The most expensive asset most couples own is their house. No couple, after all, starts their marriage thinking of divorce; they look for ways of settling down and raising a family. In the event of a separation, your family home will be considered marital property for asset division. Hence, the property is divided equally among the divorcing parties.
Most couples who choose to forego the services of a divorce lawyer in London, UK will base the value of their home on its buying price. This in most cases will leave them with a price far below what their property is worth. In some cases, one of the couples will be cheated out of his or her worth. When working with an attorney, he or she will hire an appraiser to value your home before its distribution to advise you accordingly. The following are some of the appraisal methods used for marital home valuation in divorce proceedings:
Fair Market Value Appraisal
In this method, an appraiser will consider the repairs and works you have done on your property. Any unique features in the home will also play a crucial role in the appraisal value that you get for the property. A fair market value appraisal generally mirrors what is done before the listing of a house on the property market. After considering all features and your repairs, the appraiser will then give you an estimated value of the property.
Comparative Market Analysis
Here, an appraiser looks at the listing prices of similar home in your neighbourhood. He or she will also consider how fast the homes sold at their asking price and the number of sales. The comparative market analysis method is regarded as a more accurate method of valuing a marital home since it considers the listing and selling prices. As a result, you can get a better estimate of how much you stand to make from the sale of your home.
An appraiser comes up with the estimated price of your home at a particular date. The standard dates used in divorce include the date of your marriage or that of filing for your divorce. Retrospective analyses are generally used when property markets are undergoing dramatic shifts or if one partner owned the marital property before the marriage.
This approach is based on the idea of substitution. Somebody would not buy a house for more than it would cost to buy a vacant lot then build a home of the same type. Hence, your home’s value will be based on the cost of purchasing and building a similar house in a similar locality as yours.
An appraiser will generally charge a small fee for the types of marital home valuation mentioned above during your divorce. The fee will be divided between you and your ex-spouse. The appraisal is not just needed if you decide to sell the home and split the proceeds from the sale. It will also form the foundation of the division of your home’s equity if one of you keeps it. Without an accurate home appraisal, negotiating the elements of your property’s division in a divorce is virtually impossible since you do not know what you are working with.