After another tough year of lockdowns, estate agents and lawyers are noticing an increase in the number of homes coming to market as a result of couples calling it quits on their relationships.
Divorce lawyer Jeremy Sutton told OneRoof that the rise in separation queries had put pressure on the profession.
“There’s definitely been an up-tick in the number of people at least thinking about separating, seeking advice from family lawyers,” he said.
“We’re all saying we’re being smashed, but it’s difficult to know the actual numbers because a lot of people who would access services like counselling or mediation didn’t want to do that online [during lockdown]. They’re waiting to go face-to-face.
“It will be a busy year next year. Court dates have been deferred and deferred, so we’ll be cramming more into next year.”
For homeowners, separations more often than not lead to the family home being listed for sale.
On Auckland’s North Shore, real estate agency Harcourts Cooper & Co found that 5% of the homes its agents sold this month involved vendors who were separating.
Managing director Martin Cooper said that while the number was “about normal” for the agency his sale people were “hearing from more clients who wanted to move on after lockdown. When you’re home together seven days a week, it’s not quite like when you’re both out and about.”
Cooper said that sometimes there’s a run of separations, but right now he’d say “there’s not an epidemic”.
He added: “On the nice side, some people may have found love again. That balances out the ones that broke up.”
However, Sutton said that sometimes separating couples would decide against telling agents their reasons for selling.
“Sometimes they don’t want to say anything because that might have an impact on the sale price, buyers might get a sense of desperation,” he said.
Sutton said that his profession had noticed a spike in the number of enquiries from “silver spooners” – the over 50 couples, who have been locked up together for months and realised their interests have diverged and they’ve got nothing left in common.
“It’s all coming home to roost. The pressure was building,” he said.
With property prices rising quite quickly over the past 18 months, some couples have found that the proceeds of one house sale doesn’t cover the cost of buying another two , Sutton said.
“Neither partner is in a position to buy the other out, nor could each buy again at, say, $1.5m or $2m each. So we have to be more creative,” he said.
“Deferred settlements are trending up. Maybe one parent stays in the house until the kids complete their education, then they settle on property a few years down the track.”
That avoids the new problem too of banks tightening lending, where one or both parties may be rejected for a mortgage in their own right.
“Sometimes, one can’t get back on the property ladder. We really are coaching and advising with a financial advisor.”
He added: “We recommend [separating couples] use a third experienced family lawyer or accountant to help. It’s hard to keep track of the actual property value, particularly if one party wants today’s market value and the other a recent valuation.”
Bayleys agent Linda Simmons, who operates on Auckland’s North Shore, said that while sometimes agents are unaware of the reason for a sale, she is seeing more split ups than normal.
“Everyone’s been through so much turmoil and change. In the first lockdown, we were seeing business liquidations, people losing their jobs or having to travel, a lot of Covid-related reasons,” she said.
“We’re sometimes like a life coach, helping people find two homes after they’ve sold one. It’s confidential, but it’s an honour to be there to help them.”
Barfoot & Thompson agent Paul Neshausen, who covers Auckland’s eastern suburbs, estimates he does one or two break-up sales a month, and that hasn’t changed this year.
However, he does suspect that after people have recovered from the post-lockdown December exhaustion and are ready to face the new year that there might be more.
“You’re like a hairdresser, you hear both sides of the story and have to tip-toe between the couple,” he said.
“The sale of a family home is emotional enough as it is, but when it’s even more uncertain I do a lot of counselling, telling people what I’ve seen from other couples who’ve been through this.”
Neshausen says both sets of lawyers need clarity from the start of the listing and sales process so there are no grey areas.
Jared Cooksley, who owns Ray White’s offices in Mount Eden and Mangere Bridge, said that clients who don’t want to divulge their reasons for selling should use an independent lawyer to act on their behalf during the sale. “You’re just making sure you sell the house for as much as possible, it keeps it all separate. Let the lawyers sort it all out.”
Carolyn Vernon, head of Barfoot & Thompson’s Remuera branch, noted that she’d not seen as many breakups this year, adding that couples maybe aware that attempting to sell and then re-buy a house each will be near impossible in Auckland’s double grammar zone.
“What do you get for $1.5 or $2m when you’ve split the $3m or $4m house? And that’s if you can get finance, if you’re lucky. Banks are giving short term approval only, and some are just saying no.”
This article originally appeared on oneroof.co.nz. Available at https://www.oneroof.co.nz/news/divorce-lawyers-smashed-as-aucklands-silver-spooners-rush-to-sell-40719