Real estate has plenty of confusing and unique terms that you may see and wonder… What does that mean? We have compiled a list so you never have to wonder again!
On a Listing
MLS (Multiple Listing Service)-
The Multiple Listing Service is a software platform managed by the local real estate board that compiles all the property listings in a specific market.
DOM v. LDOM v. PDOM -
DOM stands for days on the market. This term allows you to see how many days a listing has been posted. In comparison, LDOM (or sometimes CDOM) stands for cumulative property days on market. It shows the total number of days a property has been on the market even if it has been re-listed. PDOM (property days on market) shows how many days the property has been listed for in the current listing. Often agents will terminate and re-list a property to bring the DOM down, so we recommend always looking at the LDOM.
Occupancy: Tenanted/Owner v. Vacant-
Tenanted or owned means that someone currently resides in the property. For rentals, a tenant is entitled to 24 hours notice before a showing. For owner-occupied properties, agents need to book the property at a time that works for the owner. For vacant properties, agents have more flexibility because only the client and agents' schedule need to be accommodated.
The Holdover Clause is made to protect the listing brokerage. It covers any potential buyer that is introduced during the brokerage’s listing period. Any showing that takes place during a brokerage’s coverage of a property is protected by the holdover. If an offer is registered after the listing expires but the buyer had toured the property during the brokerage’s listing timeframe, the brokerage is entitled to a commission. There is no standard agreement for the holdover and it can be negotiated with the listing agent.
Completion Date v. Possession Date-
The Completion Date is the date that a transaction is officially over and the deed is transferred to the new owner. The Possession Date is the day the new owners can move into the property. These are usually the same day.
Exclusive Listing or Pocket Listing-
An exclusive listing (sometimes called a pocket listing) gives the listing brokerage exclusive authority to market the property outside of the MLS system. No MLS listing is made for these properties.
CAC stands for Central Air Conditioning and is usually on listings for condos. The CAC indicates what is included in a condo building’s maintenance fees.
Parcel of Tied Land is an owned or rented property that shares amenities with other owners/renters; shared parking areas and shared swimming pools are examples.
SPIS stands for Seller Property Information Sheet and it used to be required when listing a property. It informs any prospective buyer about known issues with a property. After several legal cases, SPIS is no longer mandatory but may still be included.
UFFI stands for Urea Formaldehyde Foam Insulation. It is a type of insulation that was widely used in the 1970's for insulating and retrofitting industrial, commercial and older residential buildings. The use of a urea formaldehyde based resin in the manufacturing of UFFI can lead to the release of formaldehyde gas. Health Canada does not currently know the long term effects of UFFI. It has been prohibited from being advertised, sold or imported in Canada under item 34, Part I of Schedule I to the Hazardous Products Act since December 1980.
SNLR (Sales-To-New-Listings Ratio)-
Sales-To-New-Listings Ratio (SNLR) is a percentage determined by the number of houses currently selling and the number of new listings coming onto MLS.
MOI (Months of Inventory)-
The MOI is a calculation that determines how long it would take for all the currently available properties to sell if no new properties come on the market.
ELFs (Electrical Light Fixtures)-
Some listings may include ELFs which entitles a buyer to all the light fixtures on the property.
Types of Agents
The listing agent represents the interests of an owner of a property. This agent is responsible for marketing the property effectively and getting a desirable outcome for the seller. Most listings are posted to the MLS system but there are some exceptions (e.g. exclusive listings).
The buyer’s agent represents the person(s) looking to either purchase or rent a property. This agent helps their client(s) see properties of interest, communicate with listing agents, and submit offers.
The co-op agent is the agent working on the other side of your transaction. If you are trying to sell your property, the buyer's agent is the co-op agent. If you are trying to purchase a property, the listing agent is the co-op agent.
Each Realtor (or real estate agent) works under a brokerage and realtors are able to market themselves under their brokerage. Although realtors work as independent contractors, in Ontario, agents must work under a brokerage.
On some listings you may see 2 bedrooms +1 and this can mean different things depending on the type of property. For condos, this often refers to an interior room that has no door or window (e.g. a den or solarium). For houses, +1 often refers to bedrooms below grade (e.g. a basement bedroom).
An ensuite, most commonly used to describe a bathroom attached to a bedroom, means any secondary room attached to a primary. Lockers and closets are also considered an ensuite if they are inside the property.
Accessory Dwelling Units (ADU) is a secondary living space that is usually detached from a house and is often used as a rental unit. ADUs go by many terms and can either already exist on a property or be added if space and bylaws allow.
Comps are an appraisal tool used by agents to help evaluate how much a property is worth. Frequently, they are either used to determine the listing price for a property or a fair offer price in a purchase application. Comps are determined by comparing recent sales and/or list prices in the area.
Types of Property Ownership:
With this type of purchase, you purchase shares in a corporation instead of the actual land. These buildings often have stricter rules and require potential purchaser interviews. The financial state of a potential purchaser is more influential and these buildings require a larger down payment of around 30-35%.
This is a legal structure for a property where purchasers co-own the property and both names are on the title.
The most common ownership type for condominiums and townhouses is a condominium. It is when you own a unit but share common amenities. Shared amenities may include a shared parking lot or swimming pool.
Considered the most ideal form of ownership, freehold means you own both the property and the accompanying land.
In leasehold ownership, you own the property on the land but have a long-term rental agreement for the accompanying land.
Types of Offers
A conditional offer is legally binding so long as certain conditions are met. Conditions can include passing inspections, financing, status certification (for condos), required repairs, etc.
A firm offer is one that does not have any conditions. These offers are typically more desirable to a seller.
An offer is a written agreement that indicates the intent to purchase or rent a property. Once an offer is made, if it is accepted, the buyer or leaser is obligated to follow through on their commitment to possess the property.
A bully offer is an aggressive offer made prior to an offer date. It also expires prior to the offer date.
The offer date is the date when offers will be reviewed by a seller. They are typically used in a market that favours the seller.
The deposit is the amount of money given to the seller upfront. It comes out of the purchase price and usually accompanies the offer. In rentals, it is commonly given in the form of months upfront. In Toronto, the most frequent deposit amount is around 5% but it can be negotiated between buyers and sellers.
A down payment is paid by the buyer to a lender when purchasing a house. The higher the down payment, the lower the risk is for the lender. In paying a down payment, a lender will then finance the remainder of the house for the purchaser. It often represents a portion of the total purchase price.
BoC (Bank of Canada)-
The Bank of Canada (BoC) is responsible for setting the overnight rate for mortgages that affects the rates offered by mortgage lenders.
A home owner’s equity is the amount of money the property owner has tied into the home. It can be calculated by the current market value of a home minus any owed money such as a mortgage or liens.
Documents and Forms
Agents may ask you to show supporting documents before they help you search for a property (especially with rentals). Agents ask for these documents to see what a client is able to afford and make the application process easier. Supporting documents may include a credit report with score, employment letters, a rental application or any other documents that may present you as an ideal candidate.
Buyer Representation Agreement (BRA)-
A buyer representation agreement (sometimes called a BRA) is a legal agreement between a buyer and their realtor. When you sign a BRA you agree to work exclusively with a realtor and they are obligated to you as well. You should only sign a BRA once and if you feel that an agent has your best interest in mind.
We hope this list helps! If you have any questions or are interested in learning more, feel free to reach out to Homing Real Estate.
Graham Rowlands | 416 720 0003 | firstname.lastname@example.org