Property Terminology

A mortgage lender will, after obtaining certain information from the buyer, issue an Agreement in Principle (AIP). The information given by the buyer is taken at face value and not checked, it is simply the mortgage lender saying "If what you have told us is true, we are prepared to lend you this much". See Sorting Out Your Mortgage for more information.

This is a term given to the moment of completion, normally mid day. It is so called because it is that strange moment when the buyer and seller own nothing, have no utility accounts, no home, and so on.

Where one or more parties has offered on a property the seller may try and play one buyer off against the other asking each one to bid higher until they stop in a similar manner to an aution. However because this is emotionally charged the winning buyer often withdraws a few days later when they realise they got carried away. Most professional agents will recommend sealed bids as an alternative. See How to Really Make an Offer for more information.

Where a property has had structural changes made to it (say it has been converted from a house into apartments or an internal wall has been removed) the owner will need the local authority to approve the works have been carried out to a certain standard. This is known as Building Control Approval. Usually, but not always planning consent is also required.

Be aware that building control only started in the mid 1980s and so if changes were made to a property before this they will not have, and do not need, building control approval.

A buyer who does not need to sell anything in order to buy. Sometimes called a first time buyer

A vendor who will sell his property and move out as soon as the solicitors sort out the paperwork and the buyer has the funds in place. This is different from the chain situation where a vendor accepts an offer subject to him finding a place to buy. Chain Free Properties are extremely attractive as any purchase should only involve five people – you, the vendor, the lender and the two solicitors. The fewer people involved and the shorter the timescales, the more likely it is that everything will happen successfully (see Time Costs Deals).

Where one or more parties has offered on a property the seller may accept both offers but state he will ultimately sell to the person who can prepare the legal paperwork and be ready for exchange of contracts fastest. Most professional agents, however, will recommend sealed bids as an alternative. See How to Really Make an Offer for more information.

This is the date on which the legal title of the property moves from the previous owner to the new owner. It can be the same day as exchange of contracts or any time after. See The Property Buying Process in Theory for more detailed information

This is a form of Exchange of Contracts. The buyer and seller have agreed legally to buy and sell but subject to some event - e.g. that the seller replaces a broken window

See Solicitor.

The name given to the legal side of the property buying process.

See also:
Choosing a Solicitor or Conveyancer
The Property Buying Process in Theory
Legal Matters in Property Purchases
Why Vendors are Poorly Prepared

All professional property solicitors are part of the DX system (short for Document Exchange). This is an express service which allows solicitors to move large amounts of paperwork between each other quickly. As such they often use terms such as "I will DX it tonight". Note you should avoid using solicitors who are not on the DX system as they slow down the buying process immeasurably.

This is the moment when the buyer and seller agree legally to buy and sell and a date when the legal ownership of the property (completion) is set.

Originally this term arose to mean exactly what it said, “A buyer who has nothing to sell because this is their first purchase”. Over time it has become associated with anyone who does not need to sell in order to buy, be this their first or their twentieth property purchase. It’s worth letting any agent know if this is your situation as you will be much more attractive to many vendors.

Your advantage is that, should you make an offer, the vendor is only reliant on you and your solicitor to get the sale through. If you have something to sell, even if an offer has been agreed on it, there is still twice as much to go wrong and the vendor you wish to purchase from knows absolutely nothing about the stability of your buyer.

In recent years it has become increasingly popular for home owners to sell and move into rented accommodation before they start looking for something to buy. Many have realised the cost of renting is often outweighed by the lower offers that are accepted by vendors from First Time Buyers.

Such buyers are also sometimes referred to as chain free.

A part of the building that includes the ground it was built on and the structure of the building. Most houses are freehold meaning the current occupier owns it all. There are however a large number of leasehold houses as well.

After a sale has been agreed the vendors' solicitor will send the buyers' solicitor the contract and a number of other papers relevant to the sale. The vendors solicitor may decide this is all that he needs. However he may decide he requires more information either for his own piece of mind or because the mortgage lender requires it. As such he will ask these further questions and refer to the situation as 'I am raising further enquiries'.

A type of Survey more detailed and more expensive than a Valuation Survey because the surveyor is instructed to report not only on the value but the general condition of the property such as windows, damp, etc. This type of survey does not include any structural issues unless they are immediately obvious and may affect the value of the property. As such they are quite popular with those buying a flat who not only want to see the value but also any immediate issues. The surveyor, however, should not speculate on the costs of any issues he reports. For more information see What a Property Survey Really Means

Where there is an issue with a property that cannot be solved reasonably quickly indemnity insurance can be used. As an example 15 years ago the seller replaced a basement window with a larger one but never got planning permission to do so. The buyer takes out an insurance policy that says "Should the local authority ever pursue the matter the insurance company will pay the costs". Indemnity insurance is widely used to deal with small and large issues. See Legal Matters in Property Purchases for more details.

A property that is leased from the freeholder for a set number of years. A person may buy an apartment with a lease of 100 years. After 100 years it must be given back to the freeholder. Note the leaseholder can, in some circumstances, force a lease extension to stop this happening. The lease can be sold to another party, hence the term, 'this property is leasehold'.

The local searches are carried out by the seller if a Home Information Pack is required but, for most mortgage lenders, they are only valid for three months so the buyer may need to carry out a new search. Local searches check what is planned for the area (planning applications) and that the property has the right to be connected to the mains sewerage. For more on local searches see Legal Matters in Property Purchases.

This usually refers to properties which have been built in the last 30 years or so. See also Purpose Built

A period property that has been converted into apartments. This is very common with victorian two and three storey houses where each floor has been converted into one or two bedroom flats

Usually referring to Victorian, Georgian or Edwardian properties but also generally used to describe anything over about 100 years old

The Town and Country Planning Act 1947 requires that properties built after this time require permission from the local authority. Properties that have substantial changes made to them also require planning permission - a house converted into apartments in 1970 would need planning permission as would a house that adds a large extension.

It is important to note that some small extensions in certain areas do not require planning permission - check with the local authority for exact details in your area.

If you want to find out if the property you are buying has got planning permission the files are freely available at walk in centres operated by the local council.

See Planning Consent

Many properties in the UK are period houses which have been converted into apartments (and so called period convertions). To differientiate apartments that were built to be apartments, the term purpose built is often used. Some buyers see this as an advantage because convertions do not always have the sound proofing of purpose built.

Note purpose built does not necessarily mean New Build. Many Victorian and Georgian properties were built to be apartments.

When a home owner can not pay their mortgage for several months the mortgage lender often has the power to take the property and sell it themselves in order to recover the debt. The process of taking the property away from the owner is known as repossession. Mortgage lenders often want to sell the property fast and so place it in an auction or price it just below the market rate. As such they are often bargains but the buyer must be able to move fast and there are strict time lines from offer to exchange.

Where one or more parties has offered on a property, usually at the asking price, the buyer may decide to go to sealed bids. A date is set by which you are asked to put forward your best offer. The seller then chooses the buyer he would like to go forward with. Note this is not always the buyer who has offered the most. See How to Really Make an Offer for more information.

These are tenants who have the right to remain in a property, often for long periods or even until they decide to leave. Some have their rent fixed or rent rises capped. It is quite possible to buy a property with sitting tenants but you should check their rights carefully.

Once an offer is agreed the property is sold subject to a contract being agreed. The contract includes the completion date so a property is always sold subject to contract until all monies are paid and the new owner takes legal posession.

In reality almost all sales are sold subject to survey and sold subject to contract. However some buyers choose not to have a survey on the property if they are buying for cash and they are confident about its quality and value. In this case it is only sold subject to contract. If a survey is required (for example if a bank is going to secure a mortgage on it) the property is 'Sold subject to contract and survey' although the law only requires agents to state 'Sold Subject to Contract'.

Although it is possible for the buyer or the seller to do their own legalities when it comes to buying and selling properties most choose to hire a solicitor to act on their behalf. This individual is legally qualified to handle property purchases and sales and should they miss something in the paperwork that later affects the value of the property they can be sued.

See also:
Choosing a Solicitor or Conveyancer
The Property Buying Process in Theory
Legal Matters in Property Purchases
Why Vendors are Poorly Prepared

A structural engineer is often bought in after a Structural Survey. He is a qualified individual who can state if there is really a problem with a building such as heave, subsidence or slip and how much it will cost to rectify the issue. Buyers should note that not all types of subsidence are a problem, some are normal and do not affect the value of the property. See What a Property Survey Really Means for more information

A type of Survey more detailed and more expensive than a Homebuyers Survey because the surveyor is instructed to report not only on the value but the general condition of the property such as windows, damp, etc. and also to investigate the structure. It should be noted that surveyors are not qualified to say definitively if there is a structural problem, if he suspects this exists he should only recommend the building be inspected by a structural engineer. Structural surveys are popular with those buying period houses or buildings who not only want to see the value but also any immediate issues. The surveyor, however, should not speculate on the costs of any issues he reports. For more information see What a Property Survey Really Means

See Sold Subject to Contract

There are two main types of subsidence - 'up and down', the property moves up and down on a regular basis and there is no cause for concern - 'down', the property or part of the property is moving down continuosly and needs to be underpinned. See What a Property Survey Really Means for more information on subsidence

A report created by a surveyor who looks at a property to see if it is worth the price that has been agreed between the vendor and the buyer or the price the vendor is asking. The survey can also include particular issues with the property such as damp, structural problems, plumbing, roofing and electrics. The surveyor is qualified to spot the issues but not to fully assess them or the cost of their repairs. For this a specialist must be bought in

see also:
Valuation Survey
Homebuyers Survey
Structural Survey

A surveyor is a qualified person who carries out a Survey. He is instructed to do so by the mortgage lender if a loan is being secured on the property. If not the buyer can choose to hire a surveyor if he wishes but it is optional.

These are properties with tenants who are renting. It is quite possible to buy such a property if the mortgage lender agrees and saves you time in finding your own tenants if this is a Buy to Let purchase. However you should check of they are standard tenants with a normal one year contract or Sitting Tenants.

If a property has subsidence it may need to be underpinned. This is a method by which a concrete foundation is inserted under the structure to stop any further movement and is often required on period buildings at some point. See What a Property Survey Really Means for more information on underpinning and how it works

This is often confused with chain free properties. Just because a property is empty it does not necessarily follow that it is being offered chain free so always double check.

A type of Survey to assess the value of a property and note any major issues that would affect the value. See