As if convincing existing employees and coveted new hires to uproot themselves and their families and accept transfers was not challenging enough, current economic conditions are making these candidates increasingly gun-shy about accepting moves if it means selling a home in a down market.
On the flip side, the cost of workforce mobility continues to escalate, even as it becomes a more integral component of a successful corporate growth strategy. To avoid a failed move or assignment, employers must be confident that they will receive the best possible return on their mobility investment.
In response, a growing number of employers are bolstering their programs and recruitment efforts with pre-decision services. Pre-decision is a sort of “fact-finding” mission conducted before a move takes place, enabling the employer and employee to better assess the potential costs of each move (particularly the value of the employee’s departure home), ensure that the employee is a good fit for the new job and destination location, and make informed decisions.
Pre-decision services can help recruiters close qualified candidates more quickly, boosting acceptance rates, and can help employers overcome employee reluctance by providing critical information and counseling that demonstrates the company’s culture, alleviates concerns, and motivates employees for heightened productivity in their new roles. They also can save employers from wasting valuable time, money, and effort on candidates or transitioning employees who cannot afford to move.
While a pre-decision program is not a crystal ball, it does give the employer a better handle on the potential cost of a move and helping to identify situations that may prove too costly. It also can be useful in educating employees who may have made poor homebuying decisions in the past, so that these decisions do not haunt future moves.
What constitutes a well-rounded pre-decision program? Research indicates that regardless of the type of homesale assistance offered, a program that addresses the concerns of both employees and employers may include the following:
- Proactive counseling to assess any unique concerns and requirements. It may yield that it is simply not cost effective to transfer certain employees based on personal, familial, or financial needs in the new location.
- Mortgage pre-qualification for the destination home. Knowing in advance how much home an employee can afford is critical in targeting potential destination communities.
- Expert valuation of the departure home. If it is a home that is going to prove challenging to sell or is worth far less than what the employee owes, the employee will want to know about it.
- A comprehensive marketing plan that identifies target buyers and incentives most likely to result in a sale within the specified time period.
Pre-decision not only addresses one of the biggest obstacles to mobility today: the difference between what employees think their homes are worth and what their homes actually are worth; but it also enables the client and transferee to make a decision based on these differences. Specifically, a Broker Market Analysis (BMA) can be ordered to establish a baseline in determining an employee’s equity position in their home, revealing potential burdens such as the need for loss-on-sale support.
According to Worldwide ERC®, the value of the departure home is most often the greatest importance to a transferee. Enlightenment should come before the transferee is already in the process of a relocation. Since the sale of a home has a considerable financial impact on mobility decisions and budgets, obtaining an estimate of value can provide a credible benchmark for an employee to assess how their home may have been affected by the current economic downturn.
Pre-decision consulting can also help employers overcome employee reluctance and boost acceptance rates by alleviating employee worries, addressing their needs, and motivating them for heightened productivity in their new roles.
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