Should you sell your house before or after a divorce?

On Behalf of | Apr 23, 2021 | Property division

Like so many questions in divorce, the question of whether you should sell your Orange County house before or after your divorce is best answered with “it depends.”

It depends on the financial situation of both you and your spouse, as well as tax implications and the condition of the housing market.

Orange County surge

According to media reports, the local housing market surged in February: sales increased 13 percent and prices were up 9.6 percent over 12 months – a record high. But housing data has a built-in lag, so while the February numbers were great for sellers, there is no guarantee today in April or in coming months that the boom will continue.

Divorcing homeowners need to consider how much they would net if they sold their house today and then make their best guess about how much you’d net in a year or so.

Pros and cons of selling before the divorce

  • Pro: You don’t just end your marriage with a divorce, you start a new life – a new life in which you’ll need to pay for a new place to live. Because California’s a community property state, each spouse owns half of the assets such as a house, acquired during the marriage. If there’s substantial equity in the house, your share could provide the funds needed to get you started in your new life.
  • Pro: the sooner you sell, the sooner you can begin to let go of the past.
  • Con: a residential real estate sales site points out that if you decide to sell before the divorce, a slow sale process could complicate matters. Every home seller would love to sell quickly and easily, but that is often simply not how it happens in real life. If the relationship with your soon-to-be-ex is contentious, there might be sale-delaying disagreements over price, agent, property enhancements and so on.

Please check back here for a follow-up blog post that’ll include the pros and cons of selling your home after a divorce.

A family law attorney and a financial advisor can help you weigh these pros and cons and others as you work your way through property division issues in your divorce.