Construction Terms Used in Property Appraisals & Inspections

Instructor: Ian Lord

Ian has an MBA and is a real estate investor, former health professions educator, and Air Force veteran.

Appraisal and inspection reports often include construction and building terms to describe improvement of a property. Real estate professionals needs to have a basic familiarity with common terms to understand these reports.

Construction and Building Terms

When appraisers or home inspectors report on the condition of properties, they use terms common in the construction and building industry. These terms can help identify important features of a property, new or outdated elements, or clearly explain issues that need repair or depress value.

Building Construction and Structures

If you are familiar with construction, either through working in the industry or simply being handy around the house, these terms will probably be familiar. Many people, though, aren't as familiar with some of the common construction jargon. Let's talk about some of the basics:

A foundation is the structure in contact with the ground on which the rest of the house is built. The most common types are basements, crawlspaces, and slabs. A basement has a shallow slab and walls built into the ground. The rest of the building sits upon these walls. The basement is typically deep enough for a person to walk in, and often can be used for laundry, storage, or even living space. A crawlspace has a low ceiling space between the first floor and the ground, often used to run electrical and plumbing connections. Water and electricity connections enter the home typically by entering the interior of the foundation through the ground. A slab foundation is a flat pad of concrete poured onto the ground. Water and electricity connections can run under or inside the slab up into the home.

Sitting on top of the foundation are the joists. These are horizontal boards that support the subfloor. The subfloor is a wood or composite material between floor joists and usually includes a final covering such as tile, carpet, or hardwood.

Walls go up next. Walls are built using studs. Studs are wooden boards used to create the frame or shape of the walls and building structure. Some walls simply help divide the interior space of the house into rooms. Others are load bearing walls. These walls support vertical weight such as the ceiling and are the strongest walls in the home.

The outside of a wall facing the environment can be covered with different types of materials. Modern construction generally uses siding. Siding comes in metal, vinyl, or wood materials. Walls can also be built using masonry, which is construction speak for building materials made out of stone, brick, or cement. The next layer working inward toward the home is insulation. Insulation material in walls and ceilings resists the transfer of heat. Insulation can take the form of loose blown in material, batting, or spray foam. Insulation effectiveness is measured in R-Value. A higher R-value means greater insulation properties and slower changes in temperature.

Interior walls are typically made out of drywall, a paper covered board made out of gypsum. Baseboards are decorative strips designed to cover and transition the area between the wall and the floor. Any gaps are filled in with caulk, a common gap filling material also found in window frames, tiling, showers, and counters.

Finally, up to the roof! Roofs are supported by rafters, which are typically wooden beams which form the roof structure and angle. Shingles, waterproof materials used to cover the roof, are laid upon boards attached to the rafters. The soffits are the parts of a roof that extend past the wall and sometimes include airflow vents into the attic.

Electrical Terms

Here are a couple of terms that come up when describing the house's electrical components.

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