Whether you are a real estate agent, home buyer or seller, there are some commonly used terms and jargon you should definitely know. I understand that some of the buzzwords may sound phony and an upscale real estate agent would want to avoid those. However, having knowledge of these terms will prevent you from looking like a goose in front of your clients.
Here Are the 6 Terms Everyone in the Real Estate Industry Should Know
1) Days on Market (DOM)
Days on Market (DOM) is a term used by people in the real estate industry to determine the age of a real estate listing. It tells you the number of days a particular property has been on the market (from the day of listing to purchase). The higher the DOM, the lower the price of a property and vice versa.
2) Closing Costs
A closing cost is a fee paid at the end of a real estate transaction. This fee is either paid by the buyer or a seller to the person who worked to make the deal happen. Generally, this person is a certified real estate agent, but depending on the region, other people may also contribute to the deal.
3) Homeowner’s Association (HOA)
Once a property is sold, the burden of responsibility of the real estate still remains with the developer. After a few years when the entire plot, apartment building or a packet neighborhood is sold out, the developer hands over the responsibility to the homeowners. The homeowner association is a governing body that looks over this process.
The Oxford definition of contingency is a future event or circumstance which is possible but cannot be predicted with certainty. In real estate, a contingency is a clause or a condition in the contract which nullifies the contract if a certain predetermined event occurs within the set period.
For instance, what if the buyer is not able to get his/her mortgage loan approved before a particular date? This is where contingency comes in. It protects the homeowner from getting floundered in someone else’s mess.
5) Escrow Holder
Escrow basically is a short-lived trust arrangement between the property owner and buyer/tenant. This term is mainly used in dealing that involves sale or rent of a personal property or mobile home. The property owner is always the Escrow holder.
6) Blind Offer
A blind offer is an old school marketing tactic to see how much attention a customer usually pays to your ads or marketing banners. A discount or coupon code is placed in an unexpected place on an audio ad, banner, or billboard.
In real estate sales, the term is used when a buyer is ready with an offer even before he/she is well acquainted with the property. Usually, this happens when the buyer knows the topography very well.
These are the commonly used terms in the real estate industry. Several such terms are being used in the industry but I felt the need to elaborate more on the ones listed above. For a home buyer or a seller, knowing these terms is more than enough as you will be encountering them only on certain occasions.