Use our Investor Translator below.
Capital
The money that you put into a property or are left with after a sale minus expenses.
Capital growth
The increase in value of a property in the market as a whole, and therefore an increase in the capital you receive following a sale.
Cash flow positive
Where your overall income is greater than your costs.
Cash flow negative
Where your overall income is less than your costs.
Comparable study
A process comparing properties of a similar standard and size to the one you wish to purchase in order to establish its true market value.
Density
The ratio of buildings and total build area in proportion to land plot size.
Demand
The level of interest in a property or area. High demand can significantly raise the price of a property.
Diversification
Spreading your portfolio across a range of investments to reduce risk.
Downside
The disadvantages or hazards of a deal.
Due diligence
The background research and contract checking necessary before making an investment decision.
Emerging market
Describes a country where the property market is in its infancy but shows potential for growth.
Escrow
Money held in account by an independent third party to be released when pre-agreed obligations are fulfilled.
Finder
A person or company who is paid to locate and select property according to your brief.
Flipping
Selling off-plan property as it is built or just as it is completed.
Hotspot
A location where demand for investment property is high.
KPI
Key Performance Indicator
Leveraging
Using capital in such a way that positive or negative outcome is magnified.
LTV
Loan To Value – used in reference to a mortgage or other borrowings. The amount borrowed as a proportion of the value assigned.
Market value
A property’s perceived worth on the open market.
Non-status finance
A way to finance a property purchase without needing to prove income.
Off-plan
When you buy a property before it has been built based on architect’s plans.
Portfolio
Your collective property investments.
Pre-off plan
When you invest at a very early stage in a deal, often when there are no final plans for the property, in order to receive a substantial discount to purchase price.
ROI
Return on Investment
Title deed
A deed or document proving a legal right of ownership to land or property.
Under market value
The percentage that the property is priced less than the verifiable average of the comparable properties.
Upside
The advantages or benefits of a deal.
Zoning
Areas designated for certain purposes eg. Residential, agricultural or commercial.