About 40-50% of married couples in the U.S. end up getting divorced. Whether the split is amicable or ugly, there are many factors within a divorce that each person has to consider, including custody arrangements, how to split assets, and what to do with the marital home.
If you’ve been granted your marital home as part of your divorce agreement but you no longer want to live there, you might be asking yourself “what’s next?”
What To Do With the House After Divorce
There are several options that can actually benefit you if you’re willing to put in a little time, effort, and research. You could simply sell the house and gather the profits. Or, you could rent it out and move to a new place, turn it into an Airbnb, rent out part of the house, or raze it and build a new place. Sometimes, the marital home can stir up a lot of negative memories, but you may be attached to the house itself. So, why not turn it into something positive and make a bit of money along the way?
The Responsibilities of Being a Landlord
If you decide to turn your home into a rental property, you’ll instantly become a landlord. That’s a title that comes with a lot of responsibilities. Even when you’re just managing one property, consider how hard it can be to take care of a house on your own. Now, you’ll have to make sure everything is functioning properly in your rental, on top of wherever you choose to live after the divorce.
There are also many things to consider before renting out your home, including:
- Making sure your homeowner’s insurance covers your rental property
- Having the right permits
- Performing repairs and upgrades to the home
- Deciding a fair fee for renters
- Finding a reliable tenant
Once you do find solid tenants, your responsibilities as a landlord will officially begin. It’s up to you to completely maintain the property, including making repairs, keeping up with permits and certifications, and sticking to the agreements of the lease you created and signed.
Resources for Renovations
If you were looking for a new home, or even a place to rent, which features would be most important to you? That’s something to consider whether you want to sell your house or find tenants to rent it out. You may need to do some upgrades or renovations before putting it on the market. Some key home features people tend to look for include:
- A functional laundry area
- Energy efficiencies
- A patio/porch
- Garage space
- Exterior lighting
- A walk-in pantry
Obviously, these renovations can take both time and money. The first thing to do is to take a look at your budget. Divorce can cause a financial strain on many people. The average cost of divorce, even in reaching a settlement agreement, is over $10,000 when attorneys are involved. When you look at your budget, post-divorce, focus on your necessities, and think of areas where you can cut back. That’s important, not only to continue with your normal lifestyle but to be able to put money into home repairs and renovations.
Learn More About Real Estate Finance
Have you heard of the 2% rule? Do you know how much money you should be making if you rent out your whole house or even a room? If you decide to sell, how can you tell what a fair listing price is?
Unless you were interested in real estate or investing before, you probably haven’t given much thought to making money from your property before now. But before you make any major decisions on what to do with your home, it’s a good idea to learn everything you can about real estate finance.
If you’re not familiar with real estate financing and you’re having a hard time understanding it, it may be worth it to hire someone as your financial advisor. They can help you to first decide if it’s worth it to sell or rent the house, whether you should buy a new one or any other common questions about real estate, and how they might relate to your divorce. Real estate financial analysts do everything from managing property portfolios to monitoring market trends, and they can pass that information onto you.
Whether your divorce was “quick and painless” or a long, drawn-out process, it’s a major life change and you’ll have to get used to things that you may not have thought of before. If you’ve been left with the marital house and you’re not sure what to do with it, keep some of these ideas in mind to help you move forward to your next chapter, and make a little extra money along the way.
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