Canadian Real Estate Jargon For Beginners

1. Canadian Real Estate Jargon for Beginners If you’ve ever marathoned episodes of home building, home improvement, or home buying and selling shows, you may find yourself stumped at a few words that seem to fly out of people’s mouths. Let’s clear up any confusion about some of the basic terms. We’re talking you through some of the real estate jargon common in the Canadian real estate market. The Seller’s Market: Remember in 2016 when houses were flying off the market almost as quickly as they were listed? That’s what the seller’s market is in a nutshell. Buyers scramble to find homes, and sellers are able to list for higher prices (and actually get the asking price) The Buyer’s Market: This is the exact opposite of the seller’s market. If you’re hearing the term “buyer’s market” tossed around, it means that there is a surplus of homes listed by sellers, and buyers get a much wider selection of homes. The home prices in a buyer’s market tend to drop, and houses may stay on the market longer. A Balanced Market: It’s been a while since the last appearance of a balanced market. A balanced market means that the supply of homes meets the demand of homebuyers. Prices in this type of market tend to be stable and there are enough houses to choose from. Real Estate Agent: In simple terms, it’s someone who has a real estate license. Real Estate Broker: Someone who has gone beyond the level of real estate agent with further education, and has taken a broker licensing exam. A broker usually runs a brokerage, and can have real estate agents working under them. Real Estate Associate Broker: Someone who has a broker license, but works under another broker as part of a team or a brokerage. REALTOR ® In Canada, a REALTOR ® is someone who is a real estate agent, part of the Canadian Real Estate Association (CREA), and adheres to the REALTOR® code of conduct.

2. They are expected to actively update their education and they enjoy full access to Board MLS Systems. Title: Title is saying that a piece of real estate is legally yours. There are two types of titles, a freehold and leasehold. Freehold: The type of real estate that one owns the land the building is located on. In this case you are responsible for the maintenance of that land. Leasehold: A type of property interest that is only for a certain period of time, as stated in the contract signed. Leaseholds are typically for landlords. Condominium Fee: If you live in a condominium or townhouse, you will pay a fee to that building ownership that takes care of the cost of maintenance, repairs and management. Condominium fees are usually paid out once every month. Mortgage: The legal way in which real estate is used as security for a loan. Unless you have all the money to pay for your home upfront, you’ll be like many other Canadians who have a mortgage and make payments towards their mortgage every month. Mortgages aren’t one size fits all. People shop around for mortgage deals that make sense for their finances and their needs. Term: A length of time the person, who has the mortgage, pays the interest rate on the mortgage loan. Usually, people don’t get to pay off their mortgage in their term because there is an amortization in place that reduces the debt Amortization: The period of time after one has made regular mortgage payments and can have a reduced debt number of zero. Amortization periods are set in the 15-25 year range. Once you have made regular payments, you will receive reduced debt after whatever period of time you agreed to. Down Payment: A down payment is the price one must pay for a piece of real estate upfront, out of their own resources, before they make mortgage payments. Depending on your

3. house and city, the down payment can be anywhere from 5% to 25 % of the purchasing price. Closing Costs: Closing costs are the additional fees one must pay on the day that their property sale is final (the close date). Appraised Value: An appraisal of real estate is determined by a certified appraiser for mortgage financing, and states how much the home is valued at. This is different from the market value. Market Value: The market value of a home is the final price the home sells for, or should sell for. It does not go through the any financing values, and is not as accurate at stating the value as an appraisal. Equity: The price a home can sell for, minus the total debts against the home, equals the equity left in the home. Equity tends to increase as the mortgage payments are made, but market values may affect the equity in a home. Foreclosure: Foreclosures happen when a lender gets ownership of the property (like the bank) if a borrower can’t pay a mortgage loan. Deed: This legal piece of paper is signed by both the purchaser and the vendor, transfers the ownership. This is evidence that states who the owner is. Zoning Bylaws: These are laws put in place by the municipality or region that specify how land can be used. It can also put restrictions on how the land can be used. These are just some of the basic terms that may help you understand what’s going on in Canadian Real Estate lingo. For more information on what the terms mean in your specific situation of real estate, you may find it useful to contact a local agent.