A Brief Guide to Relocation and Temporary Housing

In the relocation management universe, temporary housing is one of those benefits that doesn’t get nearly the attention it should. Which, frankly, is pretty ironic, considering how pivotal it is to the recruiting and relocation processes—both for employers and employees.

For employers, a competitive relocation package is a critical recruiting tool, and temporary housing accommodations are a key component of any such plan. Beyond recruiting, once long-distance candidates have signed on, short-term housing is the most foolproof way to bring them on board as quickly and smoothly as possible.

On the flip side of the equation, savvy job seekers will short-list employers that offer impressive relocation benefits, and few things deliver peace of mind like the security of having a nice place to live until one’s housing arrangements are finalized. Because more often than not, sorting out housing—out with the old, in with the new!—is the hardest piece of the relocation puzzle.

But here’s the thing. While short-term housing is a highly-prized benefit that may tilt the scales in a prospective employer’s favor, it’s also a hefty financial lift—perhaps the very reason some employers tend to give it short shrift.   

And so, the question becomes: how can employers make their temporary relocation housing benefits as awesome and yet affordable as possible, pleasing both their new hires and CFO? 

Temporary Housing Costs by the Numbers

Typically, temporary housing benefits are offered in 30-day increments: 30 days, 60 days, etc. Nationally, the average cost is $4,200 for each 30-day period.   

For employees who rent, 30 days may be a pretty doable timeframe. But for those who are buying and selling a home, they’ll likely need more time. After all, residential homes are currently on the market for a median of 25 days per Redfin, and the average it takes to close on one is 49 days, per the latest Ellie Mae Origination Insight Report

That adds up to an average of 74 days to complete a home-buying/selling transaction.  No wonder one of the most common relocation exception requests involved extended temporary housing and storage!  

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Ways to Control Temporary Housing Costs

The good news is, when it comes to short-term housing arrangements, employers have options. Yes, they can elect to provide a flat relocation benefit and let employees figure it out. However, employers seeking to provide a more cost-effective (and helpful!) solution might elect to: 

  • Purchase a condo unit or residential property for this purpose, if they handle frequent relocations and it makes financial sense. 
  • Rely on home rental services like Airbnb or Vrbo, an increasingly-popular strategy in some markets.
  • Strike an agreement with an extended stay hotel and make it their go-to solution. 

To further cut costs, employers may opt to expand their house-hunting benefits, which frequently are limited to a single 4-5 day trip. Because the faster employees can purchase a home, the fewer days they’ll need to spend in corporate-funded housing.

For example, one UrbanBound client found itself fielding a high volume of temporary-housing exceptions in one particularly hot real estate market. A few days simply wasn’t enough time to find a desirable home when properties were snapped up as soon as they hit the MLS. 

Working the numbers with the employer, we determined that allowing new hires to take more time for house-hunting would be a money-saving move. Added bonus: the employer’s generosity wowed their new hires, getting things off to a booming start. 

Finding Solutions that Work for You

In the final analysis, temporary relocation housing benefits matter a whole bunch. But getting them right can be a tricky business—just like all things in the relocation universe. If you don’t have the time or manpower to become an expert, the next best thing is to find one. 

Among other things, a service-minded, cost-conscious relocation company can help you identify your best short-term housing options. Better yet, the provider may already have agreements with extended-stay hotel chains and other national providers in place, allowing you to leverage their greatly discounted pricing without any work on your behalf.  

And of course, a relocation specialist can help you achieve that sought-after balance of highly-competitive yet cost-effective relocation benefits. You don’t know what you don’t know—which is why sometimes the smartest thing to do is simply ask an expert.

Human Resources Today