Agents brace for rise in divorced couples seeking quick sales during COVID-19 crisis
Divorcing couples seeking a swift home sale are expected to put downward pressure on property prices during the coronavirus pandemic.
Splitting couples already account for close to one in six Aussie home sales each year and the proportion of divorcee sales is forecast to rise as other sellers withdraw their homes from the market.
The increased time some families spend together over lockdown may be an additional factor driving the forced sales, with social isolation putting strain on relationships that were already showing cracks.
Real estate agents said they were bracing for a pattern similar to one witnessed every January, when there was often a spike in divorces.
A frequent factor bringing these divorces to a head was the increased time couples in rocky relationships spent together over Christmas and the holidays – along with New Year’s resolutions.
Such couples were rarely in as strong a position as other home sellers when they listed their properties because they often had to sell quickly and accept whatever the market would offer.
With total listing numbers forecast to drop 60 per cent due to COVID-19 and divorced sellers accounting for a larger proportion of sales, there will likely be a shift in overall prices, housing experts said.
Starr Partners CEO Douglas Driscoll said it was impossible to put a number on how much prices would drop but buyer uncertainty over the virus and the reasons people sold would make a decisive impact.
“Most sales are going to be driven by those who have to move out of necessity like divorce,” Mr Driscoll said.
“Aspirational sellers, those who normally would want to sell to get a better property, won’t be listing. There’s no reason to.”
SohoApp.com CEO Jonathan Lui said it was rare for former spouses to hold onto their properties after divorce. “The family home is often too expensive for either former partner to afford on their own,” he said.
“Without a doubt, most people end up feeling poorer after their divorce. It’s a big financial shock for many people and it can take you months or even years to recover.”
Auctioneer James Pratt said two in 10 of his sales last year were the result of divorce but the number has already inched up to three in 10 since lockdown started.
“Being forced to live together 24/7 sadly has caused some couples who might have been on the fence about staying together to call their agent and (list),” Mr Pratt said.
Mr Pratt recently sold a house in Double Bay and said “being stuck inside together was a huge motivation” for the vendors to go to market.
“They had already made the decision to divorce but moved the house sale forward,” he said.
“Now that we have the coronavirus, the excessive time couples are spending together is the catalyst for some to split up. Selling your property is one of the first things that has to be done.”