Relationship Breakdown – Valuing the Family Home

In part 2 of this guest blog, Lorraine Richardson from Adapt Law and Carla Ditz, Professional Support Lawyer at FLiP, provide some guidance on what is likely to become a vexed issue of valuing the family home on relationship breakdown.

The unfortunate consequence of lockdown for many will be the ending of their relationship. In our first blog (found here), we considered some of the practical steps that the parties can take to ease the conveyancing process when preparing to sell their property.

However, one of the most vexed issues that a divorcing couple is likely to face in the coming months is agreeing on the valuation of the family home which, in many cases will be the single most valuable asset that the family owns.

There is a conveyancing adage that a property is worth what someone is prepared to pay for it.  But the issue is more complex than this – in the current, increasingly turbulent, market a property may be worth what a mortgage company is prepared to lend on it.

A surveyor will generally be more reticent to over value a property than an estate agent, particularly in an uncertain market.  So, it would be worth considering paying an RICS qualified surveyor to provide a formal residential property valuation which would give the ‘market value’ of the home.  The valuation will be based on a number of factors including information on the sale price of three comparable homes nearby that have recently been sold.  The valuation will usually be valid for 3 months form the date it was produced. A residential property valuation is not a building survey – so it will not pick up defects in a property which may have an adverse effect on the eventual sale price of a property. It is likely that this sort of valuation will give a more realistic figure than simply a market appraisal by a local estate agent.  Remember that lenders rely on surveyor valuations when assessing how much a property is worth for mortgage purposes.

But we exist in a distorted market at the moment.  We are coming out of lockdown and there is some pent-up demand in the market. This coupled with the SDLT changes announced by the Chancellor on 08.07.2020 (and commented on by FLiP Director James Pirrie in his blog ‘Divorce – We’re all taking a stamp duty holiday!’) means that property prices may be inflated now, but may drop when the SDLT discount ends on 31.03.2021.

This is a toxic mix for surveyors and valuers.  So, what can divorcing couples do?

It goes without saying that it is crucial to ensure that a financial order on divorce is made. If the parties just agree how the property might be divided between themselves (in the absence of a formal court order), there is nothing stopping a former spouse from coming back, possibly many years after the divorce, to seek a share in a property.

Where there is a provision in a court order for the former matrimonial home to be sold as part of the financial settlement on divorce, it is vital to ensure that this will be complied in a timely manner. Given the likely volatility in the property market over the coming months, couples may struggle to reach an agreement over the ‘right’ sale price and there will be even more need for an order to provide for strict timeframes to avoid delay. The order should also provide for the eventuality where the parties cannot agree. Such provisions may include the right to apply to the court or appoint an arbitrator for determination of the matter. Mediation could also provide a forum for such issues to be discussed with a mediator facilitating the conversation, helping couples to come to an agreement where possible.

There is plenty of time between now and 31.03.2021 to sell a house. Any couple thinking of doing so would be well advised to progress promptly.   As March 2021 approaches the pressure will be on to agree a sale. The prospect of a fall in house prices might be enough to persuade even the most unwilling owner to agree a sale and move on.

Anyone who wants to delay a sale to be difficult should remember that they will hurt their own pocket if they stand to receive some of the sale proceeds.  Returning to court for an order for sale is a last resort if one party refuses to agree a sale.  But this would result in significant legal fees being paid out of the sale proceeds, which may be substantially diminished if the matter drags on beyond March 2021.

The author of this blog, Lorraine Richardson M.A. (Cantab), is an experienced property solicitor and trainer who is a popular conference and CPD speaker. She also designs and delivers property and legal skills related courses and on line materials including Conveyancing Quality Scheme training for the Law Society. Lorraine is the major writer for the monthly update journal for practitioners, the ‘Practical Lawyer’ and offers property related courses and webinars and a membership scheme for firms which includes personalised conveyancing training.

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If you are considering moving out of your family home following a breakdown in your relationship, it is important that you understand your rights under the law. Please contact any of our top London divorce and family lawyers at Family Law in Partnership on E: or T: 020 7420 5000 for expert advice.