Negative equity forces rowing couples to continue living under same roof
Saturday 09 January 2010
Last Monday marked a peak in the number of couples starting divorce proceedings as fragile relationships collapsed under the strain of the Christmas break, according to website divorce-online.co.uk. The UK already has one of the highest divorce rates in the world, with nearly 12 divorces per 1,000 married people, but the site predicts a two per cent rise in the divorce rate this year because of money worries caused by the recession.
The recession is also to blame for forcing couples that want to split up to remain living together, according to housing charity Shelter. Its research, published this week, reveals that nearly a quarter of people say they, or someone they know, have had to stay living with their partner because they cannot afford to live on their own.
That is backed up by a survey by the house and flatshare website easyroommate.co.uk. Its research shows that 28 per cent of couples who have split up now have no choice but to continue living together. And, unsurprisingly, of those who continued to cohabit, three quarters said they found the experience stressful.
"Relationships do break down, which is painful enough, but being forced to carry on living with an ex-partner, even for a short time, adds real pressure to the situation," says Kay Boycott, director of policy and campaigns at Shelter. "The fact that one in four of us either have experienced or know someone that has experienced this situation means this may be more widespread a problem than we realised."
She points out that, until recently, couples with no hope of saving their relationship would simply live apart after a break-up, but an increase in housing costs means more people are being forced to remain living together.
In fact, Shelter's research shows that worries about housing costs are very often the cause of arguments. Nearly one in six people said that financial worries about their home had led to arguments with partners or other family members. "As a nation we have accepted the way housing costs have risen hugely over the last few years, but are we ready to accept the human cost this brings?" adds Boycott.
While some can't afford to move out, others are effectively trapped in joint homes because of a slump in property values. Despite average house prices climbing six per cent in 2009, there are still many families living in homes worth less than they paid for them because of the property crash of the past 12 months. Negative equity – owing more than the property is worth – is trapping thousands of those forced to stay under the same roof, according to Jonathan Moore of easyroommate.co.uk.
His research shows that around one in 40 couples have to live together because they are stuck in negative equity misery and, on average, homeowners affected are in negative equity to the tune of £12,000. "These couples would have to wait eight months for that sum to be recovered through property price growth alone," says Moore.
"Relationships don't always work out, but the recession is preventing even more couples from making a clean break when they split up. Difficulties in selling houses, negative equity hell and not being able to afford to move out are forcing more people to carry on living with their exes. Needless to say, this is usually extremely awkward and distressing."
Some get a lucky break, such as our case study (see right). But most are stuck facing months, or even years, of potential misery living with someone long after the love has left the relationship. But there are ways out, says Moore.
"There are options for people living together after a relationship ends," he says. "Moving into a flatshare can offer an escape route – and is usually more affordable than renting alone. Flatsharing also offers the opportunity to meet new people and avoid loneliness. For those whose ex-partner has moved out, taking in a lodger can help meet the additional costs of paying a mortgage or rent."
Taking in a lodger can offer financial support to couples looking to cope after their split. It can allow one person to continue living in the home with the lodger's rent helping to cover the cost of bills, mortgages, rent, and other expenses. It can also help emotionally. Around one in 10 people say they took in a lodger to get someone into the house to make it feel more like a home after their partner left, according to easyroommate.
Flatsharing, too, can offer emotional help as well as being a financial solution for splitting couples. While most people who choose to flatshare after separating find it the cheapest way to live in their chosen area, around one in seven say they chose the option because it gave them the chance to kick-start their social life.
Splitting up can be a tough time and worrying about where to live only adds to the stress. Getting outside help from Citizens Advice or Shelter can help ease the burden.
Home help: 'House-price slump left me living with my ex'
When Anna-Marie Nelson bought her dream home with her partner, Darren, in 2007, she had no inkling it would end up a nightmare. After 12 months and several arguments the couple were hardly talking and eventually decided to split up and sell their home. But that's when their troubles really began.
They had paid £113,000 for a two-bedroom home in Leeds (and splashed out on a new kitchen and bathroom) but property prices started to slump and estate agents were soon advising them to sell at less than they owed on their mortgage. Despite having decided to end their relationship, they suddenly had no option but to carry on living together.
"We had been together for more than seven years when we bought our home, so it seemed a sensible move. But we had a massive bust-up in June 2008 and Darren moved into the spare room. In fact, we then hardly spoke to each other for the next 12 months, even though we still had to share the house," says Anna-Marie, 28, who works in conference management for the NHS.
Keen to sell up and move on with their lives, they initially put their house on the market at £130,000, but got no interest so dropped the asking price by £10,000. "Next we were told to drop the price below £100,000, which wouldn't even have covered the mortgage, so we were stuck. We both still paid into a joint account and all bills were paid by direct debit so we didn't really need to talk about things," says Anne-Marie. "It was simply a case of whoever got home first would have the front room while the other would have to spend the evening in their own bedroom."
"It was really awful. There was always the risk of an argument bubbling under the surface and it got so bad I became ill through the stress. We ended up living together longer as separated people than we had as a couple."
But a solution arrived when a promotion led Darren to move to Dublin in June 2009. However, the problem has yet to be resolved. He still pays his share towards the mortgage and the couple will eventually have to face selling the property and sharing the proceeds.
"I don't expect to be able to afford to do that for at least two to three years," admits Anna-Marie. "In an ideal world I would buy him out but, in the meantime, I've been taking in lodgers to make the home more affordable for me to live in. I just want to put the misery behind me now."
Independent Partners: Get fee-free expert mortgage advice and find the right mortgage deal for you.
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