The Ultimate Real Estate Glossary: Letter D

2021-05-03

The Ultimate Real Estate Glossary: Letter D

 

If you’re new to the real estate industry, the language can be a little overwhelming. Like many industries, real estate has its own jargon and learning that jargon can be a difficult (but essential) part of entering the rental property business.

This is why we’ve put together this Ultimate Real Estate Glossary! To jumpstart the learning process, we’ve created this alphabetical guide to all the terminology used in the rental real estate industry, broken down by letter to make it easy for aspiring landlords to find any term you’re unsure about.

In this edition, we’ll go through the terms that start with the letter D.

Real estate terms: The letter D

Days on Market (DOM): This refers to how long a property has been on a multiple listing service (MLS). A property with a high DOM has spent quite a long time on the market, and so may warrant closer examination. High DOM may be due to deficiencies in the property itself, or simply a price that is not appropriate for the market. 

Also known as “time on market.”

Debt: This is money borrowed from one partner to another, or the obligation to pay the amount borrowed. In financial terms, debt may also be an instrument used by corporations to borrow or make purchases.

Decree: This is a court judgment. It’s an order passed down by a judge that resolves the issues in a court case. A decree is issued after an assessment of the rights of the involved parties. It may include directions that guide how the decree is to be applied, making them more flexible.

Deed of trust: This is a written document between a borrower and lender in purchasing the property. The property is held in trust by a neutral third party until the loan has been paid off. Deeds of trust are used in some states as an alternative to a mortgage for financing real estate, and some states allow both.

Depreciation: This is the decline in a property’s value over its life, usually due to lack of upkeep or market forces. In real estate, depreciation is also a process that allows a property owner to reduce their tax liability by deducting the expenses of purchasing and improving a rental property over the period of its useful life, rather than in a single lump sum.

Desk fee: This is a payment agreed between a real estate agent and their company or brokerage to maintain a desk or office space at the company premises. Usually, a company charges desk fees as an alternative to a commission split, though some companies may use both.

Destination services: These are services designed to assist people moving into a new city. These may include assistance in finding a home, acclimatization to the new environment, familiarization with the area, searches for schools, and so on. Many businesses employ destination services to find housing for transferred employees, so they can be a great resource for landlords to find a quality, consistent tenants.

Direct home-selling costs (DHSC): These are the costs associated with selling a house. These include repairs and improvements, interest on equity loans, carrying costs, taxes and insurance, commission, principal, closing costs, utilities, interest, and loss on the sale.

Disclosures: These are statements required by state law in which sellers of real property must reveal certain types of information relating to the property to potential buyers. Usually, this means relevant material facts about the property’s condition, such as whether it’s in a fault zone or a flood hazard area if it has any structural problems or other such relevant information.

Down payment: This is an upfront cash commitment paid by a buyer, which is a percentage of the full price. Because interest is only applied to the remaining amount of a loan, a large down payment will reduce monthly payments over the loan’s lifetime. A down payment is also used to help secure financing, as most borrowers are less likely to default on loans with a down payment.

Drive-by appraisal: This is a value estimate of a property or potential listing made without looking into the interior. It’s not strictly wrong, as long as the nature of the appraisal is disclosed, but it’s inherently limited in what it can assess about the property.

Dual agent: A broker and/or licensee who acts as the agent to both the buyer and the seller during the same transaction. Agents must disclose if they are acting as dual agents, to make buyers and sellers aware of potential conflicts of interest. It’s also illegal in certain states.

Conclusion

There are still twenty-two letters to go, so don’t give up just yet! Learn these terms one at a time, and you’ll soon be walking and talking like a seasoned landlord. 

Keep a watch on our site for the next list, where we’ll continue covering the next letters in sequence until we reach the letter Z.

Any other terms you want to see explained? Just comment on them below and we’ll make sure to touch on them!

Image courtesy of Pixabay

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