Contracts, regulations, compliance, entity structures, zoning, permits, and landlord-tenant law.
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Foundation terms you need to know first (88 terms)
Development costs are all the expenses incurred during the process of acquiring land, designing, constructing, and preparing a real estate project for use or sale, from start to finish.
Base rent is the fixed, minimum rent amount paid by a tenant to a landlord for the use of a property, excluding additional charges like operating expenses, taxes, or utilities.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
The Lease Commencement Date is the official date specified in a lease agreement when the tenant's rights and obligations, including rent payments and property responsibilities, legally begin.
An application fee is a non-refundable charge paid by a prospective tenant to a landlord or property manager to cover the costs associated with processing a rental application, including background and credit checks.
Complex strategies and professional concepts (103 terms)
An Equity-for-Property Swap is an advanced real estate investment strategy where an investor exchanges equity in one or more properties or entities for direct ownership of another property, often to achieve tax deferral, portfolio restructuring, or strategic asset acquisition.
The accounting process of recognizing the estimated cost of an Asset Retirement Obligation (ARO) as a liability and capitalizing a corresponding asset, which is then depreciated over its useful life, reflecting the future costs associated with retiring a long-lived asset.
A legally binding contract that alters the priority of liens on a property, allowing a senior lienholder to voluntarily place their claim in a junior position to another, typically to facilitate new financing or complex transactions.
Unrelated Business Income Tax (UBIT) is a tax levied on the net income of a tax-exempt organization, including certain real estate investment vehicles, derived from a trade or business regularly carried on and not substantially related to its exempt purpose.
Inverse condemnation is a legal action initiated by a private property owner against a government entity to recover "just compensation" for a taking of their property, where the government has not formally exercised its power of eminent domain but has effectively deprived the owner of beneficial use or value.
An absolute auction is a type of real estate auction where the property is sold to the highest bidder, regardless of the price, with no minimum bid or reserve price set by the seller.
Acceptance in real estate is the unconditional agreement by a buyer or seller to the exact terms of an offer, forming a legally binding contract for a property transaction.
An application fee is a non-refundable charge paid by a prospective tenant to a landlord or property manager to cover the costs associated with processing a rental application, including background and credit checks.
An "As-Is Sale" in real estate refers to a property being sold in its current condition, meaning the seller will not make any repairs or improvements, and the buyer accepts all existing defects.
Asset verification is the process lenders use to confirm a borrower's financial resources, ensuring they have sufficient funds for a down payment, closing costs, and reserves for a real estate purchase.
Base rent is the fixed, minimum rent amount paid by a tenant to a landlord for the use of a property, excluding additional charges like operating expenses, taxes, or utilities.
A bilateral contract is a legally binding agreement where two parties exchange mutual promises to perform specific actions, making it the most common type of contract in real estate transactions.
A Board of Directors (BoD) is a group of individuals elected to oversee the management of a company, representing the interests of its shareholders and ensuring ethical and effective operations.
A Brownfield site is a property that has been previously developed, often for industrial or commercial use, and may have real or perceived environmental contamination that complicates its reuse or redevelopment.
A dedicated financial account used exclusively for business-related transactions, separate from personal finances, crucial for legal compliance and clear financial tracking in real estate investing.
Buyer's premium is an additional fee charged to the winning bidder in an auction, calculated as a percentage of the final winning bid and added to the total purchase price.
A clear title signifies undisputed legal ownership of a property, free from any liens, claims, or other legal encumbrances, ensuring the seller has the full right to transfer ownership to a buyer.
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