Real Estate Glossary Terms Beginning With – A

Updated: November 22, 2021

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Terms Beginning With - A

Property Development & Investment Glossary, Terms & Definitions


Voluntary surrender of property, whether owned or leased, without naming a successor as owner or renter.

Absentee owner

A property owner who does not live on the premises or manage it.

Absorption rate

The expected time it takes to lease properties in an area.

Acceleration clause

If the mortgagor defaults on any of the requirements, a clause in the mortgage agreement gives the mortgagee the authority to accelerate full repayment of the debt.

Acceptable referee

Accountants, solicitors, magistrates, doctors, and justices of the peace are all included.

Accelerated cost recovery system (ACRS)

The Economic Recovery Act of 1981 introduced a technique of depreciation that determines the useful life of various types of property.

Accelerated depreciation

A depreciation method in which the asset is written off faster than using the straight line method.


Accepting an offer is the act of consenting to do so.

Access right

The ability to enter and exit a property.

Accredited investor

A wealthy investor who is not one of the 35 investors allowed to invest in a private limited partnership under Securities and Exchange Commission Regulation D. To be eligible, an investor must have a net worth of at least $1,000,000, an annual income of at least $200,000, or a minimum investment of $150,000 in the deal, with the investment not exceeding 20% of the investor's net worth.

Accrual basis

Income and costs are recognised when they are earned or incurred, even if they have not yet been received or paid, according to this accounting technique.

Accrued interest

Interest that is due but has not yet been paid.

Accumulated depreciation

The entire amount of depreciation taken thus far.


An individual's assertion that he has signed a paper voluntarily.


The procedure for acquiring real estate.

Acquisition cost

The whole cost of purchasing a piece of real estate, including all fees, closing costs, and renovation expenditures.

Acquisition fee

A fee paid to a syndicator in return for their assistance in the acquisition of a property.


43,560 square feet, 160 square rods, 10 square chains, or 4840 square yards are the dimensions of a piece of land.

Adjustable rate mortgage (ARM)

A mortgage whose interest rate is linked to a floating index. At predetermined intervals, the interest rate is modified.

Adjusted average rate of return method

A modified rule of thumb that uses an average income or cash flow figure while accounting for the predicted sales price or equity reversion.

Adjusted tax basis

The sales price less costs and commissions on which a capital gain or loss is calculated.


A person appointed by a court to manage the estate of someone who died intestate.

Administrator's deed

A deed that transfers the property of a person who died without leaving a will.

Ad valorem tax (Latin)

A property tax based on the property's current value.

Adverse possession

Acquisition of title to property where an occupant has been in actual, open, infamous, and continuous usage for a period of time prescribed by state law.

After tax cash flow (ATCF)

The amount of money left over after all expenditures, including taxes, have been paid.

After tax cash flow multiplier

The equity split by the after-tax cash flow is used to calculate the payback method.

After tax equity reversion (ATER)

The net selling price minus any outstanding mortgages and any taxes owed at the time of sale.

After tax rate (ATR)

The after-tax cash flow divided by the equity yields a rate of return.

After tax real rate of return

Adjusted for inflation, the amount of money an investor can keep after paying any taxes on a sale.


The legal connection that exists between a principle and an agent as a result of a contract in which the principal hires the agent to undertake specified tasks on his or her behalf.


Individual who has been permitted to act on behalf of another person (principal) in a transaction with a third party.

Agreement of sale

A written contract between a buyer and a seller of real estate.

Air rights

The right to use, occupy, or govern the area above a specific piece of land. These rights can be transferred to another party by selling, leasing, or donating them.

Alternative minimum tax

Individual taxpayers with specific income levels pay a flat rate tax.


Attractive aspects of a piece of property that can be improved.

Amortization | Amortisation

The systematic payment of the principle over a set length of time to gradually repay debt. When the loan balance is zero, the debt is fully amortised. In other words, to repay a loan's principal and interest over a set length of time, usually in instalments.

Amortization schedule

The periodic principal and interest payments on a mortgage loan are shown in this table. As the loan is paid off, this timetable will also reflect the outstanding sum owed on the loan.

Anchor tenant

A key tenant in a retail mall, attracting additional shops and customers.

Annual debt service

The entire amount of monthly debt service payments that a lender requires.

Annual percentage rate (APR)

On an annual basis, the actual cost of borrowing.


Within a multi-family construction, a residential unit.


A knowledgeable person's estimate of the value of a piece of property.


A person who does appraisals and is qualified to do so.


The increase in the value of a property due to an increase in the property's performance due to management or inflation.

Approaches to value

Market data, income, and the cost method are three assessment techniques used by appraisers to evaluate the worth of real estate.


Something that is not within the boundaries of the property but is considered a part of it and contributes to its overall enjoyment.


A person who creates, coordinates, and writes the drawings and specifications utilised during the development design phase.


A payment made at the end of a term. The majority of mortgage interest payments are made late.

Arm's length transaction

A transaction involving two or more unconnected parties.

Articles of partnership

A document that outlines the terms and conditions of a partnership, including the nature of the partnership's business and the partners' rights and responsibilities.

As is

A property condition in which there are no guarantees.

Asking price

The selling price is determined by the amount of value a property owner assigns to it.


The sale of two or more properties as if they were one.

Assessed value

The local taxing authority's assessment of a property's worth.


A specific payment or tax imposed by a local taxing authority on a property.

Assessment ratio

The proportion of a property's assessed value to its market value.


A local government authority who determines property taxes.

Assignment of contract or lease

The transfer of a lease's entire title, right, and interest in a piece of real estate.


A person to whom a property interest is transferred.


A person who assigns an interest in real estate.


Everything a person or other entity owns that can be used to pay back a debt.

Assumable loan

When a property is resold, the loan might be taken over by a new borrower. The new borrower will take over all of the original borrower's obligations.

Assumption fee

A cost charged by a lender to allow a mortgage to be transferred.

At risk

Those funds that are at risk of being misplaced. Limited partnership investors can only claim tax deductions if they can show the IRS that there is a probability they will never make a profit and will lose their investment.

At-risk rules

The tax regulation that restricts the amount of money that an investment can lose as a result of a tax loss.


A legal seizure of property to compel debt repayment.


A renter's formal agreement to become a new landlord's tenant.


A property is sold to the highest bidder in a public auction.

Automatic renewal clause

A lease condition that automatically revives the contract unless both the renter and the owner mutually agree to end it.

Average rate of return

Things to keep in mind that result in average earnings or cash flow numbers expressed as a percentage of net or ownership cost.

Average rate on after tax cash flow

The average rates are determined by dividing the after-tax income stream by the equity expenses.

Average rate on before tax cash flow

The average profit can be made by dividing average before-tax income stream by equity costs.

Average rate on net operating income

The average profit can be made by dividing operating profit by investment costs.

Glossary Index

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