Real Estate Vocabulary
Acceleration clause - -Usually written into a mortgage to allow the lender to
accelerate or call the entire principal balance of the mortgage, plus accrued interest, when
Page | 1
the payments become delinquent.
Adjusted cost base - -The value of the real property established for tax purposes. It is
the original cost plus any allowable capital improvements, plus certain acquisition costs,
plus any mortgage interest costs, and less any depreciation taken.
Agreement of purchase and sale - -A written agreement between the owner and a
purchaser for the purchase of real estate on a predetermined price and terms.
Amenities - -Generally, those parts of the condominium or apartment building that
are intended to beautify the premises and that are for the enjoyment of occupants rather
than for utility.
Amortization - -The reduction of a loan through periodic payments in which interest
is charged only on the unpaid balance.
Amortization period - -The actual number of years it will take to repay a mortgage
loan in full. This can be well in excess of the loan's term. For example, mortgages often
have 5-year terms, but 25-year amortization periods.
Analysis of property - -The systematic method of determining the performance of
investment real estate using a property analysis form.
, Appraised value - -An estimate of the fair market value of the property, usually
performed by an appraiser.
Page | 2 Assessment fee - -Also referred to as maintenance fee. A monthly fee that
condominium owners must pay, usually including management fees, costs of common
property upkeep, heating costs, garbage-removal costs, the owner's contribution to the
contingency reserve fund, and so on. In the case of time-shares, the fee is normally levied
annually.
Assumption agreement - -A legal document signed by a homebuyer to assume
responsibility for the obligations of a mortgage made by a former owner.
Balance sheet - -A financial statement that indicates the financial status of a
condominium corporation or apartment building, or other revenue property, at a specific
point in time by listing its assets and liabilities.
Base rent - -The fixed rent paid by a tenant. This is separate from any rent paid as a
result of extra charges or percentage rents.
Beginning Undepreciated Capital Cost - -The amount prior to CCA being taken.
Blended payments - -Equal payments consisting of both a principal and an interest
component, paid each month during the term of the mortgage. The principal portion
increases each month, while the interest portion decreases, but the total monthly payment
does not change.
Budget - -An annual estimate of a condominium corporation or apartment building's
expenses and the revenues needed to balance those expenses. There are operating
budgets and capital budgets.
, Buildings - -The buildings included in a property. In the case of a condominium
purchase, usually refers to the parts that are divided into the units and the common area.
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Canada Mortgage and Housing Corporation - -The federal Crown corporation that is
governed by the National Housing Act. Services include providing housing information and
assistance, financing, and insuring home purchase loans for lenders.
Canada Revenue Agency - -This is the current name of the former Revenue Canada.
Canadian Real Estate Association - -An association of members of the real estate
industry, principally real estate agents and brokers.
Capital budget - -An estimate of costs to cover replacements and improvements,
and the corresponding revenues needed to balance them, usually for a 12-month period.
Different from an operating budget.
Capital Cost Allowance - -A depreciation method under Canadian tax law which
allows for the accelerated write-off of property under various classifications.
Capital gain - -Profit on the sale of an asset that is subject to taxation. Capital
improvements. Major improvements made to a property that are written off over several
years rather than expensed off in the year in which they are made.
Capital gains - -Capital gains is the difference between the selling price of the
property and the initial cost of the property.
Acceleration clause - -Usually written into a mortgage to allow the lender to
accelerate or call the entire principal balance of the mortgage, plus accrued interest, when
Page | 1
the payments become delinquent.
Adjusted cost base - -The value of the real property established for tax purposes. It is
the original cost plus any allowable capital improvements, plus certain acquisition costs,
plus any mortgage interest costs, and less any depreciation taken.
Agreement of purchase and sale - -A written agreement between the owner and a
purchaser for the purchase of real estate on a predetermined price and terms.
Amenities - -Generally, those parts of the condominium or apartment building that
are intended to beautify the premises and that are for the enjoyment of occupants rather
than for utility.
Amortization - -The reduction of a loan through periodic payments in which interest
is charged only on the unpaid balance.
Amortization period - -The actual number of years it will take to repay a mortgage
loan in full. This can be well in excess of the loan's term. For example, mortgages often
have 5-year terms, but 25-year amortization periods.
Analysis of property - -The systematic method of determining the performance of
investment real estate using a property analysis form.
, Appraised value - -An estimate of the fair market value of the property, usually
performed by an appraiser.
Page | 2 Assessment fee - -Also referred to as maintenance fee. A monthly fee that
condominium owners must pay, usually including management fees, costs of common
property upkeep, heating costs, garbage-removal costs, the owner's contribution to the
contingency reserve fund, and so on. In the case of time-shares, the fee is normally levied
annually.
Assumption agreement - -A legal document signed by a homebuyer to assume
responsibility for the obligations of a mortgage made by a former owner.
Balance sheet - -A financial statement that indicates the financial status of a
condominium corporation or apartment building, or other revenue property, at a specific
point in time by listing its assets and liabilities.
Base rent - -The fixed rent paid by a tenant. This is separate from any rent paid as a
result of extra charges or percentage rents.
Beginning Undepreciated Capital Cost - -The amount prior to CCA being taken.
Blended payments - -Equal payments consisting of both a principal and an interest
component, paid each month during the term of the mortgage. The principal portion
increases each month, while the interest portion decreases, but the total monthly payment
does not change.
Budget - -An annual estimate of a condominium corporation or apartment building's
expenses and the revenues needed to balance those expenses. There are operating
budgets and capital budgets.
, Buildings - -The buildings included in a property. In the case of a condominium
purchase, usually refers to the parts that are divided into the units and the common area.
Page | 3
Canada Mortgage and Housing Corporation - -The federal Crown corporation that is
governed by the National Housing Act. Services include providing housing information and
assistance, financing, and insuring home purchase loans for lenders.
Canada Revenue Agency - -This is the current name of the former Revenue Canada.
Canadian Real Estate Association - -An association of members of the real estate
industry, principally real estate agents and brokers.
Capital budget - -An estimate of costs to cover replacements and improvements,
and the corresponding revenues needed to balance them, usually for a 12-month period.
Different from an operating budget.
Capital Cost Allowance - -A depreciation method under Canadian tax law which
allows for the accelerated write-off of property under various classifications.
Capital gain - -Profit on the sale of an asset that is subject to taxation. Capital
improvements. Major improvements made to a property that are written off over several
years rather than expensed off in the year in which they are made.
Capital gains - -Capital gains is the difference between the selling price of the
property and the initial cost of the property.
