CapRelo Blog

A House Hunter's Checklist for Keeping Track of Expenses

Posted by George Herriage on Tue, Apr 01, 2014

prancheta-1508904-640x480If the corporate relocation package being offered to you requires that you perform a house hunting expedition on your own, it’s likely your employer will reimburse you for many associated expenses – including travel, lodging, and meals to name the most common. Naturally, you’ll want to check with your employer to determine what expenses are covered and what exclusions there are.

Here's a checklist to help you keep track of your expenses.

  • Get yourself a notebook and keep it with you at all times. This will come in handy as you keep track of all your receipts. You don’t want to have to hunt them down after your move.
  • Buy yourself a sturdy file folder. You will need this to keep all of your printed receipts and invoices in one safe place. Even if you decide to track everything electronically in Excel, your employer may require you to turn in physical receipts to prove your expenses.
  • If you’re hitting the road and driving your own car, track all mileage, and any additional fares and tolls you’ll be required to pay. Make sure you obtain receipts for all road travel expenses.
  • If you’re traveling by plane, train or bus, save all itineraries that include cost.
  • Track all meals and refreshments you buy and keep receipts, even if it’s just a simple soda purchase. Alcohol purchases may not be covered by your employer’s reimbursement plan.
  • Track all car rental costs and keep receipts.
  • Make note of all money spent on cab fare, shuttle and public transportation fees and ensure you obtain receipts for these.
  • Obtain documentation for all lodging costs. You will likely not be able to submit for reimbursement of entertainment expenses like in-hotel movie rentals, so be sure to make note of those costs so you can subtract them later.
  • Track all business related phone calls you make. Depending on your cell phone’s mobile plan, being out of network may result in you incurring additional roaming charges and long distance fees. Make note of the dates and times of all calls made or received, as well as their duration. This will make it easier for you to go through your phone bill later on and include any additional charges with your expense report.
  • Pet owners may have to make arrangements for their pets to be boarded during their time away from home. Add this to your list of expenses but many companies may not reimburse this type of expense.

Remember that the IRS doesn’t consider a house hunting trip to be a deductible expense. What this means is that any money you spend while house hunting for which your employer reimburses you will be reported to the IRS as taxable income – and you won’t be able to deduct those expenses when you file your personal taxes. For this reason, you may want to consider keeping costs as minimal as possible to prevent from inadvertently boosting yourself into a higher earnings bracket come tax season.

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Topics: Household Goods, Home Buyers, House Hunting Trips

Employer and Employee Benefits of House Hunting Trips

Posted by Barbara Miller on Tue, Oct 09, 2012

family-house-for-sale.jpgWhether you are a homeowner or renter, when relocating to a new, unfamiliar area, you certainly would appreciate assistance from your employer. Whether you're a senior executive or a new lower-level hire, all relocating employees can use employer help in finding a new residence.

The best employee relocation policies contain this important feature. They can take various forms, all of which are helpful to transferees. In addition to the obvious monetary benefits, home finding assistance greatly reduces the employee's stress level.

Learn more about developing relocation policies with our free guide.

Employer Benefits

This result is particularly beneficial to employer expectations of transferred employee productivity in the new location. Happy, stress-free employees are productive employees.

Setting reasonable parameters offers cost containment and management benefits for employers. Expense management and control must be matched with valuable benefits for your employees. Home finding assistance and one or more reimbursed house hunting trips achieve this goal.

Common Components in Relocation Programs

Finding a new home is stressful for employees in good or bad real estate markets. Reducing this stress level by offering home-finding help is always important. The best executive relocation policies usually feature some consistent benefits, like:

  • Hasten and smooth the procedure of locating, buying and occupying the employee's new home
  • Provide for one or two home-finding excursions, for seven to 10 days total, for both the transferee and his/her spouse or domestic partner
  • Help selecting a trained and experienced real estate professional.
  • Reimbursement for normal and customary house hunting expenses on an "as-submitted" or lump sum basis.
Often, the most vital component is selecting the "right" real estate agent. The most respected, experienced professionals deliver more than just knowledge of the area and the best homes for sale or rent. These agents have a strong network to find preferred homes, condos or apartments for the transferee. They also assist in narrowing their search criteria, hastening the process of selecting the most appropriate properties.

While neither employee nor employer wants transferees to "rush to judgment" in selecting their new home, speed and efficiency are essential. The move must be completed as quickly as possible to have your employee become productive at the new location. Employers need this result. Transferees also need to minimize moving stress and get their families settled into new homes as smoothly as possible.

Most Common Home-Finding Expense Reimbursements

Transportation costs. Including airfare, auto rentals, mileage costs and appropriate miscellaneous expenses (tolls, parking, auto service, etc.)

Temporary lodging. Including hotels, motels or other short-stay options for the house hunters.

Food and meals. Most solid relocation policies offer per diem allowances of around $40 per day, per adult house hunter, without requiring receipt submission. When no per diem allowance is offered, transferees submit receipts for family meal reimbursement.

Daily child care costs. Common allowances are around $50 per day per child, up to a maximum $100 per day for all minor children.

These covered expenses, along with other miscellaneous reimbursements, apply directly to the home finding activities of the transferee. Home sale and/or purchase assistance is covered in additional policy areas. House hunting assistance reimbursement parameters and maximum amounts, if any, are specified or negotiated as needed, per policy language.

Free Article:  A Guide to Developing  Relocation Policies

 

Topics: relocation benefits, Home Buyers, destination services, House Hunting Trips

New Home Purchase Assistance

Posted by Rick Bruce on Tue, Oct 02, 2012

istock_000010968215large-resized-600.jpg

A major component of professional corporate relocation programs has always been – and remains – assistance with selling the transferee's current home and purchasing a new residence in an unfamiliar area. The recent recession and accompanying housing crash has made this relocation component even more vital to a successful executive move. The continuing uncertainty regarding a consistent economic recovery has kept the real estate markets from rebounding around the U.S. Compounding this perfect storm, mortgage lenders have tightened qualifying criteria for all prospective homeowners. The strong potential for a transferee to endure a loss on the sale of a home completes the numerous negative factors involved in an executive relocation.

Find out more about developing relocation policies in our free guide.

Home Selling and Purchase Assistance Needs Are Not Restricted to Executives

Although historically rare in normal or hot real estate markets, relocating employees occasionally suffered a loss on the sale of their homes. Typically caused by a necessary rush to sell to meet relocation dates, in recent years millions of homeowners have found their homes' values depressed, often equalling less than their outstanding mortgage balances.

Senior executives are neither immune to this problem, nor are they the only group affected by the housing crash. While potential executive real estate losses on sales may larger than some other transferees, every employee/homeowner risks suffering this fate.

These conditions create home selling and buying economic nightmares for some of your most valuable employees. Similar to transferred employees, new hires face the same daunting challenges. A good relocation policy addresses these serious, expensive concerns. Those relo programs missing this feature have led to many employees rejecting promotions that involve moving to a new, distant location.

New Home Purchase Assistance

Historically applicable to transferees who were already homeowners, some of the better relocation programs also feature this benefit for those who were renters. Other benefits typically common to successful corporate relocation policies include the following features:

  1. The employer reimburses closing costs incurred when buying a home in the employee's new location.
  2. The employer pays one or more points on the new mortgage.
  3. The employer sets up direct billing with the new mortgage lender, to control and reduce administration requirements.
  4. The employee receives a "bridge loan" from their employer if their former home is not sold in time for the move.
  5. Depending on the employer's workplace locations, some companies offer transferees a sliding scale of home purchase assistance amounts relative to the sometimes wide differential in housing costs.
  6. In periods of rising interest rates, the employer provides for a temporary "buydown" of prevailing rates for the first three to five years at the new location.

While controlling relocation costs remains a top priority, employers still must hire and retain the most talented employees available. Adopting a relocation policy that effectively addresses these real world home selling and purchasing issues is a wise business decision.

Using one of the top professional relocation firms can also help control costs and reduce employer administration requirements. Forward-thinking employers understand that relocation expenses are one-time charges but engagement and high performance of a valued employee helps the bottom line indefinitely.

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Topics: Home Selling and Purchase Assistance, Home Buyers

Who Are Home Buyers Today?

Posted by Tamara Bianchi on Tue, Aug 28, 2012

Each year, the National Association of REALTORS® Profile of Home Buyers and Sellers survey provides the latest demographics, preferences and experiences of recent home buyers and sellers. Highlights from the 2011 Characteristics of Home Buyers[1] can help you see the challenges your relocating employees face in the real estate market:

  • First-time home buyers make up 37% of the market, a drop from 50% in 2010.
  • Typical home buyers are 45 years old, a jump from 39 years old in 2010.
  • The 2010 median household income of buyers was $80,900. The median income was $62,400 among first time buyers and $96,600 among repeat buyers.
  • Married couples accounted for 64% of recent home buyers - the highest share since 2001. Eighteen percent of recent home buyers were single females - the lowest share since 2004.
  • Most home buyers searched for 12 weeks and viewed 12 homes before purchasing.
  • The typical For Sale by Owner home sold for $150,000 compared to $215,000 among agent-assisted home sales.
  • About half of home sellers traded up to a larger sized and higher priced home and 60% purchased a newer home.
  • Sixty one percent of recent sellers reported they reduced their asking price at least once and sold their homes for 95% of the listing price.

[1] National Association of REALTORS®, Economists' Outlook BLOG, July 11, 2012

Topics: employee retention, Home Buyers, employee transfer, talent management

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