What are accrued items in real estate transactions?

Accrued items in real estate transactions refer to expenses that have been incurred but are not yet paid. In this context, these are expenses that will be paid by the buyer at the end of the billing period. When a property is sold, certain costs associated with the property - such as property taxes, interest on loans, or utility bills - may have accumulated, but payment has not yet been made at the time of closing.

Understanding this concept is crucial as it impacts the financial settlement and the distribution of costs between the parties involved in the transaction. The buyer often assumes responsibility for these costs, which have been accrued during the seller's ownership of the property, leading to accurate accounting during the transfer process. This ensures that the buyer is aware of all financial obligations related to the property they are purchasing.