When investment markets are sluggish or unstable, real estate is often viewed as one of the best places to store capital for long-term investment. After all, there will always be a demand for housing, as well as for commercial and industrial properties.
When you decided to invest in real estate, you likely didn’t stop to consider that your investment could have an impact on your marriage in the future. However, complex assets, such as real estate, can make divorcing in Florida more difficult.
Unless you have a legally sound prenuptial agreement that addresses your real estate holdings or investment properties, or owned them outright prior to marriage, you will likely have to engage in the complicated process of placing a price on those properties and then dividing them.
Any property you acquired during marriage you technically share
You may think that because you ran the real estate company or because you made more money that you are the only one with the claim to your investment properties. In reality, if you used assets, such as income, acquired during marriage for those properties, the houses are likely marital property. Both you and your spouse have an interest in them.
For the purposes of asset division in Florida, the courts will consider real estate investments purchased with marital income marital property. In order to fairly divide those properties, the courts will need an accurate price. They will then either allocate specific properties to individual spouses, give the investment properties to one spouse while the other receives assets of comparable value or order the sale of the investment properties, depending on your circumstances.
You and your spouse must agree on fair valuations for your real estate holdings
The only way to fairly split everything you own is to know what the total value of all your assets and debts is. It is possible for you to potentially reach an amicable decision with your spouse regarding the value of investment property, which can speed up the asset division process.
For example, you could agree to use the initial purchase price as the overall value for the property, even if market prices have changed since then. Otherwise, you may need to invest in appraisal services, especially if you can’t agree on fair market values. Appraisals generally involve a real estate professional checking the property for its overall condition and then examining selling prices for similar houses in the same neighborhood.
Once you have a fair price and a comprehensive list of your real estate holdings, the courts can begin the process of determining how to split them up between you and your spouse. Any divorce involving valuable, complex assets requires careful attention to detail, especially in the planning stages of the divorce.