Need to understand what we are saying? Here is a glossary of terms for you.

Acre - The non-metric measure for an area of land measuring approximately 4,045 square meters.

Appraisal - An estimate of the market value of land and improvements at a particular point in time.

Approved - In real estate development terms it is an adjective generally used to describe a piece of land that has a local authority permit in place.

Auction - A public sale in which a property is sold to the highest bidder.

Auctioneer - The individual who runs an auction.

Balloon Payment - The final lump sum payment that is due on the outstanding loan amount, often larger than previous repayments.

Beneficiary - The person designated to receive the income from a trust, estate, or a deed of trust.

Body Corporate - A body corporate is an incorporated entity and administrative body comprised of each of the lot owners in a community titles scheme.

Breach of Contract - Breaking the terms or conditions of a contract.

Brick Veneer - A single skin brick on an external wall.

Bridging Finance - Finance obtained over a short period as a prelude to long term financing.

Capital Gain - The monetary gain obtained when an asset is sold for a higher price than you originally paid for it.

Capital Growth - The increase in value of an asset (i.e. the difference between the current value and the original purchase price).

Capital Loss - The monetary loss realised when an asset is sold for lower price than you originally paid for it.

Cash Flow - A measure of the inflow and outflow of cash.

Chattels - Property other than real estate, movable possessions which may be included in a sale (e.g. furniture etc.).

Caveat - Caveat is Latin for ‘beware'. A caveat can be lodged on the title by anyone with a legal interest in the property and can effectively prevent the sale of the property.

Certificate of Occupancy - A document issued by a local authority to a developer permitting the property to be occupied.

Certificate of Title - A certificate that provides details of a piece of land and details of its owner. A certificate of title contains registered owners details, tenancy details, registered plan details, local authority details, easement details, encumbrance details, interest details, administrative advices and unregistered dealings.

Collateral - An asset used as security by a financier.

Common Property - All property located within a community title scheme that is not registered on the title of the lot owners (e.g. driveways, gardens, lifts, pools etc.).

Community Title - A method of titling land to allow people to maintain separate ownership of their land while having a shared interest and responsibility over common property (e.g. driveways, gardens, lifts, pools etc.).

Conveyancing - The legal process involved in transferring the ownership of a property.

Covenant - Terms, conditions and restrictions noted on the title of a property. Developers sometimes place restrictive covenants on buyers defining the type of house (e.g. size, style etc.) that can be built on the land. Not all jurisdictions allow building covenants to be registered on title.

Default - Failure by a party to meet the terms of an agreement.

Density - A measure of the number of buildings permissible for a given area of land.

Down Payment - The cash paid by the borrower that represents the difference between the sale price and the loan amount (also referred to as the deposit).

Drawdowns - The progressive disbursement of funds from a financier.

Due Diligence Analysis - the process of investigation to determine the potential risks of a project.

Easement - A right or interest given by a landowner to a third party regarding a property. For example, the right to run a storm water pipe through the neighbour's property.

Encumbrance - A claim or lien on a property which can hinder the seller's ability to pass an unencumbered title to the buyer.

Encroachment - Part of a house or establishment illegally overhanging the street or a neighbour's property.

Equity - The value of an asset less any liabilities (e.g. mortgages).

Fittings - Objects that can be removed from a property without causing damage to it.

First Right of Refusal - A provision in an agreement that gives a party the first opportunity to purchase or lease the property before it is offered for sale or lease to others.

Fixed Interest Loan - A loan priced at a fixed rate of interest for a set term. Interest rate and repayments remain the same during the fixed term of the loan regardless of interest rate changes in the market.

Fixtures - Fixed items that cannot be removed without damaging either the property or the fixture.

Freehold - Tenure involving the ownership of land for an indefinite period of time.

Gazumping - Where the seller agrees to sell a property, but then sells it to someone else or raises the price.

Gearing - The use of borrowed funds to purchase an item. Same as leveraging.

General Tax Rule - GST on sales is calculated on the sale price.

Gross Floor Area (GFA) - Although different local authorities have different definitions, GFA is generally the sum of the fully enclosed covered floor area of a building less the garage. Unenclosed floor area (e.g. balconies) and mezzanine floor areas (e.g. common stairwells) are generally calculated separately and added to the GFA to derive a total floor area (TFA) of the building.

Gross Realisation (GR) - The total value of all revenue items in a project.

Guarantor - A person who agrees to indemnify a financier of all or part of the outstanding balance of a loan in the event of the borrower defaulting.

Hectare - The metric measure for an area of land measuring 10,000 square metres (approximately 2.47 acres).

Holding Deposit - An amount of money given by a buyer to the seller. It shows the buyer's serious commitment to the property, but is not compulsory and is refundable if the offer is rejected.

Jointly and Severally - Refers to the situation in joint loans where all borrowers are fully responsible for the loan repayments (i.e. if one person defaults on the loan repayments the other borrowers are responsible for that person's share of the loan).

Joint Venture - A project undertaken by two or more parties.

Lease - A document which grants a person (or legal entity) tenancy of a property for a specific period on specific terms.

Leasehold - Tenure involving the right to possession and use of land for a fixed period of time subject to certain conditions.

Lessee - A person (or legal entity) who leases property.

Lessor - The owner of a property who leases the property to another person (or legal entity).

Leverage - The use of borrowed funds to purchase an item. Same as gearing.

Lien - A legal claim on another's property as security for the payment of a debt.

Line of Credit - A loan facility whereby the financier allows the borrower to drawdown the facility to a pre-agreed limit.

Loan to Value Ratio (LVR) - The amount of the loan as a percentage of the assets value.

Margin Scheme - An alternative to the general tax rule where GST on sales is calculated on the ‘margin' as opposed to the sale price. Depending on when the property was purchased and who it was purchased from, the margin is generally the difference between the sale price and the amount the seller paid for the property, or the sale price and the approved valuation of the property as at 1 July 2000.

Mezzanine Finance - Additional finance raised beyond senior finance. Same as subordinate finance.

Mortgage - An agreement that pledges a property to the financier as security for payment of a debt.

Mortgagee - The financier in a mortgage agreement.

Mortgagor - The borrower in a mortgage agreement.

NIMBY - Stands for ‘not in my back yard'. The term refers to people you are opposed to development in their area.

Nominee - A person or legal entity acting on behalf of another.

On the Market Sites - those sites that are publicly advertised and are officially for sale.

Off the Market Sites - those sites that are not publicly advertised and are generally considered to be not for sale.

Off the Plan - Refers to the purchase of property before it is completed. Same as presales.

Principal - The amount borrowed or still to be repaid.

Private Sale - The sale of a property by the owner without using the services of a marketer or real estate agent.

Private Treaty Sale - The sale of a property by the owner using the services of a marketer or real estate agent.

Purchase Contract - A written agreement which details the terms and conditions regarding the purchase of a particular property.

Refinance - The process of changing a loan from one financier to another.

Rental Yield - The annual rent of a property as a percentage of the purchase price.

Reserve - The minimum price a seller will accept at auction.

Reticulation - Formation of a network of individual lines to service urban land on establishment of principal utility services (e.g. supply of water to individual houses from a water main).

Return on Cost - A performance measure that is calculated by dividing the development profit by the total development cost and multiplying by 100%.

Rezoning - The change in zoning of land. Either the result of a new local authority plan or a successful development application.

Right of First Refusal - A clause in an agreement that gives one or both of the parties the first opportunity to buy or lease a property.

Scope of Works - Details of the extent of work to be performed. Often accompanies a quotation from a consultant.

Senior Finance - Finance registered by a first mortgage.

Services - Utilities such as electricity, gas, sewer, telephone, and water.

Serviceability - The ability of a borrower to service loan repayments.

Setback - The horizontal distance between a buildings and the boundary of the lot.

Site Flicker - Individuals who purchase sites with development potential and go on to obtain the necessary local authority permits and then sell the site.

Skillion - A roof set at one angle without a ridge.

Slider - A project that involves the relocation of a building to one side of a piece of land which is then subdivided into two or more pieces.

Splitter - A project that involves the subdivision of one piece of land into two.

Strata Title - A form of community title that allows for the horizontal and vertical subdivision of property into separate titles.

Subordinate Finance - Additional finance raised beyond senior finance. Same as mezzanine finance.

Title - Evidence of a persons right to ownership in real property.

Torrens Title - A titling system whereby dealings and ownership of land are managed by a central register.

Unencumbered - Describes a property free of mortgages, covenants, restrictions, etc.

Variable Interest Loan - A loan priced with an interest rate that can vary over the term of the loan.

Vendor - Another name for the seller of a property.

Yield - The number of properties that may be developed on a piece of land.

Zero Lot line - The location of a building on a lot whereby the exterior wall of the building rests on the boundary of the lot.

Zoning - The legislative regulation that controls the use of land in a particular area.