Navigating the “As-Is” Clause in Divorce Real Estate: A Realistic Perspective

Divorce proceedings are rarely a walk in the park, and when it comes to dividing assets, the family home often takes center stage. The agreement to list a property “as-is” may seem like a win for one party, but as a Certified Divorce Real Estate Expert® (CDRE®), I’m here to shed light on the real implications of this decision.

In the aftermath of intense negotiations, it’s not uncommon for a client to declare, “Fine, I’ll list it, but I won’t spend a dime on repairs. It’s to be sold ‘as-is’.” This sentiment gets neatly documented in the court order, leaving both parties feeling like they’ve won a small victory.

However, the reality is that selling a house “as-is” has its consequences. While sellers aren’t obligated to invest in pre-sale repairs, the cosmetic and structural condition of the home significantly influences its market value and appeal.

As a CDRE®, my primary role is to maximize the value and equity in a house. The visible aspects like cleanliness, paint, and landscaping matter just as much as the hidden issues discovered during buyer inspections — things like a damaged roof, sewer lines, wood-rot, or electrical problems.

In a hot real estate market, buyers might overlook these issues, especially in bidding-war scenarios where they’re eager to secure a deal. But our current market trends suggest a different story. Buyers are less likely to waive inspections and are more insistent on addressing significant problems before closing the deal.

The “as-is” clause in the court order becomes a point of contention when sellers realize that they might have to compromise on their asking price or offer credits to the buyer due to undisclosed issues. It’s a bitter pill to swallow, but as former President Bill Clinton said, “It depends on what the meaning of the word ‘is’ is.”

The truth is, while sellers may avoid immediate financial contributions for repairs, the overall value of the house takes a hit. Houses involved in divorce proceedings often suffer from deferred maintenance and damage, impacting their market worth.

So, here’s the bottom line: Don’t rely on estimated net proceeds until the sale is complete. There may be unforeseen hurdles along the way that affect the final numbers. As your dedicated CDRE®, I’m here to guide you through the complexities of divorce real estate, ensuring that we navigate the process with a clear understanding of its implications.