For most Los Angeles couples, the family home is the single largest asset they own together, and often the most emotionally charged. Whether you purchased a modest condo in Silver Lake or a sprawling home in the San Fernando Valley, figuring out what to do with real property during a California divorce is one of the most critical decisions you'll face. Here's what homeowners in LA need to understand before making any decisions.
California Is a Community Property State
California law treats most assets acquired during a marriage as community property, meaning they belong equally to both spouses, regardless of whose name is on the title or who made the mortgage payments. If you purchased your home after your wedding date using marital income, it will almost certainly be classified as community property and subject to a 50/50 split.
What If One Spouse Owned the Home Before Marriage?
This is where things get more nuanced. If you owned the home before getting married, it may qualify as separate property, meaning it could remain yours after the divorce. However, complications arise quickly. If marital funds were used to pay down the mortgage, make improvements, or refinance the home during the marriage, your spouse may have acquired a partial community interest in the property. This is known as a Moore/Marsden calculation, and it requires a detailed accounting of mortgage payments made before and during the marriage. Without legal guidance, homeowners often underestimate how much of their "separate" property has become community property over the years.
Your Three Main Options for the Family Home
When divorcing couples in Los Angeles own a home together, they generally have three choices:
- Sell the home and divide the net proceeds equally.
- One spouse buys out the other's share and keeps the home.
- Continue co-owning the property temporarily, which is sometimes done when minor children are involved to minimize disruption.
Each path comes with financial, tax, and logistical implications. For example, a buyout requires the purchasing spouse to refinance the mortgage in their name alone, which may not always be feasible given current interest rates and individual credit profiles. Selling may trigger capital gains tax considerations, depending on how long you've owned the home and the amount of equity you've built.
Los Angeles Real Estate Values Add Complexity
LA's sky-high real estate prices mean there's often significant equity at stake. The median home value in Los Angeles County consistently ranks among the highest in the nation, so even modest properties may carry hundreds of thousands of dollars in equity. This makes accurate valuation critical. Both spouses are entitled to have the home professionally appraised. In contested divorces, each party may hire its own appraiser, and disagreements over value can become a focal point of litigation.
Don't Make Decisions Before Consulting an Attorney
Homeowners sometimes make costly mistakes: agreeing to let a spouse keep the house without accounting for the equity they're giving up, or assuming they can "just sell" without understanding tax implications or court approval requirements. Before signing anything or making verbal agreements about real property, speak with an experienced Los Angeles divorce attorney. The decisions you make about your home will follow you financially for years to come.
Claery & Hammond Is Here to Help
At Claery & Hammond, LLP, our attorneys have extensive experience helping Los Angeles homeowners navigate property division during divorce. We understand the emotional weight of leaving a home, or fighting to keep one, and we're here to make sure your rights and financial interests are protected every step of the way. Contact us today for a free case evaluation.