US workers saddled by houses that won't sell
Soft real estate markets hurt worker mobility as relocation gets more costly – financially and emotionally.
When Patrick Greenish accepted a job offer as an art director in Charlotte, N.C., last July, he assumed that his house in Orlando would sell quickly. His new employer offered to let him telecommute for a month until the sale was complete.
But when the month ended, the "For Sale" sign remained firmly planted in his front yard. Even so, the company expected him to be working in Charlotte.
"I had to leave everybody at home while the house was still on the market," Mr. Greenish says, referring to his wife and two young daughters. "It was a bit hard on everybody."
That kind of challenge is becoming more common as a soft housing market is changing the landscape of relocation. Some potential employees are turning down new jobs or transfers they cannot sell their house or would have to take a heavy loss. And companies that offer relocation benefits are spending more for employees' moving expenses.
"It's costing companies an exorbitant amount of money to cover the loss on sale to get an employee moved," says Andrew Drescher, a relocation consultant with Relocation Benefits in Vienna, Va.
Many Fortune 1000 companies typically pay closing costs, he says, as well as giving employees payment for money they lost by selling their house quickly. But small firms often cannot afford that. "It's greatly affecting the ability of smaller companies to recruit top talent out of higher-priced markets," Mr. Drescher says.
As transferees or newly hired employees wait for their homes to sell, many are spending more time in temporary housing, disrupting family life. A few years ago, the average stay was 48 days, says Mindy Pauley, global account director of BridgeStreetWorldwide, a temporary housing provider. "We're seeing that figure increase because of the inability to dispose of a house."
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