Glossary

Below is a list of some of the most commonly used terms relating to real estate and the property market.

Search by letter and click on the term.

 Advertised price
Selling at an advertised price means that a property is marketed with an asking price – the amount the seller expects to be paid for it. This amount is decided by the seller in discussion with the agent.
 Agency agreement
A legally binding contract between the seller and the agent. It sets out the terms and conditions on which an agent is appointed, what the agent will do and what they will be paid. If you want to an agent to sell a property then you need one of these.
 Agency Agreement Approved Guide
This guide, written by the Real Estate Agents Authority, provides information about agency agreements and the key things you should know. Your agent must give you a copy of this guide before you sign an agency agreement.
 Agent or Real estate agent
A general term that refers to an agent, branch manager or salesperson (these are different types of real estate licences).
 Appraisal
An agent must give the seller a written appraisal of their estimate of the sale price for the property. This must realistically reflect market conditions and be supported by comparable information on sales of similar properties.
 Auction
An auction is a sale method where buyers publicly bid until the highest price is reached.
 Builders report
A buyer should find out as much as they can about the condition of the property through a property inspection carried out by a New Zealand Standards compliant property inspector.
 Buyer Budget Over (BBO)
Sometimes used instead of BEO - see Buyer Enquiry Over
 Buyer Enquiry Over (BEO)
An indicative minimum price that the seller will sell the property for.
 Code of Professional Conduct and Client Care
The Real Estate Agents Authority maintains this Code of Conduct which sets out the minimum standards of professional competence and conduct that agents must follow.
 Commission
Real Estate Agents are usually paid a commission by the seller when a property sells. This is their fee for selling the property. Commissions should be detailed in the Agency Agreement the seller signs with the agent.
 Complaints Assessment Committee
Complaints Assessment Committees are independent judicial panels that make decisions on the complaints referred to them by the Real Estate Agents Authority.
 Conditional offer
An offer to buy a property subject to stated conditions being met.
 Deadline sale
Deadline sale is a sales method where a property is marketed for a set period with an advertised end date. The vendor is not obliged to accept any offers and can choose to accept an offer at any point during the listing period.
 Freehold (or fee simple)
Freehold title gives the owner full ownership of the land.
 GV – Government Valuation
The official estimation of a property’s worth on the market at the time it was valued, under the Rating Valuations Act 1998. Now called a “Rateable Value”.
 Land Information Memorandum (LIM)
This provides prospective buyers with important current and historical information that the local council knows about the property and land.
 Leasehold
Leasehold title does not give the owner full ownership of the land. It is only leased and the owner will only own what is on the land.
 Misconduct
The Tribunal makes a decision of misconduct if the conduct is disgraceful, seriously incompetent or negligent real estate agency work or if there is a wilful of reckless breach of the Act, Regulations or Code, see s73 of the Act.
 No further action
A decision of no further action is made when the licensee did not breach the standards set out in the Code of Conduct or their legislative requirements.
 Non- verifiable continuing education
Licensees have to do 10 hours of non- verifiable continuing education each year (as well as 10 hours of verifiable continuing education). Non- verifiable continuing education is structured professional development such as training courses.
 Offer
When you want to make an offer to buy a property the agent will draw up a sale and purchase agreement and ask you to sign it. You can make your offer subject to certain conditions.
 On the market
At an auction, a property is “on the market” if the highest bid will now be successful and any reserve no longer applies.
 Passed in
At an auction, a property is “passed in” if the auction is closed without the property being sold.
 Property inspection
A buyer should find out as much as they can about the condition of the property through a property inspection carried out by a New Zealand Standards compliant property inspector. We recommend buyers consider having a property inspection done.
 Public register
The Real Estate Agents Authority maintains a public register of licensed real estate agents. If an agent is found guilty of unsatisfactory conduct or misconduct this will be recorded in the public register.
 Rateable Value
The official estimation of a property’s worth on the market at the time it was valued, under the Rating Valuations Act 1998. Formerly called a “Government Valuation”.
 Real estate agent or agent
A general term that refers to an agent, branch manager or salesperson (these are different types of real estate licences).
 Real Estate Agents Act 2008
The Real Estate Agents Act 2008 established the Real Estate Agents Authority and its regulatory framework. The Act's purpose is to promote and protect the interests of consumers and promote public confidence in real estate agency work.
 Real Estate Agents Disciplinary Tribunal
The Tribunal hears & decides cases against agents that are referred to them by the Real Estate Agents Authority. It also hears appeals of Complaints Assessment Committee complaint decisions & licensing decisions made by the Real Estate Agents Authority.
 Reserve
At an auction, a “reserve” is the lowest price the seller is willing to sell the property for.
 Sale and purchase agreement
A legally binding contract between the buyer and seller for the purchase/sale of a property. A sale and purchase agreement provides certainty to both the buyer and seller and it sets out in writing all the agreed terms and conditions.
 Sale and Purchase Agreement Approved Guide
The Real Estate Agents Authority Guide provides information about sale and purchase agreements and the key things you should know. The agent must give both the sellers and the potential purchasers this guide before they sign an agreement.
 Settlement
When the sale and purchase of a property is completed with exchange of property and payment.
 Tender
A tender is a sale method where prospective buyers submit confidential written offers by a deadline.
 Title Search
A lawyer can check who is the legal owner of the property and to check no one else has any claim over it.
 Trust account
Any real estate agency that a buyer pays a deposit to, is required by the Act and the Regulations to hold the funds in a trust account until the agreement become unconditional.
 Unconditional agreement
Where a buyer and seller have agreed to buy and sell a property without any conditions. A conditional sale becomes unconditional once all conditions are met.
 Unconditional offer
Where the buyer offers to buy a property without any conditions.
 Unsatisfactory conduct
The Complaints Assessment Committee or the Tribunal make decisions of unsatisfactory conduct, this is conduct that falls short of the standard expected by the public, is a breach of the Act, is incompetent or negligent or unacceptable, see s72 of the Act.
 Valuation report
An estimate of the property’s worth on the current market carried out by a registered valuer. A buyer’s bank or lender may request this and the buyer usually needs to pay for it.
 Verifiable continuing education
Licensees have to do 10 hours of verifiable continuing education each year (as well as 10 hours of non-verifiable continuing education). This is delivered through one of our approved providers.