Can Divorce Rates Predict the Housing Recovery?
Back in the '80s when we were in high school together, she was the "it" girl. By 2006, her smile graced real estate ads all over Westport, Conn. Hendrickson (pictured at left) had opened her own firm that grew to more than 20 employees. Her handsome husband and the father of her two children was a builder. They were in the zone. Then things startled to unravel fast.
Hendrickson is refreshingly candid about how things went down. If she didn't laugh, she says, she'd cry, and she's admirably quick to own up to her mistakes along the way. "I thought I was doing all the right things," she says with chagrin.
By 2008, the marriage had deteriorated, the business was closed, she was riding the bus and hitching rides with a network of dedicated girlfriends. "I remember begging the financing company to just come pick up the BMW X5." She recalled saying, "Please just take it." They did.
What Divorce Looks Like Post-Recession
A longtime real-estate agent with Coldwell Banker, Hendrickson is also particularly cognizant of the role "the house" (those two words pack a lot of punch) plays in the unfolding drama -- her own and others. Her firsthand experience reflects some intriguing trends, and may indicate that "divorce starts" may be a slight, new leading indicator for housing starts. Not that we would ever wish the former on anyone in any economy.
While not everyone whose marriage ends is immediately breaking ground on a new home, some Realtors say that divorcing spouses make up at least a third of their clients. And, any move prompts related spending. Whether you got all of the stuff, half of the stuff, some or none of the stuff, setting up a new household means you'll probably hit the aisles of Bed Bath & Beyond, and the like, sometime soon.
Both divorce rates and housing prices have been down for awhile, but what happens if and when they start to pick up -- and which will pick up first? How will lessons learned and other economic and sociological factors play a part in divorce trends over the next decade? The factors that are currently stalling divorces and housing sales may point us toward entirely new trends based primarily on necessity-fueled compromise. After all, the new divorce isn't generally marked by splitting bulging stock portfolios, paid-off cars and mortgage-free homes. It's about clinging to the house or walking from it, driving cars into the ground, and praying that at least one of you has a job with health benefits for the kids. Freedom may be the goal, but don't expect it to be glamorous in the post-recession era.
Fewer Divorces and Lower Housing Prices -- Chicken and Egg Dynamic?
A lot of people throw around the "half of all marriages will end in divorce" statistic. According to the Census Bureau, that number is probably inflated, as 55 percent of American couples reach their 15th anniversary. Further analysis by the National Marriage Project at UVA indicates that graduating from college and making it to church on Sundays may be the winning marriage trifecta.
It's unclear whether couples will continue with the practices they gravitated toward during the Great Recession if the economy picks up. "The data indicated that about one in five married Americans have been hit with multiple financial stressors," said Bradford Wilcox, director of the National Marriage Project. But some of them are turning adversity into solidarity. "For some, the financial stresses associated with the Great Recession have hurt their marriages. But, for others, this recession has fostered a new commitment to marriage that appears to have improved the quality and stability of their marriages." Maybe it has also made for more civil divorces. It's hard to micromanage and maintain power struggles when you're both just trying hard to meet ends meet.
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