Glossary of housing terms

These are the terms that recur across the guides, defined as they are used here. Where a word carries a different technical meaning in a particular contract or statute, that document governs and this list does not.

A

Abatement

A temporary reduction in property tax granted to a building, usually with a stated expiry date.

Amortisation

The schedule by which a loan's balance is repaid in full over its term.

Appraisal

A lender's valuation of a property as security for a loan. It is not an inspection.

Assessment (building)

A one-off charge levied on unit owners for work the reserves do not cover.

Assessment (tax)

The value a municipality assigns to a property for the purpose of taxing it.

B

Basis

The recorded cost of a property, used to calculate gain when it is later sold.

Board package

The financial and personal documentation a co-operative board requires from a purchaser.

C

Chain of title

The unbroken sequence of recorded transfers leading to the present owner.

Closing

The meeting or process at which funds move and the deed is delivered.

Closing costs

The taxes, fees and prepayments due at closing, payable in cash and not borrowable.

Co-operative

An ownership form in which shares in a corporation carry a lease of an apartment.

Common charge

A condominium's monthly charge for operating the building's shared elements.

Common elements

The parts of a condominium owned jointly by all unit owners.

Comparable

A recently sold property similar enough to be used as price evidence.

Condominium

An ownership form in which a unit is owned outright as real property.

Contingency

A condition in a contract that must be satisfied before the parties are bound to complete.

Covenant

A recorded promise limiting how land may be used, binding on later owners.

D

Days on market

How long a property has been advertised before going under contract.

Deed

The instrument that transfers ownership of real property.

Default

Failure to meet an obligation under a loan or lease.

Deposit

Money paid on contract, held pending completion; also the cash portion of a purchase price.

DTI

Debt-to-income: total monthly obligations expressed as a share of gross monthly income.

E

Easement

A right held by someone else to use part of the land, such as access or a utility run.

Encroachment

A structure that crosses a boundary onto neighbouring land.

Encumbrance

Any recorded claim or burden against a property.

Equity

The value of a property less what is owed against it.

Escrow

Money held by a third party, or a monthly sum collected for tax and insurance.

F

Fixed rate

An interest rate that does not change for the term of the loan.

Flip tax

A transfer fee payable to a co-operative when shares are sold.

Floor area ratio

The permitted floor area of a building expressed as a multiple of its lot area.

Freehold

Ownership of land and the buildings on it without a time limit.

G

Ground lease

A long lease of the land beneath a building, held separately from the building.

H

Historic district

An area whose exteriors are protected from alteration by designation.

I

Inventory

The stock of properties currently advertised for sale in an area.

L

Lien

A recorded claim securing a debt against a property.

List-to-sale ratio

The relationship between asking prices and achieved prices.

LTV

Loan-to-value: the loan expressed as a share of the property's appraised value.

M

Maintenance

A co-operative's monthly charge, typically including tax and the underlying mortgage.

Months of supply

How long current inventory would last at the current rate of sale.

Mortgage

A loan secured on real property; also the instrument creating that security.

Mortgage insurance

Insurance protecting the lender where the loan-to-value ratio is high.

Multi-family

A building containing more than one dwelling unit.

N

Non-invasive

An examination made without opening, lifting or excavating any part of a building.

O

Offering plan

The document setting out the terms on which units in a building are offered.

Origination fee

A lender's charge for making a loan.

P

Points

A fee paid at closing to reduce the interest rate on a loan.

Principal

The amount of a loan still owed, excluding interest.

Proprietary lease

The lease of an apartment that a co-operative's shares carry.

R

Reserve fund

Money a building holds against future major repairs.

Right of first refusal

A board's right to buy a unit on the same terms as an outside purchaser.

S

Setback

A required distance between a building and a boundary, or a step in a building's profile.

Sponsor unit

A unit still held by the party that converted or built the building.

Stoop

The raised entrance stair characteristic of a row house.

Sub-market

A dwelling type, area and price band within which properties genuinely compete.

Survey

A drawing establishing legal boundaries and the position of structures within them.

T

Tenement

A nineteenth-century multiple dwelling built to a narrow, deep lot.

Title insurance

One-off cover against defects in title existing before the purchase.

Turnover

How frequently properties in an area change hands.

U

Underwriting

A lender's assessment of a borrower's capacity and the security offered.

V

Variance

Permission to depart from a zoning requirement in a specific case.

Z

Zoning

The rules governing what may be built on a parcel and how it may be used.