In California, Real Estate Disputes Are Rising Even as Transactions Slow

Fewer homes are changing hands in California right now, but the number of fights over the ones that do is not falling with them. Purchase and sale disputes, title fraud, and fire-related rebuilding conflicts are all landing on litigation desks with regularity, according to Zach Schorr, founder of Schorr Law, a Los Angeles litigation firm that handles real estate disputes exclusively. The patterns point to specific vulnerabilities in how California real estate gets transacted, disclosed, and recorded.

Schorr says the volume of purchase and sale cases stands out against the transaction slowdown. “I think especially unusual given that there are high interest rates and there are probably fewer transactions, but we’re still seeing a lot of these disputes,” he says. Title fraud cases and post-fire rebuilding conflicts have added new pressure to an already full docket.

Partial Disclosures Are Replacing Outright Omissions

Disclosure disputes have long been a fixture of California residential litigation, but the pattern Schorr describes has moved toward strategic half-truths, sellers disclosing a narrow version of a known problem while omitting the full scope.

In one current matter, a seller disclosed water damage in a small corner of a basement but failed to mention prior damage throughout the entire space. “They sort of pinned it to like a small corner and said, oh, we repaired this, but neglected to tell us that it was quite an extensive problem,” Schorr says.

The pattern extends to unpermitted work and concealed geological risk. In a prior case involving a hillside property in Silver Lake, the firm proved the seller had commissioned a report showing an unstable cliff above the home, a problem Schorr says would have cost roughly a million dollars to repair. The report did not surface through the seller. It came through the seller’s ex-wife, months into the litigation.

For buyers, these cases illustrate a specific risk: a disclosure form that appears complete can still omit the most expensive problem. A seller who acknowledges a small repair may be framing a larger issue as resolved.

Title Fraud Is Exploiting an Outdated Recording System

Over the past few years, Schorr says he has seen a steady increase in cases involving forged deeds and fraudulent title transfers, people fabricating documents that convey ownership interests in property they do not own.

The vulnerability, as Schorr describes it, lies in the recording system itself. “It seems like there’s not enough protection against that from happening,” he says. “Maybe there’s more sophisticated criminals or quasi-criminals that are taking advantage of what I think is an archaic checks and balances system at the county recorder’s office.”

California’s county recorder offices accept recorded instruments without substantive verification of their legitimacy. That gap creates opportunity for fraud at a time when property values make the payoff significant.

Neighbor-Against-Neighbor Litigation

The Palisades fires created a wave of rebuilding activity that is now producing litigation over restrictive covenants, specifically, height restrictions and view protections embedded in neighborhood agreements. Schorr is handling cases where homeowners rebuilding after the fires are attempting to exceed prior height limits, triggering disputes with neighbors whose views would be affected.

“Those are kind of not fun ones right now because you don’t really want to be dealing with on either side because it’s an unfortunate situation to begin with,” he says. The disputes are structurally straightforward, written covenants exist, and the question is whether the rebuild complies, but the emotional context of post-fire recovery makes resolution harder.

Co-Owners Driving Partition Cases

Partition actions – court proceedings to force the sale or division of co-owned property – are increasingly coming from unmarried couples who split up without any written agreement governing what happens to shared real estate. Schorr says these cases cross his desk frequently.

In one current matter, an unmarried couple with two children purchased a home together. After the relationship ended, the woman moved out and wants to force a sale; the man wants to stay and raise the children there. Both positions are reasonable, Schorr notes, but no document defines what happens next. “Those are the situations where there’s like a high level of trust. But then as a result, there’s no document out there for us to look at and say, well, what happens if it doesn’t work out?”

When partition cases do not settle through a buyout – which Schorr says is the more common outcome after several months of litigation – a court-ordered sale can be expensive and may not fetch full market value. The firm pushes for private sales over auction-style dispositions when possible. “If you get to that point, everyone’s interests at some point are aligned that hey, let’s try to get as much money out of this property as possible,” he says.

For unmarried couples buying property together, the practical lesson is specific: a written co-ownership agreement that addresses a potential breakup costs far less than a partition action.

How California Resolves Purchase Disputes

Beyond individual case types, Schorr flags a procedural issue he considers unfair to buyers. California’s standard purchase and sale agreement requires arbitration between buyer and seller if a dispute arises, but the broker is excluded from that arbitration. The result is a three-party dispute split across two separate forums.

“I believe it’s a procedural issue that’s being created to protect brokers and to make it more difficult on buyers, which I think is somewhat unfair,” he says. “My goal and any attorney’s goal is to try to simplify things, do things efficiently, reduce costs, and those things all become harder when you have a system that’s designed to complicate things.”

That split means a buyer pursuing a disclosure claim may need to litigate against the broker in court while simultaneously arbitrating with the seller, doubling the cost and complexity of resolving what is often a single underlying problem.