As home prices are rising in Florida and elsewhere, more couples are deciding to end their marriages. A decade ago, couples could count on using the profits from the sale of their property to buy and furnish their own home, but the less stable real estate market of recent years served as reason enough for some couples to delay their divorces until they were able to sell their homes for a profit. Rather than get divorced while the family home is underwater, these couples waited until they were able to sell the property and walk away with some money to start their new lives.
At least one real estate agent has reported that much of his business comes from selling homes after people get divorced and helping recently divorced buyers find new homes. The increase in home equity may encourage couples who have been contemplating ending their marriage to take the final step and file for divorce.
Starting a new life after a divorce can be somewhat financially challenging. After all of the marital assets are divided, each spouse typically has to learn to live with less money. Ending a marriage without equity in the family home creates another expense, and when possible, many couples choose to delay their divorce until their property value increases.
Divorce can be a very complicated matter, especially when it involves significant assets or underwater real estate. When the couple’s home has negative equity, both spouses often take a loss when the property is divided. An attorney with experience handling divorce cases may be able to advise clients on how to plan their finances before they get divorced so they will be ready for their new financial situation after the marital property is inventoried and divided.
Source: Orlando Sentinel, “Divorce and home values: Till equity do us part”, Mary Shanklin, August 30, 2013