Buying a house is an exciting experience, but throw in some head-scratching property jargon and this same process can suddenly go from being very exciting to very intimidating.
To keep things simple, the good folks at GoodMove have put together a list of the 12 most searched property terms and their meanings to help you navigate through the confusing language of estate agents, solicitors and mortgage lenders.
Commenting on the research that analysed Google search trends over the past 12 months, Nima Ghasri, director at GoodMove said, “When purchasing a property, the jargon used by estate agents can be somewhat confusing if people are not regularly buying, selling or renting.”
“This can mean that very often buyers can make costly mistakes by misunderstanding estate agents. Therefore, we hope that by providing some clarification on terminology it can assist with a smoother and less stressful buying process.”
1. Buy-to-let (1,500+% increase)
Renting out property is an incredibly popular motivation, and considering the generation-rent phenomenon, it’s a pretty wise one too. Buy-to-let refers to a property purchased to rent out rather than living in it yourself. Over the year, search terms for “how does a buy-to-let mortgage work?” have increased by over 1,500%!
2. Gazumping (1,500+% increase)
Gazumping is a buyer’s horror story – it occurs when a seller verbally accepts an offer from one buyer before raising the asking price. It can also refer to a seller accepting a higher offer from another buyer after already accepting yours. Unsurprisingly, it was the UK’s most searched term with a 1,500% increase in queries.
3. Power of attorney: (450% increase)
In some scenarios, it may be necessary to make financial and legal decisions on behalf of somebody else; in that case, you may need the power of an attorney.
A power of attorney is a legal document that allows someone to make decisions or act on behalf of someone if they’re no longer able to. An example of this is the family of an elderly relative who is moving into a care home taking control of their estate.
4. Leasehold (250% increase)
With a 250% increase in search queries for “What does leasehold mean?” this is another term buyers struggled with. In brief, a leasehold property is situated on land owned by somebody else (the freeholder). A leaseholder owns the property for the duration of a lease but doesn’t have any claim to the surrounding land.
5. Freehold (180% increase)
Freehold means that you own the entire ‘estate’ you live on – meaning the property and its surrounding land. You are free to make any changes you like within the parameters of planning permission.
6. Capital gains tax (200% increase)
One thing buyers may not be aware of is that the profit gained on the sale of a property, which is not the primary residence, is liable for tax. This is known as capital gains tax (CGT) and the amount you pay depends on several factors including the price of the property and your income.
7. Probate (100% increase)
When somebody dies, their estate is distributed between the beneficiaries outlined in their will – ‘probate’ is the legal administration process that accompanies this. Please note that if this is something you experience, taxes and debts in relation must be paid beforehand.
8. Property chain (100% increase)
Occasionally individuals will be stepping into the shoes of both the buyer and the seller. This process is more commonly known as a property chain. A property chain can cause a sale or purchase to stall or fall through, so consider the benefits of getting in touch with a quick house sale company.
9. Gazundering (100% increase)
On the flip side of gazumping is gazundering. This is when a buyer initially agrees to an offer on a property, before reducing it prior to contracts being exchanged. For many sellers, refusing the offer could lead them back to square one with the entire chain falling apart. Often this means they can feel forced to accept.
10. Conveyancing (90% increase)
Following the property boom over the pandemic, there was a 90% increase in searches such as “how does house conveyancing work?” To put it simply – conveyancing refers to the legal transferring of property ownership from one person to another – most commonly from the seller to the buyer.
This is the process your solicitor or legal expert carries out, because of which they are often known as conveyancers.
11. Survey (60% increase)
We’re all aware that a survey refers to the assessment of information – however, with a 60% increase in search queries, not many knew its context in property.
A property survey is a professional inspection of a property to determine its conditions, and any problems with the structure. Your mortgage lender will carry out its own survey but you may wish to request your own more detailed survey to ensure there are no nasty surprises when you move.
12. Ground rent (50% increase)
If you are living in a rented property, you will be paying what is known as ground rent. In short, ground rent is an agreement that stipulates the leaseholder of a property to pay a regular fee to the freeholder to occupy the land for a specific length of time.