Real Estate Terms Part 2

We are back with more terms to learn. These will help you work with your North Raleigh real estate agents without issues or confusion!

Terms to Know | North Raleigh Real Estate Agents

  • Unit in place method - Estimating the replacement cost of a structure based on the construction cost per unit of measure of individual building components, including material, labor, overhead & builders profit.
  • Tenancy at will - A lease that gives the tenant the right to possess with the consent of the landlord for a definite period of time without a specific expiration date
  • Straight Line Depreciation - When the cost of an asset is depreciated evenly over its useful life.
  • Square foot method - Cost per square foot of a recently built comparable structure multiplied by the number of square feet in the subject property.
  • Reproduction cost - The dollar amount required to construct an exact duplicate of the subject building at current prices. This is mostly used when appraising historical homes.
  • Replacement cost - The construction cost, at current prices and using modern materials & methodology, of a property that is not necessaraily an exact duplicate but serves the same purpose or function as the original property.
  • Quantity survey method - Estimate based on the quantities of raw materials needed to replace the subject structure as well as of the current price of such materials & their installation costs.
  • Physical deterioration curable - Repairs that are physicall possible and economically feasible & will result in an increase in appraised value equal to or exceeding their cost. ex: painting & roof replacement
  • Periodic estate - At least for an indefinite period of time without a specific expiration date
  • Net operating income - When you deduct the annual operating expenses of the real estate from the effective gross income.
  • Leasehold Estate - No ownership in the property only possessory interest
  • Incurable - If the property value is less than the cost to correct the depreciation, then that item of depreciation is?
  • Income captalization approach to value - Estimate based on the present worth of the future rights to income.
  • Estate for years - A lease for a definite period of time and terminates automatically without notice from either party
  • Economic obsolescence incurable only - Caused by factors outside the subject property & is not curable. ex: proximity to a polluting plant
  • Economic Life - The period during which property is expected to remain useful for its original intended purpose.
  • Curable - If the cost to correct depreciation contributes more value than the actual cost to cure, that depreciation is?
  • Capitalization rate - The yield that an investor will demand for the investment of capital. This is the rate of return.
  • Age Life Method of Depreciation - The easiest but least precise way to measure depreciation that uses the effective age of a building & its economic life.

Be sure to visit back with us soon for more real estate terms that will help you work with your North Raleigh real estate agents without issues or confusion!

With the lower interest rates and increased sales, it's a great time for buyers to really consider purchasing a home before the end of this year. With time left to search, as well as sell current homes, now's a great time to contact our North Raleigh real estate agents!

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