Real Estate Glossary

Ownership of both the land and the building/structure. You own the property outright and can use it indefinitely.

Ownership of a unit or structure, but not the land. The land is owned by another party (usually an estate or trust) and your rights last only until the lease expires. Common in Hawaii, especially Waikiki.

Absolute ownership of real property with no time limit or superior landlord. Equivalent to fee simple.

Condominium units that operate like hotels with nightly rentals. Typically require special financing and have higher HOA fees.

A secondary dwelling unit on the same property as the primary residence. Common in Hawaii for multigenerational living and rental income.

A residential building designed for one family, typically with its own lot, yard, and separate entrance.

Individual units in a multi-unit building where owners own their unit and share common areas. Subject to HOA/AOAO fees.

A multi-story residential unit that shares walls with adjacent units. Usually includes a small yard or patio.

Real estate purchased primarily for income generation through rental, resale, or appreciation rather than personal use.

A property rented to tourists for short-term stays (typically under 30 days). Subject to local zoning and permitting requirements.

A lender's conditional commitment to loan you a specific amount based on your financial information. Required before making an offer on a home.

An informal estimate of how much a lender might loan you based on basic financial information. Less rigorous than pre-approval.

A loan used to purchase real estate, secured by the property itself. The borrower repays the loan with interest over a set period (typically 15-30 years).

The upfront cash paid by the buyer toward the purchase price. Typically 3-20% of the purchase price. The remainder is financed through a mortgage.

Private Mortgage Insurance. Required when a down payment is less than 20%. Protects the lender if the borrower defaults.

Annual Percentage Rate. The yearly cost of a loan including interest and fees, expressed as a percentage. Used to compare loan offers.

Fees and expenses paid at closing, including appraisal, inspection, title insurance, escrow, and lender fees. Typically 2-5% of purchase price.

A neutral third party that holds funds and documents during a real estate transaction until all conditions are met and the sale closes.

Insurance that protects the buyer and lender against loss due to defects in the property title or ownership.

A professional assessment of a property's value conducted by a licensed appraiser. Required by lenders to ensure the loan amount doesn't exceed the property value.

Properties currently for sale on the MLS that have not been sold or withdrawn.

Properties that have accepted offers but have not yet closed. The sale is under contract.

The number of days a property has been listed for sale. Lower numbers indicate faster sales and stronger buyer demand.

The middle price point of all homes sold in a given area during a specific time period. Half sold for more, half for less.

A comparison of data from the same period in consecutive years. Used to measure market trends and changes.

The total number of homes available for sale in a given area at a specific time.

Market conditions favoring buyers, characterized by more inventory, lower prices, and less competition.

Market conditions favoring sellers, characterized by less inventory, higher prices, and more buyer competition.

A sale price higher than the original list price. Indicates strong buyer demand and competition.

A sale price lower than the original list price. May indicate weaker demand or negotiation by the buyer.

A legal document that transfers ownership of real property from one party to another.

Legal proof of ownership of a property. The deed is the document that conveys title.

A legal claim against a property as security for a debt. Must be paid off before the property can be sold.

A legal right to use another person's property for a specific purpose (e.g., utility access, right of way).

The minimum distance a building must be set back from the property line. Regulated by local zoning laws.

Local regulations that designate how land can be used (residential, commercial, industrial, etc.).

Homeowners Association. An organization in a residential community that sets rules and collects fees from homeowners.

Association of Apartment Owners. Hawaii's term for a condominium association. Manages common areas and collects maintenance fees.

Short-Term Rental. A property rented for periods under 30 days. Subject to zoning restrictions and permitting in Hawaii.

Hawaii Tax ID (Certificate of Registration). Required for all short-term rental properties in Hawaii.

A Hawaiian word meaning group or collective. Refers to a group of people pooling resources to purchase real estate together. Growing in popularity as a way to build generational wealth.

Hawaiian word meaning love, compassion, and respect. Represents the spirit of community and hospitality central to Hawaiian culture.

Hawaiian word meaning family. Refers to both blood relatives and extended family/community. Influences real estate decisions and multigenerational living.

Hawaiian word meaning responsibility or privilege. Represents the obligation to care for the land and community.

Monthly fees paid by condo owners to cover maintenance, utilities, insurance, and amenities. Often higher in Hawaii due to climate and building age.

Hawaii state tax on the transfer of real property. Paid by the seller, typically 0.5-1.5% of the sale price depending on the county.

A Hawaii tax exemption for owner-occupied primary residences that significantly reduces property tax liability.

Areas designated by FEMA as having high flood risk. VE (Velocity Zone) properties require special flood insurance and construction standards.