Benchmarks work when considering incremental changes, but they really don't have you thinking out of the box. Traditional relocation policies were designed to help someone get out of their home and into the new location quickly and efficiently. "Now we find ourselves with an inverse problem, where selling properties is easy but procuring a new one is incredibly difficult." This insight from AIRINC is very true.
In our 50+years in the business, we have seen real estate markets shift dramatically. Homes definitely took much longer to sell in the past than they do today. In fact, in the recent hot housing market, homes spent an average of 17 days on the market in June 2021, 10 days fewer than two years ago.
According to Zillow, here is where homes have sold the quickest:
- Columbus, OH (8 days)
- Denver, CO (9 days)
- Raleigh, NC, and Seattle, WA (10 days)
- Boise City, ID, and Cincinnati, OH (11 days)
- Grand Rapids, MI (11.5 days)
- Ogden, UT, Salt Lake City, UT, Indianapolis, IN, and Boston, MA (12 days)
- Colorado Springs, CO, Dayton, OH, and Charlotte, NC (13 days)
This is good news if you're selling in these locations, not so much if buying in these locations. In this current market, average home values have increased over 17% in just 18 months. Per AIRINC, some key markets have seen spikes upwards of 50%. Looking to dig in deeper to determine what to expect for real estate in the future? Hit this recent post: Where will home prices and rents go in 2022?
Housing markets vary and they shift over time. So adjusting policy might get challenging. On top of that, your employees all have unique situations and different expectations today than employees have had in the past. Today, they expect options, they expect technology, they expect choice and control and the ability to pivot as needed. They want flexibility at work and in the relocation process.
Today, mobility programs have the opportunity to go beyond benchmarking and dealing with exceptions. There are solutions that allow for cost controls but still provide everyone (think inclusion now, too) the opportunity to meet their own needs! That is powerful and way more fun to talk about than whether or not to add/remove 14 days to temp living. Thinking out of the box will give you an advantage when you have already worked hard to attract, develop and retain the best people. Think differently. Your relocating employees are worth it.
These new market trends pose a serious challenge for companies relocating talent domestically. Traditionally, domestic relocation packages have been structured to get people out of their houses quickly. This stems from old market norms where houses could take months to sell, and companies needed talent to relocate quickly. This structure has been effective in the past but is challenging today when most homes sell in a weekend and market values are at all-time highs. Now we find ourselves with an inverse problem, where selling properties is easy but procuring a new one is incredibly difficult.