In this post you we will explore some more real estate terminology to help guide you through the world of real estate with a better understanding of what all those phrases mean.
- • Capital Gain is the tax that you have to pay on any capital gain that you make. It is an additional component of your annual income tax. When you make a net capital gain, as in from the sale of a real estate investment property, you are taxed at your marginal tax rate.
• Clear Title pertains to land or property that does not have any liens debts against it including a mortgage. This is property that is owned free and clear.
• Collateral is something of value that you would use as an asset to secure a loan.
• Conveyancing is the legal work that is involved in the preparing of sales contracts, mortgage paperwork and any related documents that are used when you buy or sell a home, land or investment property. Conveyencing can be done by a licensed conveyancer, a solicitor, or you can do it yourself.
• Covenant is the agreement of one party to adhere to certain terms, conditions or restrictions in regards to a certain property. Covenants are usually only valid if they are noted on the title to the land. A covenant is also defined as a lawful restriction on the use of the property or on improvements permitted on the property. For instance, some lake side properties may have covenants restricting the building of an addition or dwelling closer to the lake.
• Decrement is a decrease in the size of a property due to erosion.
• Developer is the company or person who purchases a property with the express purpose of developing the property and reselling it for a profit. Some areas are trying to restrict developers from purchasing land in Australia in order to protect the ecological system.
• Dual Occupancy refers to a block of land or a building that is zoned to allow the owner of the property to reside with additional living quarters, separate from the owner. An example of a dual occupancy dwelling would be a duplex, or a granny flat.
Check back next time as we continue to explore the fascinating world of real estate terminology.
Sean Rasmussen
Property Options Australia
Property Options Blog © 2006 – 2008
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Hi Sean,
Another awesome list of real estate terminology. Thanks for explaining these terms in a way that I can understand.