Familiarizing yourself with common lingo used by realtors is a great move when getting into the housing market. It’ll make the process smoother when you know what everyone is talking about, and ensure you’re not taken advantage of by seeming too green.
1. “As Is” Condition: If a house is listed in “as is” condition you can usually assume this means it needs work. Big things to watch out for would be knob and tube wiring, low, unfinished basements and requiring overall TLC (and money).
2. Bidding War: If a property on the market has a set “offer date”, they may be angling for a bidding war. The property is sometimes (but not always) listed at a lower price than market value, creating a lot of buzz and interest, hopefully resulting in multiple buyers competing for the same house, driving the price up. Be wary; getting caught up in a bidding war can mean spending more money than you budgeted.
3. Buyer & Seller Markets: These are general terms for the nature of the current market that reflects inventory. A “Buyers” market suggests there are more houses on the market than buyers, thus giving more power to potential buyers. A “sellers” market is the opposite.
4. Closing Costs: These are the costs in addition to the final sale of the home. They can include notary fees, transfer fees and taxes and may range anywhere from 1-4% of the final sale price.
5. Closing Date: The official day the new owner takes possession—or title—of the home.
6. CMHC: The Canadian Housing & Mortgage Corporation was formed after WWII and provides insurance for residential mortgage loans to Canadian homebuyers. They’re a great resource with tools and other valuable information: www.cmhc.ca
7. Conditional Offer: An offer to buy a home that is contingent on specified conditions put in writing such as a home inspection or financing.
8. In-Trust: Money held by a third party—usually the listing broker's agency or a notary—until all agreed upon terms are met, during the purchase or sale of a property.
9. Firm Offer: An offer to purchase the home with NO conditions. (These are generally preferable to the buyer.)
10. Fixture: Anything listed as a fixture of the home means it comes with the property. Usually anything that is affixed or nailed down like lights and curtains are considered fixtures. When in doubt, ask.
11. Maintenance Fees: Typically associated with townhouses and condominiums—where the property isn’t “freehold”—these are monthly fees in addition to the purchase price. They can cover a range of services like utilities and cable, or just the basics like outside maintenance and snow removal.
12. Mortgage: A loan to buy a home, usually from a bank.
13. Survey or Certificate of Location: This shows the formal boundaries of the property.