Dictionary of Terms - S

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S

Safe Rate: (See interest rate.)
Sale Price: The price at which the property actually sold.
Sale-and-leaseback: A transaction in which an owner sells his or her improved property and as part of the same transaction signs a long term lease to remain in possession of the premises.
Sale-Leaseback: A financing device in which real property is sold by its owner-user who simultaneously enters into a lease with the buyer such that the owner-user has continuing use of the property. The sale leaseback carries with it the same essential advantages and disadvantages to lessor and lessee that leasing in general provides.
Sales Comparables: these are also known as sales comps. Data regarding sales of properties similar to the subject property. Fields of data compiled include factors such as date of sale, property address, seller, buyer, sale price, square feet, year built, condition and notes. See also sales comparison approach
Sales Comparison Approach: The process of estimating the value of property through examination and comparison of actual sales of comparable properties; also called the direct market comparison or market data approach.
Sales Comparison Method Of Depreciation: Way of estimating loss in value through depreciation by using sales prices of comparable properties to derive the value of a depreciated item Also called the market data method and the market extraction method.
Sales Contract: A contract signed by the buyer and seller detailing the terms of a property sale.
Sales Price: The actual price that a buyer pays for a property.
Sales Ratio: Compares sales prices to assessed values. Other terms for this ratio include: RAR (residential assessment ratio); assessment level; the common level of 100% of true value; average ratio or director's ratio.
Salesperson: (See real estate salesperson.)
Sales-Ratio Analysis: Study of the relationship between assessed values, sales prices and the deviations resulting from difference between the two, to determine the efficiency and fairness of assessing activities.
Sale-Success Ratio: The relationship between the number of properties listed and the number of properties sold. Comparison data may consist of dollar volumes or number of sales. Though it is labeled as a ratio, it is typically expressed as a percentage.
Sample: Statistically, a sample is a specific number of items (information bits) drawn from a population, which is a much larger amount of data. Samples are used to draw conclusions about the population based upon examining the items in the sample. A sample in appraising could be 10 single-family homes with 1200 to 1400 square feet sold in one month in a city. The 10 homes would be selected and studied as a representative sample of the population of all homes with similar characteristics in the entire city.
Sandwich Lease: The ownership interest of a sublessee.
Satisfaction Of Mortgage: A document acknowledging the payment of a mortgage debt.
Scheduled Rent: Rent paid by agreement between lessor and lessee; also called contract rent.
Second Mortgage: A mortgage loan secured by real estate that has previously been made security for an existing mortgage loan. Also called a junior mortgage or junior lien.
Secondary Mortgage Market: Buying and selling of existing mortgage loans designed to provide additional liquidity for lenders.
Section: In the rectangular survey method of legally describing land, it equals 640 acres, which is one square mile or 1/36 of a township.
Security Agreement: See Uniform Commercial Code.
Security Deposit: A payment by a tenant held by the landlord during the lease term and kept (wholly or partially) on default or on destruction of the premises by the tenant.
Seller Carry-back: An agreement where the seller provides financing for a home purchase.
Seller Financing: The seller allows the borrower to use a portion of the equity in the property to finance the purchase.
Selling Price: The actual price that a buyer pays for a property.
Separate Property: Under community property law property owned solely by either spouse before the marriage acquired by gift or inheritance after the marriage or purchased with separate funds after the marriage.
Servant Tenement: Land on which an easement exists in favor of an adjacent property (called a dominant estate); also called a servient estate.
Service Life: The period of time that property has usefulness extending from the date of its installation to the date of its retirement from service.
Setback: The distance a building must be set back from the property lines in accordance with local zoning ordinances.
Settlement Or Closing Fees: Fees paid to the escrow agent (often a title insurance company) for carrying out the written instructions of the agreement between buyer and seller and/or borrower and lender.
Settlement Statement: A closing statement or settlement sheet that outlines all closing costs on a real estate transaction or refinancing for the buyer and seller.
Settlement: The process of closing a real estate transaction by adjusting and prorating the required credits and charges.
Severalty: Ownership of real property by one person only, also called sole ownership.
Severance: Changing an item of real estate to personal property by detaching it from the land; for example, cutting down a tree.
Share-CAD: A property that is valued by two appraisal districts because the property lies within the boundaries of a tax entity which straddles a county line. Appraisal districts are required to accept the lowest assessed value established in any of the appraisal districts for a share-CAD property. The lowest assessed value can be generated by its notice value, an informal hearing, an appraisal review board hearing or a judicial appeal.
Share-cropping: In an agricultural lease the agreement between the landowner and the tenant farmer to split the crop or the profit from its sale actually sharing the crop.
Shared Appreciation Mortgage (SAM): A loan designed for borrowers whose current income is too low to qualify for another type of mortgage. The SAM loan makes the lender and the borrower partners by permitting the lender to share in property appreciation. In return, the borrower receives a lower interest rate.
Shared-appreciation Mortgage: A loan that allows a lender or other party to share in the borrower's profits when the home is sold.
Shared-equity Transaction: A transaction in which two buyers purchase a property, one as a resident co-owner and the other as an investor co-owner.
Sheriff's Deed: Deed given by a court to effect the sale of property to satisfy a judgment.
Shingle: A roof covering or siding material usually made of asphalt, wood slate, tile or fiberglass.
Short-Lived: Those components of a stmcture that are expected to be replaced before the end of the physical life of the improvement. Examples are carpet, mechanical, roof, paint and appliances.
Sill: The structural member that rests on top of the foundation wall. The lowest horizontal member of the structure's framing or a window/door opening.
Sinking Fund Method: Use of a factor by which a property's annual net income may be multiplied to find the present worth of the property over a given period at a given rate of interest.
Site: Land suitable for building purposes, usually improved by the addition of utilities or other services.
Situs: (i) The physical location of real property. The taxable location of personal property. (ii) The personal preference of people for one area over another not necessarily based on objective facts and knowledge.
Slab: A flat area of concrete.
Soffit: The underside of an overhanging cornice.
Special Agent: One who is authorized by a principal to perform a single act or transaction; a real estate broker is usually a special agent authorized to find a ready willing and able buyer for a particular property.
Special Assessment: A tax or levy customarily imposed against only those specific parcels of real estate that will benefit from a proposed public improvement such as a street or sewer.
Special Purpose Property: A property that is appropriate for only one use or a very limited number of uses; its highest and best use will probably be continued at the current use or the improvements will be demolished.
Special Warranty Deed: A deed in which the grantor warrants or guarantees the title only against defects arising during the period of his or her tenure and ownership of the property and not against defects existing before that time generally using the language "by through or under the grantor but not otherwise."
Special-purpose Property: Property that has unique usage requirements, such as a church or a museum, making it difficult to convert to other uses.
Specific Lien: A lien affecting or attaching only to a certain specific parcel of land or piece of property.
Specific Performance: A legal action to compel a party to carry out the terms of a contract.
Speculative Use: Property that is held primarily for future sale; value is based upon the future highest and best use.
Square Foot Cost: The result obtained by the division of the actual or estimated cost of a building by its gross floor area, or by the division of the actual or estimated cost of land improvements by its square foot area.
Square Foot Method: The appraisal method of estimating building costs by multiplying the number of square feet in the improvements being appraised by the cost per square foot for recently constructed similar improvements.
Square Footage - ANSI Z765-1 996: An area of a house that is measured and calculated in accordance with the standard. When employing Metric or Standard International (SI) measurement units, the term floor area is used in place of square footage. (as defined by American National Standard for Single-Family Residential Buildings Square Footage- Method for Calculating)
Standard Deviation: A measure of the difference between individual entities, called variates, and an entire population, in which the square root of the sum of the squared differences between each variate and the mean of all the variates in the population is divided by the number of variates in the population.
Statistics: The science of collecting, classifying and interpreting information based on the number of things.
Statute Of Frauds: That part of a state law that requires certain instruments such as deeds real estate sales con tracts and certain leases to be in writing to be legally enforceable.
Statute Of Limitations: That law pertaining to the period of time within which certain actions must be brought to court.
Statutory Lien: A lien imposed on property by statute-a tax lien for example-in contrast to an equitable lien which arises out of common law.
Statutory Right Of Redemption: The right of a defaulted property owner to recover the property after its sale by paying the appropriate fees and charges.
Steering: The illegal practice of directing members of minority groups to, or away from, certain areas or neighborhoods; channeling.
Step-rate Mortgage: A loan that allows a gradual increase in the interest rate during the first few years of the loan.
Stigmatized Property: A property that has acquired an undesirable reputation due to an event that occurred on or near it such as violent crime, gang related activity, illness or personal tragedy. Some states restrict the disclosure of information about stigmatized properties.
Straight (term) Loan: A loan in which only interest is paid during the term of the loan with the entire principal amount due with the final interest payment.
Straight Line Method: A method of calculating depreciation for tax purposes computed by dividing the
Straight-Line Depreciation: A method of depreciating assets during their estimated lives in equal annual amounts.
Straight-line Recapture: A method of capital recapture in which total accrued depreciation is spread over the useful life of a building in equal amounts.
Strict Liability: The owner is responsible to the injured party without excuse.
Subagent: One who is employed by a person already acting as an agent. Typically a reference to a salesperson licensed under a broker (agent) who is employed under the terms of a listing agreement.
Subdivide: One who buys undeveloped land divides it into smaller usable lots and sells the lots to potential users.
Subdivision And Development Ordinances: Municipal ordinances that establish requirements for subdivisions and development.
Subdivision Development Method: A method of valuing land to be used for subdivision development. It relies on accurate forecasting of market demand, including both forecast absorption (the rate at which properties will sell) and projected gross sales (total income that the project will produce); also called the land development method.
Subdivision Plat: See plat map.
Subdivision: A tract of land divided by the owner into blocks, building lots and streets by a recorded subdivision plat. Compliance with local regulations is required.
Subject Property: the real estate, business personal property or mineral interests being valued or reviewed for unequal appraisal
Sublease: See subletting.
Subleasehold: The interest of a sublessee under a sandwich lease.
Subletting: The leasing of premises by a lessee to a third party for part of the lessee's remaining term. See also assignment.
Subordinate Loan: A second or third mortgage.
Subordination Agreement: A written agreement between holders of liens on a property that changes the priority of mortgage judgment and other liens under certain circumstances.
Subordination: Relegation to a lesser position usually in respect to a right or security.
Subrogation: The substitution of one creditor for another with the substituted person succeeding to the legal rights and claims of the original claimant. . Subrogation is used by title insurers to acquire from the injured party rights to sue in order to recover any claims they have paid.
Subsequent Rate Adjustments: The interest rate for adjustable rate loans (ARMs) adjusts at regular intervals. This adjustment period could in some cases differ from the initial interest rate duration period.
Subsequent Rate Cap: A specific limit defined by most adjustable rate loans (ARMs) for the maximum amount the interest rate may increase at each regularly scheduled interest rate adjstment date. This limit may differ from the initial rate cap.
Substitution: An appraisal principle that states that the maximum value of a property tends to be set by the cost of purchasing an equally desirable and valuable substitute property assuming that no costly delay is encountered in making the substitution.
Subsurface Rights: The right to the use and the profits derived from the underground portion of a designated property and usually refers to the right to extract oil, gas, other hydrocarbon substances, coal and minerals as designed in the grant. Also refers to the right to construct and maintain tunnels, subways, subcellars, pipelines, sewers, etc.
Subsurface Rights: Rights in the form of ownership or easements to minerals, oil, gas or coal located at specified depths below the ground. The owner of these rights need not be the same as the owner of the fee title to the surface of the property. Could be the same as mineral rights.
Suit For Possession: A court suit initiated by a landlord to evict a tenant from leased premises after the tenant has breached one of the terms of the lease or has held possession of the property after the lease's expiration.
Suit To Quiet Title: A court action intended to establish or settle the title to a particular property especially when there is a cloud on the title.
Summation Method: Another name for the cost approach to appraising.
Sump: A pit used to collect water in a basement area. A sump pump is used to remove the water after it is collected.
Super Jumbo Mortgage: A mortgage that is over $650,000 or $1,000,000, depending on the lender.
Superadequacy: A type of functional obsolescence that is caused by a structural component that is too large or of a higher quality than what is needed for the highest and best use of the property; an item in which its cost exceeds its value; an over improvement.
Superfund Amendments And Reauthorization Act (SARA): An amendatory statute that contains stronger cleanup standards for contaminated sites increased funding for Superfund and clarifications of lender liability and innocent landowner immunity. See Comprehensive Environmental Response Compensation and Liability Act (CERCLA).
Superfund: Popular name of the hazardous, waste cleanup fund established by the Comprehensive Environmental Response Compensation and Liability Act (CERCLA).
Supply And Demand: An appraisal principle that states that the value of a property depends upon the quantity and price of the property type available in the market and upon the number of market participants and the price they are willing to pay.
Supply And Demand Principle Of: A principle that the value of a commodity will rise as demand increases and/or supply decreases.
Supply: The amount of goods available in the market to be sold at a given price. The term is often coupled with demand.
Surety Bond: An agreement by an insurance or bonding company to be responsible for certain possible defaults debts or obligations contracted for by an insured party; in essence a policy insuring one's personal and/or financial integrity. In the real estate business a surety bond is generally used to ensure that a particular project will be completed at a certain date or that a contract will be performed as stated.
Surface Rights: Ownership rights in a parcel of real estate that are limited to the surface of the property and do not include the air above it (air rights) or the minerals below the surface (subsurface rights).
Survey: The process of measuring land to determine its size, location and physical description; also, the map or plat showing the resuits of a survey.
Sweat Equity: The non-cash value added to a piece of property by the owner, such as do-it-yourself home improvements.
Syndicate: A combination of people or firms formed to accomplish a business venture of mutual interest by pooling resources. In a real estate investment syndicate the parties own and/or develop property with the main profit generally arising from the sale of the property.





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