#real estate


Any property held by an individual or entity for future sale or use.

Real property

Real property is a legal concept that refers to a real estate including the bundle of property rights in addition to real estate ownership. Examples of real property rights include the right of ownership, right of possession, right of exclusion, right of disposition, and the right of use and enjoyment.

Real property, real estate, realty, or immovable property are mostly used interchangeably. However, in the legal sense, real property is a broader concept than real estate and refers to the bundle of rights involved with ownership.

Real estate

Real estate refers to an immovable property including land and the buildings on it. The key difference between a property (personal) and real property is that real property is immovable by law. The term "real" indicates that the property is immovable.

See estate.


In the real estate industry, the term "estate" refers to the ownership interest one has in real property. An estate encompasses the degree, nature and extent of ownership rights.

Estates are typically divided into two groups: freehold estates of indefinite length and leasehold estates for a fixed term.


1. The ownership interest one has in real property.
2. The property left by a deceased person.
3. A large house with substantial grounds surrounding it, giving the impression of belonging to a wealthy person.


A sale transaction wherein one person (usually the seller) delivers evidence of title to a third person to be held by the escrow holder until the happening of the performance of a prescribed condition (usually deposit of funds by a buyer), when the evidence of title is then delivered to the buyer.

:: Escrow in mortgages ::
Escrow concept is used in mortgages where the mortgage provider opens an escrow account to pay insurance and real estate tax throughout the mortgage.


The market value of a real estate property after the amount of existing liens have been subtracted. Thus, a home valued at $100,000 with $30,000 in mortgage liens has a net equity of $70,000 ($100,000 - $30,000).


A decrease or reduction in the amount of rent. An abatement of rent might be offered to a tenant when leased space cannot be occupied due to fire or flood damage.

Principle of substitution

In appraising, it is a principle which contends that the higher limit of the value of a property is defined by the cost of acquiring an equally desirable substitute property. This principle is the basis for the market comparison or market data approach.


Agency arises out of a contract, either expressed or implied, written or oral. Agency involving real property should be in writing, such as listings, trusts, power of attorney.


A principal is any person involved in a contract, such as a seller, buyer, principal broker, or an owner who has hired an agent as a property manager.