When it comes to learning more about the real estate industry, the greatest place to start is with something you might not expect vocabulary. It’s much easier to understand processes if you’ve learned the jargons.
When it comes to the real estate industry, knowledge is power. A broker who aspires to be successful needs more than charm and connections to achieve their goals. Similarly, an investor requires more than money to achieve the desired results. Simply put, you must educate yourself.
As a result, take some time to go through this list of Philippine real estate glossary terms and phrases as part of your continuing education in the field as a buyer or as an agent.
Abstract of title
A document that provides a summary of the history of a specific title. This includes property transactions as well as claims against it.
Lands that are adjacent to one another. A shared boundary exists between adjoining properties.
A contract provision that allows a mortgage firm to demand that a borrower return the loan’s outstanding balance if the latter fails to meet specific conditions.
When opposed to a straight-line method, this accounting method allows an income property to decline at a faster pace.
A way of obtaining property that has increased in value as a consequence of modifications or additions. A person who owns a home near a river, for example, also owns the additional land generated by natural deposits along the riverside.
The depreciation of a property’s value over time. Wear and tear is a typical cause of decreasing value.
The procedure for acquiring property ownership. A legal action is taken in order to purchase real estate.
As a result of a judicial ruling, a tenant is physically removed from the rented property. Failure to pay rental costs is a typical basis for eviction. The procedure is distinct from constructive eviction, which occurs when a tenant vacates the premises due to a landlord’s illegal act rendering the rental unit unfit for habitation.
A method of obtaining property over time and in accordance with legal requirements; that is, possession should be in the sense of an owner, public, peaceful, uninterrupted, and hostile. Ordinary acquisitive prescription requires possession of objects in good faith and with just title for ten years, while exceptional acquisitive prescription demands sustained adverse possession for 30 years without good faith or just title.
Ad valorem tax
A sort of tax in which the amount is determined by the property’s value.
An adjustable-rate mortgage, in contrast to a fixed-rate mortgage, has a changeable interest rate that is determined by the country’s monetary authority (in the case of the Philippines, the Bangko Sentral ng Pilipinas). Depending on the current economic condition, the interest rate on an adjustable-rate mortgage can go low or high.
A written statement made under oath and admissible in a court of law. An affidavit of self adjudication, for example, is a document that a person creates when they want to proclaim that their entire estate is theirs.
Agreement of sale
An agreement in which the buyer agrees to buy a property and the seller agrees to sell it, both on the same terms and circumstances.
The right to use and develop the space above the surface of the earth. Property owners can sell their land to companies who build skywalks or power wires.
A complete property transfer from one party to another. It can be voluntary, such as in the case of a sale, or involuntary, such as when the government acquires real estate for public use.
A clause in a mortgage contract that allows the lender to call the loan due immediately if the owner sells or transfers the property’s title.
Changes made to previous agreements.
Apart from their real property, a community has access to a variety of amenities and services. Swimming pools, clubhouses, bike lanes, community parks, and gardens are all popular examples.
Refers to land or property tax
Payments are stretched out over a period of time using this strategy. For example, an amortized loan must be paid on a monthly basis, with the amount covering both principal and interest.
A self-contained living unit within a bigger structure. It is typically leased for use as a dwelling and is equipped with housekeeping facilities.
The process of determining a property’s worth. Because the value of a property fluctuates often, almost every real estate transaction necessitates an appraisal report. Population, location, upgrades to the property, rehabilitation potential, and other factors all influence value.
The increase in property’s value over time.
The simultaneous purchase and sale of a property, with the latter commanding a higher price. The goal is to increase the transaction’s yield.
Alternative conflict resolution in which disagreements are resolved outside of the courtroom. With the assistance of a neutral third party, two parties discuss and decide on an issue in arbitration. Most people choose arbitration over lawsuit because it is less expensive. They use it to settle disagreements over inspection difficulties, claims of deception concerning the condition of the property, and repair costs.
Ari-ariang lupa at bahay
Refers to real estate properties
The process of transferring real estate rights or advantages to another person (which may include interest in the case of a bond or lease). The assignor is the one who transfers the information, while the assignee is the one who receives it.
Assumption of mortgage
An agreement in which the present owner’s outstanding loan balance is transferred to the property’s buyer. This is usually done to save money on closing fees or to avoid paying higher interest rates on a new loan.
A space or room just below the roof of a building.
The individual who is permitted to conduct business on someone else’s behalf. When an investor is unable to sign contracts, buy or sell real estate, or deposit monies, for example, they may allow someone else to do it.
As a result of the movement of a river or a body of water, a parcel of land is abruptly detached from one property and attached to another. The basic norm is that the original owner has the title to the land as long as they remove the moved portion of the property.
(Spanish origin) an open balcony or veranda; a rooftop deck
Balloon payment mortgage
A type of mortgage that does not fully amortize during the agreed-upon period. As a result, there is a balance left at maturity. The big sum is referred to as a balloon payment because it is much larger than the monthly instalments. This is a common occurrence in commercial properties.
(Spanish origin) bathtub; the bathing area of a home
A staircase’s baluster or railing.
Bargain and sale deed
A title deed that does not include any warranties against liens or claims against a debtor’s property. It does, however, allow a grantor to transfer the title. The grantee, on the other hand, may have little to no legal redress if the title problems are discovered later.
Imaginary lines that run from east to west and cross a major meridian at a given location. Under the rectangular survey system of property description, surveyors use it as a guide in finding and identifying land.
Surveyors use a reference point to calculate elevation differences.
The inherited property. It is a clause in a will that specifies how personal property will be allocated.
A legal contract in which one party agrees to do something in exchange for the other’s commitment to do something. Simply put, the seller commits to sell a property and the buyer promises to purchase it. It differs from a unilateral contract, in which only one side is obligated to comply.
Bill of sale
A certificate that certifies the transfer of a property’s title.
A property consisting of land or buildings.
A loan that covers numerous areas of real estate. Developers use this to buy large tracts of property in order to subdivide them and sell the smaller sections later for profit.
A bungalow is a one-storey dwelling, cabin, or cottage with no more than one floor. Bungalows have a low-pitched roof and a large front porch.
Capital Gains Tax
A capital gains tax is a sort of tax that is levied on profits made from the sale of an asset. The capital gains tax is deducted from the total selling price or market value of the property, whichever is greater.
The Certificate Title, which is issued by the city or municipality, states an owner’s exclusive rights to a specific property. To validate the document’s legitimacy, the Registry of Deeds should be able to issue a certified true copy.
The closing costs are the expenses paid when the property is transferred from the sellers to the buyers, and they are normally split between the two parties. Surveyor fees, attorney fees, taxes, escrow fees, and title insurance expenses, to name a few, are all included in closing costs.
(Spanish origin) dining room/area
This refers to the remuneration that an agent receives for fulfilling his tasks. From the sale or rental of property, he receives a commission.
A condominium is a privately owned individual apartment within a big property complex, often known as a condo. Condo owners receive a deed to their own apartment as well as joint ownership of shared common amenities including corridors, pools, elevators, and gyms.
The Condominium Act of the Philippines, or Republic Act 4726, covers condominium owners’ ownership, rights, and obligations. It also establishes the regulations and conditions for condominium development.
Property and assets owned by a married couple are referred to as conjugal property. Under the Family Code, all property obtained before or during the marriage is considered conjugal property. This means that whatever property owned by a husband while he was single becomes the property of his wife (and vice versa) after they marry. Part or all of a couple’s property becomes conjugal property when they marry. According to Philippine law, part or all of your spouse’s property becomes conjugal property.
Contract to Sell
The precise terms and conditions of the sale are contained in the Contract to Sell. After the down payment has been made, the seller will issue this to the buyer. However, the seller retains possession of the property until the entire purchase price has been paid. The Sale Contract must be notarized as well.
This refers to the attractiveness of a property for sale and its surroundings when viewed from the street. It usually includes the landscaping and the front entrance of a house.
Deed of Sale
This is a legally binding document that proves and documents the sale of a specific piece of property. It is written evidence that the buyer and seller have reached an agreement on the sale or purchase of real estate. When there are future disagreements or problems, the deed of sale protects both the buyer and the seller.
The decrease in the value of a property over time. This decrease in value is caused by deterioration due to normal wear and tear or economic obsolescence.
(Spanish origin) home office
A home separated into two different living zones, each with its own entrance. These two units share a common wall at all times, but there is no interior connection between them.
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If the buyer want to demonstrate their purpose and good confidence in the purchase, earnest money is offered to the seller. It basically informs your seller that you are a serious buyer. The escrow account is usually where the earnest money is maintained.
In a mortgage, an escrow is a neutral third party who protects the transaction’s deposits or papers. This term is usually mentioned near the end of the purchasing process. The term “escrow” can also refer to the party in charge of holding the insurance money or the taxes that collect until the loan is repaid. After then, the escrow pays “on behalf” of the payer.
A fixed-rate mortgage means that the interest rate on your loan will not change until the contract expires or until a certain time period has passed. This sort of mortgage provides the buyer with the benefit of knowing exactly how much their monthly payments will be.
These are homes that have been repossessed by lenders or the government.
This occurs when the property’s titular owner is unable to make regular payments to a lender or pay the local government’s real property tax.
The structural post of the house/building
The value of your home is referred to as home equity. It’s the current mortgage balance minus the property’s market value at the time of acquisition.
Home Owners Association
The Home Owners Association (HOA) is a private organization that oversees a community (condominiums, townhouses) and collects payments on a monthly, semi-annual, or annual basis. They frequently set the rules, laws, and taxes that come with residing in a specific neighborhood.
The roof is supported by rafters and trusses.
A contract between an owner and a tenant that details the terms and circumstances under which the renter may inhabit and use the property, as well as the length of the lease.
A lessee is someone who leases land or property from a lessor or landlord. In the Philippines, a tenant is also known as a renter.
A lessor is someone who rents out a property to a tenant or lessee. In the Philippines, this person is also known as a landlord.
Letter of Intent
The buyer submits this non-binding letter to declare his or her intent to purchase the property.
Local Transfer Tax
This is a tax imposed on the transfer of real estate ownership. It ranges from 0.5% to 0.7% of the selling price or zone value (whichever is greater). Because the percentage varies by area, you should check with your city or municipal treasurer.
The Maceda Law is Republic Act No. 6552, also known as the Realty Installment Buyer Protection Act. This law pertains to purchasers of real estate property on an installment basis and is named after the principal creator, former senator Ernesto Maceda. The rights of a buyer who defaults on installment payments are outlined in R.A. 6552. It also lays forth the requirements for buyers to be eligible for refunds and grace periods.
A mortgage is a long-term loan used to fund the purchase of real estate, such as a home and lot or a condominium unit.
Mortgage Redemption Insurance
The mortgage redemption insurance (MRI) is a type of life insurance that pays off a portion or the entire outstanding mortgage balance if the insured dies or becomes totally disabled.
(Spanish origin) furniture pieces
Tenant or border
This is a set amount of time during which a home is open to the public for viewing by potential buyers.
See assume balance
Tagalog for window ledge
A rental property
Another translation for “real estate” is a property that cannot be simply relocated.
A person who pre-sells a property enters into a legally binding contract to buy it before it is even built.
Real estate broker
This is a duly registered and licensed natural person who, for a professional fee, commission or other valuable consideration, acts as an agent of a party in a real estate transaction to offer, advertise, solicit, list, promote, mediate, negotiate or effect the meeting of the minds on the sale, purchase, exchange, mortgage, lease or joint venture, or other similar transactions on real estate or any interest therein.
Real estate salesperson
This is a duly accredited natural person who serves on behalf of and for. a real estate broker who is registered and licensed by the Professional Regulatory Board of Real Estate Service in exchange for or in anticipation of a commission, professional fee, salary, or other useful consideration.
The Installment Sales Law was the original name for Act No. 4122. It is now covered by a series of provisions included in the Philippine Civil Code. The Recto Law, enacted in 1933 by Senator Claro M. Recto, protects the rights of buyers of personal property. Its major goal is to prevent potential seller abuses in the event that a buyer is unable to make additional payments on a property.
A property you can acquire in a given time of rental occupancy to qualify its purchase.
The Philippines’ Real Estate Service Act (RESA) is known as Republic Act No. 9646. The RESA Law lays out the requirements for becoming a legitimate practitioner. The RESA law’s principal purpose is to professionalize the real estate service industry by requiring all persons involved in property sales to be properly registered and licensed before conducting business.
This refers to the legal cancellation of a purchase transaction contract.
This abbreviation stands for “Ready for Occupancy” (RFO). Because the property has already been developed, when a unit is classified as RFO, it indicates the homeowner can move in right away after purchasing it.
(v.) To mortgage is to grant a lender a claim on one’s property in the event that a loan is not paid on time.
(n.) A mortgage is a claim on property made to someone who has loaned money in the event that the money is not repaid when it is due.
Basement is the area beneath the floor of a home or building in Tagalog.
A single-detached house, also known as a single detached building, is normally built on its own lot and includes ownership rights to the land on which it is built. It is surrounded on all sides by open space and is not connected to any other habitation or structure (except its own garage or shed).
This entails making changes to a home in order to boost its resale value. It entails enhancing the appeal of a house for sale by decorating and furnishing it to appeal to potential purchasers.
A single-room residence with a living room, kitchen, and bedroom all in one location.
An assessor/calculator; someone who deals with property tax assessments.
A gate; an opening in a fence or wall.
Total Contract Price
This is the overall contract price that includes everything. It is the whole contract price set down in a lump sum contract, or the sum of all monthly purchase amounts owed under a monthly purchase plan.
A three- or more-story row home in the classic sense. It commonly has shared external walls with other residences in the neighborhood.
This refers to a home that is ready to live in and does not require any substantial repairs or improvements.
(Spanish origin) open windows with panels that allow fresh air to flow through.
This is the digital equivalent of property viewings, in which the house or condo is displayed as a simulation created from a series of photos stitched together.
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