3 Things to Consider when Divorce is Inevitable

He was my tall, dark and handsome. A musician with a sharp wit, delivered in the most seductive of baritone voices. So many years later, we both agree that it was love at first sight. Teenagers when we met. At 24, (he 27) we held hands in a church wedding, and as the amber of an early October sunset streamed in the stained glass window, promised to be together until the end of our days. At the time, I took that golden light to be a sign that the marriage was perfect and blessed and ‘till death would we part. Six years later, not long after buying our first jewel-box home together, it was over.

Neither one of us wanted to keep this first house, even if we could have afforded it on our own (we couldn’t), so an agent friend was called, and our “799 sq. ft. inner city love nest” was put up for sale. Fortunately, the market was strong that year, the house was adorable, and so we each walked away with slightly broken hearts, wiser and with enough cash to start over.

Approximately 70, 000 Canadian marriages end in divorce every year. Marriages get into trouble for all sorts of reasons, and when a couple hits hard times, the reality of the situation, if you will forgive me, comes home when each person has to address the value of the marital home in the current market and what is going to be left over if it and when it is sold.

According to one Environics study, housing prices have climbed 156% nationally in the past 15 years, and 430% in the past 30 years. The average house price in Calgary is currently $484, 877. It's a lot of money, especially when you find yourself shouldering it all on your own.

For couples who were lucky enough to get in before the markets started their meteoric rise, the equity in their home (like my musician and I) provides enough of a cushion to start a new life. For others, who entered the market when prices were already on the rise, or worse still bought at a peak, selling the marital home often means a significant downgrade in lifestyle and purchasing power. Running separate households costs a heck of a lot more than running a single one.

If divorce is the only option, here are a few things real estate to consider:

Timing: Spring and fall markets are most often the strongest, with more buyers and less pressure to sacrifice your sale price. If you find yourselves having to sell quickly at a slower time of the year, you could be leaving a lot of cash on the table. We sold during a spring market, which worked to our advantage.

Discretion: What ever you do, don't publicize the fact that you are selling because of a divorce. Remember that your agent owes you confidentiality. Ask the neighbours to keep it on the down low too; a good buyer’s agent is not above banging on their door to ask the reason for the sale. Only one partner’s clothing in the master closet or too much of one person’s clothing in the basement bedroom are also dead giveaways that there is distress in the sale. Buyer’s WILL take advantage and low-ball their offers. Since that first house was built in 1929, closet space was at a premium and the basement was too scary for anyone except the spiders to sleep in.

Know your Numbers: Make sure you understand all of the costs associated with the sale of the marital home. You could be looking at thousands of dollars to break your mortgage. There will also be real estate commissions, title transfer fees, moving costs, etc. Anticipate that transaction costs could cut into the equity of your home by 8-10%. This is where we took the biggest hit when we sold our little house.

Divorce can be a a hard, and often ugly experience, my heart goes out to anyone going through it. It is fraught with emotions, the death of so many hopes and plans, but it can also be the making of you as a person, providing the opportunity to start anew. 

Having been there, I understand what you are going through, and regardless of how impossible your situation feels, I can help you navigate though the dark times.

As for my musician and I, we were the lucky ones. Not only from a real estate perspective but also because so many years later, we both have created amazing lives for ourselves and have finally slipped into a pattern of fond friendship that comes from knowing each other from a time when we were very young.

Life is good. Life is what you make of it.

I hope you love where you live.