Divorces increase as improving economy makes split-ups affordable
The improving economy and booming housing market have prompted an unexpected result: More people are getting divorced.
It’s not that money necessarily leads to unhappiness. Instead, the recession caused many couples to stay together because their homes were underwater or one or both parties were out of work, said Debra Schoenberg, a San Francisco divorce attorney.
“Prior to the recession, a couple’s home was one of their largest assets to divide,” said Schoenberg, author of the newly released book, “Divorce in California: The Legal Process, Your Rights and What to Expect.”
“When the recession hit and home values plummeted, the couple had fewer assets. Divorcing resulted in greater financial losses. Now, however, the housing market has rebounded and interest rates are [close to] historical lows. Couples now have more wealth as they consider divorce, which lessens the financial impact.”
Home prices have skyrocketed this year. In August, the Southland’s median home price was 24.6% higher than last year, according to real estate firm DataQuick, which studies home sales in Los Angeles, Orange, Ventura, San Diego, Riverside and San Bernardino counties.
With the economy improving, divorcing parties can now split a profit from a home that was worthless a few years ago, Schoenberg said.
This phenomenon is not unique to the United States. Divorce rates plummeted to historic lows in Britain in 2008 as that country’s economy was devastated by the financial crisis, Marquette University professor Abdur Chowdhury said in a research paper.
“Rising inflation and falling housing prices put pressure on marriages and might thus contribute to higher divorce rates,” Chowdhury said. “The same factors also make splitting up more complicated. Falling property prices mean that selling the family home may not provide sufficient funds for two separate homes, especially now that lenders have become much more selective.”
Schoenberg offered 10 tips for couples considering divorce. Not surprisingly, No. 1 on her list was: “Hire an experienced family law attorney.”
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