Parting Ways in a Down Florida Housing Market

“Either party may unilaterally demand a 10 percent drop in the acceptable selling price and listing price every 60 days.”

Now that’s a divorce clause you probably would not have seen during the recent Southwest Florida housing market boom.

It’s also something that a Sarasota couple parting ways actually agreed to in January, according to the Herald-Tribune.

Stacked-up listings and double-digit price declines - phenomena that have plagued Florida real estate since mid-2005 - have dramatically skewed the rules for getting divorced.

Selling a home requires a lot more patience now, something that is often lacking in a divorce case for a variety of reasons.

Couples severing their marital ties are being forced to either submit to a sacrifice sale or put up with each other longer.

With a Florida mortgage on a home often representing their biggest shared asset, the decision to wait is a weighty one.

It is not hard to find divorce attorneys who will complain about the effect that the housing blues are having on business.

“I had another today with the same problem,” Lisa Kleinberg, a family attorney in Sarasota, said. “House on Siesta. Gone down from being worth about $1.2 million to being $900,000. They can’t get it sold.”

Sometimes - like when a couple bought a property at the peak and now pay a Florida mortgage loan for more than the house is worth - there is no easy way out.

“In divorce, we identify assets and divide assets, and real estate is frequently one of the most important assets,” said Richard Perlman, who sees both sides as a Longboat Key Realtor and divorce mediator.

Divorce attorneys hire Perlman based on his high success rate of getting two parties to agree to a deal that neither one likes.

“I mediate about 100 cases a year, with a 90 percent settlement rate,” Perlman said. “I am always negotiating deals. I am a deal maker.”

But he concedes that the game is getting tougher all the time amid current Florida housing market conditions.

“We used to rely on appraisals, but their value is questionable,” he said. “Regardless of what the appraisal is, the value of a property is only what someone is willing to pay for it. There are fewer buyers now.”

The couple who posted their real estate contingency plans in the January court document made an amateur’s mistake.

Most lawyers manage to keep the contingency plans private because both parties to the split realize that they would otherwise be tipping their hand to potential buyers.

But contingencies are becoming more and more common.

Sometimes the proposals might bring a divorcing couple to the bargaining table. They might agree that if the property does not sell by a certain date, they will return to mediation.

Continue reading this Sarasota Herald-Tribune article on the Southwest Florida housing market by following this link …