Building Construction Glossary

• Allowance – Funds reserved expressly for the purchase of items specified in a contract that have not yet been chosen or decided upon, such as carpet color, dishwasher brand, refrigerator model, cabinet grain, etc.
• Bid – Price quote provided by a contractor for a specified project, based on the cost and labor required to do a job.
• Blue Stake – Refers to the “Utility Notification” where a utility company (such as gas, electricity, water, cable, etc.) visits a construction site and marks where their service is located underground with small flags or spray paint.
• Building Codes – Ordinances sanctioned by the local community or government that regulate residential construction and remodels.
• Building Permit – Document granted by the local building authority to proceed with a specified construction job.
• Call-back – When a contractor returns to a home to fix issues under warranty found by the homeowners after they move in.
• Change Order – Official written document that states modifications to the original construction contract plans and/or price.
• Certificate of Occupancy (CO) – Following an inspection and payment of all bills/fees, the local municipality will issue a certificate stating it is safe for the home to be lived in.
• Close-Out – Final “walk-through” of a new construction home where the contractor gives the new homeowners a tutorial of the home’s maintenance and makes a list of any issues/defects that need to be fixed before move in.
• Draw – Specified amount of money withdrawn from the total budgeted funds for a new home construction to cover services rendered up to the present.
• Easement – Contract that permits the use of another’s property for a designated intention, such as running a water line through a neighbor’s backyard.
• Egress – A window or door that provides an exit to the exterior of a home and typically requires a certain size in all bedrooms and basement.
• Estimate – Approximated cost of a job for construction and materials as provided by a contractor and/or supplier.
• Extras – Work performed by a contractor that is not included in the contract and billed independent of the original budget.
• Impact Noise Rating (INR) – Estimates the sound insulating performance of impacts on a floor—the higher the number, the better the effectiveness.
• Lien – A legal hold on property that puts it up as collateral for money, services or debts owed.
• Lien Release – Record that a contractor has paid all suppliers, workers, and subcontractors in full and legally prevents a contractor or supplier from putting a lien on your property.
• Payment Schedule – Prearranged timetable for payment installments to a contractor for work as it is completed. May involve a deposit and/or retainer for 5-10% of the project’s total cost.
• Penalty Clause – Stipulation of a contract that monetarily penalizes a contractor for inability to fulfill conditions of the contract or complete work on deadline.
• Performance Bond – Money a contractor puts on deposit with a designated governmental agency as insurance that the job will be done properly and on schedule. The amount is typically 10% of a project’s total cost.
• Plan View – Rendering of a property and structure as seen from above.
• Plot Plan – Illustration provided by the surveyor from an overhead angle that depicts a home’s location on a lot, property lines and easements.
• Property Survey – Professionally determined boundaries of a plot of land.
• Punch List – Record of issues or defects in a newly constructed home that require correction by the contractor.
• Punch Out – Final inspection where the newly completed home is examined and a list of problems that need correction is made.
• Quote – Price of materials, services or labor presented by a contractor or supplier.
• R Value – Evaluates a material’s resistance to heat getting through—the higher the number, the better the insulation.
• Red Lined Prints – Copy of blueprints that show modifications to the original plans marked with red pencil.
• Sound Transmission Class (STC) – Measures how well a material or construction assembly resists airborne sound transfer—the higher the number, the better the noise-blocking ability.
• Specifications (Spec) – Descriptive list/account of building materials, construction methods and property details that supplement blueprints and working drawings.
• Stop Order – Written notice for contractor to suspend work due to cancellation of contract, safety violations, faulty materials, substandard workmanship or other reasons for postponement.
• Subcontractor – Company or individual hired by the general contractor to do a specific part of the construction project, such as a plumber, roofer, drywaller, carpenter, etc.
• Turnkey – When a subcontractor supplies all material and labor necessary to complete a particular element of the home construction process.
• Warranty – Written policy that problems found within a specified amount of time after completion of a newly built home will be rectified; may include a manufacturer warranty for products/materials and/or one for labor.
• Zoning Laws – Regulations and conditions as stated by a local governing authority regarding the legal use of land for certain types of property construction (e.g. condominiums, single-family detached homes, commercial, industrial, etc.).

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