Buyer Guide
Real Estate ABC: The Complete GTA and Ontario Real Estate Glossary
A plain-language glossary of the terms that appear in an Ontario purchase — from Agreement of Purchase and Sale to Zoning By-Law — written so you can ask a better question before you sign.
The short answer
A plain-language glossary of Ontario real estate terms, assembled by Robin Patel, runs from Agreement of Purchase and Sale to Zoning By-Law and separates the pairs that cost people money: deposit and down payment, conditional and firm, assessed value and market value. Read it before you sign rather than afterwards.
Written forFirst-time buyers, sellers, investors and owners in Brampton, Mississauga, Milton, Vaughan, Toronto, Caledon, Oakville, Burlington, Kitchener, Cambridge and the surrounding GTA who keep running into terms nobody stops to explain.
The short version
- A deposit and a down payment are different things: the deposit secures the Agreement of Purchase and Sale, while the down payment is the portion of the price you are not financing.
- A conditional offer still has conditions to satisfy or waive; a firm offer has none left, and that is the point at which the deal becomes binding.
- A property’s assessed value, used for municipal taxation, is not the same number as its current market value.
- A status certificate is the condominium document that sets out the corporation’s common expenses, reserve fund and legal matters — read it before you go firm on a condo.
- Freehold means you generally own the land and the structures; leasehold gives you a right to occupy or use land for a specified period instead.
How to use this glossary
This is a plain-language guide to the most important real estate terms used when buying, selling, investing in or owning a property in the Greater Toronto Area and across Ontario.
Whether you are a first-time home buyer in Brampton, Mississauga, Milton, Vaughan, Toronto, Caledon, Oakville, Burlington, Kitchener, Cambridge or another GTA-area community, understanding the terminology before you sign can help you make one of the biggest financial decisions of your life with fewer surprises. Terms are grouped alphabetically, so you can read it straight through once or come back to a single letter when a document puts a word in front of you.
A — Real Estate Terms
- Acre — A unit of land measurement equal to 43,560 square feet.
- Additional Deposit — An additional amount of money a buyer may be required to pay toward the purchase according to the Agreement of Purchase and Sale.
- Adjusted Cost Base (ACB) — The cost used to calculate a property’s capital gain for tax purposes, including certain eligible expenses and improvements.
- Agreement of Purchase and Sale (APS) — The legally binding contract between a buyer and seller that sets out the purchase price, closing date, conditions and other terms of the transaction.
- Amortization — The total period over which a mortgage is scheduled to be repaid.
- Annual Property Taxes — The yearly property taxes charged by the municipality.
- Appraisal — A professional estimate of a property’s market value, often required by a lender before approving a mortgage.
- Appraised Value — The estimated market value determined through an appraisal.
- Appreciation — An increase in a property’s value over time.
- Assessment (assessed value) — The value the municipality assigns to a property for property-tax purposes. It is not necessarily the same as current market value, and a sale above it does not automatically change it.
- Assignment Sale — A transaction in which a buyer transfers their contractual rights to purchase a property to another buyer before the original closing.
- Assumable Mortgage — A mortgage that may allow a qualified buyer to take over the seller’s existing mortgage.
- Accessory Dwelling Unit (ADU) — A secondary residential living space associated with a primary dwelling, subject to applicable municipal rules.
- Attractive Nuisance — A potentially dangerous feature on a property that may attract children or others, creating possible liability concerns.
| Term | What the glossary says it is |
|---|---|
| Appraisal | A professional estimate of a property’s market value, often required by a lender before approving a mortgage |
| Appraised Value | The estimated market value determined through an appraisal |
| Assessment | The value assigned to a property for property-tax purposes; not necessarily the same as current market value |
| Assessed Value | The value used by the municipality for taxation purposes |
B — Real Estate Terms
- Backsplit — A house design in which different levels are separated by short flights of stairs.
- Basement — The lower level of a house that is partially or fully below ground.
- Basement Apartment — A separate living area located in a home’s basement, subject to applicable zoning, building and fire-safety requirements.
- Below-Market Value — A property price that is below comparable market prices.
- Bi-Level Home — A home with two main levels connected by a short staircase.
- Bridge Financing — Short-term financing used to cover the gap between purchasing a new property and receiving funds from selling another property.
- Broker of Record (BOR) — The individual responsible for ensuring a brokerage complies with applicable regulatory requirements.
- Brokerage — A real estate company through which registered real estate professionals provide services.
- Buyer Representation Agreement — A written agreement between a buyer and a brokerage outlining the services, obligations, scope and compensation arrangements.
- Buyer — The person or party purchasing a property.
- Buyer’s Agent / Buyer Representative — A real estate professional representing a buyer, subject to the applicable representation agreement.
C — Real Estate Terms
- Capital Gain — The increase in value of an investment property from its adjusted cost base to its selling price, subject to applicable tax rules.
- Cash Flow — The money remaining after rental income, operating expenses and financing costs are considered.
- Chattels — Moveable items that are not permanently attached to the property, such as certain appliances or fixtures depending on the agreement.
- Closing Costs — Expenses associated with completing a real estate purchase, such as legal fees, land transfer tax and other applicable costs.
- Closing Date — The date when ownership is legally transferred from seller to buyer.
- Cloud on Title — A claim, defect or issue that may affect clear ownership of a property.
- Comparables / Comparable Properties — Similar properties used to help estimate market value.
- Comparative Market Analysis (CMA) — An analysis of comparable properties used by a REALTOR® to help determine a property’s likely market value or listing price.
- Conditional Offer — An offer containing conditions that must be fulfilled or waived within the specified time.
- Condo / Condominium — A form of property ownership in which an owner owns a specific unit and shares ownership of common elements.
- Condominium Corporation — The corporation responsible for managing a condominium property and its common elements.
- Condo Fees — Monthly fees paid by condominium owners toward common expenses and services.
- Condo Reserve Fund — Funds maintained by a condominium corporation for major repairs and replacements of common elements.
- Corner Lot — A property located at the intersection of two streets.
- Counteroffer — A response to an offer that changes one or more terms of the original offer.
- Curb Appeal — The visual attractiveness of a property from the street.
D — Real Estate Terms
- Days on Market (DOM) — The number of days a property has been marketed for sale according to the applicable listing data.
- Debt Service Ratio — A measure used by lenders to assess whether a borrower can manage debt payments.
- Deed — A legal instrument relating to the transfer of ownership or interest in real property.
- Deposit — Money provided by the buyer as security for the Agreement of Purchase and Sale.
- Depreciation — A decrease in a property’s value.
- Detached Home — A house that does not share walls with another residential dwelling.
- Designated Representative — A REALTOR® designated to represent a client under Ontario’s real estate representation framework.
- Discharge of Mortgage — The legal process of removing a mortgage from a property’s title after the mortgage has been paid or otherwise discharged.
- Down Payment — The portion of the purchase price paid by the buyer that is not financed through a mortgage.
- Duplex — A property containing two residential dwelling units, subject to applicable zoning and building requirements.
E — Real Estate Terms
- Easement — A legal right allowing someone to use part of another property for a specific purpose.
- Encroachment — When a structure or improvement extends onto another property or public land.
- Encumbrance — A claim, restriction, lien or other legal interest affecting a property.
- Equity — The difference between a property’s market value and the outstanding mortgages or other secured debts against it.
- Exclusive Listing — A listing arrangement in which a brokerage receives the agreed authority to market and sell the property.
- Expired Listing — A listing that reaches the end of its listing period without being sold.
- Estate Sale — A sale of property connected with the administration of an estate.
F — Real Estate Terms
- Fair Market Value — The estimated price a property could reasonably sell for in an open market under appropriate conditions.
- Firm Offer — An accepted Agreement of Purchase and Sale with no outstanding conditions.
- First-Time Home Buyer — A person who meets the applicable federal or provincial definition for a first-time home buyer.
- Fixed-Rate Mortgage — A mortgage with an interest rate that remains fixed for the agreed term.
- Fixture — An item attached to the property that may legally form part of the property.
- Foreclosure — A legal process through which a lender may enforce its security interest after mortgage default.
- Freehold — A form of property ownership where the owner generally owns the land and structures, subject to applicable rights and restrictions.
G — Real Estate Terms
- GTA (Greater Toronto Area) — The Greater Toronto Area, commonly referring to Toronto and surrounding municipalities.
- Gross Rental Income — Total rental income before deducting expenses.
- Gross Floor Area (GFA) — The total floor area of a building as defined by applicable municipal rules.
- Georgian Home — A traditional home style often characterized by symmetrical design and balanced windows.
- Garden Suite — A detached residential structure located in the yard of a property and used as a dwelling, subject to municipal regulations.
H — Real Estate Terms
- Home Appraisal — A professional assessment of a property’s market value.
- Home Inspection — An inspection of a property’s visible and accessible components to identify potential issues.
- Homeowners Insurance — Insurance coverage protecting a homeowner against specified risks and losses.
- Holdback — Money retained temporarily until specified work, conditions or obligations are completed.
- Hot Market — A market characterized by strong buyer demand relative to available inventory.
- HST — Harmonized Sales Tax. Its application to real estate depends on the type of transaction and property.
- HVAC — Heating, ventilation and air-conditioning systems.
I — Real Estate Terms
- Income Property — A property purchased or owned to generate rental or other income.
- Interest Rate — The percentage charged by a lender for borrowing money.
- Interim Occupancy — A period when a condominium buyer may occupy a unit before legal title transfers.
- Inclusions — Items specifically included in the purchase according to the Agreement of Purchase and Sale.
- Inspection Condition — A condition allowing a buyer to conduct or review a home inspection before becoming firm, when included in the agreement.
L — Real Estate Terms
- Land Transfer Tax (LTT) — A provincial tax generally payable when acquiring land or an interest in land in Ontario.
- Land Transfer Tax Rebate — A rebate that may be available to eligible first-time home buyers under applicable Ontario rules.
- Lease — A legal agreement giving a tenant the right to occupy a property for a specified period under specified terms.
- Leasehold — An interest in property based on a right to occupy or use land for a specified period rather than owning the freehold interest.
- Listing Agreement — A written representation agreement between a seller and brokerage relating to the sale of a property.
- Listing Price — The price at which a property is marketed for sale.
- Lien — A legal claim against property securing payment of a debt or obligation.
- Lot — A parcel of land.
- Lot Line — The legal boundary of a property.
- Luxury Home — A marketing term generally used for higher-end properties; there is no single universal GTA price threshold.
M — Real Estate Terms
- Market Value — The estimated price a property could reasonably sell for under appropriate market conditions.
- MLS® System — The Multiple Listing Service® system used by REALTORS® to market and access property listings.
- MLS® Listing — A property listing entered into the MLS® System.
- Mortgage — A loan secured against real property.
- Mortgage Broker — A professional who helps borrowers obtain mortgage financing from lenders.
- Mortgage Pre-Approval — An indication from a lender of how much a borrower may potentially qualify to borrow, subject to conditions and verification.
- Mortgage Stress Test — A federal mortgage qualification requirement used to assess a borrower’s ability to manage payments at a qualifying interest rate.
- Multiple Representation — A situation where the same brokerage or designated representative represents more than one client in the same transaction, subject to Ontario rules and required disclosures and consent.
- Municipal Property Tax — Property tax charged by the municipality.
N — Real Estate Terms
- Net Operating Income (NOI) — Income from an income property after operating expenses but before financing costs and income taxes.
- New Construction — A newly built property that has not previously been occupied or has recently been completed.
- Non-Resident Speculation Tax (NRST) — A provincial tax that may apply to certain purchases of residential property by foreign nationals, subject to current Ontario rules and exemptions.
- Notice of Assessment — A document issued by the Canada Revenue Agency showing information about a taxpayer’s assessed tax position.
O — Real Estate Terms
- Offer — A proposal from a buyer to purchase a property under specified terms.
- Open House — A scheduled period when a property is available for prospective buyers to view.
- Open Offer — An offer process where certain information about competing offers may be disclosed according to applicable rules.
- Operating Expenses — Expenses required to operate and maintain an income property.
- Ontario Land Transfer Tax — The provincial land transfer tax payable on qualifying transfers of land in Ontario.
P — Real Estate Terms
- Power of Sale — A legal remedy that may allow a lender to sell a property after mortgage default, subject to applicable law.
- Pre-Construction — A property purchased before construction is completed, often directly from a builder.
- Pre-Approval — A lender’s preliminary assessment of a borrower’s potential mortgage qualification.
- Principal — The amount borrowed under a mortgage, excluding interest.
- Property Assessment — The assessed value used for property taxation purposes.
- Property Disclosure — Information provided about a property’s known condition, features or history where applicable.
- Property Tax — Tax charged by a municipality based on applicable assessment and tax rates.
- POTL (Parcel of Tied Land) — A form of property ownership in which a parcel is tied to shared facilities or common elements, often with an associated common expenses arrangement.
- Purchase Price — The agreed price paid for a property.
R — Real Estate Terms
- REALTOR® — A registered real estate professional who is a member of a REALTOR® association and follows applicable professional standards and rules.
- Real Estate Agent — A registered real estate salesperson or broker providing real estate services through a brokerage.
- Real Estate Brokerage — A business through which registered real estate professionals provide real estate services.
- Reassessment — A reassessment of property value for taxation purposes.
- Reserve Fund — Money set aside for major future repairs and replacements, particularly important in condominium ownership.
- Residential Property — Property used primarily for residential purposes.
- Reverse Mortgage — A mortgage product that allows eligible homeowners to access equity in their home without necessarily making regular mortgage payments, subject to lender requirements.
- Rural Property — Property located outside an urban area and potentially subject to different servicing, zoning and septic or well considerations.
S — Real Estate Terms
- Sale of Property — The transfer of ownership of real property from seller to buyer.
- Seller Representation Agreement — A written agreement between a seller and brokerage outlining the services and terms of representation.
- Seller’s Market — A market where demand is relatively strong compared with available inventory.
- Semi-Detached Home — A home attached to another home by one shared wall.
- Severance — The legal process of dividing a parcel of land into separate parcels, subject to municipal and provincial requirements.
- Single-Family Home — A dwelling designed primarily for one household.
- Status Certificate — A condominium document containing important information about the corporation, unit, common expenses, reserve fund, legal matters and other relevant information.
- Sold Conditional — A property sold subject to one or more conditions that have not yet been fulfilled or waived.
- Sold Firm — A property sold with no outstanding conditions.
- Statement of Adjustments — A document showing financial adjustments between buyer and seller at closing.
- Survey — A professional plan or document showing property boundaries and improvements, where available.
- Suspended Listing — A listing temporarily removed from active marketing while the listing agreement may remain in effect.
T — Real Estate Terms
- Tax Adjustment — A closing adjustment that accounts for property taxes already paid or still owing.
- Tenancy in Common — A form of co-ownership in which owners may hold different ownership interests and generally do not have automatic survivorship.
- Title — The legal ownership and registered interests associated with a property.
- Title Insurance — Insurance that can protect against certain title-related risks and defects, subject to the policy.
- Title Search — A search of land registration records to investigate ownership and registered interests.
- Townhouse — A residential property attached to one or more neighbouring units.
- TRREB — Toronto Regional Real Estate Board.
- Trust Account — A regulated account used by a brokerage to hold certain funds in trust.
U — Real Estate Terms
- Under Contract — A property for which an agreement has been accepted, although the exact meaning can vary by market and listing system.
- Underwriting — The lender’s process of evaluating a borrower’s financial situation and the property before approving financing.
- Utility Easement — An easement allowing utility providers or others certain rights to access or use part of a property.
- Upper-Level Unit — A residential unit located above another level of a building or home.
V — Real Estate Terms
- Vacant Home Tax (VHT) — A municipal tax that may apply to certain residential properties determined to be vacant under applicable municipal rules.
- Variable-Rate Mortgage — A mortgage where the interest rate can change based on the lender’s applicable variable-rate structure.
- Vendor — Another term for the seller of real property.
- Vested Interest — A legally recognized interest in property or an asset.
W — Real Estate Terms
- Walkout Basement — A basement with direct exterior access, often through a door leading to the yard.
- Warranty — A promise or guarantee regarding a particular item, condition or obligation, depending on the contract.
- Waterfront Property — Property located directly adjacent to a body of water.
- Will — A legal document that can specify how a person’s assets, including real property, are distributed after death.
- Working with a REALTOR® — The process of receiving real estate services and representation from a registered real estate professional.
Z — Real Estate Terms
- Zoning — Municipal rules that determine how a property and land may legally be used.
- Zoning By-Law — A municipal regulation establishing permitted land uses, building types, setbacks, heights and other development requirements.
- Zoning Certificate — A municipal document or confirmation relating to the zoning status or permitted use of a property.
- Zone — A geographic area subject to specific zoning regulations.
Real Estate ABC for first-time home buyers
If you are buying your first home in the GTA, you do not need all twenty-six letters on day one. Start with these terms, because they are the ones that appear in the documents you will actually be asked to sign and in the conversations where money moves.
Understanding these terms can help you ask better questions and make more informed real estate decisions. If someone uses a word from this list and you are not sure which meaning applies to your deal, that is exactly the moment to stop and ask.
- Agreement of Purchase and Sale
- Appraisal
- Assessment
- Buyer Representation Agreement
- Closing Costs
- Conditional Offer
- Deposit
- Down Payment
- Home Inspection
- Land Transfer Tax
- Mortgage Pre-Approval
- Property Tax
- Status Certificate
- Title
- Title Insurance
- Zoning
If someone uses a word from this list and you are not sure which meaning applies to your deal, that is exactly the moment to stop and ask.
An important note about this glossary
Real estate laws, taxes, mortgage rules, municipal by-laws and regulatory requirements can change. This glossary is intended for general educational purposes and should not replace advice from a qualified REALTOR®, lawyer, mortgage professional, accountant or other appropriate professional.
Robin Patel is a GTA REALTOR® with The Agency Toronto and a First-Time Home Buyer Specialist, helping buyers and sellers navigate the Ontario real estate market. His goal with this glossary is simple: make real estate easier to understand, whether you are a first-time home buyer, a move-up buyer, an investor or a seller.
Written by
Robin PatelSalesperson · The Agency Toronto
Updated
Published
Read in your language
A machine translation, not Robin’s words. For anything that decides money, ask him in Gujarati or Hindi directly.
