commission

Definition

The beautiful moment when someone gets paid a percentage for making something happen, whether that's selling a house, brokering a deal, or convincing someone to buy timeshares. It's the financial incentive that turns salespeople into your new best friend until the contract is signed. In real estate, it's typically the 5-6% that makes agents answer your calls at 9 PM.

Example Usage

The real estate agent earned a $15,000 commission on the sale, which suddenly made all those weekend open houses feel worthwhile.

Source: Common business and real estate terminology

Related Terms

Beginner

HOA fees

Monthly payments to a committee of bored neighbors who fine you for parking your own car in your own driveway. It's the subscription service nobody wanted, covering 'amenities' like a pool you never use and landscaping you could do yourself.

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Intermediate

Comps

Short for comparables, these are recently sold nearby homes that agents use to justify whatever price they want. Finding the right comps is an art form -- you just cherry-pick the ones that support your narrative.

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phantom rent

The theoretical rental income from a vacant unit that's factored into pro forma projections but not actually being collected. It's the imaginary money that makes cap rates look better on paper than they are in reality.

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kickout clause

A contingency allowing sellers to accept backup offers and 'kick out' current buyers if they can't remove their contingencies fast enough. The real estate equivalent of keeping your options open while dating.

🏠 Real Estate

Intermediate

net operating income

A property's annual revenue minus operating expenses but before debt service and taxes, the key metric for commercial real estate valuation. Abbreviated NOI, it's the number that makes or breaks whether your investment property is actually profitable.

🏠 Real Estate

Advanced

recourse loan

A loan where the borrower remains personally liable even after foreclosure if the property sells for less than owed. It's the lender's insurance policy that you can't just walk away.

🏠 Real Estate

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