Real estate glossary

Real estate should be simple: it is a human affair that almost all of us are confronted with at least once, whether in the context of a sale or a purchase. And yet, it is also a matter of laws, technical constraints, specificities en obscure notions.

Our real estate experts regularly contribute to this lexicon, to popularise the terms of real estate jargon so that you have all the keys to talk about your project - the project of a lifetime.

Understand each term, and demystify the purchase of real estate with the glossary of the real estate agency Neho.

Real estate glossary

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A
  • Purchase
    Sale
    Agreement in principle

    An agreement in principle is an agreement between two parties on the terms of a future contract.

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  • Purchase
    Sale
    Authentic act

    An authentic act is a contract drawn up by a public officer, generally a notary, and can also be called a notarial act. As soon as it is signed, it has an important legal value and allows to frame several operations.

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B
  • General
    Building right

    The right to build is an easement granted to a person allowing him or her to build a property on land that does not belong to him/her. He or she can also buy an existing property on this same land. In both cases, the lessor receives an amount for making his/her land available. In a few words, the leaseholder is the owner of a property on land that does not belong to him/her.

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C
  • General
    Condominium

    Condominium ownership is a widespread form of co-ownership in Switzerland. In a condominium, several purchasers own different parts of the same building and each has an exclusive right to certain parts of the building.

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D
  • Purchase
    Sale
    Draft deed

    A draft deed is a draft of the sales contract drawn up by a notary. It is therefore not the final deed of sale, as changes may be made.

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  • Purchase
    General
    Deposit

    In real estate, a deposit is a sum of money paid by the buyer to the seller, which constitutes a partial payment of the total amount due.

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  • Sale
    General
    Direct sale

    A direct sale is the simplest and fastest way to sell. It is possible when the buyer and the seller agree on an immediate sale date.

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E
  • General
    External surface

    The External Surface concerns all the external parts of the dwelling and is not closed on all sides such as balconies, loggias or terraces.

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  • Purchase
    Taxation
    Equity

    Equity is the personal contribution you have to finance the purchase of a property.

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  • Legislation
    General
    Easement

    An easement is an encumbrance imposed on a property for the benefit of one or more other property(ies) which forces the owner to accept certain constraints (parking of vehicles, water pipe, right of way, etc.) but can also prohibit certain acts (new construction, etc.). In the real estate sector, we speak of land easements which can be contractual or legal. Each easement must be the subject of an authenticated deed and a deposit in the land register.

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F
  • Sale
    General
    Forward sale

    A forward sale is a form of sale that takes effect at the end of the term defined between the seller, the buyer and the notary. It allows the different parties to have more time to organize a move or to end a lease for example.

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G
  • General
    Gross living area

    The gross living area is made up of the net living area, the interior construction area, as well as the exterior and common walls, which are weighted at 50% of their total value.

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  • General
    Gross sales area

    The gross sales area includes in its calculation, almost all surfaces of a dwelling.

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H
  • Sale
    General
    Hedonic valuation

    A hedonic property valuation is the estimation of the property value based on the analysis of comparable properties that have recently been sold. This method is usually carried out using specialised software.

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I
  • General
    Interior Building Area

    The Interior Building Area is the area used by the building elements.

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L
  • General
    Living area

    The living area corresponds to the total of the surfaces that can be fitted out inside the dwelling.

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  • General
    Land register

    The land register is a state administration that gathers all the information related to real estate. It contains all the rights and charges attached to a property (easements, pledges, etc.). Any modification, deletion or constitution must be reported to the land register. The cantons generally have several land registers organized by district or by arrondissement. They can be kept on paper or by computer.

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M
  • Purchase
    Taxation
    Mortgage

    A mortgage is a loan that a financial institution gives to a buyer to purchase a property.

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  • Purchase
    Mortgage note

    According to the Swiss Code of Obligations, a mortgage note is "a personal claim secured by a pledge of real estate".

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N
  • General
    Net Sales Area

    The net sales area is used in the cantons of Fribourg, Vaud and Neuchâtel for the sale of a property.

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  • General
    Net living area

    The net living area is the sum of the areas of the various rooms in the property that are liveable.

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O
  • General
    Official Gazette

    The Official Gazette is a document published regularly by all the cantons.

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P
  • Sale
    Taxation
    Property gains tax

    Property gains tax is a contribution due when a profit is made when selling a property. In other words, if the sale price is higher than the purchase price and investment costs, then the amount of the gain is taxed.

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  • General
    Property

    Property is defined by law as "any area of land with sufficiently defined boundaries".

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R
  • Legislation
    Right of pre-emption

    The right of pre-emption grants a preferential right of purchase which may be in favour of a natural person or a legal entity. In this case, the person having obtained this right of pre-emption will be able to acquire the property on which the right applies in priority if the owner decides to sell it. This right must be recorded in the land register and cannot exceed 25 years.

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  • Legislation
    Right of purchase

    The right of purchase gives a person the right to acquire a property for a defined period. It must be authenticated before a notary and cannot exceed 10 years to be valid.

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T
  • Purchase
    Sale
    Transfer tax

    The transfer tax is a cantonal tax, levied by the cantons or their communes when a property is transferred between two people.

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U
  • General
    Unfinished secondary floor space

    Unfinished secondary floor space is defined as non-liveable areas that are enjoyed by the owner or tenant.

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