Key takeaways:
Agree on what to do with the home first. Selling is one option; one person may instead consider keeping it.
Selling isn't the only option. One person may keep the home and buy out the other's interest.
Agree on how the sale will proceed. This includes the agent, timing and sale method.
The sale price isn't the final proceeds. You may need to deduct home loan debt, selling costs and other amounts.
Get legal advice where needed. Ownership, authority to sell and the treatment of sale proceeds depend on your circumstances.
Selling a home after a separation can involve decisions about what happens to the property, its value, when to sell and how to approach the sale.
This guide covers the practical steps, from deciding whether to sell and understanding the property's value to choosing an agent, preparing the home and completing the sale.
What happens to the property, home loan and sale proceeds will depend on your circumstances.
Consider seeking independent legal advice before making decisions about property ownership or how to divide sale proceeds. If selling is one of the options you're considering, start by working through what needs to be decided before the property goes on the market.
Start by agreeing on what happens to the home
Selling isn't the only option after separation. Depending on your circumstances, one person may keep the property and buy out the other person's interest.
Veenu Bharara, Senior Mobile Broker at Aussie, says it's important to understand a client's goals from the outset.
"It's important to understand a client's goals from the outset, so we can support them throughout whichever path they choose to take,"
"I've assisted clients in both scenarios, including helping a client refinance and buy out their former partner's share of the family home, as well as helping a client purchase a new property after the sale of the family home,"
"Each situation requires a tailored strategy, careful planning, and the right lender to achieve the best outcome," she said.
If you want to keep the home, you may need to refinance or take out a home loan in your own name. Whether this is possible will depend on factors including your financial position, borrowing capacity and lender requirements. An Aussie Broker can help you explore your lending options, but cannot determine property ownership or settlement arrangements.
Pre-approval and formal approval aren't always the same thing in a separation, Veenu explains.
"In many cases, a lender may be happy to provide a pre-approval based on your current income and financial position. However, before issuing formal approval and settling the loan, the bank will generally require the final court orders or divorce settlement documents,"
"I recently assisted a client in a similar situation. While we were able to obtain an initial pre-approval, the overall process took almost 12 months from our first conversation through to the final settlement of her home loan,"
"Every separation matter is different, so having a strategy and the right lender can make a significant difference to the outcome," she said.
If you agree to sell, you can move on to decisions such as when to sell, which agent to appoint and how to sell the property.
Get a reliable view of what the property is worth
Understanding the property's value can give you a clearer starting point when deciding what to do after separation. Several ways to estimate a property's value exist, but each serves a different purpose.
Online property estimate
An online property estimate can provide an initial benchmark. Automated valuation models (AVMs) use property data and statistical modelling to estimate a property's value. Because an AVM doesn't involve a physical inspection, it may not capture features or changes that affect the property's value.
Don't treat it as a professional valuation.
You might also be interested in: How much is my house worth? A practical guide to property valuations
Agent appraisal
A real estate agent can inspect the property and consider its condition, comparable sales, local market conditions and buyer demand to estimate a potential selling price. An agent appraisal can help set price expectations but isn't the same as a formal professional valuation.
You might also be interested in: Bank vs agent valuations: What’s your home really worth?
Professional valuation
A professional valuation is a formal assessment completed by a qualified valuer. It may be required or appropriate for purposes including lending, taxation or family-law matters, depending on your situation.
If you're unsure which type of valuation you need, consider speaking with the relevant legal, financial or lending professional before proceeding.
You might also be interested in: How is property value calculated in Australia?
Choose a real estate agent
Once you've agreed to sell, compare agents based on more than commission. Look at their local experience, proposed sales strategy, communication and marketing costs.
What to compare | What to consider |
|---|---|
Local experience | Recent sales of comparable properties in your area |
Selling strategy | Proposed sale method, timing and approach |
Communication | How and when you'll receive updates |
Marketing | Proposed campaign, channels and costs |
Fees | Commission and other agent charges |
If you'd prefer help narrowing down your options, Aussie Seller Assist can help you compare local real estate agents. It assesses agents using publicly available third-party data, including sales results, listings, customer reviews and experience with comparable properties, then shortlists up to five agents for your property.
Shortlisted agents can contact you to arrange an appraisal and discuss their proposed sales strategy. You then decide which agent, if any, to appoint. Aussie doesn't choose an agent on your behalf or mediate between former partners.
You might also be interested in: How a buyer’s agent helped buyers secure their properties
Prepare the home for sale
Preparing a home for sale after separation may involve working around an empty room, fewer belongings, or someone still living in the property. Focus on making the home presentable and easy for buyers to inspect rather than taking on unnecessary cosmetic work.
Clear key areas: Reduce clutter in spaces buyers will inspect while keeping the home functional.
Consider empty rooms: Simple staging may help buyers understand a room's purpose and scale.
Prepare for photography: Remove or store personal belongings, family photos and valuables before photos are taken.
Confirm inclusions: Clarify which fixtures and other items will remain with the property so they're represented accurately during the sale.
Prioritise key spaces: Keep kitchens, bathrooms and living areas presentable for inspections.
If repairs are needed, understanding what to fix before selling your home can help you prioritise work that's relevant to the sale rather than renovating or replacing everything.
You might also be interested in: How to sell your home: 7 steps from prep to settlement
Understand the contract before selling
Before the property is sold, make sure you understand the contract of sale, including the sale terms and any fixtures, inclusions or exclusions. Your solicitor or conveyancer can review the contract and provide legal advice based on your circumstances.
Aussie's Contract Analyser can also provide a summary of key contract information. It doesn't replace legal or conveyancing advice, so speak with your solicitor or conveyancer before making decisions or signing.
You might also be interested in: Finalising your first-home purchase: Settlement and conveyancing explained
What happens to the sale proceeds?
The sale price isn't necessarily the amount left after settlement. Depending on the transaction, amounts may first need to cover:
Outstanding home loan debt: The amount required to repay the existing home loan at settlement.
Selling costs: Agent fees, legal or conveyancing costs and other transaction expenses.
Other amounts: Any additional costs or amounts that apply to the property or transaction.
How any remaining proceeds are dealt with after separation will depend on your legal and financial circumstances. Your solicitor or conveyancer can guide you through settlement, and independent financial or taxation advice may also be appropriate.
Veenu explained that a joint mortgage can continue to affect both parties' credit files even after separation.
"For example, if the current family home is jointly owned and one owner stops making the home loan repayments, any resulting arrears or adverse credit reporting can affect both borrowers' credit files," she said.
"I recently assisted a client in a similar situation. Following the sale of the family home, she was looking to purchase a new property. However, her credit file had been impacted due to missed repayments on the joint mortgage, despite the circumstances being outside her control,"
"We therefore needed to identify a lender that understood her situation and was prepared to assess the application with appropriate context and flexibility," she said.
If you're planning to buy another property, an Aussie Broker can help you understand your borrowing position and explore home loan options based on your circumstances.
Make the next selling decision simpler
If you've agreed selling the property is the next step, finding an agent doesn't need to become another major research task. Aussie Seller Assist can research and compare local agents using publicly available third-party information and shortlist up to five agents tailored to your property.
You can then meet shortlisted agents, compare their appraisals, selling strategies, fees and proposals, and decide which agent, if any, is suitable for your sale.