Real Estate - Scope of Ownership
Scope Of Ownership Though we often view real estate as one entity, it’s important to understand the pieces this entity actually consists of. Let’s have a closer look. Real Estate refers to the tangible aspects of property (the structure(s) often referred to as improvements made to land). Real Property includes both tangible (land and improvements made to land) and intangible (rights - air, surface and mineral). Personal Property includes all property except the land and the improvements thereon. Chattels include personal property which is tangible and moveable. Fixtures include permanent improvements to property that may not be removed at the expiration of the term, lease, or tenure (in most residential sales this would include built-ins and appliances). To simplify things further, when you sell your home you are selling the structure(s) on your land (house, garage, shed, workshop, etc.) and the land itself to a buyer. When you vacate the home, you take all of your belongings with you (personal property and chattels). The tricky part of this process often involves fixtures. It’s important to differentiate between fixtures that are staying and going and ensure everything is written into the agreement. Real Life Example → I moved in the summer of 2018. Because my boyfriend and I were moving into a home that required a major renovation, we decided to sell off a lot of our existing furniture to avoid having to move it and store it. These items would be referred to as chattels. While our Realtor was firming up the conditions of the sale with the buyer, he showed the buyer the pieces that were for sale and discussed the prices during a showing. Through our Realtor we mutually agreed on what the buyer would be keeping and for what price. Everything was written into our agreement, clearly describing each piece and each price. If you haven’t heard the phrase enough, here it is one more time, GET IT IN WRITING. Though many assume that fixtures stay and chattels go, it’s extremely important to make note of any details that could prove to be areas of contention. As a Buyer it’s crucial that you understand exactly what is included in the sale. Have your Realtor clarify any and all details you’re unsure about. There is nothing worse than walking into your new home on closing day and seeing a shelf, light fixture, or appliance removed when you assumed it was to be included. To avoid frustration, and even possible litigation, put everything in writing.