Who takes the appliances in the sale of a home, the buyer or seller? What about the ceiling fans, rugs, and bookcases? This article will discuss fixtures, what they are, how they differ from personal property, and how it is decided who gets what items in a real estate transaction. It may sound simple, but many deals have fallen apart over disagreements about what is or is not a fixture.
What is a Fixture?
A fixture in real estate is an item of personal property that has been permanently attached or affixed to real property or land.
Fixtures differ from personal property, also known as chattel. Personal property is not permanently attached to the structure or land and is usually kept by the seller when moving out. Fixtures can be cabinets, security systems, or even trees and bushes.
For example, when you buy a ceiling fan from a hardware store, it is personal property. However, as soon as it is permanently attached to your home with screws or bolts, it becomes a fixture, legally part of the real property.
What is MARIA?
According to the law, defining what is or is not a fixture may seem simple, but it can be a tricky task for real estate agents and homeowners if a disagreement occurs. Maybe the seller says a bookcase is personal property, but the buyer calls it a fixture that should stay with their purchased home.
Determining this usually comes down to 5 factors, recognizable by the acronym MARIA. These factors are the method of attachment, adaptability, relationship to the parties, the intention of the party, and agreement between the parties.
Method of Attachment
Method of Attachment: How is the object attached? Is it set on the ground like furniture or screwed into the wall like a tv mount or kitchen cabinet? Any permanent method that uses tools like a drill or ratchet or fasteners such as screws, nails, glue, or concrete constitutes a fixture.
Adaptability: Has the object become part of the real property? Maybe a floating floor is laid down in a kitchen, which is not directly attached but is still an integral part of the building. Perhaps a bookcase was custom built for a particular place in a house, not standard to any other building. For example, if an object is adapted to be an intrinsic part of the land or building, it’s usually considered a fixture.
Relationship to the Parties
Relationship to the Parties: This attribute refers to the relationship between buyers and sellers or tenants and landlords. Typically rulings will favor the buyer in selling a house because it assumed that the seller installed the item to be a permanent fixture to the home they were living in before the seller. On the other hand, tenants are usually favored over landlords because if a tenant installs a fixture, it’s assumed they will take it to their next house when they leave, as they do not own that property.
Intention of the Party
Intention of the Party: This asks what the party’s intention was when they installed the object in the space. While the intention is tough to prove, some cases can be obvious if the method of attachment was permanent such as concreting a birdbath into the backyard. If they intended to take the birdbath with them when they sold the house, they would have just set it on the ground instead of concreting it.
Agreement Between the Parties
Agreement Between the Parties: The agreement between buyer and seller is always the easiest way to prove whether an item is personal property or a fixture. There can be no argument if an object is written into the purchase contract and signed by both parties. If you are unsure of the seller’s intention for an object, always clarify it in the written agreement.
What is an Example of a Fixture?
Below is a list of standard fixtures and personal property, but let’s talk about a few that you may frequently see that you should address in a purchase contract.
Appliances: One of the most significant disputes that occur is over appliances. Refrigerators, stoves, and microwaves are generally considered personal property because they are usually placed and plugged in, whereas dishwashers, washers, and dryers are hardwired or attached to plumbing fixtures. Always define which appliances stay or go in a contract between buyer and seller.
Security systems: Ring cameras and other devices used for security are also a gray area when it comes to fixtures, especially if they’re wireless. This decision comes down to the method of attachment and agreement between sellers. Are they hardwired to the wall or wireless and sitting on a stand? What does the purchase contract say?
Light fixtures: Ok, I know it’s in the name, but frequently sellers will want to take a unique light fixture with them when selling their house, such as costly chandeliers. A court of law will usually favor the buyer in this situation. However, it is still important to define in writing if a person wants to keep specific fixtures in a home as personal property.
More Examples of Fixtures in Real Estate:
- Air conditioning systems
- Hot water tank
- Sump pump
- Water filtration or treatment systems
- Window blinds (not curtains)
- Ceiling fans
- Light Fixture
- Wall sconces
- Built-in closet storage shelves
- Kitchen cabinets
- Garbage disposal
- Built-in bookcases
- Fireplace logs
- Fireplace doors
- Fireplace mantel
- Smoke alarms
- Garage door openers
- Sprinkler systems
- Planted tree/bush/flowers
Examples of Non-fixtures, chattels, or Personal Property in Real Estate:
- Home décor
- Detached microwave
- Potted plants
- Lawn decorations
- Detached bookcases
Are Fixtures Considered Chattel Property Or Real Property?
Chattel property is the opposite of a fixture or real property. Chattel means personal property, and the terms are interchangeable. Chattel is anything you own, such as furniture, jewelry, home décor, or certain appliances. Anything that is not permanently fixed to real property or legally a part of the land.
Frequently a fixture starts as chattel when purchased, such as cabinets, ceiling fans, bushes, and carpeting, but becomes a fixture when permanently attached to real property.
What is a Trade Fixture?
A trade fixture is a piece of equipment or machinery attached to a rented building by the tenant that a person uses to carry out a trade or business. For example, a large dough mixing machine in a pizza restaurant owned by the tenant is required for their business but is an object firmly fixed to the property they’re renting from a landlord. More examples could be a drill press device used in manufacturing auto parts in a garage, which the tenant has installed themselves. Unlike standard fixtures, a trade fixture is owned by the business/tenant and, therefore, will go with them when they move.
What to Know for the Real Estate Exam
It is essential to know the definition of a fixture: A fixture in real estate is an item of personal property that has been permanently attached or affixed to real property or land.
You should also know the definition of personal property: An item owned by a person that is movable, not attached or fixed to real property, such as furniture, rugs, or potted plants. These items are also called chattel, and they are the opposite of a fixture.
It will help if you remember the acronym MARIA: Method, Adaptability, Relationship, Intention, Agreement. Sometimes tests will pose questions as word problems, and you have to refer to these five determining factors to define if something is or is not a fixture.
You may need to define a trade fixture, so remember that it is considered chattel even if it’s affixed to the building. An easy way to remember is that trade fixtures involve trade or business and a tenant attaching something to rented property.