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December 20, 2014

Housing Relocation Fears Ease for Employees

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Housing Relocation Fears Ease for Employees

The housing recovery is prompting more employees to accept relocation orders again, according to Atlas Van Lines, which tracks relocation trends. 

“Concern over what will happen to their house is rapidly declining as the major issue,” Doug Weed, vice president of global services and supplier solutions for Cornerstone Relocation Group, an Atlas subsidiary, told the Chicago Tribune. “A few years ago, housing was a huge worry — people were either in a position of taking a loss on their home, or if not a loss, they had refinanced along the way and were in a negative-equity position. That was a real problem for corporations — in order to sell the homes, they would end up writing a large check to the buyer.”

Weed says that many companies offer "loss on sale" benefits. For example, he says that if the employee purchased a home for $100,000 and it’s worth $80,000 today, the company would agree to pick up the $20,000 loss on the sale for you. 

Fewer companies are offering to buy the home from employees if it doesn’t sell, Weed says. 

“Even companies that offer it are buying fewer homes,” Weed says. “Inventories of homes bought from transferees peaked in 2008 and are down to one-third of what they were then. It's a combination of fewer companies offering the benefit and employees not needing it because they can sell without difficulty.”

Some companies are offering incentives to employees who can sell their home. For example, they may say that if they sell at close to the appraised value, the company will give the employee a 3 percent bonus. 

Source: “Companies easing burden of relocation,” Chicago Tribune (May 31, 2013)

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