Real Estate Words Made Easy: Key Terms Every Smart Investor Should Know

The decision to invest in a property is a big one, and in the current market landscape, a wise one. Property investments are always a good option for the immense security they provide and the unmatched returns they offer. But buying a property is equally challenging. From finding the perfect real estate investing opportunity to trying to understand all the jargon that gets tossed around.

Learning Real Estate Terms

If you have been researching some property types and projects to invest in, chances are, you would have come across a lot of new terms. You will be exposed to a lot of real estate terms repeatedly, and understanding them is essential for many reasons. For starters, you can use these terms to inquire about properties, assess their suitability with your investment goals, and even examine them in your purchase contracts and other documents to ensure everything is correct.

The following are the most commonly used real estate terms with which every property buyer should be familiar:

• Carpet Area: One of the most common terms that you will see or hear for any property you purchase is carpet area. This term essentially refers to the amount of space in the house which is usable. The carpet area excludes the space occupied by wall thickness and is essential to compare among properties to understand which options align with your needs.

• Built-Up Area: The built-up area is another common term. This term is used to refer to the total area of the property. The carpet area and unable area of the property are both covered by this term, including wall thickness, balcony, any other projected space, etc.

• Down Payment: Down payment is not exclusive to the real estate sector and you must have heard it around all big purchases. This term refers to the amount of money that the buyer needs to pay upfront to secure the property. It is not a part of the loan you’re secured for purchasing and is a small portion of the total value that needs to be paid.

• RERA: RERA, short for Real Estate Regulatory Authority, is the authority in India that approves properties across India in alignment with the Real Estate (Regulation and Development) Act. Properties which are RERA certified are considered a safer investment option and prospective buyers must inquire about this from sellers.

• Title Deed: A title deed is a critical document that every property owner should take care of. This document proves ownership of the property, which means that it is essential to make sure that every detail on this document is correct. When drafted, check the name, spelling, and other details mentioned thoroughly to ensure there are no mistakes. Make sure you always see the original title deed instead of the Xerox to be certain of the details.

• Sale Deed: The sale deed is an equally critical document as it is a certification of the fact that a particular property has been sold by the seller to the buyer. This document will contain property details and be signed by both the seller and the buyer, recording the sale event. If this document is missing, the sale will be considered to never have happened legally.

• Closing Cost: The closing cost of a property includes additional costs that the buyer needs to pay in order to secure the property. These costs can include expenses like lender fees, insurance providers’ fees, legal fees, charges levied by real estate agents, taxes, and more. In some cases, there are homeowners association charges as well which are included in this bracket.

• HOA: HOA or Homeowners Association is a term that you may hear more prominently nowadays. For a lot of community living projects such as apartments, and even the modern gated community farmland investment properties such as those that you can find in Hyderabad, an HOA is formed.

• Mortgage: The term mortgage refers to the loan that is taken to purchase the property. When a mortgage is taken, the property in question is placed as collateral, which means that if the buyer fails to pay back the loan amount and interest, the property can be seized from them. This is, however, done in alignment with the specific terms of the mortgage contract.

• Stamp Duty: A stamp duty is a tax collected by the government when a property is purchased. The rate of the tax can vary from one state to another. Moreover, you may also find that when the buyer is a female, the rate of stamp duty levied will be lower than when the buyer is male. The value is set at a percentage amount of the property in question. For instance, stamp duty can be set at 3% of the property value. Understanding the rate for females and males in your state can help you make significant savings.

If you are looking to make a real estate investment, it is essential to know some key industry terms that you will come across. At the same time, it is essential to know where to invest. If you are looking for a distinctive investment opportunity, check out our farmland properties at Vaayu. Vaayu is a structured farmland investment opportunity where you can invest in land divided into parcels of ¼ acres, ½ acres, and 1 acre. Planned meticulously with all modern-day amenities and a focus on sustainability, this is the best farmland in Shankarpally, Hyderabad that you will come across. For more information about this project, connect with our representatives who can also help you check out the property personally.

Conclusion

Property investment is one of the best and most critical investments of your life. This not only requires a thorough understanding of the market in order to weed out unsuitable properties but also of common industry terms to ensure you have every essential aspect checked out. If you are a first-time buyer, make sure you inquire about all the factors essential to assess the property suitability, to make an informed decision.