Your three-minute guide to decoding off-the-plan property jargon

While the phrases you hear may at first seem like learning a whole new language, decoding property jargon isn’t as difficult as you think. It won’t be long before you are throwing around acronyms with the best of them. Here is our property jargon guide to get you started.

BODY CORPORATE

Also known as an owners’ corporation, this is the group that runs the strata plan. All owners are therefore entitled to nominate as and elect members to an executive committee. This committee makes decisions about the management of the strata plan.

BODY CORPORATE FEES

Also known as levies or strata fees. These are fees that owners in a strata plan must pay to the owners’ corporation for the management and upkeep of the building and common property.

CERTIFICATE OF TITLE

A document identifying the ownership of the land. It shows the location, volume, folio numbers, easements, mortgages, or other third-party interests in the land.

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COMMON AREAS

These areas can be used by all owners and residents. Examples of common areas are the foyer, stairs, lifts, hallways, pool, gym and rooftop.

COMMUNITY TITLE

This is most common in large apartment developments with multiple buildings and shared facilities like grounds, roadways, basements, barbecues, pools, etc. The strata plan owners each contribute to the community plan to help pay for the upkeep of these areas.

CONSIDERATION

In a real estate purchase contract, the consideration is usually the price paid by the purchaser in exchange for the property.

CONVEYANCE

The process of transferring the ownership of property from the developer or sales agent to the buyer’s name.

COOLING-OFF PERIOD

In Queensland, the cooling-off period starts the day you are handed a copy of the signed contract. To cancel a sale, you must give the developer/agent written notice by 5pm on the fifth day.

DEPOSIT

The standard deposit on residential property transactions in Australia is 10% of the purchase price. This is paid as part of the exchange of contracts and is usually held in a solicitor’s trust account until you settle on your new property.

IMPROVEMENTS

Any building on the land is considered an ‘improvement’ on the land.

INCLUSIONS

These are the items to be included in a property purchase. Standard inclusions are often items such as blinds, built-in wardrobes, curtains, etc. Whilst some of these may seem obvious, it should always be specified in the contract.

SERVICE FACILITIES

Areas that contain utilities, pipes and conduits, and all other associated mechanical and other services to keep the building operational.

SETTLEMENT PERIOD

Also known as the completion time. This is the point at which the transaction for a property purchase is completed and the new owner takes possession.

SPECIAL CONDITIONS

Conditions added to the standard sales contract. Many of these are so common now that they are called ‘standard special conditions’.

STAMP DUTY

Stamp duty is a land transfer tax that is charged on every property purchase in Australia. The amount will vary depending on which state you buy in, the price of the property, and if you are a first-time buyer.

STRATA PLAN

When a piece of land is approved for a block of units the land is divided up between them. In property jargon, this is called a strata plan.

STRATA TITLE

Strata title refers to the individual ownership of part of a property (eg. apartment or townhouse), combined with shared ownership in the common property through the body corporate.

SUNSET CLAUSE

A sunset clause sets into the contract a maximum time that the developer has to finish the project. The sunset clause is complicated but is essentially designed to protect both the developer and the buyer’s deposit.

VACANCY RATE

The vacancy rate is the number of vacant rental properties that a real estate agency has available, divided by the number of rental properties they have in total, expressed as a percentage. Knowing the vacancy rate can indicate whether an area has a high rental demand or is currently oversupplied with investment properties.

With 18 different property jargon terms up your sleeve, you can now navigate the real estate realm with confidence (and without the need for a dictionary).

Written: 27 July 2018

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