Property, Improvements, Fixtures and Accessories according to Texas' One to Four Family Residential Contract

What is the “Property”?

Paragraph 2 of the Texas Real Estate Commission's One to Four Family Residential Contract defines what “Property” the seller is selling to the buyer. According to the contract, the seller is conveying “the land, improvements, and accessories.” The legal description also specifically idendifies the property by Lot, Block, Addition, City, County and Address (location). 

Paragraph 2B, Improvements

Improvements include the house, garage, and all other “fixtures” and improvements attached to the real property. The contract
lists several items that may be considered “improvements,” however, the items must be “permanently installed and built-in” for them
to be part of the “Property” being conveyed.

What is considered permanently installed and built-in?

Whether a particular item on a property is “permanently installed and built-in” is a factual issue determined on a case-by-case
basis. There is no universal rule that states a particular item is always permanently installed and built-in. What is considered a fixture? A fixture is an item that began its life as personal property, but was then attached to the real property in such a manner that it became part of the real property. Therefore, when sellers convey their real property, they are also conveying the fixture along with it. Unfortunately, what is or is not a fixture is not a simple question to answer. Texas courts look at three factors to determine if an item is a fixture:

• Did the party that installed the item intend the item to become a permanent part of the real property (intent)?
• Was there a real annexation of the item to the real property (attachment)?
• Was the item adapted to the uses or purposes of the real property (customization)?

Buyers and sellers should discuss any questionable items before executing a contract, so that all parties have the same understanding as to what items will stay with the property and which items the sellers will take with them.

Paragraph 2C, Accessories

Accessories do not have to be permanently installed. All the items listed under Accessories are conveyed to the buyer as part of the property under the contract. Paragraph 2D, Exclusions If a seller intends to keep an item that would normally convey to a buyer, such as a fixture or an improvement, the item must be listed as an “exclusion” under this paragraph, otherwise it will convey to the buyer as part of the property.

Paragraph 2D, Exclusions

If a seller intends to keep an item that would normally convey to a buyer, such as a fixture or an improvement, the item must be listed as an “exclusion” under this paragraph, otherwise it will convey to the buyer as part of the property.