How Does a Divorce Affect the Value of a House?

At first glance, it may seem like divorce has no bearing on the value of a house. After all, the bricks and mortar remain the same regardless of the relationship status of its owners. 

But if you look a little closer, you will see that in some cases, divorce can have a profound impact on the value of a property. How? Let’s take a look.

Potential ways your divorce can change the value of your house

1. You’re anxious to sell

Divorce is not only emotionally taxing but also time-sensitive. The need to wrap up shared assets and move on with individual lives often creates a sense of urgency to sell shared property, like a family home. This rush can unwittingly affect the value of the house.

If you're eager to sell, you may be more inclined to work with the first realtor you find or accept lower offers just to expedite the process. It's understandable that you want to close this chapter and start anew. But in your haste, you could inadvertently undervalue your home, accepting a price much lower than its market value.

Your home is a significant financial asset. Selling under the pressure of a pending divorce case might provide immediate relief, but it could also have long-term financial implications. If you can, take a step back to fully understand the value of your home before you sell. Explore all possible options for what to do with your marital home.

Read: Property Rights in Divorce: Options for What to Do with the Marital Home

If one spouse delays the sale

One spouse may be more reluctant than the other to sell the shared home. This is actually quite common when couples are dividing property in a divorce.

This could manifest in a variety of ways. They may not be receptive to offers, they may be unwilling to make necessary improvements to increase the home's appeal. In some cases, one spouse outright refuses to cooperate in the selling process.

This resistance can significantly impact the value of your house. Potential buyers can sense tension between divorcing spouses, and they may be deterred by a home that appears neglected or poorly maintained. A slow response to offers can frustrate interested parties, causing them to withdraw their interest.

How does living in a community property state affect the division of your marital assets? What if you live in an equitable distribution state? Read our article, Equitable Division States vs. Community Property States, to learn more.

Gossip about why you're selling

In the process of selling your home or other marital property during a divorce, it's possible that prospective buyers could become aware of your circumstances. Their knowledge could influence their perception and decision-making in ways that could potentially affect the value of your house.

For instance, a superstitious newlywed couple might hesitate to buy a home from a divorcing couple, fearing it could bring them bad luck. On the flip side, savvy buyers might use the knowledge of your divorce to their advantage, assuming you're eager to sell and presenting you with a lowball offer.

While you cannot control how others react to your situation, you can control how much information you disclose. It's crucial to maintain professionalism throughout the selling process, focusing on the property's merits rather than personal circumstances. 

FAQ about selling a home in divorce

What should I do if I can't agree with my spouse on a selling price?

If you and your spouse cannot agree on a price, consider hiring an independent appraiser to determine the home's value. 

Check out these helpful resources:

Can I buy out my former spouse's share in the house instead of selling it?

Yes, buying out your former spouse's share is an option. However, this requires you to refinance the mortgage into your own name. You will need to prove to the lender that you can afford the mortgage payments on your own.

Read: Mortgage and Refinancing Basics after Divorce

Does the reason for selling our home have to be disclosed to potential buyers?

You are not legally required to disclose the reason for the sale. Focus on the positive aspects of your property to attract potential buyers. Your real estate agent can guide you on how much information to share.

Want to know your potential share of your home’s equity in case of a buyout? Access our free tool, the Hello Divorce Home Equity Buyout Calculator, here.

At Hello Divorce, we stand ready to help people make it through their divorce proceedings with as little stress and cost as possible. We know the division of assets is hard, which is why we have certified mediators on staff to help you negotiate. We know drafting a settlement agreement is daunting task, which is why we offer legal advice as well as attorney preparation of your judgment and agreement.

Want to learn more about what we offer? Schedule a free 15-minute call with an account coordinator to ask questions and get answers.

Divorce Content Specialist & Lawyer
Divorce Strategy, Divorce Process, Legal Insights

Bryan is a non-practicing lawyer, HR consultant, and legal content writer. With nearly 20 years of experience in the legal field, he has a deep understanding of family and employment laws. His goal is to provide readers with clear and accessible information about the law, and to help people succeed by providing them with the knowledge and tools they need to navigate the legal landscape. Bryan lives in Orlando, Florida.