One little remarked upon reality of this summer’s housing meltdown: it alters the landscape for employment related relocations. With the real estate market in a slump, don’t be surprised if your employees are reluctant to sell their homes and move. A survey out from Worldwide ERC found that:
More than 70 percent of the respondents reported “slowed real estate appreciation/depressed housing market at the old location” as the reason their employees are averse to moving. This is a dramatic shift from last year, when only 16 percent of the respondents mentioned it as a reason for reluctance.
The reluctance of employees makes sense, and employers need to think about the additional costs as well — the average price tag to relocate a current employee and homeowner is $62,185, while the a new hire homeowner will cost a company $55,165. In response to increasing costs, 35% of companies have made major changes to their relocation policies, including enhancing incentives, and extending temporary living in the new location.
What if you’re the one relocating? Money Magazine offers some tips:
- Run the numbers before you agree to move to a new city. If you’d be selling into a weak real estate market, your new salary had better be pretty darn sweet - or your new employer had better be willing to help you out… Make those costs part of your pay-package negotiations; you’ll have more leverage before you accept the job.
- Ask your employer to put you in touch with a few future co-workers who have families like yours. Call them and ask for the lowdown on the best neighborhoods, how expensive they are, what commutes are like and where the good schools are.
- Relocating is sort of like buying a plane ticket to Paris: The price varies depending on when you go. May through September is peak season, so if you can depart earlier or later, many movers will charge you 5 percent to 10 percent less. The same is true if you’re willing to move in the middle of the month rather than at the beginning or end.
And if you’re going to be in the new city less than three years, consider renting. It’s probably the better deal.
