dividing the assets

The Hell of Selling a House With an Ex-Spouse

Photo: Getty Images

There’s a lot on East 64th Street off Madison Avenue, as choice a spot as one can get in this city, waiting for a monied buyer to swoop in and make it whole again. Years ago, a charming four-floor brownstone stood there, home to the Barthas, who made headlines in 2006 when their house exploded, the tragic end to a reportedly contentious and prolonged divorce battle. According to the New York Times, the husband didn’t want to give up his home, despite court orders to auction it off.He wanted nothing other than to remain in this house for the rest of his life,” a former lawyer told the paper.

As divorces go, the Bartha case is clearly extreme. But in this city, real estate is a prime battleground for spouses on the outs. “Real estate is very emotional. Divorce is highly emotional. Put both of them together into a bucket and it’s explosive,” says Leonard Steinberg, president of Urban Compass. “I’ve seen some scenarios where every time you speak to the divorcing couple, you’re on pins and needles because you’re just hoping nothing will explode. It’s very stressful — for everyone.”

And the stakes are even higher given how expensive everything is. Buying your partner out means coming up with hundreds of thousands, if not millions (or tens of millions), of dollars — a hulking, and for some, despairing task. Or, for those being bought out, walking away from the home — not to mention the spouse — you once loved passionately. Add any worries about being able to pass a board — getting into a co-op on one income may be harder, and leaving one notoriously difficult to get into in the first place could be a sacrifice some aren’t willing to take — and you have a pill so hard to swallow people would rather fight to the bitter end than concede. Adds Warburg’s Richard Steinberg: “It comes down to one word: power. Both parties just want to win.”

In 2008, the Taubs of Borough Park attracted attention for having a divorce so epically difficult they partitioned the Brooklyn mansion they shared with walls of plywood and Sheetrock — an awkward, to say the least, and confrontational way to divide an asset. The separating owners of the $14 million co-op that Town Residential’s Judi Lederer handled years ago didn’t approach this War of the Roses–level of bitterness “but it wasn’t amicable,” she remembers. (She was representing the husband, and the wife had retained her own broker.) “Everything was a sore point.” The wife took issue with Lederer herself, claiming one offer she had brought was subpar and that her own agent could’ve done better. If the wife was in a bad mood on a given day “and needed something to pick on,” Lederer says she was it.

It was as if the broker had become a proxy for the spouse — a feeling familiar to many agents. Or, the transaction itself became a way to rehash fights, seek recompense for old hurts. Take one woman Michele Kleier, president of Kleier Residential, had to contend with a few years back. She was representing the husband, and the wife, who had her own broker, refused to let her in for showings. “She was so irritated that he wanted to use somebody different that finally, they had to get lawyers involved so that [both her agent and I] would have [equal] access to the apartment,” she says. “She wouldn’t return phone calls and when she did, it was always, ‘Sorry, that doesn’t work for me’ or ‘Sorry, it’ll have to be another day.’”

And even when Kleier was finally able to show the space and find them a buyer, “every inch of it was difficult.” She’d walk in with a potential buyer, appointment made well in advance, to find “the bed unmade, and she would leave laundry on the floor. She used to try to make it look as bad as possible because she didn’t want to move out. I did feel sorry for her because he left her and she didn’t want to leave the apartment.”

Halstead Property’s Lisa Rose had a divorcing duo with a $3 million co-op disagree over the chandeliers. One of them wanted to remove them and keep them, while the other insisted they were best sold with the apartment. Rose told them it would be hard to sell the place with the lighting situation in a flux, directing them to their lawyers for adjudication. The chandeliers were replaced with other fixtures before going on the market. Richard Steinberg had clients similarly go to battle over curtains. “We lost a deal because the injured party didn’t want to part with the window treatments,” he says. “Just simple window treatments she didn’t want to leave because she knew that would cause an issue.” Never mind that they wouldn’t fit her new space. They ended up selling later for a lower price.

Sometimes the fighting gets so intense, and the lawyer fees grow so enormous, divorcing couples barely see any of the proceeds. At the closing for a $10 million apartment Leonard Steinberg helped unload, so many checks had to be written for lawyers that there was little money left. “At the end of the day, the net proceeds were maybe $3 million,” he says. “It was brutal.”