Real Estate Glossary O

Obsolescence - A type of depreciation of property.

Offer - A promise by one party to act or perform in a specified manner provided the other party will act or perform in the manner requested.

Offer and acceptance - The two components of a valid contract; a "meeting of the minds."

Office exclusive - A listing in which the seller refuses to submit the listing to Multiple Listing Service, even after being informed of the advantages of MLS, and signs a certification to that effect.

Offsite costs - Costs such as for sewers, streets, utilities, etc., which are incurred in the development of raw land, but are not connected with the actual construction of the buildings (onsite costs).

Online real estate listings - Properties listed for sale on the Internet.

Open-end mortgage - A mortgage in which the borrower is given a limit up to which he may borrow, with any incremental advances of money up to but not exceeding the original borrowing limit to be secured by the same mortgage. 

Operating expenses - Those periodic and necessary expenses, which are essential to the continuous operation and maintenance of a property.

Opinion of title - An opinion by a person competent in examining titles, usually a title attorney, as to the status of the title of a property.

Oral agreement - Contractual arrangements that are not in writing and are usually not legally binding.

Original principal balance - The amount of principal owed on a loan before a borrower makes any payments.

Over improvement - An improvement, which by reason of excess size or cost is not the highest and best use for the site on which it is placed.

Overhang - A protruding structural feature.

Override - A commission paid to managerial personnel (e.g. principal broker) on sales made by their subordinates, usually calculated as a percentage of the gross sales commissions earned by the salesperson.

Owner financing - A transaction in which the seller of a property agrees to finance all or part of the purchase.