The family home is often the most substantial asset owned by couples, as it holds immense emotional value. This begs the question: should you sell it and move on, or endeavor to salvage it and make it thrive?
Here are some factors to consider before making this decision.
The Real Estate Market in Chicago
Before delving into the specifics of selling or keeping your family home, let’s explore the real estate market in Chicago.
As one of the largest cities in the United States, Chicago boasts a diverse housing market offering a wide range of options for potential homebuyers. According to Zillow, the median home value in Chicago stands at $285,000, making it a valuable asset to consider in a divorce settlement.
Selling the Family Home
Here are some factors to consider if you’re thinking about selling:
- Financial stability
If neither party can afford to keep the house on their own, selling it may be the best option. This will allow both parties to have a clean financial break and start fresh. It can provide the opportunity to pay off any outstanding debts, secure a new living arrangement, and establish a solid foundation for future financial stability.
- Emotional attachment
The family home may hold too many memories for one or both parties, making it difficult to move on. In this case, selling the house may be the best option for a clean break and a fresh start. It allows for the creation of new spaces and environments that are not associated with the emotional baggage of the past, promoting emotional healing and personal growth.
- Equitable distribution
If both parties contributed equally to the purchase of the home, selling it and splitting the proceeds may be the most fair option. This ensures that each party receives their fair share of the investment made into the property, promoting a sense of fairness and equity in the division of assets.
- Divorce agreement
If there are no children involved and neither party wants to keep the house, selling it and splitting the proceeds may be outlined in the divorce agreement. This provides a clear and legally binding resolution to the property division, ensuring that both parties can move forward with their lives without any lingering disputes or complications.
Keeping the Family Home
On the other hand, there are couples who may opt to retain their family home amidst a divorce. This decision can present its challenges, but here are some reasons why it might make sense:
- Children involved
If there are children involved, keeping the family home can provide stability and a sense of continuity for them. It allows them to maintain familiar surroundings, stay in the same school district, and keep their established friendships, which can be crucial for their emotional well-being and adjustment.
- Emotional attachment
Some couples may want to keep the family home as a way to hold onto their memories and maintain a sense of familiarity. The house may have witnessed countless family milestones, from birthdays to anniversaries, and letting go of it can feel like letting go of cherished moments.
- Financial stability
If one party is able to afford the mortgage payments on their own, keeping the family home can be financially feasible. However, it’s important to consider the cost of upkeep, property taxes, and potential repairs as well.
- Investment opportunity
Depending on the market conditions, keeping the family home may be a good investment opportunity for one or both parties. If the value of the house increases in the future, they can sell it and split the profits. Additionally, they can explore the option of renting out a portion of the house, generating rental income and potentially maximizing their return on investment.
Talking to a Financial Advisor
Regardless of whether you decide to sell or keep your family home, it’s crucial to consult with a financial advisor before making any decisions. A financial advisor can offer valuable insights into potential tax implications and help navigate the division of assets during a divorce.
Additionally, if you are considering keeping the family home, a financial advisor can help assess its financial viability and provide advice on managing associated costs.
Work with us
If you have more questions about divorce, our team is here to help you every step of the way. At Purposeful Wealth Advisors, we work closely with divorce attorneys, accountants, and other dedicated professionals to arrive at comprehensive solutions for our clients.
Contact us today to know more!
Any opinions are those of the author and not necessarily those of Raymond James. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making a decision, and it does not constitute a recommendation. All opinions are as of this date and are subject to change without notice. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc. and Keating Financial Advisory Services. Keating Financial Advisory Services and Purposeful Wealth Advisors are not a registered broker/dealers and are independent of Raymond James Financial Services.
