Divorce has a way of turning the family home into a very complicated house. One person wants to stay; the other wants to sell. Someone thinks the house is worth $900,000; someone else thinks it’s worth $750,000. One spouse wants to move out tomorrow; the other wants to wait until the kids finish school. And somewhere in the middle of all that, there is a mortgage, a bunch of furniture, a roof that may or may not need replacing, and two people who may not be speaking to each other.
When I went through my own divorce, my former husband and I owned multiple properties together, including investment properties in other states and our primary home. Figuring out how to divide everything was complicated from a financial and logistical standpoint. There was also a lot of emotion wrapped up in the decisions.
Every divorce is different, of course, but some common real estate questions come with them.
Here are seven of the most common real estate disputes I see in divorces.
1. “The house is worth more than that.”
The value of the house might be the most common argument of all among divorcing couples. Everyone has an opinion, but the market (thankfully) doesn’t care about anyone’s opinion. When I’m helping a divorcing couple, one of my jobs is to provide an objective assessment of what the property could realistically sell for. That means looking at comparable sales, current competition, the condition of the house, and what’s happening in the specific neighborhood.
North Carolina’s equitable distribution process also has specific rules around valuation. Under current state law, marital property is generally valued as of the date of separation, while divisible property and divisible debt are valued as of the date of distribution. (That’s a legal distinction, so your attorney should advise you on how it applies to your case.)
2. “I want to keep the house.”
This one is incredibly understandable, especially when children are involved, and the thought of uprooting everyone feels like one more loss nobody needs.
North Carolina law specifically lists the need of a parent with custody of children to occupy or own the marital residence among the factors that can be considered when determining whether an equal division of marital property would be equitable. That doesn’t mean the custodial parent automatically gets the house, but it does mean the children’s stability can be relevant to the legal property-division analysis.
There’s another question I think is just as important: Can you afford to keep it? If you’re taking on the mortgage, taxes, insurance, maintenance, and repairs on one income, we need to look at what that actually means for your life. A house can be emotionally worth everything and financially worth too much.
Real Estate During Divorce: What Happens to the House?
3. “I’ll buy you out, but that’s not what you’re getting.”
A buyout sounds simple: The house is worth X. The mortgage is Y. There’s Z in equity. One person keeps the house, and the other gets their share. Except it rarely ends up that simply.
- What is the house actually worth?
- What is the mortgage balance?
- What would the couple have paid in selling costs if they sold?
- What other assets and debts are being divided?
- Are there credits or other financial considerations?
- What does the separation agreement say?
- And can the spouse keeping the home actually afford it?
The important thing is not to negotiate a buyout based on a Zillow estimate and a calculator:
- Get a property valuation done by a professional.
- Get the financial and legal questions answered.
- Then make a decision.
Further reading: My guide on how real estate is divided in a North Carolina divorce goes deeper into the different ways marital real estate may be handled.
4. “We’re keeping the house until the kids graduate.”
Sometimes both spouses agree not to sell immediately. Maybe the children are in high school, and nobody wants to move them, or maybe the market isn’t where the couple wants it to be.
This can work, but it can also create a whole new set of disputes. From a real estate perspective, I want both people to understand what they’re signing up for. A house doesn’t stop costing money because the divorce is finalized. You’ll need to consider:
- Who pays the mortgage?
- Who pays property taxes?
- Who pays for repairs?
- Who gets to decide whether the kitchen needs updating?
- What happens if the HVAC dies in July?
- What happens if the spouse living there loses his or her job?
- What happens if the property appreciates substantially?
- What if one person wants out sooner?
North Carolina’s equitable distribution laws recognize divisible property, including certain changes in value occurring after separation and before distribution. That makes the timing and structure of a deferred sale something worth discussing carefully with your attorney.
5. “I don’t want to sell yet.”
This dispute often comes down to timing, when one spouse wants the house on the market immediately, but the other wants to wait. There may be good reasons on both sides:
- One person needs the proceeds to buy their next home
- The children need some stability
- The house needs repairs
- One spouse thinks the market will improve
I’ve had a situation where both spouses moving into rentals before selling the marital home ended up being the better strategy. It gave everyone some breathing room and allowed us to prepare the house properly. Of course, that’s not always the answer. The bigger point is that timing should be a strategy, not a tug-of-war.
I’ve written about this in Is It Better To Sell the House Before or After a Divorce?.
6. “I want to spend money fixing the house. He doesn’t.”
Welcome to one of my favorite divorce arguments. One spouse thinks the house needs new flooring, fresh paint, and landscaping before it goes on the market; the other thinks they’re throwing money away. Both may have a point.
This is where I try to take emotion out of the conversation and look at the likely return.
Will replacing the carpet help the house sell? Will fresh paint make the home more competitive? Is that $15,000 kitchen renovation actually going to make the house worth $15,000 more? Sometimes yes. Sometimes absolutely not.
My advice is to make improvements based on the market and the likely return, not personal preference. I’ve talked about this before because it comes up constantly: one of the biggest mistakes divorcing sellers can make is focusing on what they need rather than what the market will support.
You may also be interested in: 10 Tips for Selling Your Home During a Divorce
7. “We’re not speaking. How are we supposed to sell a house together?”
I’ve worked with couples who genuinely cannot communicate with each other. As in, they can’t be on the same text thread. They certainly don’t want to sit across a kitchen table and decide what color to paint the front door.
That’s where the role of the REALTOR® changes. I need to communicate clearly with both people without taking sides, make sure everyone has the information they need, and refer relevant questions to attorneys.
You may also be interested in: How Real Estate Decisions Can Impact Your Divorce Settlement
What should you do when you can’t agree?
I’ve found that getting the right information in front of people can calm down a surprising number of disagreements. You don’t have to agree on everything before you start gathering information.
Start by separating the questions.
Is this a legal question?
Call your attorney.
Is this a tax question?
Call your CPA or tax advisor.
Is this a financing question?
Call your lender.
Is this a question about what the house is worth, what it could sell for, or how to prepare it for market?
That’s where I come in. Here are my expert tips from a divorce real estate specialist.
Real estate disputes in divorce don’t have to become a second divorce
If you’re fighting over the house, you’re probably already exhausted. You may not need another person telling you what you should do. You may need someone who can calmly explain what the real estate options actually are.
I’ve completed specialized Certified Divorce Specialist training because I wanted to understand more about the dynamics of divorce, including communication, terminology, body language, and what children and parents may be experiencing.
One of the things I’ve learned is that you don’t need to solve everything at once; you need to know what the problem is, then figure out who is best equipped to solve it.
If you’re in Holly Springs, Apex, Fuquay-Varina, or the surrounding Triangle area and you’re trying to figure out what happens to your home during a divorce, I’m happy to start with a conversation.