Terminology
The term “real property” is a common source of confusion for people outside the world of legal practice and real estate law. Use of the term can evoke questions like: “What does that mean?” and “Can property be fake?” In the realm of real estate law, the term “real property” simply refers to land and its permanent attachments (house, townhouse, condominium).
Conversely, the direct contrast to real property is “personal property” or chattels. This category of property encompasses a wide range of rights and belongings ranging from tangible objects (like clothes, furniture, appliances, vehicles) to intangible and abstract entities (intellectual property or the right to enforce debt) to leases.
So, what is a fixture in real estate? Well, simply put, when a chattel becomes semi-permanently or permanently attached to real property it can become a fixture.
Chattels vs Fixtures: Why They Matter in Real Estate
In the context of a British Columbia real estate conveyance – the transfer of real property from one party (seller) to another (buyer) – the terminology matters! In BC, the standard contract of purchase and sale (CPS) used by most realtors and, therefore, the majority of real estate conveyances in the province, stipulates that, unless stated otherwise in the contract, fixtures are automatically conveyed with and included in a property sale or transfer. Chattels, on the other hand, are excluded from the conveyance (and taken with the seller to their next home), unless written otherwise in the CPS. Therefore, as both a seller and a buyer, it is essential to understand what chattels vs fixtures are so that you have a clear understanding of what will be included in the purchase price and left behind for the buyer, compared to those items that will belong to the seller to keep.
Chattels vs Fixtures: A Grey Area
As a rule, fixtures may be attached permanently or semi-permanently – that is, nailed down, screwed-in, or secured in a way that makes their removal possible with the use of tools and/or specialized equipment. Conversely, chattels usually rest on their own weight or are merely plugged in.
Yet, difficulty can sometimes arise when an item could be construed as either a chattel or fixture. For example, a toilet is secured, but technically could be disconnected and removed from a house. So how, then, can we classify those items that seemingly fall in the “grey area” between chattels vs fixtures? Objectively, distinguishing factors are based on the degree and purpose (objective) of affixation and the effect of removal. In the context of our toilet example, the purpose of a toilet is to enhance the land and removing it would be detrimental to the property. Therefore, based on the ‘degree and purpose test’ a toilet is a fixture.
Examples of Chattels and Fixtures:
Common Fixtures
Some other examples of fixtures found in most homes are: blinds, awnings, screen doors, windows, curtain rods, tracks and valances, fixed mirrors, fixed wall-to-wall carpeting, hardwood flooring, chandeliers and lights, showers and sinks, built-in cabinetry and shelves, central heating systems and in-ground landscaping.
Common Chattels in Real Estate Deals
Common examples of chattels found in most homes are: area rugs, curtains, hanging mirrors (that are merely hung and not installed as a an entire wall of mirrors), TV mounts, furniture (ie: bedroom sets, wardrobes, dining room sets, couches) and appliances.
Chattels vs Fixtures: The Devil is in the Details
So, if appliances are chattels, why do purchasers commonly expect sellers to leave the appliances behind in the house for the buyers? Typically, appliances like refrigerators, washer & dryer sets, microwaves and stoves have been purchased with specific size restrictions in mind and are meant to fit within the confined of a given kitchen and laundry room. Therefore, it is exceedingly common for realtors to write the appliances into the CPS (section 7) as “included items” so that the seller will leave the appliances at the property for the new buyer. That said, this is not always the case. I once worked with a set of buyer-clients whose new realtor mistakenly overlooked the appliances when writing their contract. Since the appliances were not recorded as ‘included items’ in the CPS, the seller took all the brand-new stainless-steel appliances with them when they moved; when the buyers moved in, they were shocked to find their kitchen and laundry room completely empty! Luckily, in this case, there was a happy ending for the buyers, whose realtor agreed to purchase new appliances for them.
If you are buying or selling property and have specific concerns about a particular chattel or fixture, its best to clarify the intention by specifically including or excluding the item(s) in section 7 of the CPS. (For example, “the sellers will not convey and will take their hot tub with them upon sale of the property”). That way, there are no costly surprises or disappointed parties.
Did you know…?
BC Notaries are routinely hired to convey real property; but did you know that you can also hire a Notary Public to review and provide advice about your CPS (which is best done before you remove real estate subjects)? If you are selling or buying property and have questions or need help – give us a call! 604-576-3211.
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FAQs
- What are Chattels in real estate? A chattel is a tangible object that rests on its own weight and is not attached to “real property” (real estate).
- What is a fixture in real estate? A fixture is a chattel that has been purposefully and semi-permanently or permanently affixed to real property to the degree that removing or detaching the item would be detrimental to the property.
- What are some examples of chattels and fixtures? Chattels: area rugs, curtains, furniture, appliances. Fixtures: blinds, awnings, screen doors, chandeliers, toilets, sinks, built-in cabinetry, in-ground landscaping.
- Chattels vs fixtures: does it really matter? If you are buying or selling a property, understanding chattels vs fixtures really matters! Unless otherwise specified, fixtures are automatically conveyed with the property, while chattels are not. Be sure to understand the difference in order to avoid unpleasant surprises on moving day.
