So You Want to Sell Your Home
Part 7 –
What stays, what goes. Real vs. Personal Property
Your home is for sale, buyers flock to your door, offers are arriving one after another, almost too fast for you to respond to them. Well, maybe not. However, you do finally get an offer on your home, you negotiate, and a sales contract is signed. The buyer does all the due diligence, having inspections, getting financing, etc. You have corrected any problems found during the inspection and you have moved all of your personal property out of the house. Your furniture is on the moving van and you are now waiting for the buyer at the office of the closing attorney or a title company.
The buyer has made the final walk-through of the vacated property and comes to the closing ready to walk away from the purchase. Why, because you removed a Waterford Crystal chandelier that was hanging in the dining room. Sure, it was a family heirloom and you never intended it to stay. And yes, you replaced it with another chandelier from Home Depot. But the buyer really envisioned that Waterford chandelier hanging above their formal dining set. Or, it might have been a built-in microwave, or a couple of small trees or shrubs that you planted in honor of your children. It could have been any number of things that you removed but the buyer expected to remain.
This happens more often than you might think, especially when one or both of the sides (buyer & seller) are inexperienced or don’t have knowledgeable representation. Sometimes the closing can be rescued with additional negotiation and concessions. Sometimes it can’t.
But how can this be prevented? First, both buyer and seller need to understand the difference between real and personal property. Real property is basically defined as the land and its appurtenances. Everything else is personal property. The confusion is over what is included in the appurtenances.
Well, the obvious would be the house and garage or carport (if there is a garage or carport). Fences, barns, outbuildings that are fixed to the ground, sidewalks, driveways, and in-ground pools or spas are also included. So are trees, bushes, annuals, perennials and other in-ground plants. Inside appurtenances would include built-in cabinets, existing light fixtures (including grandma’s Waterford Crystal chandelier), ceiling fans, plumbing fixtures, switch plates and outlet plates, built-in appliances, blinds, shades, window covering hardware. Basically, anything that is screwed or nailed or otherwise “permanently” affixed to the home is considered real property.
Furniture, free-standing appliances, free-standing (or hanging) art work and mirrors, and indoor plants are considered personal property. Basically, anything that can be removed without damage to the property is considered personal property, except of course things like light fixtures, switch plates. Also, surprisingly, any blooming flowers, ripened fruit or vegetables are also considered personal property. While the plants must remain in the ground, you can pick the flowers or fruit and take them with you.
There are some things, though, that are in a bit of a gray area. Are curtains and curtain rods real or personal property? Is patio furniture real or personal property? How about the portable storage building that the garden tools and lawnmower are kept in? What about the large potted trees that line the patio or entrance? The best answer to this is “maybe.” Sometimes it may be obvious: if the curtains are custom made to match the pattern of the wallpaper, they are probably real property. If you have made a path leading to the storage shed, the shed is probably real property. Likewise, if there is custom built-in cabinetry to house a specific television or entertainment system, those electronic items could be real property.
But the best way to avoid any confusion is to remove any items that are not included in the sale from view before showing the property. That might mean replacing that chandelier with another, removing and replacing the switch covers, etc. Also, clearly state in both the disclosure and the contract what items are included in or excluded from the sale. If there are items of personal property that are agreed to be included as part of the transaction, such as free-standing appliances, mirrors, patio furniture, etc., they should be clearly indicated, by brand and serial number if possible, in a separate personal property addendum that is an attachment to the contract.
Get everything down in writing. It may seem redundant, it may seem trivial; however, it will make the closing of the property smoother and leave both parties with positive feelings.
And don’t forget to leave all the keys and any remote controls (garage door, lighting, etc). They, too, are part of the real property.
Best of luck on the sale of your home. Please feel free to contact me by phone or email if you have any questions regarding the sale or purchase of a home or property.
This is not to be construed as legal advice. For any legal questions, please consult an attorney that specializes in real estate law.
