In property terminology, what does 'cost' refer to?

In property terminology, 'cost' specifically refers to the sacrifice made to acquire property. This encompasses the total expenditure incurred, which may include the purchase price as well as any additional costs associated with the acquisition, such as closing costs, legal fees, and financing costs. It's a broader concept that reflects the actual investment made by the buyer beyond just what is listed as the market or appraisal value.

Understanding 'cost' in this context is important because it addresses the genuine financial implications of obtaining a property, impacting how individuals and entities assess their investments and financial planning regarding real estate. This distinguishes 'cost' from other terms like market value or appraisal value, which relate to how a property is valued in the market or by assessors, rather than the concrete financial commitment made to acquire it.