Continued from…
Real Estate Glossary B [Part 1]
Beach
Land near a sea, lake or river. If the tide goes up and down over the land, it is called tideland; land that isn’t affected by the tide is called shore/and.
Beam
A part of a structure that holds a load in two directions.
The roof or floor above is frequently supported by a horizontal structural element.
Bearing
0° to 90° is a term used in surveying to describe the direction of a course or distance in relation to true north or south.
Bearing Header
(a) A perpendicularly placed beam to which joists are attached in framing for a chimney, stairs, or other entrance.
(b) A lintel made of wood.
(c) A horizontal structural element that spans a gap.
Bearing Partition
A structure designed to support enormous loads.
Bearing Point
This is when structural weight is focused and conveyed to the foundation at a specific spot.
Bearing wall
People call this “load-bearing” wall because it usually holds up the roof above. In a condominium, all of the walls that support the structure are owned by the apartment owners. Non-bearing walls, like some partitions, are owned by the apartment owners.
A wall that can hold more weight.
Bed-and-breakfast
A part of a single-family home that is rented out for a short time, usually in a vacation area. Breakfast may also be served in the home of the owner. Local laws should be checked to see if homestays can be used.
Bedrock
The solid rock that is under the soil and other things that are on the ground.
Solid rock that has been coated with dirt or rock pieces in most areas.
Bedroom community
A part of the community that serves as a home for people who live in a nearby or next-door metropolis. Also known as a “dorm town.”
Before-and-after method
It’s called the federal rule because it’s used to figure out how much land should be compensated for when it’s been taken by the government. Property taken: The difference in value between the value of the whole thing before it was taken and what it is worth now. If you use the before-and-after method, the amount of compensation you get in a condemnation case for taking land and severance damages is the difference between the value of the whole thing before and the value of the rest after. This is how you figure out how much money you’ll get in the end.
People sometimes get more money for their homes after they’re taken away. This “special benefit,” however, could lower their federal condemnation award. In most states, special benefits can only be used to pay for severance damages, not the part that was taken.
There are also times when appraisers use the before-and-after method to figure out whether the value of a home went up more than the costs of modernizing it.
Before-tax cash flow
Net operational profits for the year minus yearly debt service
Before-tax cash flow (BTCF)
Prior to paying income taxes, the cash flow accessible.
Before-tax cash flow multiplier
The equity split by the before-tax cash flow is the return technique.
Before-tax equity reversion
The net selling revenues less the mortgage loan’s outstanding balance.
Before-tax equity reversion (BTER)
The difference between the estimated sales price and any selling expenses, minus any outstanding mortgage amount at the point of transaction.
Belly-up
The term is used when a real estate project or business doesn’t work out.
Benchmark
A criterion used to assess the relative performance of a certain asset or management operating on behalf of an investor.
- A standard from which specific estimates are made.
A permanent reference mark (PRM) is a mark that is permanently attached to a durable object, like an iron post or a brass marker that is embedded in a sidewalk. It is used to establish elevations and altitudes above sea level over a surveyed area; it is also used in tidal observation. The PRM is also used to measure the height of the tides.
The heights are based on the official datum, and each benchmark has its own official height. Thus, a surveyor can start at any point in order to measure the elevation. Surveyors use the base elevations set by the U.S. Geological Survey when there is no datum for a place where they work.
- In this case, a major court decision that is used as a precedent or guideline for future decisions.
Benchmarking
Update and/or revise a data series in response to new information or methodological modifications.
Beneficiary
A person who has received or will get benefits in the form of particular actions.
Real owner: The person who gets something from someone else’s gifts or actions, like in the case of someone who is named to get the money from an insurance policy or a will. The trustee only holds legal title. With a trust, the trustee has the legal title, but the beneficiary gets to enjoy the benefits of owning the things that are in the trust.
Beneficiary statement
In the case of a deed of trust, this is a statement of how much money is still owed and how it is being paid off.
Benefit cost ratio
An different financing technique for calculating the ratio of benefit to cost, usually on a payback period basis.
Benefit-of-bargain rule
This is a rule of damages that allows a buyer who was defrauded to get the difference between how much money he or she lost when they bought something and how much money he or she lost when they bought something else.
Benefits
Measurable returns created by the project after completion.
People who have had their private property taken in an eminent domain case have seen their lives get better as a result. Benefits can be general, which help all the properties in the area, or specific, which help only the subject property or a very small group of properties.
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Benn
A low, linear earth and dirt mound.
Bequeath
A bequest is when you leave something to someone else in your will. To leave real estate in your will is to make a will. In modern language, the word “bequeath” is used a lot to talk about giving something away in a will, whether it’s real or personal property.
BER
The break-even ratio, which determines if the property’s income is sufficient to cover all operating expenses as well as all mortgage repayment obligations.
Berm
It’s like a ledge or shoulder, like at the edge of a paved road.
Best efforts
An insurer of a restricted partnership’s effort in raising equity for a deal.
Beta
When a manager exposes a client’s capital to the market and takes a certain degree of market risk, the result is called a market return.
Betterment
Improvements to real property, like adding a sidewalk or road, that make the property more valuable. Measure of value is not how much the improvement costs, but how much it adds to the value of your home. It doesn’t come from buying new property, and it’s not just a simple restoration of the property. It’s a capital expense, not a repair or replacement.
An enhancement that increases the structure’s capital value. A capital value that increases the utility or market value of a property. It differs from repairs or replacement in that the original character is enhanced and the value is increased. A physical modification to an existing property or piece of equipment that increases its value or utility and is not simply a restoration.
In some cases, the promotion of a scheme and the execution of authorized works can raise the value of remaining lands. Betterment refers to this increase.
Biannual
Taking place twice a year, or semiannually. People might have to pay real estate taxes twice a year, in November and May.
Bid
The price that a person is willing to pay.
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An offer to buy property for a set price, such as at an auction, foreclosure, or probate sale. Frequently, the owner of a property put up for auction will place a protective bid to prevent the property from being sold at a loss. A mortgagee may bid up to the amount of the outstanding loan at a foreclosure auction.
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Formal procedure for submitting sealed proposals by a list of contract bidders to perform specific work at a cost specified in the proposal, usually within a specified time frame. Intended to provide the client and contractors with an objective and competitive method of meeting job requirements at the lowest possible cost.
A contractor’s formal offer to complete a specific project at a given price and under the terms and circumstances indicated in the offer.
An offer to purchase (at a set or stated price) something being auctioned off.
Bid Bond
A contractor’s supply bidding procedure to the project owner to ensure that the winning bidder would carry out the contract on the conditions that they Bid security Funds or a bid.
Bid Shopping
It is the practice of disclosing a contractor’s or subcontractor’s bid to competing contractor(s).
Bid-Rent curve
A functional relationship that represents the exact maximum rent that a company with a certain profit profile may pay while still finding it worthwhile to stay in business.
Bid-Rent model
Model of how land users compete for a site that exposes impacts on how land use density is established, how competing urban land uses sort out their locations, how urban land value is determined, and why land uses vary over time.
Bidding requirements
The terms and conditions that must be followed while submitting a bid document.
Biennial
This happens every two years. Some states require real estate licenses to be renewed every two years.
Bifold Door
Closet doors typically have apertures that allow them to be folded into two sections.
Bikeways
Bike paths are paths that are specifically designed for bicycle traffic.
Bilateral contract
An agreement where both parties must fulfill their obligations.
A contract in which each party promises to perform an act in exchange for the promise to perform of the other party.
The standard real estate sales contract is an example of a bilateral contract in which the buyer and seller exchange reciprocal promises to buy and sell the property, respectively. If one party refuses to keep a promise and the other is willing to fulfill it, the non performing party is said to be in default. Neither party is obligated to the other until the non-defaulting party performs or tenders performance. As a result, if the buyer refuses to pay the purchase price, the seller is usually required to tender the deed into escrow to demonstrate readiness to perform. However, in some cases, tender is not required.
A listing form, depending on how it is worded, may be considered a bilateral contract, with the broker agreeing to use best efforts to find a ready, willing, and able purchaser for the property and the seller promising to pay the broker a commission if the broker finds such a buyer or the property is sold. When signed by both the broker and the seller, a listing contract becomes legally binding on both parties.
Bill of sale
A written document that transfers the actual title of the property from a sales perspective.
A written agreement in which one person sells, assigns, or transfers a right to or interest in personal property to another. When the owner of a store sells the building and includes the store equipment and trade fixtures, the seller of real estate may use a bill of sale to evidence the transfer of personal property. Personal property can be transferred by mentioning it in the deed or, more commonly, by a separate bill-of-sale document. A bill of sale may include or exclude warranties covering property defects or unpaid liens.
Binder
An advance payment deposit is a payment made to protect a piece of real estate under terms agreed.
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A contract formed by the receipt of an earnest money deposit for the purchase of real estate as proof of the purchaser’s good faith and intention to complete the transaction. The agreement binds the parties until a more formal contract can be prepared and executed. The receipt of the binder money, also known as the deposit, is usually documented in the sales contract.
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A written instrument that provides immediate fire and extended insurance coverage until a regular insurance policy can be issued, which is sometimes obtained while a real estate transaction is being completed.
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A title insurance temporary contract in which the insurer agrees to issue a specific policy within a specified time frame. Any defects, liens, or encumbrances affecting the title that exist between the date of the binder and the date of conveyance to the proposed insured are excluded from coverage.
Because a preliminary report is not a commitment to insure the title, it is sometimes necessary to obtain a binder or commitment from the title insurer stating its willingness to insure the title, especially in complex transactions with multiple simultaneous closings.
A sort of deposit document used to preserve a buyer’s and seller’s right to acquire a home at a predetermined price and term.
Binder Deposit
The portion of a property’s total price that a buyer pays to the seller in exchange for the right to buy the property.
Bipass doors
They are commonly used for closets and slide one behind the other.
Bird dog
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A salesperson whose sole responsibility it is to “flush out” new listings. When a lead is obtained, the bird dog salesperson transfers the transaction to a broker or a more experienced salesperson.
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Any person who can provide leads, such as a postal carrier, mover, barber, or beautician.
Biweekly Mortgage
Is a payment plan for a mortgage loan in which the borrower makes payments to the principle and interest every two weeks rather than once a month.
Biweekly payment loan
A loan that requires 26 half-month payments per year, resulting in a loan retirement date that is earlier and lower total interest costs than a typical fully amortized loan with regular monthly payments.
Blacktop
Asphalt paving is a type of pavement that is commonly found in streets and driveways.
Blanket mortgage
A loan that covers multiple pieces of real estate.
The commitment of two or more pieces of property as security for a single debt.
A mortgage secured by a number of properties or lots. A blanket mortgage is frequently used to secure construction financing for planned subdivisions or condominium developments. The developer typically seeks to have a “partial release” clause inserted into the mortgage in order to obtain a release from the blanket mortgage for each lot as it is sold, according to a specified release schedule. For example, if a developer obtains a $500,000 mortgage to cover the development of 50 lots, he may be required to pay off $12,500 of principal to release each lot from the blanket mortgage.
Land developers may include a “special recognition” clause in their blanket mortgage, under which the lender agrees to recognize the rights of each individual parcel owner even if the developer defaults and a foreclosure occurs. On rare occasions, the federal government obtains a blanket lien against all properties owned by people who have fallen behind on their income taxes.
A blanket mortgage is also used when a buyer buys a house and an adjacent vacant lot and finances the transaction with a single mortgage that covers both properties. It may also be used in cases where the equity in a single property is insufficient to meet the lender’s requirements.
Blankets Fiberglass or rockwool
Insulator is used for unique handling, lengths, and widths required for metal building, which is available in large rolls of 15 or 23 inches wide.
Blended rate
A newly refinanced loan with an interest rate that is higher than the existing rate but lower than the current market rate; frequently used with a wraparound mortgage.
Blended rate mortgage
A rate of interest that applies to a refinanced mortgage and is calculated as the average of the past and present rates.
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Blighted area
A declining area, usually in the city centre, where real property values are seriously impacted by negative influences such as encroaching inharmonious property use mixtures or rapidly depreciating buildings, with no immediate prospect of improvement.
Blind Ad
An advertisement that does not include the advertiser’s name or address, only a phone number or post office box address. Blind ads are generally prohibited by state license laws for licensed brokers.
Blind fund
A real estate investment trust that has received funds but has yet to invest in any properties.
Blind pool
A company’s business investment in which the property is not identified in advance but is purchased after the funds have been raised.
A securities offering of unspecified and yet-to-be-determined properties; a non-specified property offering in which an investor typically relies on the general partner’s ability to locate and put together suitable investments. Some states, such as New York, prohibit blind pool offerings, which means that securities can only be offered in existing, selected properties or specific properties proposed for development. Other states allow blind pool offerings that meet certain
Blind pool syndication
A sort of limited partnership in which the promoter gathers a group of investors to acquire an undesignated asset of a specified type.
Block out
To install a barrier within a foundation wall so that concrete does not enter the arena.
Blockbusting
An illegal and discriminatory practice in which one person induces another to enter into a real estate transaction in which the first person stands to profit financially.
An illegal and discriminatory practice in which one person induces another to enter into a real estate transaction from which the first person may profit financially by inferring that a change may occur in the neighborhood with respect to the occupants’ race, sex, religion, color, handicap/disability, familial status, or ancestry, a change possibly resulting in the lowering of property values, a decline in the quality of schools, or an increase in the crime rate. In general, blockbusting violates both state and federal anti-discrimination laws governing fair housing.
Blocked (door blocking)
Shims of wood are used between door frames to keep doors semi-open, allowing controlled access and egress to the shaft.
Blocked (rafters)
It is used to keep rafters and ceiling joists from twisting at their bearing points.
Blocking
A collection of small pieces of wood used to space, join, or reinforce members.
Blow insulation
It’s utilized to insulate existing walls with no exposed framing components.
Blue book
One of a plethora of useful reference books that list new and used values as well as amortization and balloon payment tables.
Blue laws
Colonial-era laws prohibiting business transactions on Sundays and certain religious holidays. The name comes from the practice of printing these laws on blue paper in the beginning.
Blue print(s)
This is a copy of a technical drawing that documents architecture or engineering design.
Blue Sky Laws
States enacted that safeguard the public from securities fraud.
State securities laws are intended to protect the public from deceptive practices in the promotion and sale of securities (“promising the sky”), such as limited partnerships, syndications, and bonds. Blue-sky laws typically require that securities be registered with the securities commissioner in the state where the offers are being made, and that the issuer disclose to prospective purchasers all relevant facts about the investment (typically in a prospectus). Unlike federal securities laws, some state laws impose qualitative standards on securities issuers and require that each offering be “fair, just, and equitable.” This requirement may be used to limit the amount of commissions or other compensation paid, the nature of the investment, or other related matters.
Blue stake
Another way to say Utility Notification. It is used to notify the owners and operators of underground facilities.
Blueprint
A working plan used by trades people on a construction site; an architectural drafting or drawing that is transferred to chemically treated paper by exposing it to strong light, causing the paper to turn blue and thus reproducing the drawing in white.
A plan created by an architect to explain a structure’s drawing.
Board
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A local chapter of the state REALTOR® association, which is affiliated with the National Association of REALTORS®.
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Occasionally used to refer to the state real estate commission.
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Occasionally refers to a condominium or cooperative community’s board of directors.
Board Approval
A provision in a cooperative sales contract that states that one of the requirements for completing the transaction is that the buyer be accepted by the board of directors.
Board foot
A one-foot square by one-inch thick piece of timber; 144 cubic inches = 1’ x1’ x 1 "
A specialized unit of lumber volume measurement. It’s the volume of a one-foot length of one-foot-wide-by-one-inch-thick-board.
Board of adjustment
In municipal zoning law, a board of citizens is selected by the governing body to hear and rule on zoning variance appeals. The board of adjustment is special in that its decisions are definitive rather than just suggestions to the governing body. They can only be challenged in court.
Board of directors
A corporation’s governing body, which is allowed to carry out and regulate the company’s business activities and whose members are chosen by shareholders on a regular basis. Unless otherwise specified in the bylaws, directors are not obliged to be shareholders of the corporation. The minimum number authorized is set by state law, as is the amount that must be inhabitants of the state.
A director who works as a broker in negotiating the sale or acquisition of corporate property may not earn a commission for services unless the board of directors expressly authorizes him or her to do so.
A board of directors normally governs a condominium owners’ organization. Among other things, the board is obligated by law to ensure that proper insurance is secured if the bylaws demand it. Individual directors might face personal culpability if they do not comply.
Board of REALTORS®
A local organization of licensed real estate brokers and salespeople known as REALTORS® and REALTOR-ASSOCIATES® who are members of the National Association of REALTORS® and the state REALTORS® associations. In the United States, there are over 1,800 local boards of REALTORS®, however some are referred to as organizations.
Body corporate
A legal corporation in charge of the administration and upkeep of a unit site’s common areas. It is made up of a group of owners who have elected a committee.
Owners of offices, dwelling units, flats, town houses, and other communal property form a legal administrative group.
The control and administration of common property is vested in a statutory Body Corporate under legislation relating to villas, town houses, flats, or home units, which comes into existence automatically upon the registration of the plan and is exempt from the provisions of the Companies Act. The members of the body corporate are the registered proprietors of the units. Scheduled by-laws define the rights and obligations. Easements are also provided for the protection and enjoyment of the units and common property. The term also refers to shareholders in Company Title units.
Body corporate levy
The fee that a group of people pay to a body corporate to pay for things like administrative costs for the group’s common property.
Boiler room
A dubious promotional practice in which land sales businesses make frequent “cold pitch” phone calls to the general public in order to generate leads for the sale of real estate, generally unoccupied land or property in another area or state. Real estate licenses are frequently needed by telephone solicitors.
Boilerplate
A contract’s conventional, established wording, such as that found in most mortgages, contracts of sale, contracts for deed, leases, and CC&Rs (covenants, conditions, and restrictions). If the language is overly one-sided, the contract may be deemed an adhesion contract. Any vague or confusing clauses in a form contract or lease are construed against the party that provided the form.
BOMA
The Building Management teams Association is a non-profit organization that represents building managements.
BOMA standard method
BOMA created a standard way to measure office building.
Bona fide
Real, truthful, and sincere
Bona fide purchaser (BFP)
A party that purchases property in good faith and for a valuable consideration without knowledge of the prior rights or equity of third parties, whether actual or constructive. BFPs are usually protected by state recording legislation from third parties that have a prior unrecorded interest in the same property.
Bond
A bond is paid as assurance that the tenant will not violate the terms of the lease and will vacate the premises in good repair and order.
Bond Market
Is a financial market where treasury bonds can be bought and sold.
Bond or bonding
A contractor’s license is protected by terms and conditions.
Submitted with a bid as a promise to the bidder’s recipient that, if the offer is accepted, the contractor would execute the contract in compliance with the contract documents’ bidding conditions.
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A written commitment that usually comes with a mortgage and serves as the primary proof of the debt obligation covered by the mortgage; also known as a completion bond or a performance bond.
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A debt instrument; a financial obligation; a security issued by a company to borrow money. A mortgage bond might be secured or unsecured (debenture).
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A government-issued interest-bearing certificate used to fund real estate developments and community enhancements such as schools and parks. Property taxes will be used to pay back general obligation debts.
Is a loan instrument issued by the government or a corporation to raise funds for the purpose of obtaining a contractor’s license.
Bonus clause
A prepayment clause in an installment contract, deed of trust, mortgage, or note that requires the lender to make a special payment if the loan is paid in full or in part before the due date.
Book value
The initial cost of the property includes the amount of any modifications, less any tax deductions. This is the value that is recorded in the financial statements of the owner.
The value at which assets are recorded on a company’s books of account (i.e., its accounting records); typically, cost minus accrued depreciation or cost recovery allowances.
The value of an asset on a person’s, partnership’s, association’s, or corporation’s financial records.
Based on the technique used for computing depreciation throughout the asset’s recovery period, book value is the capitalized cost of an asset less depreciation taken for accounting reasons. It is the asset’s adjusted basis, which is frequently different from its assessed or market value. The basis for calculating profits or losses from a sale is book value. By adding the depreciated value of the improvement to the assigned value of the land, the book value of a property may be easily calculated.
Boom
A device that is used to elevate or lower a load.
Boot
The similar asset that is added in a property trade to balance the transaction’s value.
“Money or other non-like-kind property supplied to make up any value or equity differential between swapped goods.” Cash, notes, diamonds, or the market worth of an item such as a mortgage, land contract, personal property, goodwill, or a service or patent supplied in return can all be used as a boot. In a like-kind exchange, taxable gain is recorded immediately up to the amount of the boot, but extra gain can be postponed until a later transfer.
Assets obtained in return for what would otherwise be an exchange of totally like-kind assets. Boot receipt may result in tax liability in what would otherwise be a tax-deferred transaction.
BOQ A bill of quantities (BOQ)
Materials, parts, and labor (along with their costs) are enumerated in this form, which is used in construction tenders.
Bottom chord
A truss’s lowest longitudinal member. It is normally horizontal, although depending on the truss design, it may be inclined.
Bottom-up approach
A method for creating an analysis using the most disaggregated data available.
Bottom-up approach to investing
A top down investing strategy in which large-scale trends in the general economy are examined and assets selected that are likely to benefit from those trends, as opposed to bottom up investing in which large-scale trends in the general economy are examined and assets selected that are likely to gain from those trends.
Bottomland
When both parties to a property transaction assume liabilities (mortgages, deeds of trust), the liabilities’ amounts are tallied to establish a net boot. An excess amount of obligation acquired by one of the exchange parties is passed on to the other. This is true regardless of whether the party receiving the property admits the obligation or just accepts the property subject to the liability.
Bottom plate
The horizontal beam on which partition studs are installed. Also known as the ‘sole plate.’
Boulevard
A large street with or without a median strip that is usually shorter than a freeway and serves through traffic on a continuous path.
Boundaries
The boundaries or perimeters of a parcel of property as defined by legal description." Boundary disputes are disagreements between adjacent property owners about the correct position of the dividing line between their properties. Some adjoining property owners sign into a boundary agreement in which they agree that a certain separating line, such as a fence, acts as the genuine boundary of the properties.
A common source of contention is when the branches of a tree on one owner’s land grow over the boundary line into the property of a neighbour, infringing the neighbor’s air rights. In certain places, the neighbour can chop the branches up to the boundary line or file a lawsuit for monetary penalties and nuisance abatement. Prudent buyers request the seller to stake or survey the property to reduce the danger of boundary disputes.
Bounds
A direction reference based on terminal points and angles. In a metes-and-bounds legal description, metes symbolizes length measurement and limits the length to a certain region.
Box Crib
A wooden tool used during construction to support heavy objects.
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