The first time Dan Grebow returned to Altadena, Calif., to pick through the rubble of his family’s home, he felt a strong pull to rebuild.

After all, it had been his home for 15 years. Mr. Grebow and his wife, Carmina, fixed it up together. And it was where their three young children had started their lives.

But when Mr. Grebow began navigating the labyrinth of insurance, mortgage payments and temporary housing, the variables overwhelmed him: How long would it take to rebuild? How much would it cost? Would the house be insurable in the future? Would it be safe for him and his family?

Across Altadena, where thousands of homes were destroyed in January by the Eaton fire, residents are grappling with the difficult question of whether to stay and rebuild — or leave for good.

Their decisions will determine the future of a neighborhood that generations of families have cherished as an emblem of middle-class prosperity in the bucolic foothills of the San Gabriel Mountains.