Held Back by the House
Saturday, June 14, 2008
By the time Ed Drouhard and Jill Divine figured out they were victims of the housing slump, it was too late for them to do anything about it.
The couple moved to the Washington area soon after Drouhard accepted a government engineering job. They left behind their home in the Florida Panhandle, confident that if they did not sell it, the relocation company hired by his new employer would buy it from them at an acceptable price.
They were wrong.
The housing downturn hit. Their waterfront property just 10 miles from the Gulf of Mexico languished on the market at $559,000, then $499,000. And the relocation company offered them 66 percent of the appraised value of the house.
"If we knew then what we know now, we would have stayed where we were," Divine said. "But we'd already moved. I'd given up my job. My husband had been replaced. And we were stuck with a $3,600-a-month mortgage payment. It was really stressful."
These kinds of job-and-housing problems were a rarity when the housing market was sizzling and sellers could quickly offload their homes for a tidy profit.
But now, depressed sales and sinking home prices in many parts of the country are complicating relocations and transfers for thousands of workers, including those coming to and leaving the Washington area, known for its transient workforce.
A survey last year by Worldwide ERC, a nonprofit association that represents relocation specialists, found that depressed home values emerged as the No. 1 reason for resisting job transfers for the first time in more than 10 years.
Of the member organizations that reported employee reluctance to move, 71 percent cited the sluggish real estate market as an impediment to a job-related move, up from 16 percent last year.
"This is a dramatic shift," said Cris Collie, the group's chief executive. "The top issue has consistently been family concerns, such as dual-career couples, children at a critical school age or caring for elderly parents who live nearby."
Against that backdrop, it has become more important than usual to consider the financial trade-offs of a job-related move.
Pandra Richie, vice president of relocation at Long & Foster, the Washington area's largest real estate brokerage, said that if an employer is willing to pick up the tab for a move, the employee needs to be clear about who pays for what and how much it will all cost.