-refundable fee paid to cover potential pet damages.
- Pre-Approval Letter: A lender’s statement showing a buyer’s creditworthiness and loan amount eligibility.
- Principal Balance: The outstanding amount owed on a loan, excluding interest.
- Property Appraisal: The evaluation of a property’s market value by a licensed professional.
- Property Maintenance: Routine upkeep and repairs to keep a property in good condition.
- Property Management: The operation, maintenance, and oversight of real estate investments.
Q
- Quitclaim Deed: A legal instrument transferring ownership rights without guaranteeing clear title.
R
- Real Estate Investment Trust (REIT): A company that owns and manages income-generating real estate.
- Refinance: The process of replacing an existing mortgage with a new loan under different terms.
- Rent Control: Government-imposed limits on the amount landlords can charge for rent.
- Rent Roll: A document listing all rental income from a property.
- Renters Insurance: A policy protecting tenants’ personal belongings and liability coverage.
- Replacement Reserve: Funds set aside for future property repairs or replacements.
- Rental Yield: A measure of annual rental income relative to the property’s value.
S
- Security Deposit: A payment made by tenants to cover potential damages or unpaid rent.
- Single-Family Home: A property designed for occupancy by one household.
- Squatter: An individual occupying a property without the legal right to do so.
- Student Housing: Residences intended for college or university students.
- Sublease: An arrangement where the tenant rents the property to another person.
- Subletting: The act of renting out a leased property to someone else.
- Syndication: A partnership pooling resources to invest in large real estate deals.
T
- Tax Lien: A legal claim against property for unpaid taxes.
- Tenancy: The possession or occupancy of property under a lease agreement.
- Tenant Improvement: Upgrades or modifications to a rental property made by or for a tenant.
- Tenant Screening: The process of evaluating potential tenants’ suitability.
- Term Sheet: A document outlining key terms of a real estate deal.
- Title Company: A firm ensuring the legitimacy of property ownership during transactions.
- Townhouse: A multi-story home attached to others, sharing walls on one or both sides.
- Triple Net Lease: A lease where tenants pay for property taxes, insurance, and maintenance in addition to rent.
- Triplex: A building divided into three separate living units.
- Turnkey Property: A fully renovated property ready for immediate occupancy.
U
- Underwriting: The process lenders use to assess financial risk before approving a loan.
W
- Warranty Deed: A legal document guaranteeing the seller has clear title and can transfer ownership.
- Weighted Average Cost of Capital (WACC): The average rate of return an investor is expected to pay for financing.
- Wholesaling: Contracting a property and selling the contract to another buyer for a fee.
- Workforce Housing: Affordable rental options for middle-income workers.
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