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Glosary of terms to understand real estate market

This glossary of terms will help explain some of the terminology used in Real Estate in the United Republic of Tanzania. If you can not find a particular word referenced please, contact us, to send an email and we will endeavour to answer your question.

Acceptance

Agree to the terms and conditions of an offer or contract.

Agent

A body or person who is authorised to act on behalf of the client in the sale, purchase, letting or management of real property.

Auction

A public sale where the property is sold to the highest bidder – on the proviso the reserve price for the property has been met or exceeded.

Body Corporate

The owners of the units/apartments within a building form a Body Corporate. These owners select a council who are responsible for the maintenance of the building (which includes all common areas).

Bond

Upon signing a Tenancy Agreement a bond needs to be paid by the Tenant to the Rental Bond Board (usually equivalent to 4 weeks rent). Please check with the Managing Agent to confirm the amount.

Capital Gain

The monetary gain that you obtain when an asset is sold for a higher price than originally paid for it.

Certificate of Title

A document, which shows the following: Ownership details, dimensions of the land, details of any mortgages and encumbrances (outstanding charge/liability on a property).

Common Property

An area which is owned by all tenants of the strata property.

Company Title

Owners of these units are shareholders in a private company. The approval of the majority of shareholders is necessary if you wish to lease or sell your property.

Contract of Sale

A written agreement which details the terms and conditions regarding the sale or purchase of a particular property.

Conveyance

The legal process involved in transferring the ownership of a property.

Deposit

A deposit is required when purchasing a property (at the time you sign the Contract of Sale) – usually 10% of the sale price. However please check with your Managing Agent for confirmation of the deposit amount.

Gazumping

Where the seller agrees to the sale of the property but before the Contract of Sale is signed the property is sold to another buyer.

Holding Deposit

This is a deposit paid to the vendor – based on the goodwill of the buyer to go ahead with the purchase of a property. It may or may not be refundable at the Vendor's / buyers prior agreement.

Land Tax

An annual tax paid to the State Government, calculated according to the value of the property. Please check with your State Government for the tax amount.

Lease

A document which grants a person/s tenancy of a property. A specific period and terms and conditions will apply. Contact the Managing Agent for details.

Lessee

A person (or legal entity) who leases a property.

Lessor

The owner of a property who leases the property to another person (or legal entity).

Mortgage

A legal document containing the terms and conditions applied to the funds (money) leant to a person (or legal entity) for the purchase of property (real estate).

Mortgagee

The lender of the funds (money) to purchase the property.

Mortgagor

The person who borrows the funds (money) to purchase the property.

Passed in

A property will be passed in at Auction if it does not meet the set Reserve price.

Reserve Price

The reserve price is the amount, which is set by the owner of the property prior to the Auction. After the property meets the reserve price it will be sold to the highest bidder.

Settlement

A date is set for settlement of the sale and at this point the balance of the contract price is paid and ownership of the property transfers from the vendor (seller) to the buyer.

Stamp Duty on the Mortgage

A State Government tax applies to the mortgage amount.

Stamp Duty on the Property amount

A State Government tax applies to the property amount (the sale price).

Strata Title

This type of title gives you ownership of a unit, which you can lease or sell at your own discretion. Membership of the Body Corporate is automatic with this type of real property.

Title Search

Process to ensure ownership of a property.

Certificate of Title

System of recording ownership of a property.

Vendor

The party (seller) who offers a property for sale.

Yield

The income gained from a property. The yield is usually expressed as a percentage of the value or cost of the investment.

For your comfort, contact us now. We are your Real Estate partners in Tanzania & Zanzibar Real Estate market.