When you’re preparing to sell your home, real estate agents, buyers, and marketing materials often use terms that might leave you scratching your head. From “conditional offers” to “CMA,” the lingo can be overwhelming for first-time sellers or anyone unfamiliar with the process. This guide simplifies the most common real estate jargon so you can navigate the selling process with confidence and clarity.
Whether you’re listing your home for the first time or just need a refresher, here’s a handy glossary to help you speak the language of real estate like a pro.
An appraisal is a professional estimate of your property’s value. A licensed appraiser evaluates your home based on factors like location, condition, and recent comparable sales (similar homes in your area that have recently sold).
Why it matters: Appraisals are often used by lenders when buyers apply for mortgages to ensure the home’s value matches the loan amount. For sellers, an appraisal can help set a realistic asking price.
A CMA is a detailed report prepared by a real estate agent to estimate your home’s value. It compares your property to similar recently sold homes in your area, taking into account size, condition, and features.
Why it matters: A CMA helps you determine a fair and competitive asking price to attract buyers while ensuring you get the best value for your home.
The market value of a home is the price that a buyer is willing to pay and a seller is willing to accept, based on current market conditions.
Why it matters: Market value fluctuates with supply, demand, and economic factors. An experienced agent can help you gauge your home’s market value and price it effectively.
The asking price (or list price) is the price you set when your home is listed for sale. It’s the amount you hope to receive for the property but is usually open to negotiation.
Why it matters: The asking price sets expectations for buyers. A competitive price can attract more interest and offers, while an unrealistic price might deter potential buyers.
Why it matters: Most properties in New Zealand are freehold, but leasehold properties often come with additional costs and responsibilities, which can affect buyer interest.
A valuation is a formal, in-depth assessment of your property’s value by a qualified professional. It is often required by banks before approving a mortgage.
Why it matters: A valuation gives you a reliable benchmark for your home’s worth and can support your asking price.
A buyer’s market occurs when there are more homes for sale than buyers looking to purchase. This creates lower demand, which can drive prices down and give buyers more negotiating power.
Why it matters: In a buyer’s market, sellers may need to price their homes more competitively, be flexible on terms, or invest in upgrades to stand out.
A seller’s market occurs when there are more buyers than homes available for sale. This creates higher demand, often leading to quicker sales and higher prices.
Why it matters: In a seller’s market, sellers can benefit from strong competition among buyers.
This measures how long properties remain listed before being sold.
Why it matters: Shorter DOM indicates high buyer demand, while longer DOM may suggest a need for price adjustments or improved marketing.
A tender is a sales process where buyers submit their best offers by a set deadline. The seller can accept, reject, or negotiate any offer.
Why it matters: Selling by tender can create competition and push buyers to make strong offers. It’s popular in high-demand markets.
An auction is a public sale where potential buyers bid for a property. The highest bidder, once the reserve price is met, secures the property.
Why it matters: Auctions can result in quick sales and competitive prices, particularly in high-demand areas.
The reserve price is the minimum amount a seller is willing to accept at auction. If bids don’t reach this price, the property may not be sold.
Why it matters: Knowing the reserve price helps sellers gauge interest and set realistic expectations.
The offer price is the amount a buyer is willing to pay for your property. This price may match, exceed, or be below your asking price.
Why it matters: Negotiating the offer price is a key step in the selling process. Your agent will help you evaluate offers and negotiate for the best outcome.
A conditional offer is an offer to buy your property, but only if certain conditions are met. Common conditions include:
Why it matters: Sellers should evaluate the likelihood of conditions being met before accepting the offer. A conditional offer isn’t final until the conditions are satisfied.
An unconditional offer is a purchase offer with no conditions attached. The buyer is committed to purchasing the property once the contract is signed.
Why it matters: Unconditional offers are ideal for sellers because they’re final and can speed up the sale process.
A deposit is the initial amount of money paid by the buyer when they agree to purchase the home. It’s usually a percentage of the sale price and shows the buyer’s commitment to the deal.
Why it matters: If the buyer breaches the contract, the seller may be entitled to keep the deposit.
The settlement date is the day the ownership of the property officially transfers from the seller to the buyer. On this day, the buyer pays the remaining balance of the sale price, and you hand over the keys.
Why it matters: The settlement date marks the end of the sale process. Ensure you’re ready to vacate the property and complete all agreed-upon terms.
A title is the legal document that proves ownership of a property. It outlines any restrictions, rights, or conditions tied to the land.
Why it matters: Before selling, ensure there are no unexpected issues with the title, such as boundary disputes or easements.
Escrow is a neutral third party that holds funds or documents until all conditions of a real estate transaction are met.
Why it matters: Escrow protects both buyers and sellers by ensuring funds and paperwork are handled securely.
A withdrawn listing is a property that has been removed from the market before it was sold.
Why it matters: Sellers may withdraw a listing if market conditions change, offers are unsatisfactory, or they decide not to sell.
A final inspection allows the buyer to check that the property is in the agreed-upon condition before settlement.
Why it matters: Issues discovered during the final inspection could delay settlement or require resolution.
Conveyancing is the legal process of transferring property ownership from the seller to the buyer.
Why it matters: A conveyancer or solicitor ensures all legal requirements are met for a smooth transfer of ownership.
CGT is a tax on the profit made from selling a property that is not your primary residence.
Why it matters: Understanding CGT obligations is crucial for sellers of investment properties.
A mortgage discharge is the process of formally removing a mortgage from your property’s title once it is fully paid off.
Why it matters: Sellers must ensure their mortgage is discharged before settlement to complete the sale.
Chattels are movable items included in the sale of a property, such as appliances, curtains, or light fixtures.
Why it matters: Clearly identifying included chattels avoids disputes between buyers and sellers.
Fixtures are items that are permanently attached to the property, such as built-in wardrobes or kitchen cabinetry.
Why it matters: Sellers must understand what constitutes a fixture to avoid misunderstandings with buyers.
Transfer duty (or stamp duty) is a tax paid by the buyer when a property changes ownership.
Why it matters: While it’s a buyer’s expense, understanding transfer duty can help sellers set realistic expectations during negotiations.
Home staging involves decorating and furnishing a property to make it more appealing to potential buyers.
Why it matters: Staging can enhance a property’s presentation, helping it sell faster and for a higher price.
This report is prepared by a qualified inspector to evaluate the condition of the property, identifying any structural issues or necessary repairs.
Why it matters: Providing a pre-inspection report can give buyers confidence and streamline the negotiation process.
Real estate terminology can feel like a foreign language, but understanding these key terms will help you navigate the selling process with confidence. Whether you’re reviewing an offer, setting your asking price, or negotiating terms, this glossary ensures you’re well-prepared and informed at every stage.
If you’re ever unsure, don’t hesitate to ask your real estate agent for clarification—communication is key to achieving a smooth and successful sale.
Keep exploring! Head to the next section: Planning Your Sale to discover the next stage of the selling process and take another step toward a smooth and successful sale.