This is an interesting article.
The recent debate over on Norma Toering’s post about whether or not a plasma tv attached to the wall is a fixture or not reminds me of a sale I had earlier this year. It all ended well and never degenerated into a “war” but it did bring up some issues that will very likely need clarification in our contracts sooner rather than later!
My seller and I had discussed at time of listing that his audio/video system, which was controlled from a special closet in the Family Room, would likely be a point of discussion or negotiation when the right buyer came along. Not only was the plasma TV mounted on the wall but there was other equipment involved and the complex system controlled entertainment in some of the Bedrooms as well as the Living Room and Kitchen. He was more than willing to consider leaving the system “with the right offer.”
Sure enough, when our best offer arrived, it included the system with a caveat that if the seller would not leave the system, he would repair the damage made by removing it. Fair enough. We asked the buyer’s agent which option the buyer preferred. He preferred keeping the system so we set about negotiating a price for the home that would allow the seller to feel alright about leaving the system in place. We got to a bottom line figure and I conveyed it to the buyer’s agent who called me to say she and her client were having a hard time understanding the figure as her buyer “could go buy a flat screen TV at Best Buy for a few hundred dollars.”
"Yes, he could." I replied, "But that isn’t where the value lies." If you have ever had a complex audio/video system installed in your home, you know that the last issue is how much the TV is worth. I explained that there is a lot of time and expertise involved in selecting compatible components, programming them to work together and then learning how to operate the system. (I addressed this awhile ago in another post.) The buyer’s agent said she was unaware of this and would convey it to her client.
When they came back to us, the contract now included complicated language requesting that the seller agree to repair or replace any defective audio/video equipment found by the “home inspector” at his expense. Okay….except I am not aware that there are any licensed home inspectors out there who would consent to “inspect” a complicated audio/video system much less how we would agree that he/she was “qualified” to do so!
I picked up the phone and called the buyer’s agent and just asked her to share with me what, exactly, the buyer was attempting to accomplish. She said he really wanted the system, especially now that he knew what could be involved in replacing the components, but wanted to be sure that the system really worked “as advertised”!
It was an easy thing to work out once we all understood each other’s point of view! The seller simply agreed to show the agent and the buyer how the system worked during the home inspection and then agreed to come back after the buyer moved in and spend a couple of hours teaching him how to use it!
The deal closed, everyone is happy! But I can absolutely see that as this new technology becomes prevalent in many more homes these issues will need to be addressed! I can foresee professional AV equipment installers, like the one I wrote about in my previous post, who will have a new opportunity for business as an “AV expert” who can provide an opinion about the value and functionality of a system. I’ve seen these systems run into the thousands, even tens of thousands, and there will need to be some accommodations made for “fixtures” with such high value!
As ever, dealing with the issue up front, during the listing appointment, and then asking for the motivation of the parties during negotiations and resolving them creatively, will get you farther down the road than anything else!
SarahGray Lamm is a licensed, full time, residential Broker in the Triangle of North Carolina. She specializes in serving the real estate needs of home owners and home buyers in Chapel Hill, Carrboro, SW Durham and Northern Chatham County.
With over 60,000 hours of experience in North Carolina real estate, SarahGray is proudly associated with Allen Tate Realtors, the Carolinas largest independent real estate company. With exceptional relationships all over the Carolinas, SarahGray is able to connect you with other professionals in all areas who will make your home buying or selling experience the best you have ever had!