The property market is notorious for complex terminology. For buyers, sellers, and investors, understanding this jargon can save you money, speed up your transaction, and put you in a stronger negotiating position.
This guide breaks down the essential terms you’ll encounter when buying or selling property in the UK.
A tax payable when buying property over a certain threshold in England and Northern Ireland. Rates depend on whether you’re a first-time buyer, moving home, or purchasing an additional property. Since it can run into the thousands, always factor stamp duty into your budget before making an offer.
- Freehold: You own the property and the land outright. No time limit, no landlord.
- Leasehold: You own the property for a set number of years (the lease length) but not the land. Leaseholders typically pay service charges and ground rent to maintain the building. Under the Leasehold Reform (Ground Rent) Act 2022, most new leases cannot charge ground rent beyond a peppercorn (essentially zero). Older leases may still include it.
- Commonhold: An alternative to leasehold where you own your flat outright, plus a share of the building’s common areas. Rare, but growing in relevance.
- Share of Freehold: Typically applies to flats. You buy the leasehold flat, plus a share in the freehold of the building with other leaseholders—giving you more control over service charges and management.
- Shared Ownership: A government-backed scheme allowing you to buy a percentage of a property and pay rent on the remainder. You can increase your share over time through “staircasing.”
- Auction Sale: Properties sold at auction often complete much faster (usually within 28 days). Buyers must have funds or finance ready, making it a high-risk but potentially cost-effective route.
- Mortgage in Principle (Agreement in Principle): An initial lender statement showing how much you could borrow based on income and credit history. Not binding but essential for proving seriousness to agents and sellers.
- Loan-to-Value (LTV): The percentage of the property’s value you borrow. A £300,000 property with a £60,000 deposit = 80% LTV. Lower LTV usually means better rates.
- Buy-to-Let Mortgage: A loan designed for landlords purchasing property to rent out. Typically requires a larger deposit (25%+) and has different lending criteria based on rental income rather than just personal salary.
The legal process of transferring ownership. A solicitor or conveyancer handles searches, contracts, and Land Registry filings.
A recurring fee leaseholders pay to cover upkeep of shared areas—gardens, lifts, hallways, roofs. Costs vary widely, so always review the service charge accounts before committing.
- Valuation Survey: For the lender only—confirms the property is worth the price.
- Homebuyer Report: Mid-level, identifies visible defects.
- Building Survey: The most comprehensive, ideal for older or unusual properties.
- Chain: Your purchase or sale depends on other linked transactions. Can delay completion.
- Chain-Free: No such dependency. Attracts buyers and often speeds up deals.
- Exchange of Contracts: Legally binding point where buyer and seller commit.
- Completion: Final step when funds transfer and keys are released.
- Gazumping: Another buyer offers more after your offer is accepted but before exchange.
- Gazundering: A buyer lowers their offer just before exchange. Both legal, both frustrating.
Required when selling or letting. Ranks energy efficiency from A (best) to G (worst). With rising energy costs, EPC ratings now carry real weight for buyers and tenants alike.
Final Word
From stamp duty to service charges, mortgages to ground rent, every property transaction comes with its own language. By decoding these terms, you position yourself to act decisively, avoid pitfalls, and secure the best possible outcome.
At Argant Estates, we specialise in making the process transparent. If you’re considering buying, selling, or investing, our team is here to provide clear advice every step of the way.
Disclaimer
This article is for general informational purposes only and does not constitute legal, financial, or professional advice. While we strive to ensure accuracy, property laws, regulations, and market conditions may change over time. We do not guarantee the completeness, reliability, or current validity of the information provided. Readers should independently verify details and seek professional guidance before making any property-related decisions. We are not liable for any losses or damages resulting from reliance on this content
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