Real Estate Glossary V [Part 1]

Terms Beginning With - V

Property Development & Investment Glossary, Terms & Definitions

VA-guaranteed loan

A government-guaranteed loan that enables veterans to acquire home mortgage loans that they might not otherwise be eligible for.


Number of unoccupied dwellings or commercial spaces in a region at a given time (usually expressed as a vacancy rate).

Vacancy allowance

A measure of housing market demand; an indicator of the optimal vacancy rate (which, for example, is one that allows the market to function smoothly and efficiently by encouraging household mobility).

Vacancy factor

A discount or allowance for the estimated number of empty units in a rental project. The vacancy rate is the number of empty units in a project or area as a percentage of the total number of units. When putting together an investment income analysis of a property, such as an apartment building, the number of empty units and the amount of rent lost are very important.

The U.S. Census Bureau, regional housing reports from the Department of Commerce, and local utility companies are all good places to get up-to-date information on vacancy factors.

The expected vacancy rate of a property.

Vacancy rate

The anticipated rate of the percentage of unoccupied rental units in a particular year.

The proportion of a market’s total supply of a given commercial property type that is unoccupied and available for rent at any given time.

Vacant land

Land that has not been renovated.


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Vacant possession

In the context of real estate, this describes a right to possession of unoccupied ground or built-up property.


To relinquish one’s right to occupy or possess something.

To emigrate

Vacation home

A place to live, often in a resort or vacation area. It is often a second home used for recreation. Federal tax laws limit the business deductions an owner can claim for renting out a second home if the owner uses it for personal use more than 14 days or 10% of the number of days it is actually rented, whichever is greater. If the limit on personal use is exceeded, cost recovery, maintenance, and utilities can only be deducted for the rental portion of the year, and then only if rental income is more than interest and real property taxes.

Vacuum piping

The pipe that leads from a pump’s suction side to a vacuum fitting at the pool’s bottom, where it may be used to attach equipment for underwater cleaning.


A legitimate contract must meet all of the requirements of contract law in order to be considered legal. There must be suitable formalities, legal criteria, sufficient legal force to withstand an assault and a legitimate purpose for a contract in order for it to be valid.


Two sloping roof sections that meet at an angle to produce a V-shaped space.

Valley flashing

To prevent water from entering the valley, a water barrier made of aluminium was built.

Valuable consideration

The giving of a right, interest, or profit, or the taking of a legal loss or default, by one party in exchange for another party’s performance, usually to get them to sign a contract. In the past, the law of conveyances has made a distinction between valuable consideration and good consideration. Good consideration is love and affection that can’t be measured in money, such as when a father gives an estate to his son or daughter as a gift.

Valuable consideration is always enough to back up a contract, but sometimes good consideration isn’t enough. Modern courts only talk about “consideration,” and love and affection wouldn’t count as a valid consideration. For example, a father might agree to give his son the title to a piece of real estate if the son agrees not to smoke, drink, or hang out with people of questionable moral character before he turns 21. If the son agrees to forbear, he can enforce the contract when he turns 21. This is because he gave his father something valuable in exchange for his father’s promise.

But if the father had agreed to give the son ownership of the property because of how much the son loves and cares for him, the son could not force the father to give him the property. Even though it would be enough to pass title if it was written in the deed, it is not enough to support the contract because the son has not given up any rights or made any promises.


A sworn valuer usually provides a documented estimate of a property’s worth to the lender in order to determine the actual loan to value ratio and if lenders mortgage insurance is necessary.

A report that the lender wants to see that shows a professional’s opinion of the value of the home.

An inspection of a home that is done by a licenced inspector to figure out how much it is worth. Usually used by lenders to figure out how much a security is worth.

A property inspection conducted by a licenced inspector with the goal of determining the house’s market value. Lenders frequently use this method to determine the value of securities.

Valuation fee

Fees that may be charged if the lender wants to pay for the cost of valuing the property that is being used as collateral for a loan, like a house.

The sum that a borrower must pay to cover the expense of a property inspection.

Valuation report

A record of the assignment’s instructions, the reason and foundation for the valuation, and the outcomes of the analysis that produced the assessment of worth. In addition to presenting relevant data utilised in the study, a valuation report may also describe the analytical procedures used to carry out the appraisal. Oral or written valuation reports are both acceptable. The intended user, legal requirements, the type of property, the nature and complexity of the assignment, and the report’s form, substance, and length differ. Valuation Report and Valuation Certificate are also used interchangeably.


An item’s ability to demand other items in exchange for the present value to typical users and investors of future benefits resulting from property ownership; the amount of money considered to be the equivalent in value of the relevant property. A product’s value is derived from its demand, utility, scarcity, and transferability (DUST). Cost and equity do not equate to value.

It’s important to note that there are a number of different kinds of values. Market value is applied in the vast majority of real estate transactions.

In addition, the location of a property is one of the most essential variables in determining its value. Size and design, usability, accessibility, and exposure are also important concerns. It’s common for business streets to be more valued on the south and west sides, as people prefer the shady side and merchandise is protected from the sun.

The value or utility of a product or service.

Value added

Fixing a problem that has caused accumulated depreciation is expected to raise the property’s value.

Value added real estate investments

Property investments that are slightly riskier than Core-Plus and seek internal rates of return of 11% to 15%. Value-Added Real Estate Investments have debt ranging from 50% to 75% of the property’s value and rely on local knowledge more than Core or Core-Plus Investments.

Value engineering

Technique for comparing costs and values of various materials, tools, and systems.

Value in exchange

The monetary worth that an asset may demand on the market.

Value in use

The worth of an asset to its owner or a potential buyer.

The current value of future ownership benefits.


A person who is (a) certified by the Australian Property Institute as a Certified Practising Valuer; (b) a member of the Australian Property Institute; or (c) registered, licenced, or approved to perform property or plant and machinery valuations under any State, Territory, or Commonwealth legislation.

Vapor barrier

A substance used to stop condensation on walls from causing moisture damage.


Something that can be measured and evaluated about a person, place, property, location, or phenomenon, and whose value can change depending on the context of the observations being made.

Variable expenses

The running costs fluctuate depending on the property’s occupancy.

Utility bills and other expenses that rise and fall with occupancy levels.

Variable interest rate

They move up and down as the rate of interest on a variable-rate home loan changes with the market.

Lenders can change the interest rate on a loan with a given amount of notice, based on an agreed-upon basic index, such as the prime rate, under a modern finance method. Although the monthly payment is the same, the portion of the payment that goes toward principal repayment varies depending on the current interest rate. The variable interest rate payment is a contrast to the fluctuating payments of adjustable-rate mortgages. ’ As an illustration, consider the following scenario:

A lump sum of $50,000 to be paid in equal monthly installments of $400, with interest accruing at a rate of 7 percent per year or 2 percent higher than the prime interest rate at the Bank of Primo, whichever is greater, provided that the interest rate does not exceed the maximum rate permitted by law, and the unpaid balance being subject to interest at that rate.

Mortgages with a one-year term and a 20-year amortization are a version of this principle. New interest and principal payments are stretched out over a 19-year period when a loan is renegotiated at the end of the year at the current interest rate. Every year while the loan is outstanding, this process repeats itself.

Variable rate

A variable interest rate that changes over the loan’s term. They are typically based on a benchmark rate, like the prime rate of a nation.

Variable rate loan

A loan with a variable interest rate.

Variable rate mortgage (VRM)

A mortgage with variable interest based on a specified index rate.

A financing instrument that allows the lender to change the interest rate with advance notice depending on a certain base index.

Variable-payment plan

A plan for paying off a mortgage that lets a person make small payments at the beginning of the loan and larger payments in later years, likely as the mortgagor’s income grows.

This is also called a “flexible-payment mortgage,” and its goal is to make it easier for people to get loans by basing payment schedules on how much money they expect to make. The variable index could be something outside of the lender’s control, like the interest rate on government bonds, or something inside, like the rate paid on the lender’s savings deposits.


A measure of the spread of potential values around the midpoint of a probability distribution of possible outcomes, which is widely used as a risk indicator. The standard deviation multiplied by the square of its value.

Any discrepancy between projected and actual estimations (in time or costs).

Permission from the government’s zoning authorities to build something or do something that is expressly forbidden by the current zoning laws; a way around the zoning laws. A variance gives the zoning game a little bit of wiggle room.

The applicant usually has to explain why they wouldn’t be able to use the land or building in a reasonable way if it could only be used for what’s allowed in that zone. They also have to explain why their request is unique and not just a result of how things are in the neighborhood as a whole, and how the use they want won’t change the essential character of the area or go against what the zoning code is meant to do.

For example, you could ask to build an apartment in a single-family residential area or ask to build a building that is bigger than what is allowed.

The dispersion of an ex ante distribution probability about its predicted value, or of historical (realized) cash flows or returns around the mean value.

A variance from the appropriate zoning restrictions for a specific property. Only when the zoning ordinance causes the property owner excessive hardship will it be granted.

A modification to a zoning ordinance’s particular standards because of unique features of the land.


A contract or its terms that has been added to, left out of, or changed.


VAT stands for Value Added Tax.

VATA 1994

The Value Added Tax Act of 1994.


The buyer of real estate under a contract for deed or articles of agreement.

The person who buys real estate; the buyer. The person who signed the contract for the deed.

A person who buys real estate.


The person who sells real estate under the terms of an article of agreement or a contract for conveyance.

A property owner who decides to put their house on the market.

The one who sells property. Under contract for deed, the seller. In some situations, the seller might not be the owner, but might be the person who has an option on the property.

A person who sells real estate.

Vendor Discounting

The gap between a property’s original advertised asking price and the amount for which it is actually sold

Vendor Sale

A transaction conducted by the owner without the involvement of a real estate agent

Vendor terms contract

when a property is purchased over time-typically with a down payment and then regular payments of the balance, plus interest, over a period of several years.

Vendor’s lien

The grantor’s equitable lien on the land conveyed in the amount of the unpaid purchase price. Because it is just an equitable right to rely on in the event that the whole purchase price is not paid, unlike a mortgage, it does not constitute an absolute interest in the property.

Vendor’s affidavit

A statement made by the seller in a document that is sworn to be true that they have not encumbered the title to any real estate without fully informing the buyer.


A thin layer of one material on top of another. For example, mahogany veneer on less valuable wood, or a brick finish on the outside of a wood frame.

A framed wall covered with a thin ornamental sheet of wood.


A small hole that lets air move through any space in a building, like an attic or the area under a first-floor building that hasn’t been dug out.

A conduit via which gases and air can move.

Venture capital

Money that isn’t guaranteed and is put toward an investment. Because it is risky, it usually has the highest rate of return.


The place where the reason for the lawsuit happened or where the jury is chosen and the trial is held. The word “venue” comes from the Latin word for “to come.” The county and state where the acknowledgment is made and where the person making the acknowledgment is appointed are written on the acknowledgment. This is called the venue.


To swear an oath or affirmation. Verification of claims in small claims court is a requirement. Price, financing, motivation, and other aspects of a transaction are all confirmed in a market data study used in real estate appraisal.


A mineral that expands when heated that is hydrous. used in building.

Vested interest

A present right, interest, or title to real estate that comes with the right to transfer, even if the right to use the property won’t be used until some time in the future. For example, when Hosea gives Evita the right to live on his ranch for life, the property goes back to Hosea when Evita dies. A vested interest is the reversion.


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Entryway to a building or room with a little entrance hall.

Vesting options

Options available to buyers when buying property.

Veterans Administration (VA)

A federal agency that grants house loans to veterans who qualify.

A federal organisation that offers low-downpayment mortgages to veterans and their families.

Veterans Affairs (VA) A U.S. government

Department whose mission is to assist veterans in reintegrating into civilian life.

Veterans affairs (VA) loan

GI loans refer to a government-sponsored mortgage aid programme. The Servicemen’s Readjustment Act of 1944, as amended in 1952, 1974, 1978, 1980, and 1987, allows eligible veterans and un-remarried widows or widowers of veterans who died in service or from service-connected causes to obtain partially guaranteed loans for the purchase or construction of homes or the refinancing of existing mortgage debts. The Department of Veterans Affairs administers VA-backed loans.

The primary objective of the GI loan is to assist veterans in financing the purchase of moderately-priced properties, including condominium units and mobile homes, with minimal or no down payment, very simple eligibility requirements, and a relatively low interest rate. The VA programme encourages private lending institutions to issue mortgages with high loan-to-value ratios by guaranteeing a portion of the loan against default.

Contact any Department of Veterans Affairs Regional Office or the majority of VA-approved lending institutions to determine eligibility. A veteran is generally qualified if he or she served at least 181 days of active duty between September 16, 1940 and September 7, 1981. The minimum obligation is ninety days of active duty during particular combat periods. To be eligible, enlisted members of the armed forces who joined after September 7, 1980, or commissioned officers who joined after October 16, 1981, must complete a total of two years of active duty. Certain members of the Reserves and National Guard with six years of service are also eligible. A special provision permits active-military soldiers with fewer than two years of service to get a VA-guaranteed home loan after 181 days of service, as long as they remain on active duty.

Eligibility and loan guarantee: The VA imposes no maximum loan limits, merely the greatest potential loan guarantee. The maximum loan guarantee under Public Law 1 10-389, The Veterans’ Benefits Improvement Act of 2008, is based on the county in which the property is located, the county’s median house price, and the Freddie Mac conforming loan ceiling. The guarantee covers 50% of a mortgage loan up to $45,000, and up to $22,500 for loans between $45,001 and $56,250. The guarantee is 40% of the loan amount, up to a maximum of $36,000, for loans ranging from $56,251 to $144,000. The guarantee for loans between $144,000 and $417,000 is 25% of the loan amount. The guarantee for loans in excess of $417,000 is the lesser of 25 percent of the VA county loan limit or 25 percent of the loan amount. The listing of VNs loan limits is updated annually.

All foreclosed properties must be listed with real estate agents by the VA.

The VA will only lend money to Native Americans on trust land or to complement a grant for a specially adapted dwelling for certain veterans with a total and permanent service-connected disability(ies). Typically, veterans submit loan applications to VA-approved lending institutions of their choosing, which evaluate the applications with the knowledge that the loans will be at least partially guaranteed against loss by the VA.

Interest rate and loan limits: Since 1992, the VA has issued its loan guarantee at an agreed-upon interest rate between borrower and lender. The term of the loan might be any number of years up to a maximum of 30 years. The length of the mortgage is limited by two factors: (1) the term of the loan, which cannot exceed the remaining useful economic life of the home as determined by a VA appraisal; and (2) the loan can only be for the remaining set rental period on a ground lease property.

VA does not establish a maximum loan amount other than those imposed by the secondary market (Fannie Mae and Ginnie Mae). Typically, lenders loan up to four times a veteran’s eligible entitlement with no down payment, provided the veteran has adequate income and credit, and the loan does not exceed the appraised value of the property (the certificate of reasonable value) or the purchase price, whichever is smaller. Loans are made in $50 increments. VA recognizes FHA appraisals but not conventional appraisals. VA mandates that the real estate sales contract for a property include a clause (typically in the form of an addendum) that states, should the property appraise for less than the sales price, the seller will refund the buyer’s good-faith deposit and cancel the contract if the veteran does not wish to complete the purchase.

When a VA-guaranteed loan is issued, secondary financing is permissible under specific conditions.

The veteran must be prepared to pay cash for all closing costs, excluding those paid by the seller, up to four percent of the sales price, and the difference between the sales price and maximum loan amount. After the VA mortgage has been closed and the VA guarantee has been issued to the lender, there are no restrictions on obtaining secondary financing.

Fees for the loan, discount points, and funding costs: The maximum permissible origination charge is 1 percent, although some lenders may opt to list the actual expenses connected with preparing and processing the loan application documentation. The lender cannot assess both fees. Since 1992, veteran borrowers may pay discount points, although they cannot be added to the loan amount. The origination fee is proportional to the loan amount and may be financed.

Programs: VA-guaranteed mortgage loans may be used for the construction, purchase, or refinancing of a home. VA requires veterans to attest that they occupy or intend to occupy the property as their primary residence in all situations. This certification must be provided both throughout the loan application process and at closing. The veteran is subject to criminal prosecution for providing false certificates, but after satisfying the owner/occupancy criteria, he or she is permitted to rent or sell the home while retaining the VA loan.

There are two sorts of VA loans: mortgages with level payments and mortgages with tiered payments. Level compensation or “conventional” For several years, the maximum loan-to-value ratio for VA loans has been 100% for homes where the sales price or appraisal (whichever is lower) does not exceed four times the amount of entitlement the veteran has available. The framework of the progressive payment programme and the FHA-245 loan programme are essentially identical. As with the FHA graded mortgage, the VA GPM is geared for first-time homebuyers and needs a larger down payment than a standard loan. It allows these veterans to purchase a home sooner than if they had to acquire the required income for a loan with higher monthly payments.

Assumptions: VA loans are no longer completely assumable; for loans originated after March 1, 1998, assumptions are not permissible without the lender’s or VA’s prior consent. While earlier loans can still be assumed without restriction, the seller remains completely accountable until a release of duty is secured.

A veteran is permitted to sell a home acquired with a VA-guaranteed loan to anyone, including a nonveteran. The veteran has the option of remaining liable for the VA loan or requesting a release from liability if the person accepting the loan is financially qualified to make the mortgage payments. Restoration of entitlement differs from release of liability. If the individual assuming the loan is a qualified veteran, that person can replace the seller’s eligibility. Upon substitution, which also requires the veteran-buyer to qualify to release the veteran-seller from obligation, the veteran-eligibility seller’s to use a VA loan for a future home purchase is reestablished. Veterans must get releases from both the lending institution and the VA.

Those who assume the loan must pay a user charge of 0.5 percent. Additionally, buyers accepting a VA-guaranteed loan must complete a credit check. If a purchaser does not meet these requirements, the veteran may request that the VA authorize the assumption if he or she is willing to assume secondary liability for the debt.

Veto clause

Tenant’s right to prevent any other tenants from signing leases with the landlord. Usually an anchor tenant. Generally, antitrust law holds such agreements to be unenforceable.

Vicarious liability

Liability is created not because of what a person does, but because of how they are connected to other people. For example, real estate brokers are responsible for the actions of their salespeople when the salespeople are working on their behalf, even if the brokers did nothing wrong.

Becoming accountable for another person’s behaviour.

Vickers report

This is the final report of Sir John Vickers’ Independent Commission on Banking. To improve financial stability and competitiveness, the Commission was requested to investigate structural and related non-structural reforms to the UK banking industry.


Condominiums are typically one-story dwellings that are built in units of two or four and typically feature a garage and a private yard.


An act, deed, or condition that goes against the law or the way real property can be used.

Visible improvements

Buildings, fences, orchards, and other improvements that can be seen on a tour.


Along with many other purposes, a polyethylene plastic sheet is used to cover concrete as it hardens.

Visual rights

The right to stop a structure (like a billboard) from being built in a place where it would block a beautiful view or make it hard to see at a busy intersection.


What a person does for a living. The job that a person does most of the time. As a part-time job, you can work as a real estate broker or salesperson in most states.


To be devoid of force or effect; to be unenforceable.

With no legal force or binding effect; a nullity; something that can’t be enforced. A broken deal isn’t a deal at all. A void contract doesn’t need to be broken, and it can’t be made to work. A contract that is made for an illegal purpose, like gambling, is not valid. Under many state and local laws against discrimination, a contract that excludes someone because of their race, sex, colour, religion, marital status, or ancestry may be invalid (although the non-discriminating portions of the document in which it is contained may still remain valid).

Legally ineffective.

When working with expansive soils, a cardboard box is utilised to fill the space between the bottom of grade beams and slabs. also referred to as void boxes.

Void periods

A period of time when a property, or portion of a property, generates no income, either because there is no Lease in place or because there is a Lease in place but a Rent Free Period has not yet expired.


That which has the potential to be declared invalid but is not so unless action is taken to make it such.

One of the parties who was under a disability may be able to void the contract, even though it looks to be legitimate and enforceable. This includes things like being a minor or being under pressure or undue influence; things that can be avoided or declared void but are not void in and of themselves. A contract that is voidable is one that can be canceled. Instead of a valid act that can be rejected, voidable denotes one that can be rejected by an act of disaffirmation. Due to the fact that the minor has not reached the age of majority, the contract might be canceled by the minor. Contracts signed by minors are legally binding if they choose to enforce them, even though they are not of legal age.

A buyer of real estate who has been the victim of fraud has the right to confirm or deny the contract within a reasonable time after the truth has been revealed. As a result of the inability to fulfill contractual commitments during a license suspension, a broker’s listings are void.


An electrical potential measurement.

Volume per square feet

This approach involves multiplying the modified gross building volume in square feet by a predefined cost per unit of volume to estimate the likely final construction cost.

Voluntary conveyance

Voluntary transfer of mortgaged property by a defaulting mortgagor to the mortgagee in order to prevent foreclosure and a probable deficiency judgment.

Voluntary foreclosure

A voluntary foreclosure is when the borrower initiates the foreclosure process rather than the lender in an effort to stop making payments.

Voluntary lien

A lien put on property with the owner’s permission.

A claim made by one person against the belongings of another as collateral for the repayment of a debt. Liens are secured against the property, not the owner.

Voluntary prepayments

Borrower prepayments to reduce or pay off the outstanding principle, frequently as a result of the borrower refinancing at a reduced interest rate.

Voting rights enforcement

A sort of enforcement action in which the Secured Parties/Finance Parties exercise the rights attached to pledged shares. A Voting Rights Enforcement is frequently used to replace the Borrowing vehicle’s board of directors.

Voucher system

In construction lending, a method of giving subcontractors a voucher instead of cash that they can exchange with the construction lender. The voucher system is the opposite of a fixed disbursement schedule, in which the lender sends subcontractors set amounts of money at set times.