Real Estate Glossary - O

Obligatory Advances - Disbursements of construction loan funds that the lender is obligated to make (by prior agreement with the borrower) when the borrower has completed certain phases of construction.

Obsolescence - Any loss in value (depreciation) due to reduced desirability and usefulness.

Obsolescence, External - Loss in value resulting from factors outside the property itself, such as proximity to an airport. Also called economic obsolescence or external inadequacy.

Obsolescence, Functional - Loss in value due to inadequate or outmoded equipment, or as a result of a poor or outmoded design.

Offer - When one person (the offeror) proposes a contract to another (the offeree); if the offeree accepts the offer, a binding contract is formed.

Offer, Illusory - An offer that is not a valid contract offer, because it requires something more than simple acceptance in order to create a contract.

Offeree - One to whom a contract offer is made.

Offeror - One who makes a contract offer.

Officer - In a corporation, an executive authorized by the board of directors to manage the business of the corporation.

Off-Site Improvements - Improvements that add to the usefulness of a site but are no t located directly on it, such as curbs, street lights, and sidewalks.

One-Party Listing - A listing agreement that is only effective in regards o one particular buyer.

Open House - Showing a listed home to the public for a specified period of time.

Open Market Operations - The Federal Reserve's manipulation of the money supply through the purchase and sale of government securities.

Option - A contract giving on party the right to do something, without obligating him or her to do it.

Optionee - The person to whom an option is given.

Optionor - The person who gives an option.

Option to Purchase - An option giving the optionee the right to buy property owned by the optionor at an agreed price during a specified period.

Ordinance - A law passed by a local legislative body, such as a city council.

Orientation - The placement of a house on its lot, with regard to its exposure to the sun and wind, privacy from the street, and protection from outside noise.

Origination Fee - A fee lender charges a borrower upon making a new loan, intended to cover the administrative costs of making loan. Also called a loan fee.

"Or More" - A provision in a promissory note that allows the borrower to prepay the debt.

Outlawed - Barred by the statute of limitations.

Overimprovement - An improvement that is more expensive than justified by the value of the land.

Overlying Right - A landowner's right to use percolation or diffused ground water.

Oversupply, Economic - A situation where there are more units available in a renal market than potential tenants who are able to pay the rent.

Oversupply, Technical - A situation where there are more units available in a rental market than potential tenants.

Ownership - Title to property, dominion over property; the rights of possession and control.

Ownership, Concurrent - When two or more individuals share ownership of one piece of property, each owning an undivided interest in the property (as in a tenancy in common or joint tenancy, or with community property). Also called co-ownership or co-tenancy.

Ownership in Severalty - Ownership by a single individual.

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