Reference
UK property investment glossary
45 terms in plain English, each with a real example and, where we have one, a guide or calculator that goes further.
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Additional property surcharge
An extra 5% of the price added to stamp duty in England and Northern Ireland when you will own more than one home, or buy through a company. On a £200,000 buy-to-let it takes the bill from £1,500 to £11,500. Stamp duty calculator.
Additional licensing
A council scheme requiring licences for smaller HMOs, usually three or more people from two or more households, in a set area for up to five years. HMO licensing by council.
AML registration
Registration with HMRC for anti-money laundering supervision. Property sourcers must have it before they trade; it is a criminal offence not to. How to check a sourcer.
Article 4 direction
A council order that removes a permitted development right in an area, so you need full planning permission instead. Manchester, Birmingham and Nottingham all have city-wide Article 4 directions on turning houses into small HMOs. Article 4 by council.
Assured periodic tenancy
The standard private tenancy in England since 1 May 2026. It rolls on month to month with no fixed end date, and the landlord needs a legal ground to end it. Renters' Rights Act guide.
Bridging loan
Short-term finance, usually priced monthly, used to buy a property quickly or one a mortgage lender will not lend on yet. It is repaid by a sale or a refinance.
BRRR
Buy, refurbish, refinance, rent. You add value with works, then refinance at the higher value to take cash back out, and let the property. BRRR guide.
Buy to let
Buying a property to rent it out, usually with a buy-to-let mortgage that is assessed on the rent as well as on you.
Capital at risk
A warning that you can lose some or all of the money you put in. Property values and rents can fall, and costs can rise.
Cash left in
In a BRRR deal, the money you still have in the property after refinancing. The lower it is, the sooner you can do the next deal. BRRR calculator.
Class MA
The permitted development right to convert a Class E building, such as a shop or office, into homes with prior approval rather than full planning permission. The building needs two years of Class E use. Commercial to residential guide.
Comparables
Recent sales of similar homes nearby, used to judge what a property is worth. HM Land Registry publishes every sale price for free. How to check a discount.
Completion
The day the money is paid and the property becomes yours. It usually follows exchange of contracts by a few days or weeks.
Deal Score
DealSold’s score out of 100 for a listed deal, based on its numbers and how well they are evidenced. A deal that loses money cannot score above 40. How we calculate.
End value (GDV)
What a property should be worth after the works are finished. Also called gross development value. Only a surveyor’s valuation confirms it.
EPC
Energy Performance Certificate. Rates a home from A to G and records its floor area; most lettings need one. The public register is a free source of floor areas.
Exchange of contracts
The point where the purchase becomes legally binding. You usually pay a deposit, often 10%, and lose it if you then pull out.
Flip
Buying a property, improving it and selling it, rather than letting it. Profit depends on the end value and keeping works and holding costs in check.
Freehold
Owning the building and the land it stands on outright, with no time limit.
Gross yield
A year’s rent divided by the price. A £180,000 flat let at £1,100 a month has a 7.33% gross yield. Rental yield calculator.
Ground 1A
The possession ground a landlord in England uses to sell a let property. Not available in the first 12 months of a tenancy, and it needs four months’ notice. Renters' Rights Act guide.
HMO
House in multiple occupation: a home let to three or more people from two or more households who share a kitchen or bathroom. Five or more people needs a mandatory licence. HMO licensing.
Interest coverage ratio (ICR)
How much a buy-to-let lender wants the rent to exceed the mortgage interest, tested at a stress rate. Usually 125% for basic-rate taxpayers and companies, 145% for higher-rate taxpayers.
Leasehold
Owning a property for a fixed number of years under a lease, usually with ground rent and service charges. Short leases, under about 80 years, are harder to mortgage and cost more to extend.
Loan to value (LTV)
The mortgage as a percentage of the property’s value. A £150,000 loan on a £200,000 home is 75% LTV, a common maximum for buy-to-let.
Making Tax Digital
HMRC’s system of digital records and quarterly updates for Income Tax. Landlords with over £50,000 of property and self-employment income joined in April 2026. Making Tax Digital guide.
Net yield
Rent after running costs, divided by everything you spent buying the property, including stamp duty and fees. The better number to compare deals on. Rental yield calculator.
Optimism Index
A DealSold warning that flags deals where the value, rent, works and borrowing assumptions are all at the generous end at the same time.
Permitted development
Building work or a change of use you can carry out without a full planning application, within national limits. Councils can remove it with an Article 4 direction.
Prior approval
A lighter council check used for some permitted development, limited to set issues such as flooding, noise and natural light. For Class MA the council has 56 days to decide.
Provenance label
The tag on every DealSold figure saying where it came from: verified, third-party, the sourcer’s own assessment, or an AI estimate. How we calculate.
Redress scheme
An independent complaints service that estate agents and property sourcers must join, such as The Property Ombudsman or the Property Redress Scheme. How to check a sourcer.
Refinance
Replacing one loan with another, often on a higher value after works, to release cash or get a better rate. Most mainstream lenders wait six months after purchase.
Rent repayment order
A tribunal order making a landlord pay back rent, for offences such as running an unlicensed HMO. Up to 24 months’ rent since 1 May 2026.
Rent to rent
Renting a property from its owner on a long agreement and letting it out, often as rooms, keeping the difference. It needs the owner’s written consent and usually licensing.
Reservation deposit
Money paid to hold a deal while you check it. On DealSold it sits with a regulated payment partner, is refunded if the deal falls through for a reason that is not yours, and counts towards the sourcing fee. Sourcing fees guide.
Section 24
The rule that individual landlords cannot deduct mortgage interest from rental income, getting a tax credit instead: 20% now, 22% from April 2027. Companies are not affected.
Selective licensing
A council scheme requiring a licence for every privately rented home in a set area, not just HMOs. Newham’s covers 22 of its 24 wards until May 2028. Schemes by council.
Serviced accommodation
Letting a furnished property by the night or week, like a hotel. Higher income than a standard let, with higher costs and more empty nights.
Six-month rule
Most mainstream lenders will not lend on a property you have owned for less than six months. It is lender policy, not law, and shapes most BRRR timelines. BRRR guide.
Property sourcer
Someone who finds investment property for buyers in return for a fee. In law this is estate agency work, so the Estate Agents Act and AML rules apply. How to check a sourcer.
Sourcing fee
What a sourcer charges for finding and negotiating a deal, commonly £3,000 to £5,000 for a standard deal. The terms must be in writing before you agree. Sourcing fees guide.
SPV
Special purpose vehicle: a limited company set up only to hold property. Mortgage interest is deductible, but the company pays corporation tax and you pay tax again when you take money out.
Stamp Duty Land Tax (SDLT)
The tax on buying property in England and Northern Ireland. Residential bands since April 2025 start at 0% to £125,000. Scotland and Wales have their own taxes. Stamp duty calculator.
Stress test
A lender checking that the rent would still cover the mortgage at a higher rate. For buy-to-let, the test rate is at least 5.5% unless the mortgage is fixed for five years or more.
How we made this glossary
Written by the DealSold team. Figures and dates come from the same primary sources as our guides, checked on the date shown. England unless stated. General information, not financial, tax or legal advice. Spotted a mistake? Tell us.