Glossary

Adjustment Date The date on which the outgoings on a property are adjusted for payment and this date is the earlier of the giving of possession of the property to the purchaser or completion.

Agency Agreement An agreement between the real estate agent and the owner of the property being marketed, setting out amongst other things, the sales commission payable and the agent’s estimated market value of the property.

Agent A person authorized to act on behalf of another person in the sale, purchase, letting or management of a property. A real estate must be licensed by the Office of Fair Trading.

Attorney A person appointed by written power of attorney and according to law by another to represent or act in place of that person.

Auction A public auction sale where the property is sold to the highest bidder.

Bank Cheque A cheque issued by a bank, which is guaranteed by the bank and is as secure as cash, except that there may be a clearance period on the bank cheque.

Boundary A line separating adjoining properties.

Breach of contract Where one of the parties breaks one or more conditions of the contract.

Bridging Finance Short term finance that has been arranged until long term funding can be set in place.

Capital Gain The financial gain obtained when you sell an asset for more than you paid for it.

Caveat A legal notice by a person having a (caveatable) interest in the property which will prevent transfer in title until the claim has been determined.

Caveat Emptor “Buyer beware”. This principle of law puts onus onto the buyer to be satisfied with the property before buying. Therefore, it is essential the buyer undertakes pre-purchase enquiries.

Certificate of Title A document issued by the Land Titles Office detailing the owner, a legal description of the property and any other interests, such as mortgages, in the property.

Chattels Personal property such as furniture and other moveable items which may or may not be included in the sale.

Commission A sales fee, as agreed in the Agency Agreement, payable to the real estate agent for effecting the sale of a property.

Common Property All areas within a strata plan which are not part of any lot and is owned by the owners corporation (all the owners collectively).

Completion See Settlement.

Contract See Contract for Sale.

Contract for Sale A written agreement, signed by both parties, which sets out the terms and conditions of the sale, description of the property, the price, inclusions and completion date.

Conveyance The transfer of ownership of property from the sellers name to the buyers name.

Conveyancer A person licensed by the Department of Fair Trading to practice conveyancing in Tasmania.

Conveyancing The legal process for the transfer of ownership of real estate.

Cooling Off Period The current legislation provides a period of 5 business days from date of exchange of contracts in which (only) the purchaser may cancel the contract for the purchase of residential property.

Covenant A notation on a title deed which imposes an obligation to terms, conditions or restrictions regarding the property.

Deposit An agreed amount (usually 10%) of the purchase price, which is paid by the purchaser at exchange of contracts and usually held by the estate agent until completion.

Deposit Bonds This is a guarantee issue by an insurance company that the purchaser will pay the full deposit by the due date. There is a fee for these bonds and they are regularly used instead of money as a deposit. Conditions apply.

Disbursements Miscellaneous fees and charges incurred during the conveyancing process, including search fees and charges paid to Government authorities.

Discharge of Mortgage A document signed by the lender and given to the borrower when a mortgage loan has been repaid in full.

Easement A right by a person who is not the owner of the property, to use or have access over part of that land.

Encumbrance An outstanding liability or charge on a property.

Exchange of Contracts The time at which the Agreement for Sale becomes binding on both parties and the agreed deposit is paid.

Exclusions Items which are specifically excluded from the sale.

Fittings Goods or articles that can be removed from the property without causing damage to it.

Fixtures Items such as built in cupboards, stoves, etc which are fixed to the property and cannot be removed without causing damage. There is still argument about what constitutes a fixture so these should be detailed in depth in the contract.

Final Inspection An inspection of the property, prior to completion, to determine that the property is in the same state and condition that it was at the date of exchange of contracts.

Folio Identifier This is the legal description of your land.

Gazumping Gazumping is when a purchaser’s offer has been accepted and the purchaser begins pre-contract enquiries, only to find that the seller has accepted a higher offer from someone else.

Inclusions Items which are specifically included in the sale.

Inventory A list of items included with a property, usually furniture, furnishings, movable items etc.

Joint Tenants Ownership of a property in equal shares, where if one owner dies his/her share passes to the surviving owner/s.

Land Tax A tax levied by the state government against some owners of property and is based on the value of the property.

Mortgage Any charge on land (other than a covenant) created merely for securing the payment of a debt.

Mortgage Broker A person or organization offering to organize or broker loans from a group of lenders.

Mortgagee The proprietor of a mortgage; a person who lends the money to another where the loan is secured by taking a mortgage over the borrower’s property.

Mortgagor The proprietor of land or of any estate or interest in land pledged as security for the payment of a debt in favour of the mortgagee. OFT Office of Fair Trading within the NSW Department of Commerce.

Old System Title or General Law Title The title system which pre-dated the Torrens system and still exists in some properties today. Old system title to a property was proved by demonstrating an unbroken chain in title.

Option to Purchase A legal document giving a person a right to buy. In the document the price and period are specified. A fee is paid and if the person proceeds to buy the property the amount of the fee comes off the purchase price. If the person does not proceed to buy the property the fee is forfeited to the seller.

OSR Office of State Revenue within the Tasmanian Treasury.

Owners Corporation The owners of lots in a strata title scheme. Purchaser A person who buys a property (buyer).

Rescission of contract Where a party cancels a contract because the other party has breached the terms of the contract.

Right of Way See Easement.

Settlement The settlement (or completion) of the sale whereby the purchaser pays the balance of the purchase money, the vendor gives the purchaser possession of the property and gives the title deed and the Transfer to the purchaser.

Stamp Duty This is a tax charged by the State Government for which the purchaser will be liable, unless entitled to an exemption.

Strata Title The subdivision of a property into lots and common property. The lots are the units or other areas owned by the owners and the common property is everything that does not form part of a lot and is owned by the owners corporation (all the owners collectively).

Survey A plan that shows the boundaries of a block of land and the positioning of any building/s on that land.

Tenants in Common Joint ownership of property and may be in equal or unequal shares. Each joint owner may dispose of their share in the property independently and unlike Joint Tenancy, the shares do not automatically pass to the other owners in the event of death but form part of that persons estate.

Title Deed Title Document disclosing the legal description and ownership of a property.

Torrens Title A term used to describe the system of title (or land) registration expressed in Tasmania in the Real Property Act. This type of title is guaranteed by the State Government, except in some cases of fraud.

Transfer A document registered with the Land Titles Office that confirms the change of ownership as noted on the Title.

Unencumbered Describes a property free of mortgages, covenants, restrictions etc.

Valuation A report detailing a professional opinion of a property’s value.

Vendor A person who offers property for sale (seller).

Zoning A qualification on the allowable use of the property, imposed by Council.