Elaman Homes

Investment Guide / Glossary

Glossary — every term, in plain English

ADR — Average Daily Rate. The average nightly price achieved by a serviced accommodation unit. With occupancy, one of the two numbers that decide a short-let's revenue.

AML — Anti-Money-Laundering registration. HMRC supervision required for estate agency businesses, including deal sourcers. Trading without it is illegal.

Article 4. A direction by a local planning authority that removes permitted development rights in a defined area — most commonly the right to convert a dwelling (C3) into a small HMO (C4), making planning permission necessary.

ARV — After-Refurbishment Value. The estimated value of a property once works are complete. Used in BRRR and flip models; supported in packs by sold comparables. Also appears as GDV.

AST — Assured Shorthold Tenancy. Historically the standard private tenancy in England. Since 1 May 2026, under the Renters' Rights Act 2025, new and existing tenancies run as assured periodic tenancies instead.

BMV — Below Market Value. The percentage discount of an asking price against the median sold price of comparable properties in the postcode sector, from Land Registry data.

Bridging finance. Short-term, interest-heavy lending (typically priced monthly) used to buy properties unmortgageable in their current condition or to move quickly, repaid by refinance or sale.

BRRR — Buy, Refurbish, Refinance, Rent. A strategy that recycles capital: buy below market value, add genuine value, refinance at the higher valuation, and rent — leaving as little cash in the deal as the numbers allow.

BTL — Buy-to-Let. A residential property purchased and let whole to tenants for income; the benchmark UK property strategy.

Cash-on-Cash. Annual net cash flow divided by total cash invested — the return on the money actually deployed, not the property's price.

CGT — Capital Gains Tax. Tax on disposal gains. For UK residential property held by individuals: 18% within the basic-rate band, 24% above, with a 60-day reporting and payment window after completion.

Conveyancing. The legal process of transferring property ownership.

Distress signals. Listing and public-data evidence that a vendor is motivated: probate, repossession, price cuts, long marketing periods, short lease, poor EPC, structural notes. A core input to the Elaman score.

EICR. Electrical Installation Condition Report; required at least every five years for rented residential property.

EPC — Energy Performance Certificate. An A–G energy rating. Rental property in England and Wales currently requires a minimum of E; a minimum of C is confirmed for private tenancies from 1 October 2030, with a £10,000 per-property cost cap.

FHL — Furnished Holiday Lettings. A former tax regime for qualifying short lets, abolished from April 2025; short-let income is now taxed like ordinary property income.

Flip. Buying, refurbishing, and selling within a short window; profit is generally treated as trading income rather than a capital gain.

Freehold. Outright ownership of a property and its land.

GDV — Gross Development Value. The estimated end value of a property after refurbishment; the assumption that BRRR refinances and flip exits stand or fall on.

Gross yield. Annual rent divided by purchase price, before any costs.

HMO — House in Multiple Occupation. A property let room-by-room to three or more unrelated tenants. Mandatory licensing applies in England at five or more occupants forming two or more households; minimum room sizes and fire standards attach.

ICR — Interest Cover Ratio. A BTL lender's stress test: rent must exceed mortgage interest by typically 125% (basic-rate taxpayers and companies) or 145% (higher-rate), at a stressed rate.

Land Registry. The official record of property ownership and sold prices in England and Wales; its price-paid data is the comparables backbone of every pack.

Leasehold. Ownership for a fixed term granted by a freeholder; flats are almost always leasehold.

LTV — Loan-to-Value. A mortgage as a percentage of the property's value; 75% is the standard BTL ceiling.

Money Left In. Capital remaining in a BRRR deal after refinancing; the denominator of the deal's ongoing return.

Net yield. Gross yield minus management, insurance, maintenance, voids, ground rent and service charges.

90-night rule. In Greater London, short-letting a dwelling beyond 90 nights in a calendar year requires planning permission.

Periodic tenancy. A tenancy rolling month to month with no fixed term — the standard form in England since the Renters' Rights Act 2025 took effect on 1 May 2026.

PLO — Purchase Lease Option. The right (not obligation) to buy at a fixed future price while leasing and controlling the property now.

Redress scheme. A mandatory ombudsman scheme for estate agency work — The Property Ombudsman (TPO) or the Property Redress Scheme (PRS). Compliant sourcing agents belong to one.

ROI — Return on Investment. Profit relative to cash employed; packs report it as cash-on-cash for income strategies and profit-on-cost for flips.

SA — Serviced Accommodation. Property let by the night to guests via platforms such as Airbnb and Booking.com, or direct.

Saturation risk. The risk that too many similar properties have recently sold (or will exit) near the assumed value in the same sector, undermining the GDV assumption.

SDLT — Stamp Duty Land Tax. Purchase tax in England and Northern Ireland; standard residential bands start above £125,000, and an additional-dwellings surcharge of 5% applies to second and subsequent residential purchases.

Section 13. The statutory mechanism for rent increases on periodic tenancies — once a year, with at least two months' notice, challengeable at tribunal.

Section 21. The former "no-fault" eviction notice in England, abolished by the Renters' Rights Act 2025 with effect from 1 May 2026.

Section 24. The restriction of mortgage-interest relief for individual landlords: finance costs attract a 20% basic-rate credit rather than full deduction. Companies are unaffected.

Selective licensing. A council scheme requiring a licence for all private rentals in a designated area, regardless of property type.

Sourcing fee. The fee a sourcing agent charges for introducing a packaged deal — commonly £2,000–£6,000 or 1–2% of purchase price.

Sui generis. A planning use class of its own: large HMOs (seven or more occupants) are sui generis, so converting to one always needs planning permission.

Title Split. Separating a multi-unit property on a single title into individually saleable (and mortgageable) titles; value is released by process rather than works.

Voids. Periods when a property earns no rent between tenants; modelled in packs as a percentage of the year (5–8% typical for single lets, higher per-room in HMOs).

Yield. Income relative to price; see gross and net yield — and never compare one of each.

Updated 2026-06-12

Frequently asked questions

How is 'below market value' actually evidenced?
Against sold prices, not asking prices: the asking price is compared with the median Land Registry sold price for comparable properties in the same postcode sector. A genuine BMV figure survives that comparison; a marketing BMV is usually a discount against an inflated asking price or against better-specified comparables, which is why packs show the underlying comparables rather than just the percentage.
What is the difference between asking price and market value?
Asking price is what the vendor hopes for; market value is what evidence says a willing buyer pays, best proxied by recent sold prices for similar properties nearby. The two drift apart in slow markets and distressed sales — the gap, when it is supported by sold evidence, is exactly what deal-level research exists to measure.
What does 'distress' mean in a property listing?
Circumstances suggesting the vendor is motivated to accept less for speed or certainty: probate and estate sales, repossession, divorce, chain breaks, repeated price cuts, long days on market, short leases, or condition problems that block mortgage lending. Distress signals make a discount explicable — and a discount with no explanation is the one to distrust.
Why does Land Registry data lag the market?
Price-paid data records completions, and a completion is registered weeks or months after the sale was agreed — so the dataset describes the market as it was roughly three to six months ago. It remains the only comprehensive record of what buyers actually paid, which is why packs use it as the benchmark and state its date alongside.
How often is this glossary updated?
Whenever the rules or the packs change: each entry reflects the position on the page's 'updated' date, and regulatory entries (EPC, SDLT, tenancy law) are revised when the underlying rules move. The date at the foot of the page is the honest answer to 'is this current?'.

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