When Property Holds You Together: The Growing Influence Of Housing Costs On Marital Breakdowns

BY WEALTH ADVISER

Introduction: The New Bind—Australian Marriages and Housing Market Realities

For generations, home ownership has been woven into the fabric of Australian life, emblematic of security and prosperity. Yet, as property values in major cities and regional centres have skyrocketed, homes have become not just havens but anchors—binding couples to relationships they might otherwise exit. The intersection of soaring housing costs and changing societal values has led to a subtle but significant shift: for an increasing number of Australians, the question is no longer just whether to separate, but whether they can afford to.

Recent research reported by The Conversation highlights the gravity of this phenomenon:

“With property prices as high as they are, separating can feel impossible, especially for those with young children who want stability and proximity to good schools.” (The Conversation, 13 July 2025)

This article explores how Australia’s property boom is reshaping marital decisions, the financial realities that ‘lock in’ couples, the challenges of re-establishing life post-divorce, and the interplay between financial, social, and legal factors affecting the modern Australian family.

Relationship ‘Lock-In’: Financial Impediments to Separation

The family home, once a cornerstone of aspiration, has become a linchpin keeping many marriages intact.

Recent academic studies analysed by University of Sydney News and The Conversation reveal that as property prices surge, the costs (both direct and hidden) of ending a marriage rise proportionally. “Recent research shows high house prices are associated with couples delaying separation—even when relationships have run their course. Decisions about marriage dissolution are increasingly influenced by the daunting prospect of selling the family home and the uncertainty of re-entering the property market.” (University of Sydney News, 15 July 2025)

These financial stakes have led to a phenomenon some have dubbed “relationship lock-in,” where couples, especially those with children or shared debts, feel compelled to remain together.

“In many cases, families may find it difficult to afford two homes in the same school zone, or close to existing work arrangements. The alternative often means a dramatic drop in living standards for one or both parties.” (Firstlinks/ Firstlinks republished by The Conversation, July 2025)

As property has become less affordable, divorce—which used to be more common among lower-income Australians— now occurs more frequently among those with greater economic security. “Divorce, once more common among lower-income Australians, has become more prevalent among those with greater economic security…” (The Conversation, 13 July 2025)

Financial considerations aren’t limited to mortgage repayments or selling costs; they also encompass transactional fees, real estate commissions, moving costs, legal fees, and the emotional toll of upheaval. The longer couples remain in these strained circumstances, the greater the impact on personal wellbeing and family harmony.

The Cost of ‘Moving On’: Housing Affordability, Renting, and Single Life

Separation is not simply a matter of dividing assets and going one’s own way—it involves navigating some of the most competitive housing and rental markets in the developed world. For many, this process is daunting and at times prohibitively expensive.

“Families may find it difficult to afford two homes in the same school zone, or remain close to work arrangements, resulting in one or both parties accepting significant lifestyle and financial sacrifices.” (Firstlinks)

In high-demand suburbs, rents have soared alongside sale prices. For women, single parents, and older adults— demographics highlighted in both The Conversation and University of Sydney News articles—the challenges are especially acute. Women, in particular, face a higher risk of housing stress and lower rates of home ownership post-divorce, while single parents often struggle to find affordable, suitable accommodation.

“Australian women continue to experience housing stress disproportionately after separation, especially if they have given up paid work or have limited superannuation.” (University of Sydney News, 15 July 2025)

Even for those with means, the process of acquiring suitable, stable housing—let alone retaining proximity to children’s schools or professional networks—can create significant obstacles. As Ticker News noted: “The economic realities of setting up two households in today’s property market mean that, for many, the financial and emotional cost of starting over is now higher than ever.” (Ticker News, 14 July 2025)

The impact of these costs runs deep, influencing not just the timing of divorce but also individual well-being, financial independence, and the intergenerational transfer of wealth.

Laws and Loopholes: No-Fault Divorce as Context, Not Cause

While the accelerating property market has reshaped divorce dynamics, the legal structure governing separation in Australia also plays an important, if supporting, role.

Australia introduced no-fault divorce with the Family Law Act 1975, making it possible for one spouse to end a marriage without assigning blame. This shift removed many barriers to separation and ushered in an era of rising divorce rates—at least initially. “Legal ability to separate does not guarantee practical ability—especially when real estate is involved and the financial implications are so significant.” (Firstlinks/University of Sydney)

Over time, the focus moved from the grounds for divorce to the realities of asset division, child custody, and housing affordability. While no-fault divorce laws have enabled greater autonomy for individuals, current property values have, paradoxically, restored some of the very pressures that once kept couples together for economic rather than emotional reasons.

Some research cited by The Conversation points out that the intent of the law was to make divorce accessible and fair, but “in a climate where house prices soar, financial constraints can eclipse both the intent and the letter of family law reform” (The Conversation, July 2025).

What has changed is not so much the legal path to divorce, but the threshold for pursuing it. Choices about when and how to separate are now far more influenced by economic realities than by legal strictures alone.

Policy Responses and Looking Forward: Rethinking Financial Wellbeing in Relationships

The convergence of high property prices and complicated marital transitions has caught the eye of policymakers, financial planners, and social commentators. With clear implications for mental health, housing policy, and social equality, the question becomes: how best to support Australians navigating these challenges?

Some experts advocate for expanded affordable housing initiatives, reforms to rental assistance and superannuation policies, and better access to financial advice for couples contemplating separation.

“Professional advisers recommend planning for financial contingencies—before, during, and after marriage. This includes establishing clear communication about finances, understanding joint and individual property rights, and considering the long-term implications of home ownership.” (Synthesis from all articles)

Financial literacy, pre-nuptial or binding financial agreements, and open discussions about home ownership and assets are increasingly part of prudent relationship planning. Couples and individuals are urged to seek guidance early and often not only from legal counsel but also from financial advisers, to ensure they understand their options.

International evidence suggests similar patterns where housing markets overheat: divorce rates drop, but family satisfaction and personal autonomy may suffer as a result (Smith, J., 2022, “Housing Markets and Family Mobility,” Oxford Review of Economic Policy).

Moving forward, balancing the freedom granted by modern laws with the constraints of today’s property market will require both individual adaptation and collective action. As the cost of living continues to rise, and the dream of home ownership becomes ever more elusive, the bonds of marriage are being tested in new—and distinctly financial—ways.

Conclusion

Today, Australia stands at a crossroads: proud of its tradition of home ownership, shaped by progressive family laws, yet grappling with the financial reality that, for many, love and autonomy have become entangled with property values. When the numbers no longer add up, the decision to separate is not just emotional or personal—it is fundamentally economic.

As Professor Stephen Whelan observed: “While the law may make divorce straightforward in theory, for many couples today, it’s the cost of a new house—or even just a new rental—that keeps them together.” (University of Sydney News)

Understanding and addressing these financial ties is central to achieving well-being, whether one remains married or moves on. For every Australian household caught in this bind, knowledge, planning, and support are more valuable than ever.

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References

• Whelan, S. & Hartigan, L. (2025). “Soaring house prices may be locking people into marriages.” Firstlinks | The Conversation (republished). July 2025.

• University of Sydney News. (2025). “Soaring house prices may be locking people into marriages, new research shows.” 15 July 2025.

• The Conversation. (2025). “Soaring house prices may be locking people into marriages, new research shows.” 13 July 2025.

• Ticker News. (2025). “Soaring house prices may be locking people into marriages.” 14 July 2025.

• Smith, J. (2022). “Housing Markets and Family Mobility.” Oxford Review of Economic Policy, 38(3).

All articles relied upon in this piece were published in July 2025 unless otherwise indicated.