When an employee accepts an assignment or permanent transfer, they might choose to sell their home and then purchase or rent at the new location. In these cases, you’ll need a comprehensive approach for taking much or all of the burden of the home sale process off their shoulders … and placing much of the financial risk squarely onto yours.
If the home doesn’t move quickly, the employee might be significantly distracted just when you want them focused on their new assignment. And the last thing you need is a portfolio of hard-to-sell real estate holdings on your books.
Mobility leaders typically offer a variety of home sale options within their program based on what suits their business goals. No matter what option is used, it’s important to make sure these homes sell quickly at fair prices. The right approach in any given situation depends on the condition of the property, the local real estate market and the status of the employee.
These are the three most common, best-practice approaches to home sale assistance:
- Buyer Value Option (BVO) – The employee lists the property, and as soon as a buyer is confirmed the employee sells the house to the relocation management company (RMC) at the offer price. The RMC manages the property until it completes the sale to the buyer.
- Guaranteed Buyout (GBO) – The employee lists the property, and if it’s not sold in a certain period of time, the RMC purchases the property from the employee at an adjusted MLSP (“most likely sales price”) and continues the efforts to sell it.
- Direct Reimbursement (DR) – The employee is responsible for the home sale but is reimbursed for all agreed-upon real estate fees, commissions and normal and customary closing costs.
The home sale process is a blend of art and science with many complex factors and important elements like pricing strategy and marketing assistance. That’s why we’ll manage your home sale program with our experienced consultants and by using top-tier service providers – from assessors to stagers to realtors – that are the best in their markets to make sure the properties move quickly.
We will work with your mobile employees to navigate this very emotional and cost-driven program so that it’s a win-win for them and your business.
What’s best for your mobility program and your employees?
As mobility leaders take on the task of reviewing and revising home sale practices and policies, they should be mindful of the clear tradeoffs between the three options in terms of the associated costs and risks to the company and the employee.