Considering Employee Home Sales Support Programs

Though the trend has been to offer more lump sums and other relocation benefits short of a full home sale program, home sale services remain a central part of a well-rounded corporate relocation program. Lump sums can help to control costs, and they are certainly simple to administer, but the results are not always what the company and employee expect. Home sale assistance represents a greater commitment to the employee and his or her future with the organization—a fact that is not lost on the employee. And the economic ups and downs of the past decade have resulted in some innovative practices and approaches that allow employers to offer home sale assistance as part of their employee relocation package while maintaining better control over costs.

Employee Home Marketing Assistance

Many companies provide a Home Marketing Assistance benefit even if they do not offer a full home sale program. With this service, the relocation management company’s counselor works with the employee to explain their benefits, develop a marketing plan, use any marketing incentives or allowances, establish a timeline, discuss possible repairs and improvements, select an agent and price the home properly. A good counselor continually monitors, evaluates and reports on the home marketing efforts, making adjustments as needed until the home is sold. Home Marketing Assistance can speed the process and reduce costs.

The most popular home sale programs today are the Amended Value Program and the Buyer Value Option (BVO). With either of these programs, the relocation management company will help the company to structure a cost-effective, tax-compliant program that achieves the company’s talent mobility objectives.

The Amended Value Program

The Amended Value Program includes the marketing assistance described above. The counselor arranges for two appraisals or broker market analyses to help establish the value of the home. These are usually averaged together and that becomes the guaranteed offer. The employee markets the home for a prescribed period (usually at least 60 days but often 90 days). If the employee has not achieved a sale at this point, he can opt to take the pre-established offer. If, during the marketing period, the employee receives a higher offer, the original offer is “amended” to reflect that higher value. The company then purchases the home from the employee and completes the sale to the buyer.

The Buyer Value Option

The Buyer Value Option eliminates the traditional property appraisal process, though broker market analyses are still conducted to help the employee price the home competitively. BVOs usually include marketing assistance, but with no purchase offer or guarantee, the BVO it can be a lower-cost program for companies. The employee markets the home and when a buyer is found, the relocation management company qualifies the buyer and completes the home sale process.

A capable corporate relocation management company will help you to select the best program, or programs, for you; offer cost-saving ideas; and help to ensure you remain in step with current best practices and compliant with applicable IRS directives surrounding employee home sale programs.


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