When a couple decides to sell a home in a normal transaction, the process starts with shared intent. Both parties want to sell. They agree on a broker, sign a listing agreement, and move forward. In a divorce, that alignment rarely exists, and in a luxury market where properties routinely trade above seven figures, the financial and emotional stakes multiply.
Orange County’s coastal real estate market has been softening, according to Heather Reeves, managing broker at Origin Real Estate in Newport Beach. Properties are sitting longer, re-trades mid-escrow are becoming more common, and seller concessions, closing cost credits, and price reductions have increased compared to two or three years ago. At the same time, inventory remains constrained: baby boomers who purchased in the 1980s and 1990s have little incentive to sell, in part because of the capital gains exposure that decades of appreciation have created. Into that gap step divorcing couples who have no choice but to transact, often on a timeline they did not set and under terms they did not agree to.
“There’s a 70% divorce rate in Orange County,” Reeves says. That figure isn’t limited to first marriages; she notes many people are on their second or third, which pushes the number up. Either way, she says, “it’s more common than not for people to be going through a divorce.”
In a standard residential sale, the broker’s first meeting is usually with both owners at once. In a divorce transaction, the process often starts with attorneys. One spouse’s legal team presents three brokerage options; the other spouse chooses one. The broker may interview with each party separately, then receive confirmation from the attorneys – not the clients – that they have been selected.
Reeves describes a recent scenario where she was put forward as one of the selected brokers for a couple looking to sell two investment properties. Her name went out through one party’s attorney last Tuesday or Wednesday, and as of the interview she hadn’t heard anything back. “That’s very common,” she says. Once the attorneys do give the go-ahead, though, the timeline compresses fast: “Once it’s time to take action, they have to have it listed and on the market and all these things within a certain very short window. So it’s one of those hurry up and wait.”
That unpredictability extends into escrow. One deal Reeves handled involved a cash transaction, the kind that typically closes in under a month. A funds transfer between spouses got caught up in a back-and-forth between attorneys, extending escrow by two months. She had to negotiate escrow extensions with the seller’s side while managing the other broker’s concern that the deal might collapse entirely. “There really isn’t anything you can do about it,” Reeves says. “You just have to wait.”
The most common deal killer in divorce transactions, according to Reeves, is straightforward: the parties cannot agree on listing price, repair credits, or how proceeds will be distributed.
Reeves also points to a broader disconnect shaping today’s market: “There’s an ongoing disconnect between sellers’ perception of the value of their property and buyers’ perception,” she says, tying it to the run-up in prices during the low-rate years. Many sellers, she says, are still anchored to that peak pricing and haven’t adjusted to a market where higher rates have pulled values back down.
When one spouse does not want to sell at all – a dynamic Reeves has encountered directly – that disconnect compounds. In one case she describes, an ex-wife wanted to keep the home because her kids grew up there, while her ex-husband needed the equity out and insisted they had no choice but to sell. “It’s an uncomfortable place to be,” Reeves says.
Origin’s three-partner structure – which includes an attorney-broker and a broker-associate alongside Reeves – allows the team to work with each party individually within the same transaction. The goal is to give both sides someone to communicate with directly, reducing the suspicion that information is being shared unevenly.
Reeves says the most common misconception divorcing clients have is that the process will move quickly. “The misconception is, oh, we’ve decided to divorce, so therefore all these things are gonna move quickly, and it’ll be done,” she says. That expectation collides with the reality of dividing real assets between two people who may have opposing priorities. The disagreements that caused the divorce do not pause for the transaction.
As a result, divorce deals follow what Reeves describes as a “hurry up and wait” pattern. Weeks or months of silence from attorneys can be followed by an urgent demand to list immediately. Brokers working in this space need to be ready to move on short notice after long stretches with no contact, a rhythm that differs from conventional residential sales, where the seller typically controls the pace.
Beyond transaction-level dynamics, Reeves is watching a change in Orange County’s housing stock. State-mandated high-density housing is arriving in coastal neighborhoods that have historically been defined by single-family luxury homes. In Newport Beach specifically, new condominium developments are going up adjacent to neighborhoods where homes sell for $10 million.
“To have a Newport Beach address in a more affordable – that’s a relative term – but coming in right outside of a neighborhood that sells for $10 million,” Reeves says, “I’m really curious what that’s going to do as far as how they’re going to sell, and what it’s going to do to the values of the homes around it.”
The developments also bring practical concerns. Reeves points to traffic in areas already dealing with congestion, and she says the question of how these units will be absorbed in a market where existing inventory is already moving slowly has no clear answer yet. “The cities just have to find it,” she says of the state mandates. “It’s not an option.”
For divorcing sellers in these neighborhoods, the incoming supply adds another variable to an already difficult pricing conversation. A home that might have sold quickly two years ago now sits in a market where both buyer expectations and the competitive landscape are moving against sellers, and where agreement between two opposing parties was never easy to begin with.
About the Expert: Heather Reeves is Managing Broker at Origin Real Estate in Newport Beach, California.
This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.
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