What are the terms in typical Naples real estate sales contract?
Residential properties in Naples, FL are advertised on MLS (Multiple Listing Service) and can be labeled as unfurnished, partly furnished, furnished, turnkey furnished or negotiable. What do these terms mean and how do they impact the sale?
First, unless the furniture is addressed in the sales contract it does not necessarily stay with the property despite what the listing states. The written terms in the sales contract trump everything.
If the furniture is negotiable, then it is not included in the sales price and that can be purchased separately. If the furniture is included in the MLS listing, then those portions of personal property are reflected in the asking price. It is very important that you have a list of the items that will be a part of the transaction so that this can be a part of your sales contract.
If the listing states the home is furnished under the MLS definitions that means only furniture including couches, beds, tables, etc. This does not include art work, lamps, floral arrangements or other decorative items. If the home is turnkey furnished, then everything is included from the furniture (couches, tables, chairs, dressers, etc.) to the decorative items (rugs, lamps, art work, etc.) to the household items (dishes, pots and pans, silverware, towels, linens, etc.)
The standard NABOR contract states that even if the home is sold turnkey furnished the items are left for the convenience of the parties and have no real value under the terms of the sale. This statement clarifies to lending institutions that the sales price reflects the value of the home as a lender would not be able to lend funds for the personal property. In addition, if a piece of personal property is broken prior to the closing date the Seller may have no obligation to replace it as there is no value placed on the personal property. If the personal property is important to the Buyer, the Buyer should make a list of all items included in the sale and include the list with his or her offer as part of the transaction and include language to protect those items.
If the personal property does have a specific value which the parties wish to itemize, this must be done outside of the real estate contract. Once the personal property is sold for a specific value, the Seller may have an obligation to collect sales tax from the Buyer and this should be discussed with your accountant.
In any transaction the importance of clarity and forward thinking is a must for a smooth and successful closing. May we put our expertise to work for you?
Ann S. Zampogna