When you purchase a house in Costa Rica, what stays with the house for sale is mostly common sense. During a property showing there are always questions about what stays with the house for sale and what goes.
Honestly, I don’t really care what goes, I only care about what stays.
The buyers and I did a walk-through on the day of the closing. Horrified we find out that the seller took the awesome custom hardwood paneling and cabinetry in the study. They replaced it with cheap pine wood. Now what? The buyers fell in love with the house because of that wood paneling and custom made cabinetry!
There are quite a few articles from realtors in the United States about this to be found online. Check out “What’s a Fixture vs Personal Property” by Bill Gasset. Also try “What Stays in the House and What Goes” by Anne Miller. Real estate law in the States protects a buyer there much better than it does in Costa Rica.
Is it really that important what is a fixture and what is personal property? In Costa Rica, it’ll take you forever to sue a seller who took a fixture that they saw as personal property. So why even go there? A great general rule is that what is nailed down stays with the house for sale. Unless it is agreed on by both parties.
Listing the property
When I go to a listing appointment (we have open listings here in the Central Valley) always make sure what stays with the house for sale. I discuss with the owner each fixture or personal property I see that might be an issue to stay with the house, before I even take any photos.
Do curtains stay? Do lamps stay? Which lamp was the one that was inherited from Pierre de Rigaud, Marquis de Vaudreuil-Cavagnial? Do the mirrors in the bathrooms stay? Does the library in the office stay? I have written another article two years ago about 7 items that are sometimes in doubt if they stay with the house for sale or not. But a library with hardwood wall panels and custom cabinetry, that’s a built-in, if you take it there will be a big hole in the wall…….
When there is a question during or after a showing about a certain item, I just ask the seller about it and make a note. In many cases you will find that the seller doesn’t really care, as long as you sell the house and it will make a buyer very happy if a certain item stays.
In certain style homes, you will find special details like antique furniture used for a bathroom cabinet or to fit an aquarium or furniture imported from India to turn them into finishing details throughout the home.
When that happens, I take photos of those items and tell the seller that those details have to stay with the house for sale as I won’t list the house without them.
Offer to purchase
When I write up the offer, I always include “The sale includes xxxx and an inventory list of what stays with the house for sale will be attached to the option to purchase sale agreement.
Option to Purchase Sale Agreement
I’ll ask the closing attorney to include in the Option to Purchase Sale Agreement “The SELLER acknowledges that during the term of this option to purchase sale agreement and prior to delivery of the property to the BUYER, the maintenance of the property is the sole responsibility of the SELLER. As such, the SELLER must maintain the whole property in the same condition as it is today. If any maintenance is required to restore the property to the condition which it was prior to closing, then it shall be the sole responsibility and expense of the SELLER.”
So let’s get back to the closing with the missing library and the replacement of it in cheap pine wood. What, are you crazy? – the buyers screamed at me when I told them not to close. How do you mean we don’t close. We’re living in a hotel and need to move in today. We have our container in customs and we really need to close. The checks are cut, everything is ready to get signed and we’re done. It’s only 2 hours away! God, what do we do now?
Ok, if you want to accept what the seller just did to you, which is entirely your decision, I’ll live with it. I think you make a mistake, now is the time to play hardball and get what we negotiated with the seller. The option to purchase sale agreement will cover you; let’s talk to your lawyer.
So we simply took pictures of the hole in the wall and looked for the listing photos with the beautiful hardwood library in it. Then we took it all to the closing attorney to ask him if the buyer is legally protected to not to close. Should we request the library is delivered at the house before closing? Can we request the cost of installation and any possible damages are on the seller? As a backup, we’d get a quote of what it would cost to replace the paneling and cabinetry by the most expensive cabinetmaker in town.
Negotiating with the seller to close or not, is usually very easy as you are going to give the seller three options:
1. You do not close until the paneling and cabinetry is replaced
2. You deduct at least 20% of the cost of the house from the sales price, to be kept in escrow with your attorney, until new paneling and cabinetry is installed and paid for by the funds held in escrow.
3. You do not close at all.
I have walked out of closings before. Make sure the agreement shows what stays with the house for sale before you sign the option to purchase sale agreement.
This story is a hypothetical story. The extreme example of the study was used to show how important it is to always write up an inventory list that shows what stays with the house for sale.
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