When does personal property become a fixture?

In, New Jersey there is a difference between real and personal property.  Real property is land and includes items that are affixed to the land, usually buildings and other improvements.  Personal property is anything else.  However, there is a third category of property that falls in between real and personal property.  Items that fall within this third category are called fixtures.  Fixtures often start out as personal property and become so attached to the real estate that they essentially become part of the real estate while still holding a separate identity. 

When buying or selling property, it is important to understand whether something is a fixture that will stay on the property after closing, or personal property that the seller can remove.  A purchaser may view the property and assume that the window treatments, wall-mounted television, or swing set is included with the property.  On the other hand, the seller may be intending to take these items with them when they move.

When assessing whether or not property is a fixture, courts look at several factors.  These factors include the following:

• The homeowner's intent when the personal property was installed, i.e. whether or not the homeowner intended the property to permanently become part of the real estate;
  
• How the homeowner attached the property, i.e. screwing it into the wall;
  
• Whether or not the property was meant to be used with the real estate, i.e. built-in electronics or wall-to-wall carpeting;
  
• What the contract between the parties says; and
  
• Whether or not the buyer considered the property when the offer was made.

In or to avoid any misunderstandings, it is important that buyers and sellers make sure that their contracts clearly set forth what is included in the sale so that there are no misunderstandings and everyone has the same expectation regarding what will remain with the property at closing.