The Ultimate Real Estate Glossary Letter T
As we approach the conclusion of our Ultimate Real Estate Glossary, the time has come to tackle tricky terminologies starting with the letter T. Our goal is simple: We aim to inform you of the industry’s difficult-to-understand words and terms from A to Z, all to help you make well-informed investment decisions in the real estate market.
So, get ready to expand and refresh your knowledge of the industry!
Here’s a list of important terms starting with the letter T that you need to know.
Real Estate Glossary: The Letter T
Title deeds: Title deeds in real estate are legal documents indicating proof of property ownership. Generally, there are four kinds of title deeds: general warranty deeds for selling a property, special warranty deeds to certify selling rights during ownership, bargain and sale deeds to certify selling rights without buyer protection, and quitclaim deeds to “quit” and “claim” rights to a property.
Temporarily off market (TOM): A listed property is taken off the market for reasons such as travel, repairs, illness, and so on. A listing can only be filed under TOM by the seller. If a listing is classified under TOM, all marketing and promotional activity for the property must be stopped. That means that agents can’t show the property and prospective buyers are unable to view it.
Tenant screening: This is conducted to assess the probability of a prospective renter to fulfill the terms of the lease agreement and caring for your property. Screening includes evaluation of monthly income, employment history, previous landlord references, rental history, credit score, eviction history, criminal background check, and more.
Title insurance: This insurance ensures that the property is free of any liens and is clear for sale. It also certifies that research through public records was made to guarantee its sale eligibility. With title insurance, you are protected from risks, like falsified records and incorrect documents.
Title insurance is often required and is covered by closing costs. Closing costs are fees that must be paid in addition to the purchase price of a property at the time of closing. Closing expenses may apply to both buyers and sellers.
Transaction fee: In real estate, a transaction fee is most often a fixed amount for brokerage—charged to the seller in addition to the broker’s commission.
Turnover rate: This is the time it takes for property sales to match the number of properties in an area. For example, if 25 out of 250 properties listed for sale are sold in a year, the turnover rate is 10%.
Commonly, the turnover rate suggests how “cold” or “hot” the market is, and in hotter markets, generally properties can sell quickly. As for real estate investors, a high turnover rate usually suggests that investing in property in the area will be successful, meaning the property will appreciate in value over time.
Conclusion
Whether it’s a personal investment for a home, or a business investment to earn money, real estate provides an opportunity to secure your financial future.
To quote Robert Kiyosaki, a successful businessman and author of the best-selling book, Rich Dad Poor Dad, ”Real estate investing, even on a very small scale, remains a tried and true means of building an individual’s cash flow and wealth.”
When making important decisions, like a real estate investment, it’s important to learn and be informed about the process. Knowing the terms is just the first step in your journey into the world of real estate. With this knowledge, you’re now better equipped to make wiser investment decisions.
Interested in learning more? Then stay tuned for the next installation of our series. Please let us know if we missed anything in the comments below!