Housing Slump Makes Divorce More Difficult

The San Francisco Chronicle reports:

Back in the days of the housing boom, I knew a couple whose marriage went sour, but they continued to live together for years after their divorce went through. Turns out the holy grail of stability wasn't their affection for one another, but a rent-controlled apartment. They simply couldn't afford to move on.

I wrote then about the way the white-hot real estate market was burning families going through divorces. Now, ironically, the sharp downturn in the market is taking a similarly painful toll on couples who are breaking up. It's not that they can't afford their next home but that they can't get rid of the old one. I have friends who are taking turns living in their marital home even as they hope to sell it.

But in the new era of homes going stale in an oversupplied market and their owners going underwater on their mortgages, this is but the tip of the domestic iceberg. According to divorce lawyers, the quickly shifting real estate landscape is making breaking up harder to do than ever.

"The housing market is having a major impact on divorce cases," says Stephen Ruben, a certified family law specialist in San Francisco. "If a house doesn't sell, it has a major impact on cash flow for child support, on where people live, on future taxes."

Indeed, the mortgage crisis and moribund market have made for some strange bedfellows.

"There is a whole new aspect of divorce that most couples never had to face," explains Janell Weinstein, a partner in the law firm of Federbusch & Weinstein in New Jersey. "Many couples are forced to live under the same roof because they can't afford to move on until their home gets sold. This can go on for months or even years as the real estate market across the United States slows down tremendously. Homes that used to sell in weeks are now not moving at all."