There are certain legal terms which one must understand while buying or selling a property. “Chattels” is one such term which often crops up in real estate deals. It is important to understand what chattels are and how they differ from fixtures.
This blog is your comprehensive guide to understanding the concept of chattels in real estate, why they matter, and how they are handled in Canadian property transactions.
When discussing or delving in real estate, chattels refer to personal property that is movable and not permanently attached to the land or buildings. As you get some idea from this definition, chattels are distinct from real property. Real property includes land and anything permanently attached to it, such as buildings or fixtures.
These are just a few examples of what things are counted as chattels. Then there are items like plumbing fixtures, electric fixtures, built-in appliances, built-in shelving, flooring, permanent structures, etc, which are not considered chattels. As there can be grey areas where it is not immediately clear whether it is a chattel or a fixture, proper documentation and legal advice from the experts becomes critical.
To be precise, the major characteristic of chattels is that these are things which can be easily removed without causing any damage to the property. It is this mobility which distinguishes them from fixtures (which are considered part of the property itself).
It is but natural to get confused between chattels and fixtures while making real estate transactions. The best way forward is always getting legal experts to sort it for you. But you too need to have a fair understanding so that you understand the distinction between these two terms. In simple words, chattels in real estate are those items and things which are movable and fixtures are items that have been permanently attached to the property. Fixtures are thus a part of real estate.
To help you get more clarity on chattels, let us also now take a look at some common example of fixtures so that you don't confuse the two:
When we talk about chattels, we also talk about fixtures because that helps you determine what is included in the sale of the property.
Unless excluded by the sales agreement, fixtures are generally included in the sale. Chattels, on the other hand, are not included unless explicitly stated in the contract. This again shows why legal expertise should be sought to frame a contract.
Understanding what constitutes chattels is essential for both buyers and sellers for several reasons:
In Canadian real estate transactions, chattels are typically handled as follows:
There are some tips, which can help both buyers and sellers, for ensuring chattels are handled smoothly in your transaction. The following tips can help you avoid any conflicts, making the right valuation, and to figure out financing without any hiccups:
It is evident that chattels are an integral part of real estate transactions. Understanding their role will help you navigate the buying or selling process more effectively. In Canada, where real estate laws can vary by province, clarity and precision in handling chattels become necessary whether you are a buyer or a seller.
There are certain grey areas and sometimes it can be difficult to differentiate what are chattels in real estate and what are fixtures. Thus, it becomes crucial for both buyers and sellers to document what is included in the sale within the purchase agreement. This avoids disputes and ensures that both parties have a mutual understanding of what is being transferred. This is why you need a professional real estate lawyer who can provide personalised advice and guide you through the complexities of your real estate transaction. At Houseclosing, we have the best experts to help you with smooth transactions and deals.
Have any questions or need assistance with your real estate transactions? Our team is here to help. Get in touch with us today and experience our professional and personalized service.