When buying or selling residential property in New Zealand, one issue that frequently causes post-settlement disputes is the distinction between chattels and fixtures. Although it sounds technical, understanding this difference and recording items clearly in the agreement – can save both parties time, money, and unnecessary stress.
Chattels are movable items of personal property that do not form part of the land or buildings. Common examples include appliances, curtains, blinds, removable heaters, and freestanding light fittings. By contrast, fixtures are items physically attached to the property and considered part of the real estate itself – such as built-in cabinetry, wired-in appliances, and permanently attached heating systems.
Under the standard REINZ-ADLS Agreement for Sale and Purchase, chattels, plant, equipment, and systems or devices which provide any services or amenities to the property, must be delivered in reasonable working order but in other respects in their state of repair as at the date of the agreement (fair wear and tear excepted).
The vendor also warrants that all listed chattels are owned outright and free from security interests. Risk in the chattels remains with the vendor until possession is given, and ownership transfers on settlement when the purchaser pays the purchase price and takes possession.
Modern grey areas
Where uncertainty arises is in items that sit “on the line” between a chattel and a fixture. If there is any doubt, the safest approach is to record the item in the chattels schedule of the agreement.
Air-conditioning units, underfloor heating, heat-pumps, security systems, solar panels, EV chargers and other plant or equipment can create uncertainty. Their classification often depends on the degree of physical attachment and the purpose behind installation.
Key takeaway
To avoid disputes, both parties should carefully list all intended chattels, consider the degree of attachment and intended permanence of any item, and seek legal advice if there is the slightest uncertainty. Clear drafting at the outset remains the best protection for both vendors and purchasers.
