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Could co-owning your home after the divorce be the best option?

December 7, 2020 | Firm News

For some couples going through a divorce, the marital home becomes the focus of their contention, with each spouse hoping to retain the home they once shared. Other times, couples are united in their mutual desire to divest themselves of the place where they once cohabitated.

If you and your spouse agree that neither of you wants to live in your former marital home after your divorce, selling the property and splitting the proceeds often seems like the most straightforward solution.

However, it isn’t always the best choice. Some couples divorcing now or considering divorce in the near future may want to also think about retaining joint ownership of their home for several years after they finalize their divorce.

Boulder’s market is weak in a way that won’t benefit sellers

Real estate markets change all the time, but Boulder has recently seen a downward trend in its residential real estate market after significant growth in recent years. In fact, data for 2020 shows that the average selling price in the area is down about 7%.

If you and your ex both want your marital home to be the nest egg that finances your future, selling it for less than you paid for it or less than you owe on it isn’t going to help either of you much.

You might consider a birdnesting solution

If you have kids and know that you want to sell the home eventually, you might agree to stay in the home after making some changes to the living arrangements so that each of you has your own space.

You can live in separate rooms and treat one another as roommates, which might help the kids transition into post-divorce life while you wait for the real estate market to reach a point where listing the property will benefit you more.

If you don’t think living together would work, the kids might stay in the marital home with the two of you alternating staying with them and in your own separate rental spaces elsewhere.

You could also rent the property out together as landlords

While sale prices for homes have trended somewhat downward, the demand for housing, including rental housing, remains strong.

You might be able to rent the property for more than what you currently have to pay for your mortgage and escrow accounts. You can then reinvest any profit into fixing up the home when the time finally comes to list it for sale.

If you have any concerns going into your divorce, such as negotiating unusual property settlement terms, discussing your financial needs with a lawyer can help set you up for success.

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