Carter Jonas
Carter Jonas

Jargon Buster

Our Valuation Team has put together a list of some of the most commonly used techinical terms in the business of property or land valuation, for your reference. 

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Comparable
Evidence of a transaction of another property which is sufficiently similar in location and character to help determine the value of a particular property.

Easement
A right which constrains the legal rights enjoyed by the owner e.g. right to light, right of support.

Executor
A person named in a will who has responsibility to sort out the financial liabilities of a deceased estate.

Freehold 
Legal title that gives absolute ownership of the land that the property is standing on.

Ground rent
A payment to the freeholder attributable to the land a property stands on, historically it was paid on vacant land suitable for development.

Hope value
An element of market value, which reflects the prospect of some more valuable future use or development in excess of the existing use.

Land Registry
A Government organisation that holds records of all registered properties in England and Wales.

Lease
A binding legal contract that sets out the terms of a tenancy agreement between landlord and tenant. It defines the rights of both parties and rent/charges payable.

Leasehold
Legal title for a defined term of years on the property but not the land it is built on.  Usually a ground rent is payable to the freeholder (landlord).

Life interest
An interest in property for the remaining life of the owner or occupant.

Market rent
The estimated amount for which a property, or space within a property, should lease(let) on the date of valuation between a willing lessor and a willing lessee on appropriate lease terms in an arm’s-length transaction after proper marketing wherein the parties had acted knowledgeably, prudently and without compulsion.

Market value
The estimated amount for which a property, or space within a property, should sell on the date of valuation between a willing buyer and a willing seller in an arms length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.

Marriage value
The value released by the merger of two or more interests in land, often when combining land parcels to assemble a development site.

Option
The unilateral right, in contract, for one party to exercise his right, in certain circumstances defined in the contract, in the future. Often an option to purchase land in the future.

Overage
An additional payment to a landowner, defined by contract, following an uplift in value (often on obtaining planning permission).

Probate valuation
A valuation for inheritance tax purposes as at the date of death. The term is becoming less commonly used and is the same as market value.

Reinstatement cost
The cost of replacing buildings for insurance purposes.

Restrictive covenant
An obligation contained in a deed whereby the covenantor agrees to refrain from some act affecting the land of the covenantee, e.g. to not build on the land.

Security of tenure
The tenant’s right to remain in occupation after the lease has expired.

Survey
A detailed report on the condition of a property usually carried out for the buyer and prepared following a comprehensive inspection

Staircasing
The right/process of buying additional shares to increase the percentage in a shared ownership home.

Tenants in common
An undivided ownership of a property by two or more persons whose shares may not be equal.

Valuation
An estimate of worth of property for a particular specified purpose - a mortgage valuation is carried out for the lender to establish if the property is worth at least the amount of the loan.  It must be done by a Chartered Surveyor. It is not a survey.

Yield
The annual percentage return that is considered appropriate for an investment, being expressed as the ratio of net income to capital value.

Useful Information

In order to minimize the cost of irrecoverable VAT, i.e. input VAT which cannot be recovered, it is crucial that businesses which rent out commercial and agricultural property consider the possibility of ‘opting to tax’