The Lavoie Team
Royal LePage Frank Whitby Real Estate
Real Estate Terms Every Buyer and Seller should Know
Common phrases used in Real Estate Transactions and their meanings
Buying or selling a home in the Durham Region (Whitby, Ajax, Pickering, Oshawa) can feel overwhelming due to the complex real estate jargon and terminology. This glossary explains the most common terms used in Ontario real estate transactions so you can feel confident and informed. If you have questions about any term, The Lavoie Team is here to Help You Buy, Sell, & Invest with Confidence.
Glossary Terms (Alphabetical)
Agreement of Purchase and Sale (APS): The legally binding contract between a buyer and seller outlining the terms, price, and conditions of a real estate transaction.
Amortization Period: The total length of time it will take to pay off your mortgage in full, typically 25 or 30 years.
Appraisal: A process for estimating the market value of the property. Sometimes required by a buyer’s financial institution to approve their mortgage.
Closing Costs: Additional expenses paid at closing, such as legal fees, land transfer tax, title insurance, and adjustments.
Conditional Offer: An offer to purchase that includes conditions — like financing, inspection, or sale of the buyer’s current home — that must be met before the sale becomes firm.
CMA (Comparative Market Analysis): An estimate of a property’s market value based on recent sales of similar homes in the area, often prepared by a Realtor®.
Deposit: A sum of money submitted with an offer to show the buyer’s good faith, held in trust until closing.
Down Payment: The portion of the home’s purchase price paid upfront by the buyer, with the remainder financed through a mortgage.
Easement: An interest in land owned by another person that benefits someone for a specific purpose, for example permitting passage over a strip of land to read the hydrometer.
Firm Sale: A deal where all conditions have been met or waived, making the sale legally binding.
Fixed-Rate Mortgage: A mortgage where the interest rate stays the same for the entire term, offering predictable payments.
Home Inspection: A professional assessment of a property’s condition before purchase, identifying issues that could affect value or safety.
Land Transfer Tax (LTT): A provincial tax paid by the buyer upon closing, based on the purchase price.
Listing Agreement:The contract between a seller and their Realtor® authorizing the brokerage to market and sell the property.
Months of Inventory (MOI): The number of months it would take to sell all current listings at the current sales pace. For example:
Seller’s Market: A market with 0–4 months’ worth of inventory, giving sellers the advantage.
Balanced Market: With 4–6 months’ inventory, prices remain stable, offering little advantage to buyers or sellers.
Buyer’s Market: More than 6 months of inventory. Homes take longer to sell, and sellers may reduce prices to attract buyers.
Mortgage Pre-Approval: Confirmation from a lender of how much you can afford to borrow, based on your income, credit, and financial situation.
Offer Presentation: The process where all offers on a property are reviewed, often at a set date and time.
Offer to Purchase: A written contract setting out the terms and conditions under which the buyer agrees to buy the home. Once accepted, it forms a legally binding contract.
Possession Date: The day the buyer is entitled to legal possession of the property.
Property Disclosure Statement (PDS): A document completed by the seller disclosing known issues or defects with the property.
Pre-Construction Home: A home purchased before it’s built, often directly from a developer or builder.
Realtor®: A licensed real estate professional who is a member of CREA and follows a strict code of ethics.
Resale Home: A home that has been previously owned, as opposed to a new construction.
Title Insurance: Protects buyers and lenders from losses related to property ownership issues, such as title defects or fraud.
Zoning: Municipal regulations that dictate how land and property can be used (e.g., residential, commercial, or mixed-use).
Can’t find the term you’re looking for? Contact the Lavoie Team — we’ll explain any real estate term and guide you through your buying or selling journey.
Get In Touch
