Real estate glossary
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A
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Acceptance of work
Act by which the owner declares to accept the work without or with reservations, in the presence of the builder. This act intervenes at the request of the owner or the builder. If the acceptance is not accomplished amicably, it can be granted judicially. It constitutes the starting point of the various guarantee periods.
B
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Biennial warranty
subscribed by the builder, it insures the buyer against all construction defects for 2 years.
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Builder
Term taken in the broad sense covering all the “participants in the act of building”: architects, technicians, consulting engineers, design offices, promoters-builders, building contractors, manufacturers and importers of “components” or prefabricated materials, technical controllers… In fact, any person who sells, after completion, a work that he has built or had built is considered a builder.
C
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Cadastral income
It is equal to the cadastral rental value minus a flat-rate deduction of 50%.
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Cadastral rental value
Fixed by the tax authorities, it corresponds, after updating, to the property rental value assessed at the time of the last revision of property assessments.
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Call for funds
For all purchases of new VEFA housing, payment for the property is made as the work progresses. When the reservation contract is signed, the schedule of calls for funds is sent to the buyer. This schedule mentions the projected dates as well as the percentage of the price requested at each stage of the construction.
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Completion guarantee
Subscribed by the builder with an approved organization, it ensures to the purchaser the completion of the construction or the refunding of the advanced sums.
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Corrected surface
Living area of the apartment, to which a certain area is added or subtracted depending on whether or not the dwelling meets the standards of comfort. The criteria considered are the means of heating, the luminosity of the rooms, the height of the ceilings, etc. Thus, a 60m² apartment can have double the corrected surface if it is particularly well equipped.
D
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Decennial warranty
Subscribed by the builder, it insures the buyer against all construction defects for 10 years.
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Declaration of completion of work
Declaration signed by the builder which must be sent to the town hall and to the Direction Départementale à l’Équipement (DDE) within 30 days from the completion of work.
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Deed of sale
This is the official contract finalizing the sale of a property and the transfer of ownership. Signed by both parties in front of a notary, the deed of sale results in the payment of the installments corresponding to the progress of the work, to which is added the amount of the notary’s fees calculated on the total amount of the purchase price.
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Delivery guarantee
Subscribed by the builder within the framework of a sale in future state of completion, it guarantees to the purchaser that it will be delivered at the agreed date and price. It is mandatory in individual construction contracts.
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DPE
The Diagnostic de Performance Énergétique (DPE) must be carried out before the sale or rental of a property used primarily for residential purposes. This technical document is used to measure the energy consumption of a property. It is established by a qualified diagnostician, who proceeds to the evaluation of various parameters such as insulation, type of heating, production of greenhouse gases… Its results are translated by two marks: the first one determines the consumption of primary energy, the second one the quantity of greenhouse gases emitted.
F
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First-time buyer
A person who has never owned real estate and who is buying a home for his or her own use for the first time.
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Floor area (excluding net floor area)
Sum of the surfaces of the floors of each level after deduction of the attics and the basements not suitable for the dwelling, the roof terraces, the balconies, the loggias, the nonclosed surfaces located at the first floor and the garages (definition very close to that of the livable surface). A flat-rate reduction of 5% is then applied.
G
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Ground plan
Plan presenting the location of the construction project in relation to its immediate vicinity and indicating the limits and orientation of the land, the location and height of the construction, the layout of the service roads and connections.
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Guarantee of perfect completion
Subscribed by the contractor, it insures the buyer against all imperfections noted by the buyer for 1 year.
H
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Hors d'air
A building is declared hors d’air (literally “windtight”) when it is closed and covered, but that its partitioning work remains to be done.
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Hors d'eau
A building is hors d’eau (literally “watertight”) when its structural work is finished (the exterior walls are completely built) and the roof is installed or the terrace is completed.
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HQE
The Haute Qualité Environnementale® (HEQ®) approach aims to improve the quality of life of the building in a sustainable manner. It minimizes the environmental and health impacts resulting from the design, construction, use or operation of the building in all phases of its life cycle.
I
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Indice BT 01
National building index, the official reference for revising construction prices, which measures changes in the cost of factors of production in the building industry; published each month.
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Indice du Coût de la Construction (I.C.C.)
It reflects the evolution of prices in the real estate sector. It is used as a reference for the indexation of the monthly payments of certain loan formulas and for the revision of rents.
L
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Land income
Income from land ownership. It is received by the owner from the rental or sale of a property.
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Land register
Administrative documents including the parcel plan, the sectional status and the cadastral matrix, allowing the identification of the properties of each commune and which can be consulted at the corresponding town hall.
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Lease
A document defining the contractual relationship between landlord and tenant. Some of them are subject to specific regulations, others are subject to the free will of the parties within the framework of the provisions of the Civil Code. They are also called “rental contracts”.
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Living area
Area of an apartment strictly reserved for living. It does not take into account the surface of the stairs, the cellar, the balconies and even the thickness of the walls. It is a surface which is announced at the time of the sale of an apartment.
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Life annuity
Real estate sales contract by which the buyer, in addition to an initial payment freely chosen by the parties (the “bouquet”), will pay the seller an annuity during the latter’s lifetime. The annuity is calculated according to the balance between the bouquet and the sale price, and according to the life expectancy of the seller. A life annuity is said free if the sold good is unoccupied; it is said occupied if the good is occupied, either by the salesman, or by a tenant.
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Lifting of reservations
Within the framework of a VEFA, the purchaser has the possibility of expressing reservations in the report of reception of his real estate, if he discovers defects. Because of the application of the guarantee of perfect completion, the promoter is held to carry out the lifting of said reservations in the year which follows.
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Location plan
Plan showing the geographical location of the land concerned within the perimeter of the municipality to which it belongs.
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Lot
A delimited and bounded parcel of land forming part of a subdivision.
M
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Market value
Estimate in money of the value of a property at a given period.
N
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Net property income
This is equal to the gross property income minus the expenses allowed for tax purposes, i.e.: repair, maintenance and improvement expenses, management fees, interest on loans relating to the above-mentioned operations and to the purchase of the property, fixed deduction.
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NF HABITAT
NF Habitat certification applies to new homes and guarantees the buyer technical quality of construction and an excellent level of comfort and safety. With NF Habitat certification, the developer undertakes to meet very demanding standards in terms of acoustic and thermal comfort, security against the risk of intrusion, accessibility for people with reduced mobility, energy performance, durability and household equipment. It must also provide a quality service to the buyer and in particular clear information at all stages of the acquisition.
O
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Overall surface
Surface resulting from the external measurement of a construction.
P
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P.O.S (Plan d’Occupation des Sols)
Available at the town hall, it allows you to know the planned evolution of the environment: protected areas, road and highway installations, housing aligned to the road, etc.
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Project manager
Professional or company (architect, builder, site manager…) who directs the construction work.
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Project owner
Natural or legal person on behalf of whom the construction works or the works are carried out.
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Promoter
Natural or legal person who takes the initiative to carry out real estate operations and assumes all the stages and steps of a construction project.
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Property administrator
Professional who carries out operations of real estate management within the framework of a mandate. One distinguishes the management of buildings in joint ownership where the manager occupies the function of syndic, and the management of real estate on behalf of owners where the manager deals with the rental management: collection of rents, payment of charges, maintenance, repairs...
R
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Real estate dealer
Trader whose activity consists in buying real estate for his own account and then reselling it with the intention of making a profit. This activity is not regulated and therefore does not offer the same guarantees as those of the real estate agent.
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Real estate expert
Professional whose function is to evaluate the market or rental value of real estate: residential or industrial buildings, businesses, premises, etc. In reality, the real estate expertise covers two kinds of activities: one is regulated, it is the judicial expertise carried out on designation of the expert by a court, the other is free, it is the amicable or conventional expertise.
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Real estate taxes
They are divided into three categories : - The property tax is payable each year by property owners. The amount of this tax is obtained by multiplying the rental value of the property by a rate that is revised each year by the municipalities. - The housing tax, calculated on the same basis as the property tax, is paid by the person, owner or tenant, who occupies the premises. - The regional tax (or local equipment tax) is payable by the person who carries out construction or extension work.
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Rental value
Amount of rent that an owner can hope to obtain by renting his apartment. The rental value is an important element of appreciation at the time of the sale of the property.
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Reservation contract
Preliminary contract by which a seller undertakes to reserve a building or part of a building for a buyer, and in return the buyer must pay a deposit into a special account.
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RT 2012
The French thermal regulation (RT) requires new buildings to respect energy consumption limits. The most recent regulation, introduced in 2012, sets a ceiling of 50 kilowatt hours of primary energy per year and per square meter. This limit is modulated according to the geographical area, the altitude, the surface and the orientation of the building.
S
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Sale by auction
Declaration by which a public officer awards a property put up for auction to the highest bidder. This type of sale can result either from a voluntary decision of the owner or from a legal procedure.
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SCI (Société Civile Immobilière)
Non-commercial company intended to be the owner of a real estate. Each partner makes contributions (real estate, cash) and receives in return and proportionally registered shares. The law does not impose any minimum amount of share capital.
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SCPI (Société Civile de Placement Immobilier)
Company whose purpose is the acquisition and management on behalf of associates, of rental real estate assets for industrial, commercial or private use. It is represented by unlisted shares.
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Specifications
Document giving the detailed characteristics of the building to be built, the external and internal equipment works essential to the establishment and the use of the building.
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Surface hors œuvre brute (SHOB)
All the floor areas of each level of a building.
T
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TMA
As part of the purchase contract, the buyer of a new home may wish to carry out alterations and adaptations that affect the plan, known as Travaux Modificatifs Acquéreurs (TMA). In order to be valid, these modification works must comply with the urban planning rules and not extend the original schedule. TMAs may be subject to a price supplement.
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Turnkey sale
Sale of a building already built that the buyer purchases on the basis of a firm and definitive price.
U
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Urbanism certificate
Document specifying the situation of a building (land or building) in relation to the town’s urbanism plan and indicating the rules to which any new construction must be subject. It is essential before any real estate transaction and must be requested at the town hall or at the DDE.
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Urban plan
A plan drawn up by an urban planner and setting out the development program for a city or town: layout of traffic routes, location of open spaces and wooded areas, public facilities, etc. This plan determines the allocation of the various zones (business districts, industrial zones, collective or individual dwellings, etc.) and prescribes the rules for land use and construction.