Property matters can be complicated at the best of times, so want to make sure you understand the lingo used by estate agents, so you can make informed decisions and know exactly what’s going on. Below is our guide on the most common jargon and buzzwords used by estate agents.
An appraisal is a valuation of your home, usually carried out by an estate agent, to determine how much your house is worth.
AST (Assured Shorthold Tenancy)
An assured shorthold tenancy is the most common type of tenancy in the UK. It involves the agreement and terms between a landlord and the tenant to privately rent the property. It will be for a fixed period and usually for less than £100,000 per year in rent.
Below Market Value
Below market value means that the property is available to buy at a price that is below the actual market value, usually because the seller wants a quick sale.
A break clause will usually be mentioned with assured shorthold tenancies (see above). This clause means that the renter can leave the tenancy agreement (see below) before the end date, as long as the correct processes are followed. It also means the landlord can end the tenancy early, as long as they too follow the correct processes.
If a property is chain free, it means the sale of that property is not reliant on another sale going through. Chain free property sales can often go through quicker and with less stress than property sales that are part of a chain.
Conveyancing is when the property is legally transferred from one owner to another. The conveyancing process needs to be carried out by a solicitor or conveyancer and begins when an offer has been accepted.
When a sale reaches completion, the keys can be exchanged, and the buyer can move into their new home. The completion day will be the final step in the property buying process.
The deeds of a property are the legal documents that confirm who owns that property.
Energy Performance Certificate
An Energy Performance Certificate, or EPC, is a legal requirement of every home. It is a certificate that details how energy efficient a property is and can give an idea of how much the energy bills will cost. The certificate records a rating for the property from A to G (A being the most efficient and G the least).
The equity of a property is how much you own of it – so it will be the difference between the value of the property and how much is still left to pay on the mortgage.
When you buy a freehold property, you own both the property and the land it is located on.
A guarantor is a person who agrees to make the repayments of a loan if the original person cannot keep up with the payments. A guarantor is often used for renters as a way of guaranteeing the rent will always be paid.
Ground rent is paid on leasehold properties (see below) to the freeholder.
A joint tenancy is when two or more people have signed the tenancy agreement and so are jointly responsible for paying rent and adhering to any terms set out in the agreement.
When you buy a leasehold property, you own the property, but you do not own the land that it’s on. The leasehold will usually last for a set period of time, but you will be able to extend it.
Negative equity is when a property is valued as less than what is left to pay on the mortgage. When a property is sold with negative equity, no profit is made.
Searches are carried out during conveyancing (see above) and involve checks on the property to see if there is anything that could affect its value before the buyer confirms.
Sold Subject to Contract
When a property is sold subject to contract, it means that an offer has been made and accepted but that contracts have not yet been exchanged. Properties that are sold subject to contract could still end up back on the open market, as the sale isn’t final.
Stamp duty is a tax that will be paid by the buyer of a property. The stamp duty rates will vary depending on the value of the property and whether the buyer is buying a property for the first time.
A tenancy agreement sets out the terms and conditions for a tenancy, including what is expected of the tenant, when the rent will be paid, and how long the tenancy is for.
The vendor is the person who is selling the property, also sometimes known as the seller.
Cairds is an experienced estate agent and letting agent in Epsom, Ashtead and the surrounding areas, with unrivalled local knowledge. If you’re looking for a new home or your selling your home, Cairds estate agents can help you, making the entire process easy and stress-free. Contact us to speak to our friendly team about your property needs.