Real Estate Jargon | Common Property Terms in Australia
‘Property speak’ – what does it all mean?
Buying your first apartment in NSW can be difficult enough without having to wade through confusing real estate jargon along the way. It seems there’s a whole new language to learn before you can climb the property ladder.
Research by Gateway Bank found that Australian mortgage holders have “concerningly low levels of awareness” of many key terms used by the home-loan industry to describe its various products and features. [1]
Gateway Bank chief executive Paul Thomas says the survey’s findings aren’t unexpected.
“We’re humans. We’re overloaded with information, and we can’t take it all in,” he said.
A similar study by ME Bank found first home buyers struggle to understand the ins and outs of buying their first home.
A ME Bank survey of first-home buyers found more than half lacked basic property buying literacy despite nearly 70% saying they felt confident to make financial decisions.
ME Head of Home Loans Patrick Nolan said this overconfidence could really be costing first-time home buyers. [2]
“Financial literacy is a valuable asset and one of the biggest money savers over time, especially when it comes to buying what is likely to be the biggest investment of your life,” he said.
Break/out box [3]
- Of 1,000 first-home buyers surveyed by the ME Bank, more than half failed a basic property buying literacy quiz.
- And yet 70% said they felt confident about making financial decisions.
- 85% of first-home buyers didn’t know that there’s no cooling-off period when buying at auctions.
- 78% of first-home buyers didn’t know that you pay the deposit on auction day.
- 65% of owner occupiers were unsure of the key things that contribute to the amount of interest you pay on a home loan.
Chief executive of My Place Conveyancing David King says that many consumers, especially first-home buyers, are unsure how the legal process of buying a home, known as conveyancing, works in Australia. [5]
“Conveyancing is the legal process where ownership of real estate, house or land, is transferred from one person to another,” he says.
Before embarking on this real estate journey, it’s worth learning what some of these key legal terms mean, and how they might impact on your purchase.
Settlement: This is where the buyer pays the seller all outstanding sums owed to ‘settle’ the purchase. This includes sale price, utility bills and taxes.
Transfer duty: Previously called stamp duty, it is a tax imposed by Revenue NSW on the sale or transfer of an interest in land. The amount of duty is assessed based on the purchase price of the property and must be paid by the buyers within three months of the contracts for sale being exchanged, although first-home buyers qualify for generous exemptions from this tax. (Click here to read more about how you can save on transfer duty in NSW).
Cooling off period: This begins when the contracts are exchanged and ends at 5pm on the fifth business day after exchange. During this time, the buyer can back out of the contract by providing notice in writing. The cooling off period does not apply to auction sales.
Contract of sale: A written contract between the buyer and the seller that sets out the key terms of the sale, and the rights and obligations of both the seller and buyer.
Conveyancing: The process of transferring the ownership of legal title in property or land from one person to another.
Disbursements: The incidental fees incurred by solicitors or conveyancers in a conveyance. These include costs in obtaining the documents required to be attached to a contract, property search fees, registration fees and agent fees.
Strata levies: Fees paid for the management and upkeep of the scheme. All property owners must pay levies to the owners’ corporation, and these should be part of your budget when buying a property.
Case Studies: Merrylands & St Marys
ALAND has forged a reputation for building affordable, high-quality projects in Western Sydney. The Gladstone Village (Merrylands) and Carson on the Park (St Marys) continue that tradition, offering stylish, modern apartments and a range of in-house amenities such as communal BBQs, playgrounds and manicured gardens. Quartz, the first release at The Gladstone Village, also features a resort-style swimming pool. Both developments are located near schools, shops, restaurants, public transport and other essential services. With completion dates approaching, stock in both development is limited, so please contact the ALAND Sales Team on 1800 025 263 or fill out your details below.
Sources:
[1] The New Daily
[2] MOZO
[3] MOZO
[4] Realestate.com
[5] MOZO