The ABCs of Real Estate

If you find yourself immersed in the exciting world of house hunting, here’s an A-to-Z glossary of real estate terms with key concepts from the sector so you can understand firsthand what people are talking about:

A – Deposit (Arras): A sum of money given as a guarantee in a purchase agreement.

B – Real Estate Bubble: A phenomenon of uncontrolled rise in property prices followed by a sudden crash.

C – Occupancy Certificate: A document that certifies a property meets the minimum requirements to be inhabited.

D – Payment in Kind (Dación en pago): The transfer of a property to the bank to cancel a mortgage debt.

E – Public Deed: A document signed before a notary that legally certifies a real estate sale.

F – Security Deposit: Money the tenant gives the landlord as a guarantee in a rental agreement.

G – Mortgage Guarantee: A property used as collateral for a mortgage loan.

H – Mortgage: A loan granted by a bank to buy a property, with the property itself as collateral.

I – Property Tax (IBI): A municipal tax that property owners are required to pay.

J – Homeowners Association Meeting: A gathering of property owners in a building or housing complex to make decisions for the community.

K – Kilometer Zero: An urban planning term referring to the central zones of a city.

L – Building Permit: Authorization granted by the local council to carry out renovations or new construction.

M – Usable Square Meters: The actual area of a property that can be used, excluding walls or non-habitable spaces.

N – Notary: A legal professional who certifies the legality of contracts and deeds in the real estate sector.

O – Binding Offer: A mortgage loan proposal with fixed conditions offered by a bank.

P – Municipal Capital Gains Tax: A tax levied on the increase in land value when a property is sold.

Q – Quorum: The minimum number of votes required in a homeowners association meeting to pass decisions.

R – Land Registry: An institution where property rights are officially recorded.

S – Resale Property (Second Transfer): A sale of a property that has already had at least one previous owner.

T – Appraisal: A professional assessment of a property's value to determine its market price.

U – Usufruct: The right to use and enjoy a property without owning it.

V – Subsidized Housing (VPO): Properties with regulated prices, intended for individuals with limited income.

W – Walk-in Closet: A large wardrobe or dressing room within a home.

X – Xeriscaping: Landscape design that requires minimal water use, ideal for sustainable homes.

Y – Yield (Real Estate Return): The ratio between the purchase price of a property and the income it generates (e.g., through rent).

Z – Zoning: Urban planning regulation that defines land use in different parts of a city or municipality.

Save this! This glossary can be very helpful if you’re in the process of investing in Hondón de las Nieves or buying your apartment in Santa Pola. If you need more information, don’t hesitate to reach out to us!

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