We know buying can be a scary experience, especially if it’s your first time. It is easy as a buyer to get caught up in negotiations focusing solely on price. The problem is there are many elements to the standard contact. You really cannot ignore the details – it is these peripheral elements that can have an impact later on.
One of those important elements is fixtures & fittings.
Before we start, we should note we are talking about real estate in Queensland and working with the Queensland Law Society Contract for Houses and Residential Land, Sixteenth Edition. It is these contracts that appear to be most widely used.
Page seven, subsection (v) in the definitions notes: “Improvements” means fixed structures on the land and includes all items fixed to them (such as stoves, hot water systems, fixed carpets, curtains, blinds and their fittings, clothes lines, fixed satellite dishes and television antennae, in-ground plants) but does not include the Reserved items.”
So put simply, the contract of sale is for the land and the fixed structure on it (say the house). Any items fixed to the structure are also included, and they give some examples. The easiest way to look at it is anything fixed is anything bolted down, stuck, glued, nailed, rooted in, concreted in etc.
It sounds simple, but this is where things can get messy. Let’s use the example of a picture hanging on the wall. The hook is probably regarded as a fixture, but the picture isn’t, as it is not fixed … you can lift it off. But what about a dishwasher? It is no more fixed than a washing machine, but buyers often expect the dishwasher to stay but not the washing machine. Or even consider pool equipment. Again, people would expect the equipment to stay, but is it fixed? Probably not.
To help with this, there is a section in these contracts on page 3 which notes Excluded Fixtures and Included Chattels.
Excluded fixtures are just that – fixtures the owner is NOT including in the sale. For example, let’s say the homeowner has installed a chandelier which is a family heirloom, which they wish to take with them after the sale. As it is fixed, they need to note this as an excluded fixture, so the prospective buyer is aware of this before offering as it may affect their offer. If it isn’t noted as excluded, it will be considered as part of the sale.
This is very important for Sellers to take into consideration. It is vital for the offer documents and contacts to be very clear.
But what about the pool equipment – it isn’t a fixture, but it should stay, right? Again, you need to be clear. If a non-fixed item is to stay and be part of the sale, it needs to be noted in the Included Chattels section. That way, it is very clear to all parties as to what stays and what doesn’t.
We believe it is also very important to be as specific as possible as to the description. Again, if we take the example of the pool equipment, just noting ‘pool equipment’ can leave things too open.
And if you are unsure, note it in the contract. Does the shed stay? Probably, but if it is unclear or can be argued either way – note it in the Included Chattels section – then it is very clear. Can I take the microwave with me when I sell? Probably, but if you are unsure, put it in the contract.
Now please keep in mind, we are not legal professionals so if you are unsure, seek your own independent legal advice. What we want to do is highlight that there is always more to contracts than just the price and it is vital for both Sellers and Buyers to consider these documents in greater depth.
Written by Shawn Kristofer