A real estate transaction is the process whereby rights in a unit of property (or designated real estate) is transferred between two or more parties, e.g. in case of conveyance one party being the seller(s) and the other being the buyer(s). It can often be quite complicated due to the complexity of the property rights being transferred, the amount of money being exchanged, and government regulations. Conventions and requirements also vary considerably among different countries of the world and among smaller legal entities (jurisdictions).

In more abstract terms, a real estate transaction, like other financial transactions, causes transaction costs. To identify and possibly reduce these transaction costs, the Organisation for Economic Co-operation and Development (OECD) addressed the issue[1] through a study commissioned by the European Commission, [2] and through a research action.[3]

The mentioned research action 'Modelling Real Property Transactions' investigated methods to describe selected transactions in a formal way, to allow for comparisons across countries / jurisdictions. Descriptions were performed both using a more simple format, a Basic Use Case template,[4][5] and more advanced applications of the Unified Modelling Language.[6][7] Process models were compared through an ontology-based methodology,[8] and national property transaction costs were estimated for Finland and Denmark,[9][10][11] based on the directions of the United Nations System of National Accounts.[12]

Real estate transactions: subdivision, conveyance, and mortgaging, as they are performed in the five Nordic countries are described in some detail.[13] A translation into English is available for the Danish part.[14]

Residential examples

United States and Canada

The sale of a house in the United States or Canada might involve some or all of the following steps:

See also

References

  1. ^ "Improving Competition in Real Estate Transactions, 2007". Oecd.org. Retrieved 3 January 2012.
  2. ^ "Conveyancing Services Market, 2007". Europa (web portal). Retrieved 3 January 2012.
  3. ^ "Modelling Real Property Transactions, 2001–2005". Cost.esf.org. Retrieved 3 January 2012.
  4. ^ "Alistair A.R. Cockburn: Basic use case template". Alistair.cockburn.us. Retrieved 3 January 2012.
  5. ^ Default. "WG Law and Modelling: UseCase descriptions of Subdivision Procedures, 2002". Costg9.plan.aau.dk. Retrieved 3 January 2012.
  6. ^ "Ferlan, Sumrada and Mattsson: Modelling property transactions, pp. 27 – 79 in: Real Property Transactions. Procedures, Transaction Costs and Models. Edited by: J. Zevenbergen, A. Frank and E. Stubkjær". Iospress.nl. Retrieved 3 January 2012.
  7. ^ "Rados Sumrada: Modeling methodology for real estate transactions, 2005". Retrieved 3 January 2012.
  8. ^ "Hess and Vaskovich: Ontology Engineering for Comparing Property Transactions, pp. 183 – 201, and Hess and Schlieder: Ontology-Based Development of Reference Processes, pp. 203- 219, both in: Real Property Transactions. Procedures, Transaction Costs and Models. Edited by: J. Zevenbergen, A. Frank and E. Stubkjær". Iospress.nl. Retrieved 3 January 2012.
  9. ^ "Vitikainen: Transaction Costs Concerning Real Property – The Case of Finland, pp. 101 – 118 in: Real Property Transactions. Procedures, Transaction Costs and Models. Edited by: J. Zevenbergen, A. Frank and E. Stubkjær". Iospress.nl. Retrieved 3 January 2012.
  10. ^ "Stubkjær: Accounting Costs of Transactions in Real Estate – The Case of Denmark. Nordic Journal of Surveying and Real Estate Research, 2:1 (2005) 11–36". mts.fgi.fi. Archived from the original on 5 February 2009.CS1 maint: unfit URL (link)
  11. ^ "Stubkjær, Lavrac and Gysting: Towards national real estate accounts: The case of Denmark and other European jurisdictions, pp. 119- 139 in: Real Property Transactions. Procedures, Transaction Costs and Models. Edited by: J. Zevenbergen, A. Frank and E. Stubkjær". Iospress.nl. Retrieved 3 January 2012.
  12. ^ "UN System of National Accounts 1993". mts.fgi.fi. Archived from the original on 13 August 2010.
  13. ^ "Ejendomsregistrering i de nordiske lande" (PDF). Archived from the original (PDF) on 13 June 2007. Retrieved 17 February 2018.
  14. ^ "Property formation in the Nordic countries – Denmark. National Survey and Cadastre (2008)" (PDF).
  15. ^ "The Need for a Real Estate Escrow" (PDF).
  16. ^ "Real Estate Buying and Selling Flowchart".
  17. ^ Chung, Juliet (1 October 2010). "The Holdouts". The Wall Street Journal. Retrieved 15 March 2014.