New Divorce Trends as a Result of the Real Estate Market

The crisis in the mortgage and Toronto real estate industry makes headlines every day in the newspapers and the news on TV and radio. Some areas of Toronto have not been touched by the real estate crisis, while others have been devastated. Even those areas yet untouched have been affected by falling real estate prices and a higher than normal rate of foreclosures. Few homeowners in Toronto have not felt the credit crunch of the recession in some form. Families are having to face the fact that they will lose their homes and have to move out and this causes tension in the household. As a result the number of divorces in Toronto is up as a result of the crash.

When couples divorce in Toronto they usually sell the real estate and divide the proceeds between them. The real estate crash is having an effect on this because the houses that once sold rather quickly are now not selling at all. The cash they had looked forward to using to help them get on with their lives is not forthcoming and this puts a strain on both partners as they try to lead separate lives. It does dictate where and how they are able to live once the divorce is finalized. It also plays a major role in the amount of child support one spouse is able to pay in spite of the agreed upon amount.

The crash in the Toronto real estate market has led to a new trend for couples who have recently divorced. This is called post-marital cohabitation and it means that the couple continue to live in the same house after the divorce. This was unheard of until recently, but the real estate market and finances have forced couples to look at this option until the home is sold. Many of them have no choice but to continue to live in the family home until such time a buyer in Toronto comes along with an acceptable bid. They simply cannot afford to let the house it empty while they rent and they certainly can’t afford to let the lender foreclose on the home because then they won’t get any money from the sale.

Many newly divorced couples are now finding that in order to survive after divorce they do have to live together for at least several months or longer afterwards. Whether they have young children or are an older couple there is no doubt that this is a stressful situation for all involved. For divorced families with children, it is likely that any rental properties that are within their financial reach are too small for the size of the families or are in areas not conducive to children. If the situation becomes too unbearable, many former spouses have resorted to moving in with friends or family members.

The Toronto real estate crash has limited the options once open to divorced couples. In many cases the value of the home has fallen significantly and they will not realize enough money from the sale to be able to go one with their lives. This leaves them no other option but to remain living in the home until the real estate market starts to turn around. They can also decide to cut their losses and sell the home for the amount owing on the mortgage just to be able to separate fully.

In some areas in Toronto, this situation has led to court action and the judge is the one to make the final decision on what the divorced couple should do next. This has occurred in some situations where one partner wishes to remain in the home until such time as it is sold at a reasonable price and the other wants to sell immediately no matter what the loss may be. Judges are hesitant to order the home sold and the partner to move out because it is possible that Toronto real estate prices may rebound and the house will sell at a very good price.