Who Should Sell the House When You Get Married?

by Tamila McDonald

selling the house, house selling tips, selling the house when you get married

Each year, approximately 2.2 million people get married in the US. While many people assume that adults might only buy property as couples, statistics show otherwise. Around 49.6 percent of single women and 46.8 percent of single men are homeowners. So many couples have property owned before marriage.

Property Owned Before Marriage

While all couples have to deal with at least some property owned before marriage, entering into a union with two houses between them is a more common conundrum than one may think.

In some cases, couples will decide that selling one of the houses is the smartest financial move. But, figuring out which person should sell his or her home isn’t the simplest decision.

If you are both dealing with real estate property owned before marriage and are trying to figure out which house to sell, here are some points to consider.

Location, Location, Location

Location is a big factor when you buy or sell a home, so it’s worth considering first when you are trying to decide which house to sell.

For example, does one of the neighborhoods provide you with a better quality of life? What amenities are near each house? If you have or plan to have children, is one of the homes in a better school district? How long are your work commutes from each location?

All of these points can help you decide if one house makes more sense to keep. However, that doesn’t mean location should be the sole determining factor when you are making the decision.

Property Size and Layout

Some floor plans may fit your lifestyle better than others. For instance, the number of available bedrooms could be important, depending on your current or future family size, whether guests may stay overnight, or even if you need a space to use as an office.

Similarly, if you love to cook, the size and condition of the kitchen might be worth examining. If you both plan on entertaining in your home together, then an open floor plan may be more conducive to those activities. Families with children often prefer to have a bathtub in at least one bathroom, so only having a shower available might not be convenient. Similarly, the number of bathrooms could play a role in your decision.

Additionally, you shouldn’t overlook the size and condition of the yard. Do you need a substantial amount of outdoor space for gatherings or for children to play? Is the yard maintenance on one property more than you want to take on as a couple? Do you have or want a dog and need a fenced yard?

The idea is to examine each home and determine whether it will help you achieve your ideal lifestyle. While both properties may have shortcomings, it’s possible one will rise to the top.

Mortgage Debt vs. Home Value

How much you each owe on your homes also plays a role in deciding who should (or even can) sell. Ideally, the house that goes onto the market needs to have a higher value than the amount left on the mortgage. Otherwise, you might not be able to pay off the debt after the sale, which could hinder your ability to sell in the first place.

For example, if you owe $120,000 on your mortgage, but the fair market value of the house is $110,000, that means you’re underwater. Selling the property for what you owe may be impossible, particularly when you add costs like real estate commissions or potentially being asked to cover the buyer’s closing costs to the mix.

Trying to get your lender to agree to a short sale, where they allow you to sell for less than what you owe, is a cumbersome process. Plus, they could deny your request, eliminating that option from the table.

Even if you have a bit of equity in your home, if you don’t have enough to cover the additional expenses (like real estate commissions), you may have to come out of pocket to handle these costs. This could make selling that home less practical.

If you aren’t certain whether you have enough equity in either home to make selling each property an option, consider getting a seller’s appraisal. This will give you an idea of what your house is worth in today’s market, making it easier to assess.

However, if you both have a substantial amount of equity, and could take home cash after the sale, you can examine this as well. The potential profit may make selling one property a wiser financial choice, depending on your current goals, savings, and debt load.

Alternative Options

While maintaining two properties comes with monetary burdens, including mortgage payments, insurance, maintenance costs, and property taxes, that doesn’t mean you have to sell to have a healthy financial life. In fact, you may want to rent out the other home instead.

By renting, you can generate income from the other property. However, this relies on you bringing in enough each month in rent to cover all of the house’s associated expenses. Plus, if you act as the landlord, there are legal implications of that decision. You may need to consult with a lawyer to make sure you cover all of your bases.

Additionally, you’re federal and state taxes may become more complex if you choose to rent. There are certain potential tax benefits, like being able to deduct certain costs from the rental. However, there could also be drawbacks, so you need to examine your situation closely before going this route.

Matters of the Heart

Deciding to sell one property over the other isn’t just a financial decision. In some cases, having an emotional connection with a home is also a factor.

For example, if one of your houses has been in the family for generations, letting go might not be easy. In fact, if the property is put up for sale, it could even damage relationships with relatives.

While choosing what home you should sell shouldn’t be an entirely emotional decision, you can’t always eliminate feelings from the equation. This means each spouse needs to have a conversation about their connection to their house, just to see if this is a factor worth considering.

By following the tips above, you can decide on which house to sell. Just make sure to review every point, as, while it is usually a lengthy discussion, it’s a conversation worth having.

How did you as a couple decide what to do with the property owned before marriage? Tell us about your experience in the comments below.

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