Buyer's Agent
A licensed professional engaged by the buyer to search for, assess, and negotiate the purchase of property, acting solely in the buyer's interest (unlike a selling/real estate agent, who acts for the vendor).
Comparable Sales (“Comps”)
Recently sold properties similar in size, condition and location, used to judge whether a price is fair.
Cooling-Off Period
A short window after signing a contract during which a buyer can withdraw, subject to conditions and often a small penalty. Rules vary by state and don't apply at auction.
Conveyancing
The legal process of transferring property ownership from seller to buyer.
Capital Growth
The increase in a property's value over time.
Depreciation Schedule
A report prepared by a quantity surveyor detailing the tax deductions available on a property's building and fixtures over time.
Due Diligence
The research and checks carried out before committing to a purchase — title, zoning, condition, comparable sales, and risk factors.
Gross Yield
Annual rental income divided by purchase price, expressed as a percentage. A quick but incomplete measure of return.
Net Yield
Annual rental income minus holding costs, divided by purchase price. A more accurate measure than gross yield.
LVR (Loan-to-Value Ratio)
The portion of a property's price being borrowed, expressed as a percentage. An 80% LVR means a 20% deposit.
LMI (Lenders Mortgage Insurance)
Insurance a lender may require when the LVR is above 80%, protecting the lender (not the borrower) if the loan defaults.
Negative Gearing
When a property's holding costs exceed its rental income, resulting in a loss that can reduce the owner's taxable income.
Positive Gearing
The opposite of negative gearing: rental income exceeds holding costs, generating a taxable profit.
Off-Market
A property for sale without being publicly advertised.
Pre-Approval
A lender's conditional indication of how much they may lend, subject to final checks.
Rentvesting
Renting where you want to live while buying an investment property elsewhere.
Settlement
The date ownership formally transfers and the balance of funds is paid.
Stamp Duty (Transfer Duty)
A state government tax paid on a property purchase, calculated on the purchase price.
Vendor
The seller of a property.
