by Carly Susic, Melbourne Property Advocate
Divorcing couples are navigating one of the toughest things in any adult’s lifetime, the painful separation and ending of a marriage. Separating the finances often involves selling a home after divorce. It’s fraught with strong emotions, because the plans you once had for living in the home and perhaps raising a family together are dashed.
Putting strong emotions aside is not easy
I’ve worked with many divorcing couples and often it’s very messy, with strong feelings on each side. This can be exacerbated if the couple don’t agree on the future of the home. Often one partner wants to sell and the other wants to keep the family home. But selling a home after divorce is often the only way to fairly split the assets.
Delays and challenges are common, especially with children involved
If there’s resentment after divorce, partners will often disagree with each other just because they can. This can cause delays with both partners unable to truly move on until they can agree to sell. When children are involved, the parents often feel guilty about the divorce. So the thought of uprooting the kids from the family home is not appealing. Ideally the children can be spared the upset of moving. Some couples try to retain the house, but often this is not financially viable. One couple buying the other out is a rarity that few couples can afford. Others attempt a nesting arrangement, where the kids stay in the home and the two parents come and go, sharing the property. This sounds nice on paper but is often incredibly difficult to navigate long term in reality.
Grey divorce now more common
Older couples are increasingly choosing divorce. One in three couples over fifty divorcing according to Australian Seniors. I have helped many couples in their 50s or 60s sell their home after divorce. Many of them have been married for 30 years or more. Often these couples are empty nesters who stayed together for the children. But the kids are now adults, so the couple choose to separate and live more independently. People in this age group commonly have concerns about separating the assets and securing a property they can solely own in their 50s or 60s. They won’t have the income earning capacity for 30 years so financial options may be limited. It’s worth investigating your options with your mortgage broker or financial advisor before making major decisions.
How a vendor advocate can help when selling a home after divorce
Working with a vendor advocate can help. It gives you a trusted independent person to act as go-between for the separating couple. We can act as a buffer and talk to both sides. You don’t have to negotiate with your husband or wife if there’s a neutral third party supporting the process. Keeping it clean, swift and simple is often the way to go.
Navigating the strong emotions can be painful. A vendor advocate will give good solid advice that aims to get the best result for everyone. It’s a bit like ripping off a band-aid. It’s best to do it quickly. Couples can waste months arguing through lawyers, costing themselves money and stop each other from moving on with their lives. If both couples agree to get the best result with the least amount of stress, selling a home after divorce can be a simple straightforward process.
Choosing the right agent is vital
Some agents see couples selling a home after divorce as a quick easy sale, and a fast commission. So it’s important to be mindful of choosing an agent. You need the best person to sell the house. But also, you need someone who can understand and empathise with the emotions involved for the divorcing couple.
Don’t let emotions cloud your decision on price
Just because you feel upset about selling your home after divorce doesn’t allow you to demand “top dollar.” I’ve worked with divorcing couples who say, “I don’t really want to sell so I will only accept the top of the market price.” They want to be financially compensated for the pain they are feeling. Or they set the price based on how much money they need to move on, instead of fair market value for the property.
Unfortunately it doesn’t work that way. Buyers will not be willing to overpay for your home, they’ll just find something else that is reasonably priced. This mindset could leave you out of pocket with expensive marketing costs, a failed auction and a house that hasn’t sold sitting on the market for months.
Be willing to invest in minor upgrades and styling costs
If your vendor advocate or agent recommends, it may be worth completing some upgrades to the property to maximise the sale price. Neither party is likely too willing to incur unwanted extra costs. But it is worth making the investment if you are both rewarded with a better sale price down the track. Selling a house comes with costs involved, mostly preparation and marketing. So be willing to make that investment and negotiate responsibility for costs and labour fairly.
Consider the legal implications of selling a home after divorce
I spoke to Jennifer Hetherington, Accredited Family Law Specialist, Mediator and founder of Divorce Hub and Untying the Knot for more insights from a legal perspective. She says:
“There is a tendency amongst family lawyers to draft Consent Orders for the sale of a property that include some problematic clauses. One of these is that if the parties cannot agree on a selling price, the agent will set the price. You can’t delegate that kind of decision to an agent. So you need a different mechanism to decide what the price will be if you can’t agree.
“I like to ensure that both parties are going to benefit from getting the best possible price for the property. Well drafted Consent Orders will make it clear who has responsibility to pay for the ongoing costs of the property, preparing it for sale and removing belongings.
“Agree on a conveyancing solicitor at the time the orders are drafted and what will happen to the sale proceeds. If a property is in one person’s name, making sure the other person is copied in with the real estate agent is important so they are involved in the sale process.
“And having a clause for what happens if someone doesn’t pay their share of the rates or the home loan is really important or you can end up with conflict over the sale proceeds.”
Navigating strong emotions during a difficult time
I spoke to Lee Hopkins counselling psychologist and writer of Mind Blown Psychology for more insights.
Lee says:
“People are routinely blindsided by how much selling the family home hurts. Most price fights aren’t really about the price. They’re proxy wars for who put more in, who’s to blame, who gets to feel they won the last round.
“The way through is to stop negotiating the outcome and start agreeing on a process. You don’t have to agree on what the house is worth. You have to agree on who decides—independent valuations, a neutral agent, a mediator, and lawyers where the stakes warrant it.
Lee shares some common pitfalls for divorcing couples to avoid to ensure a fair and equitable outcome for everyone:
- Don’t treat the sale as a battlefield: stalling viewings, knocking back reasonable offers out of spite, using the house as a way to finally “win”.
- Don’t rush to “just be done” and leave real money on the table.
- Avoid the reverse as well: don’t drag it out so long that legal fees and holding costs absorb the equity you were fighting over.
- Don’t skip independent legal financial and property advice on the assumption you can sort it between yourselves—you can’t.
- Never pull the kids into it.
- Don’t let the house fall into disrepair because neither of you want to spend a cent on a home you’re about to lose.
To summarise: selling your home after divorce
- You will be feeling strong emotions; do your best to work together.
- Hiring a vendor advocate will give you a neutral third party so you can negotiate fairly.
- Don’t demand a higher price simply because you’re reluctant to sell.
- Aim to sell the home in a sensible time frame — it will be a painful process so delays only prolong grief.
- Choose an agent who is not only the best person to sell the home but with experience in dealing with divorcing couples.
- Be careful with your Consent Orders and ensure the decision making process is fair on both parties: consult your family lawyer.
- The more you can agree on between you, the less mediation and legal costs you’ll incur.
- Avoid making decisions to delay or impact the sale out of spite to your ex partner.
