What is the distinction between a trade fixture and a regular fixture in real estate?

A trade fixture is distinct from a regular fixture primarily because it is typically installed by a tenant for the purpose of conducting business, making it movable upon the termination of the lease. This means that a tenant can remove trade fixtures before leaving the premises, as they are considered personal property of the tenant. In contrast, regular fixtures are usually affixed to the property in such a way that they become part of the real estate, and the ownership of these fixtures typically transfers with the property when it is sold.

This distinction is significant in real estate transactions as it affects the rights of tenants versus landlords and how property is classified and valued. Understanding this difference is essential for anyone involved in real estate, especially in contexts like leasing or selling a property.