image of a house with a crack and a band-aidDivorce's Impact On Property Condition and Values

Parties going through a divorce are often in survival mode-financially, emotionally and mentally. For those of us who work in the field of divorce real estate, we are often balancing client bandwidth with maximizing their property's financial potential.

Several things play into this, including the level of conflict, any pressing timing issues, such as delinquent mortgage payments or any impending moves (job transfers, change in school districts, custody arrangements) and then of course-the order. While it can be tempting to furiously rush to agreement in the halls of the courthouse or request the court make an order that the property listed "forthwith, as is," there can be a pretty substantial price tag to these decisions. 

While no one wants to unnecessarily allow the listing to languish, there is usually a financial benefit to taking a few weeks and using that time to get the house from "lived-in" condition to "market-ready" without breaking the bank.

Categories of Home Listed

There are three general categories of homes that Realtors unofficially place on listings:

  1. Fixer-upper: these homes need major repairs or remodeling, either cosmetic or structural (or both) and the house may even be barely habitable.
  2. Average: These are houses that may not be "show-stoppers", but are in good working order, may have been partially updated at some point, and may need minor repairs (think: missing baseboards, holes in the walls) or they may need a fair amount of cosmetic work (decluttering, deep cleaning, etc.). Other than these things, they are structurally sound. Of course, this is entirely subjective depending on the Realtor's or buyer's mindset and the local market, but you should get the idea. There is a spectrum of "average". It is a grey area between "gut job" and "model home".
  3. Model Homes: Then, of course, there are the model homes, the "House Beautiful" homes. Those aren't the ones we are talking about, because it is rare that I see these in a divorce listing.

What Repairs Are Worth Doing? 

So, if your home is in one of the first two categories, what repairs "ARE" worth doing to maximize the home's value before putting it on the market? 

I recommend the following relatively easy and inexpensive cosmetic changes to my clients:

  1. Make the entrance welcoming. This is the "First Impression". All kinds of anticipation are running through the bellies of the buyers when they approach the front door, and we want to deliver on it, not be a "buzzkill". Think: new doormat, wreath, plants on porch. A bright, clean entrance with living plants can help a home buyer visualize coming home every day or friends or family coming over to visit. Even though, you as the owner, may not be feeling any joy or happiness at the moment, you have to get past your own sadness at the moment to ensure putting more money in your pocket long term.
  2. Curb Appeal. Think lawn mowed and edged, weeds removed and a pop of color in the flowerbeds. We are not talking about landscape architecture here, but a sense that the home is well maintained from the curb to the front door.
  3. Declutter. A house packed full of "stuff" can distract potential buyers from visualizing how your home may look with their stuff. In some cases, there can be so much personal property that it borders on hoarding, which will place the home in the "fixer upper" category just by sheer impression.

           Some quick hacks when decluttering are: 

  • Divide personal property and have the out-spouse retrieve theirs before photographing the house. It will need to be divided anyway, so this is a great time to kill two birds with one stone
  • Put their things into 3 categories: trash, donate and keep
  • Dispose of what's trash, arrange for donations to be picked up, and then divide the "keep" belongings into what is necessary for day-to-day living, and what can be put into the storage before the is listed.

Front-loading the listing with a lot of this work completed will both make the process much smoother, and increase the value of the ultimately, netting the separating parties more money. I have also witnessed first hand an unanticipated benefit: the mindset shift that happens to one or both of the parties when they go through this process, seems to make the reality of the move set in. This leads to cooperation for showings, inspections, signatures on paperwork, and vacating the house upon closing. 

      4. Deep-clean the whole house. The fastest way to make a buyer turn around and walk out of the house during a showing is to have a dirty house. No one wants to buy another person's grime. Hiring a cleaning service to          deep-clean the house prior to photography can be the biggest return on your investment in the entire sale.

       5.  Clean carpets or polish floors. Depending on its condition, giving the carpet a fresh look by steam cleaning it can go a long way. For wood and laminate floors, a good polish can also make all the difference. 

       6. Staging. Ever since HGTV became a household name, staging homes has gone from being an extravagance to mandatory in the home resale market. Staging comes in two forms: occupied and vacant. Occupied staging is          when we use the client's belongings and arrange them in a way that creates openness, balance and flow. The            other is hiring a full staging service to furnish key areas of the home with en vogue styles. While the latter can          cost a few thousand dollars, the return is 3-5 times the investment. At the very least, occupied staging should              be done by someone the listing agent's office provides, or refers.

Why Use a CDRE 

Of course, the costs to these repairs and the decisions about who to use to complete them can result in more conflict between the parties. Most CDRE's coordinate all of this and offer cost advancement (subject to reimbursement at closing) for some minor things with vendors they use and trust. This is a nice solution where the parties reap the rewards without the fuss.

Should the CDRE find that there are financial benefits to spending a few weeks to get the house "gussied" up, they will keep counsel informed in case there are any issues with time or finances that could impact the case.

  • What is a CDRE: A CDRE (Certified Divorce Real Estate Expert) handles the sale of the property in family law cases as a neutral expert. They have knowledge and special skills to handle the effects of the family law process on divorce listings.

Complimentary Services: 

  • Title Documents
  • Property Profiles
  • Chain of Title
  • Expert Advice to Attorneys with solutions to Real Property Issues

 

Bottom Line

If you find yourself going through a divorce and you think your home may need some work, call a CDRE before you do something to the house that isn't necessary, or will not net you the return you were hoping for.