Every Buyer’s Nightmare.
If you’ve ever purchased a previously-owned home, you’ve probably been in this situation: You finally get they keys to your new digs, and you swing open the door with excitement and anticipation — only to stare in utter amazement (or horror) at what you see: Holes where the curtain rod used to be, or a missing light fixture, or worse yet, a gaping hole where the refrigerator was when you did your walk-through two days ago.
Or, on the other end of the spectrum, there’s 25 cans of paint, a sofa, a few garbage bags and a pile of scrap wood conveniently left behind in the garage. Either way, all of those warm-fuzzy feelings about your new home just evaporated as quickly as my stock portfolio.
This post is one of those that is long overdue, because it addresses what is probably the leading cause of disputes between buyers and sellers of homes everywhere, not just in San Carlos. Every agent who has done a transaction has likely run across it, and it usually leaves some sort of hard feelings between the buyers and the sellers if it’s not addressed correctly:
When you sell your home, what can you take with you, and what must stay behind with the house?
It’s one of the most misunderstood aspects of a real estate transaction. Hopefully this post will help clarify it.
Fixtures STAY, Personal Property GOES.
It’s amazing to me that this is even a problem in the first place, let alone seeing it happen over and over again. After all, there’s an entire section dedicated to just this topic in the purchase contract that all parties already signed! In both the PRDS Real Estate Purchase Contract (the one that’s most commonly used in real estate transactions in San Carlos,) as well as in the CAR California Residential Purchase Agreement, it’s spelled out in painstaking detail. Heck, in the PRDS Contract, it’s in Paragraph 4 on the very first page!. Here’s what it says:
“FIXTURES AND PERSONAL PROPERTY: ALL EXISTING fixtures and fittings attached to the Property are (if owned by Seller and unless excluded below) INCLUDED IN THE PURCHASE PRICE and shall be transferred free of lien. These shall be deemed to include, but are not limited to, existing systems and items as follows: electrical, lighting, plumbing, and heating, fireplace inserts and attached fireplace equipment, solar systems and equipment, built-in appliances, screens, awnings, shutters, window coverings and hardware, attached floor coverings, satellite dishes/related equipment, integrated telephone systems, air coolers/conditioners, pool/spa equipment, water softeners, security systems/alarms, keys to all exterior locks, garage door openers, mailbox, and in-ground landscaping. NOTE: References in fact sheets, advertisements, the Transfer Disclosure Statement or Multiple Listing Service (“MLS”) of specific items of property to be included in (or excluded from) this sale are not binding; only the express, written provisions of the Contract establish their inclusion or exclusion. IMPORTANT: Buyer and Seller should specifically designate whether wall-mounted electronic equipment (e.g. flat-screen TV’s, speakers) are included or excluded.”
Seems pretty straightforward, doesn’t it? A very easy rule of thumb to remember is simply this: If it’s physically attached to the house, it’s a FIXTURE and it stays with the house. If not, it’s PERSONAL PROPERTY and must go with the seller. (Or… if it’s screwed and you unscrew it, then you might be screwed.)
So why do so many problems still arise?
When in Doubt, Write it Out.
Like anything in life, there are always gray areas to this rule — no matter how explicit the terms are written, there are always items that fall into this squishy area. Flat-screen TV’s are sometimes physically attached to the wall, but most people consider them personal property and plan to take them when they move, right? What about artwork that’s screwed to the wall? And how about that heirloom chandelier that was given to you by your grandmother? It’s attached to the house, but you wouldn’t think of leaving without it. The list of possibilities goes on and on.
Well, unless it is explicitly stated in the purchase contract or in an addendum to the contract which of these items are an exception to the Fixture and Personal Property clause, you could be in for some major heartbreak as a seller — and perhaps legal action — if you took something that should have stayed with the house. Same goes with all of the junk that gets conveniently left behind for the sellers to clean up after.
There are 2 simple steps that you should take as a seller to ensure that you avoid this sticky situation, and the painful misunderstanding that may ensue:
- Submit a list to your listing agent of those items that you specifically plan to take with you that may fall into the “gray area”. Make sure your agent includes that list in the disclosure packet that all buyers must sign.
- Before you ratify a buyer’s purchase contract, make absolutely certain that these items are explicitly agreed by the buyer to be excluded from the sale – either in the appropriate part of the contract, or as an addendum.
As a buyer, “personal property” can always be negotiated back into the sale of the home. Perhaps the seller doesn’t want to hassle with moving the flat-screen, or you’d love to keep some of their furniture. Same as above — just make sure that it’s written into the contract.
Got any move-in nightmare stories of your own? Share them in the comments…
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