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Personal Property: What to write in and not write into the contract, and why.....

By Ralph Gorgoglione

Real Estate Broker/Owner with Metro Life Homes RS-78439 / BRE #01708344

January 07, 2014 02:43 AM

Personal Property: What to write in and not write into the contract, and why.....

The distinction between real estate and personal property usually follows the same definition: Any item that is not permanently attached to the property that resides in or on the property is not considered part of the real estate and is considered personal property.

There are a few differentiations from state to state. For example, in some states the refrigerator is automatically considered part of the real estate, where in other states it is not, etc.

For the most part, some examples of personal property would be:

Refrigerator
Washer/Dryer
Non-built-in range
Non-attached microwave
Pool equipment
Non-permanently attached bathroom mirrors
Furniture
Some window treatments such as drapes, curtains, etc.
Automobiles parked on the property
Gardening equipment
Statuary such as fountains, planters, etc.
Storage devices and sheds that are non-attached rugs
Wine coolers
Farm animals / coops
Fish tanks

There are many other types of personal property that may reside in a property depending on what type of property it is.

But the important note to remember is that as either a buyer's agent or a listing agent MAKE SURE PERSONAL PROPERTY IS DEALT WITH CLEARLY AND EXPLICITLY.

As a buyer's agent, make sure that you are aware of those personal property items when you view the property with your client so that you can have the discussion with them if they decide to write an offer. (This is one of the many skill sets that most people do not realize real estate agents have that makes it important to have a good realtor represent you.) Should your buyer place any importance on any of the personal property, make sure you WRITE IT INTO THE CONTRACT. Even if there is any ambiguity as to whether or not it is permanently attached to the property, WRITE IT IN ANYWAY.

I remember having a transaction where there were chickens and a turtle on the property, and it ended up being part of the sale!

As a listing agent, the most important things to remember are:

1. Have that discussion with your seller prior to listing the property and making it available for viewing: Either make sure that all advertising and solicitation of the property CLEARLY states what is and is not included in the property.

2. Review each and every contract prior to signing off for any personal property written into the contract, and if it is clearly not included or the seller does not want to include it, then WRITE IT OUT in a counter offer.

One thing to consider as a buyer is whether or not your request for personal property in the contract are for items that have any emotional value to the seller. In other words, don't be insensitive to the seller by asking for something that obviously has sentimental value. Or at minimum, ask first to see if there is any emotional tie to that item. You don't want to create bad faith for the rest of the transaction by painting yourself as an insensitive heel.

As a buyer, seller, or agent, you can save yourself a lot of grief by investing the time and mindset into being very diligent from beginning to end about personal property.

Remember, real estate is the biggest purchase a person will make in their lives, so emotions tend to run high on both ends.

Don't let an otherwise smooth transaction crash and burn by forgetting to deal with personal property clearly and diligently from beginning to end. Otherwise, the chicken may just end up flying the coop!