Welcome to our detailed glossary for UK property buyers and owners. This guide covers essential terms you need to understand when buying, owning, or managing property in the UK.
Assured Shorthold Tenancy (AST) Definition: The most common type of tenancy in the UK, usually lasting for 6 or 12 months. The landlord can take back the property at the end of the agreed term.
Bridging Loan Definition: A short-term loan used to “bridge the gap” when buying a property before selling an existing one. It is repaid when the sale of the original property goes through.
Break Clause Definition: Allows the landlord or tenant to end a tenancy early after a fixed period of time, e.g., 6 months into a 12-month contract.
Building Survey Definition: A comprehensive survey that assesses the structure and condition of a property. Recommended for older or unusual homes.
Buy-to-Let Definition: Purchasing a property specifically to rent it out to tenants as an investment.
Chain Definition: A sequence of linked property purchases, where each buyer is also a seller. If one transaction falls through, it can impact all the linked purchases.
Commonhold Definition: A rare form of property ownership with no time limit, typically for flats. Owners jointly manage shared areas.
Completion Definition: The final stage of the homebuying process when property ownership is transferred, the balance is paid, and keys are handed over.
Conveyancer Definition: A legal professional who handles the paperwork and searches involved in buying or selling property.
Conveyancing Definition: The legal process of transferring property ownership from the seller to the buyer.
Covenants Definition: Promises written into a property’s deeds that commit the owner to do (or not do) certain things.
Deposit Definition: A lump sum paid by the buyer to secure a property purchase, usually 5-20% of the purchase price.
Dilapidations Definition: Damage to a rental property that the tenant will need to pay to repair at the end of the tenancy.
Disbursements Definition: Fees a conveyancer pays to third parties on the buyer’s behalf, such as searches and stamp duty.
Easement Definition: A right to cross or use someone else’s land for a specified purpose, e.g., a shared driveway.
Energy Performance Certificate (EPC) Definition: Rates a property’s energy efficiency from A-G. Required when selling or renting out a property.
Equity Definition: The difference between the current value of your home and the amount you have outstanding on your mortgage.
Exchange of Contracts Definition: The point at which signed contracts are exchanged between the buyer and seller, making the agreement legally binding.
Fixtures and Fittings Definition: Items included in a property sale, such as built-in wardrobes, kitchen units, and bathroom suites.
Fixed Rate Mortgage Definition: The interest rate stays the same for the initial period of the loan, typically 2-5 years.
Flying Freehold Definition: When part of a freehold property overhangs or underlies another freehold property, e.g., a balcony or cellar.
Freehold Definition: Outright ownership of a property and the land it stands on for an unlimited period.
Gazumping Definition: When a seller accepts a higher offer from a new buyer after already accepting an offer from someone else.
Gazundering Definition: When a buyer lowers their offer just before exchange of contracts, forcing the seller to accept less money or look for a new buyer.
Ground Rent Definition: A charge paid by a leaseholder to the freeholder for the land the property is built on.
Help to Buy Definition: Government schemes that help first-time buyers get on the property ladder, e.g., equity loans and ISAs.
Home Buyers Report Definition: A survey more detailed than a mortgage valuation but less comprehensive than a full structural survey.
Home Report (Scotland) Definition: A pack of documents that sellers must provide to buyers, including a survey, energy report, and property questionnaire.
Homeowner’s Insurance Definition: Covers the cost of repairing or rebuilding a property if it is damaged, plus contents insurance for belongings.
House in Multiple Occupation (HMO) Definition: A property rented by three or more unrelated people who share facilities.
Land Registry Definition: The government body that keeps records of all registered properties in England and Wales.
Land Registry Fees Definition: Charges for registering a property with HM Land Registry and updating records when it changes hands.
Lease Definition: The contract between a leaseholder and freeholder, setting out rights and responsibilities.
Leasehold Definition: Owning a property for a fixed period but not the land it stands on. Ownership returns to the freeholder when the lease ends.
Listed Building Definition: A property of historical or architectural importance that is protected and cannot be altered without special permission.
Loan to Value (LTV) Definition: The size of a mortgage in relation to the value of the property, expressed as a percentage.
Local Authority Search Definition: Checks the local council’s records for planning issues or problems affecting the property.
Maisonette Definition: A flat that occupies two or more floors of a larger building, with its own entrance.
Management Company Definition: Looks after the shared parts of a leasehold property, such as hallways and gardens, and collects service charges.
Mortgage Valuation Definition: A brief survey to confirm the property is worth roughly the sale price. Required by mortgage lenders but not detailed enough for buyers.
Negative Equity Definition: When the value of a property is less than the outstanding mortgage secured on it.
NHBC Guarantee Definition: A 10-year warranty for newly built homes that covers structural defects.
Offset Mortgage Definition: Links savings to a mortgage, so interest is only paid on the difference, reducing monthly payments.
Ombudsman Definition: An independent and impartial body that helps resolve disputes between consumers and property professionals.
Peppercorn Rent Definition: A very low or nominal rent, used to satisfy the legal requirement for a rental payment.
Porting Definition: Transferring a mortgage from one property to another when moving house, keeping the same lender and rates.
Repossession Definition: When a lender takes back a property because the owner has failed to keep up with mortgage repayments.
Restrictive Covenant Definition: A clause in the deeds limiting how a property can be used, e.g., banning pets or business use.
Right to Buy Definition: A scheme allowing council tenants to buy their home at a discount.
Right to Rent Definition: Landlords must check that tenants have the legal right to rent property in the UK.
Section 21 Notice Definition: Allows a landlord to give an assured shorthold tenant notice to leave without giving a reason. Banned in Scotland.
Service Charge Definition: A fee paid by a leaseholder to a freeholder for maintaining and insuring a building.
Shared Ownership Definition: Buying a share of a property (usually 25-75%) and paying rent on the rest, with the option to buy a bigger share later.
Snagging Definition: Identifying defects with a new-build home and getting the builder to fix them before completion.
Sole Agent Definition: When a seller instructs only one estate agent to market their property. Fees are lower than for multiple agents.
Stamp Duty Land Tax Definition: A tax paid by buyers of properties over a certain price threshold. Rates vary across the UK.
Standard Variable Rate (SVR) Definition: The default mortgage interest rate a lender will charge after an initial deal period ends.
Subject to Contract Definition: A property sale is not legally binding until contracts are exchanged, even if an offer has been accepted.
Tenancy Deposit Scheme Definition: Landlords must place tenant deposits in a government-backed scheme for safekeeping.
Tie-in Period Definition: The length of time a seller agrees to exclusively market their property with one estate agent.
Under Offer Definition: A property where an offer has been accepted but contracts have not yet been exchanged.
Valuation Definition: An assessment of a property’s market value, usually for mortgage or tax purposes.
Vendor Definition: The person selling a property.
Wear and Tear Definition: Reasonable deterioration of a rental property through normal use. Landlords cannot charge tenants for this.
Yield Definition: The annual return on a buy-to-let investment, expressed as a percentage of the property’s value.
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