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Real estate glossary

The words you'll hear when you buy or sell, from the first showing to closing day, each in a sentence or two.

A

Absorption rate
How fast homes are selling: often shown as months of inventory, the time it would take to sell every active listing at today's pace.
Acceptance
When the other side signs the offer exactly as presented, within the irrevocable time, and that signature is communicated back. That's when it becomes a contract.
Agreement of Purchase and Sale
The written offer. Once buyer and seller both sign it, it's a binding contract.
Amendment
A signed change to an agreement that's already in place, such as a new closing date or an extended condition deadline. Both sides must agree to it.
Amortization Buying
How long it would take to pay the mortgage off completely at the current payment, usually 25 or 30 years.
Appraisal
A lender's independent opinion of what the property is worth. If it comes in below the price, the buyer covers the gap, which can put a sale at risk.
As is, where is
A sale with no promises from the seller about the property's condition. Common in estate and power of sale properties; inspect carefully before you commit.
Assessed value (MPAC)
The value MPAC sets for property tax. It's updated on its own schedule and is not the same as today's market value.
Assignment
Selling your contract to buy a property, often a pre-construction condo, to someone else before it closes.

B

Backup offer
An offer accepted in second place, ready to step in if the first accepted offer falls through, usually because a condition isn't met.
Blended mortgage Buying
Combining your current mortgage rate with today's rate when you borrow more or move, so you avoid breaking the mortgage outright.
Bridge financing
A short-term loan that covers the gap when you buy your next home before the sale of your current one closes.
Brokerage
The company a real estate agent is registered with. Your agreement is with the brokerage, and its name must appear on all advertising.
Builder's warranty Buying
The new-home warranty in Ontario, backed by Tarion, covering set items for one, two and seven years after possession.
Bully offer
An offer made before the seller's scheduled offer date, designed to win the property before others can bid. The seller can consider it or wait.
Buyer's market
More homes for sale than active buyers. Prices soften, homes take longer to sell and buyers have more room to negotiate and keep conditions.
Buyer representation agreement Buying
The written agreement between you and your brokerage: what they'll do for you, for how long, and how they're paid.

C

Capital gains Selling
Profit on selling a property that isn't your principal residence, such as a rental. Part of the gain is taxable; talk to an accountant before you sell.
Cash to close Buying
The total a buyer must have ready on closing day: the rest of the down payment, land transfer tax, legal fees and adjustments.
Chattels
Movable items such as appliances, furniture or light fixtures that aren't attached. They only stay if the agreement lists them.
Clearance certificate (non-resident sellers) Selling
When a seller isn't a Canadian resident for tax purposes, the buyer must hold back part of the price unless the seller gets a certificate from the CRA.
Closing costs
Everything beyond the price or the payout: legal fees, land transfer tax and adjustments for buyers; commission, legal fees and mortgage payout costs for sellers.
Closing date
The day ownership and money change hands, and the keys are handed over.
CMHC insurance Buying
Mortgage default insurance, required with less than 20% down. It protects the lender, and you pay for it.
Co-operating brokerage
The brokerage representing the other side of the deal. The listing agreement sets out what, if anything, it's offered.
Collateral mortgage Buying
A mortgage registered for more than you borrow, so you can borrow again later without re-registering. It can make switching lenders more involved.
Commission Selling
What the seller pays the brokerages when the home sells. It's negotiable and written into the listing agreement.
Common elements
The parts of a condo owned together: lobbies, halls, the roof, garage and amenities. Exclusive-use areas, like your balcony or parking spot, are still common elements.
Comparative market analysis (CMA)
A study of recent sales, active listings and expired listings near the home, used to set a listing price or judge an offer.
Condition
A clause that lets the buyer walk away with the deposit if something, like financing or an inspection, doesn't work out by a deadline.
Conditional sale
A sale that's agreed but still waiting on the buyer's conditions. The home often shows as "sold conditional" until they're removed.
Condo corporation
The legal body made up of every unit owner. It owns and runs the common elements through an elected board and the property manager.
Condo declaration
The condo's founding document. It sets out each unit's share of costs and the rules on pets, rentals and use; the by-laws and rules sit beneath it.
Contingency
Another word for a condition: something that must happen, like financing approval, for the deal to go ahead.
Conveyancing
The legal work of transferring ownership: title searches, the transfer, the mortgage registration and the funds on closing. Your lawyer handles it.
Cooling-off period Buying
A short window to cancel without penalty. In Ontario it applies to new pre-construction condos (10 days), not to resale homes.
Counter-offer (sign-back)
A reply to an offer that changes some terms. It goes back and forth until both sides sign the same version or someone walks away.

D

Days on market
How long a home has been listed. A long run or a relisting often signals room to negotiate.
Deed (transfer)
In Ontario, ownership moves by a transfer registered electronically on title. People still often call it the deed.
Default insurance Buying
Mortgage insurance that protects the lender, not you. It's required with less than 20% down and comes from CMHC, Sagen or Canada Guaranty.
Deposit
Money the buyer delivers soon after acceptance, held in trust and credited toward the price at closing.
Discharge Selling
Removing the seller's mortgage from title on closing. The seller's lawyer pays it out from the sale proceeds.
Disclosure
What the seller and agents must tell buyers. Sellers must disclose known latent defects that make a home dangerous or unfit; agents must disclose material facts they know.
Down payment Buying
The part of the price you pay yourself. The minimum depends on the price; with less than 20% down, the mortgage must be insured.
Due diligence Buying
The checking a buyer does before committing: inspection, status certificate, title, zoning, permits and the numbers.

E

Easement
Someone else's right to use part of a property, for example a utility line or a shared driveway.
Encroachment
Something that crosses a property line, like a fence, shed or driveway. A survey or title insurance helps find and deal with it.
Equity
What you own outright: the home's value minus what you still owe on it. For most sellers it's the down payment for the next home.
Escape clause
Lets the seller keep accepting offers while a conditional sale is pending. If a better offer arrives, the first buyer gets a set time to firm up or step aside.
Escrow (trust account)
Money held by a brokerage or lawyer in trust, such as the deposit, until closing or until the agreement says otherwise.
Estate sale
A sale by the executor of someone who has died. Expect court or probate timing, and usually little information about the home's history.
Exclusive listing Selling
A home marketed privately instead of on MLS®. The seller must give the brokerage written direction to keep it off the system.

F

FHSA Buying
First Home Savings Account: tax-deductible contributions and tax-free withdrawals for a first home.
Firm offer
An offer with no conditions. Stronger for the seller, riskier for the buyer.
Fixed rate Buying
A mortgage rate that stays the same for the whole term, so your payment doesn't change until renewal.
Fixtures
Anything attached to the home, such as built-in lights, window coverings on fixed hardware or a mounted TV bracket. They stay unless the agreement excludes them.
Freehold
Owning the house and the land outright, with no condo corporation or monthly maintenance fees.

G

Garden suite / laneway suite
A second, separate home on the same lot, in the backyard or along the laneway. Toronto now allows them on many residential lots, subject to rules.
GDS and TDS ratios Buying
The two ratios lenders use: housing costs as a share of income (GDS), and all debt payments as a share of income (TDS). Both must fit their limits.

H

Holdback
Money held back from the seller at closing until a specific issue is fixed.
Holdover clause Selling
A listing agreement clause that can still entitle the brokerage to commission if a buyer it introduced buys the home shortly after the listing ends.
Home Buyers' Plan (HBP) Buying
Lets first-time buyers withdraw from their RRSP for a home, to be repaid over time.
Home equity line of credit (HELOC) Buying
Borrowing against the equity in your home as a revolving line of credit, usually at a variable rate.
Home inspection
A professional's visual review of the home's major systems. Buyers use it to decide; sellers sometimes do one before listing so there are no surprises.
HST on new homes Buying
New builds and substantially renovated homes carry HST. Check whether the price includes it and who receives the rebate.

I

Interim occupancy Buying
Living in a new condo before the building is registered. You pay an occupancy fee, not a mortgage, until final closing.
Irrevocable
The time an offer stays open. The seller must accept before it passes, or the offer lapses.

L

Land transfer tax Buying
A tax on buying property. Ontario charges it everywhere; Toronto charges its own on top.
Latent defect
A hidden problem a reasonable inspection wouldn't reveal. Sellers must disclose known latent defects that make the home dangerous or unfit to live in.
Lien
A claim registered against the property, for example by an unpaid contractor. It must be cleared before closing or the money is held back.
Listing agreement Selling
The seller's agreement with the brokerage: the price, the length of the listing, the commission and how the home will be marketed.
Listing price Selling
The asking price. It can be set at market value, or below it to draw several offers on an offer date. Both are strategies, not promises.
Lockbox Selling
A secure box on the property that holds the keys, so agents can show the home at booked times.

M

Maintenance fee
The monthly fee condo owners pay for building operations and the reserve fund. Buyers budget for it; for sellers, high fees can slow a sale.
MLS®
The system real estate boards use to share listings between brokerages.
Mortgage broker Buying
A licensed professional who shops lenders for you. They're usually paid by the lender on standard mortgages.
Mortgage portability
Moving your current mortgage, with its rate, to your next home instead of paying a penalty to break it.
Mortgage renewal Buying
Signing a new term when the current one ends. It's the easiest time to switch lenders or change your mortgage without a penalty.
Multiple representation
When one brokerage represents both the buyer and the seller. It requires written consent and limits what the brokerage can do for each side.

N

N12 notice
A landlord's notice to end a tenancy because the owner, a buyer or their family will move in. It has strict timing and compensation rules.
Non-Resident Speculation Tax Buying
An extra provincial tax on homes bought in Ontario by people who aren't citizens or permanent residents, with some exemptions.
Notice of fulfillment (waiver)
The signed form that removes a condition. Once all conditions are fulfilled or waived, the deal is firm.

O

Offer date
A set time when the seller reviews all offers at once.
Open house Selling
Set hours when anyone can walk through the home. Good for exposure; plan for security and a clean, neutral space.

P

Patent defect Buying
A problem you could see on a reasonable inspection. Buyers are generally expected to find these themselves.
Possession Buying
The moment you get the keys and can move in, normally on the closing date.
Power of sale
A sale by the lender after the owner falls behind on the mortgage. Usually sold as is, with little seller information.
Pre-approval Buying
A lender's conditional promise to lend up to an amount at a held rate. Not a final approval on a specific home.
Pre-construction Buying
Buying a home before it's built, from the builder's plans. New condo buyers in Ontario get a 10-day cooling-off period.
Pre-listing inspection Selling
An inspection the seller orders before listing, to fix issues or disclose them up front and give buyers confidence.
Prepayment penalty Selling
The cost of paying off a closed mortgage early when you sell, often three months' interest or an interest rate differential.
Price per square foot
The price divided by the living area. Handy for comparing similar homes, misleading across very different ones.
Principal residence exemption Selling
Usually makes the gain on selling your own home tax-free. You still report the sale on your tax return.
Property tax
The yearly tax your municipality charges, based on the MPAC assessed value and the city's tax rate.

R

RECO
The Real Estate Council of Ontario, which registers agents and brokerages and enforces the rules they follow.
Rental restrictions (condos)
Condo rules on leasing units, such as minimum lease terms or bans on short-term rentals. Check the declaration and rules before you buy to rent.
Reserve fund
A condo corporation's savings for major repairs. A healthy fund protects buyers and makes a unit easier to sell.
Right of first refusal
A right to match an offer before the property is sold to someone else. It shows up in some co-ownership and commercial agreements.

S

Secondary suite
A second unit within a home, such as a basement apartment. It must meet zoning, building and fire code rules to be legal.
Seller's market
More buyers than homes for sale. Prices rise, homes sell quickly and buyers often compete on offer dates.
Seller Property Information Statement (SPIS)
An optional form where the seller answers questions about the property. Sellers should answer carefully; buyers should still verify.
Septic and well inspection Buying
For rural homes not on city services: checks that the septic system works and that the well water is safe and plentiful.
Severance
Dividing one lot into two or more, approved through the municipality's committee of adjustment.
Showing Selling
A scheduled private visit by a buyer and their agent. Showing instructions set the times, notice and lockbox access.
Sign-back
Changing an offer and sending it back; also called a counter-offer.
Sold over asking
A sale above the listing price, common when a home is listed low to attract several offers on an offer date.
Special assessment
A one-time charge to condo owners when the reserve fund can't cover a cost.
Square footage
The home's size. Listing figures are often estimates; for a condo, check what the builder's plans and the declaration show.
Staging Selling
Arranging furniture, light and decor so buyers can picture themselves in the home. It usually helps photos most of all.
Statement of adjustments
The lawyers' closing tally: price, deposit, taxes and fees the seller prepaid, and the final amount each side pays or receives.
Status certificate
A condo corporation's package of documents on its finances, rules and legal matters. Sellers order it; buyers' lawyers review it.
Stress test Buying
Lenders check you could afford payments at a higher rate than the one you're offered.
Subject to sale Buying
A condition that the buyer's current home must sell first. It's often paired with an escape clause that lets the seller keep marketing.
Survey
A drawing of the property's boundaries and buildings, showing where everything sits.

T

Tarion Buying
The organization that administers Ontario's new home warranty: what a builder must fix, and for how long.
Tenancy (sitting tenant)
A tenant already living in the property. Their lease carries over to the buyer unless it ends lawfully, so check it before buying.
Title
Legal ownership of the property, recorded in Ontario's land registry, along with anything registered against it.
Title insurance
A one-time policy covering problems with ownership, boundaries and certain kinds of fraud.
Title search
The lawyer's check of the property's registered history: owners, mortgages, liens and easements.
TRESA
Ontario's Trust in Real Estate Services Act: the law that sets the rules for agents and brokerages and the protections you're owed.

U

Underwriting Buying
The lender's review of you and the property before final approval: income, credit, down payment and the appraisal.

V

Vacant Home Tax
A yearly City of Toronto tax on homes left empty for more than six months of the year. Every owner must declare their home's status each year.
Vacant possession
The home is handed over empty, with no tenants or belongings left behind, on closing day.
Variable rate Buying
A mortgage rate that moves with the lender's prime rate.

W

Waiver
The buyer's signed notice giving up a condition, such as financing or inspection, before its deadline. Once every condition is waived or fulfilled, the deal is firm.
Work order
A municipal order to fix a building or safety issue. Open work orders should be cleared or dealt with in the agreement.

Z

Zoning
The city's rules on how land can be used and built on. Check before buying if you plan a basement suite, laneway house or addition.

The approach

With me, you don’t buy with confidence, you close with it.

I'm Nima. My work in commercial and investment real estate has taught me to look beyond the property itself, to the numbers, the risks and the details that matter. I bring that same approach to every residential transaction.

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