We are a highly mobile population. In fact, according to the U.S. Census Bureau, the average American will move nearly 11 times over the course of a lifetime, and at least once out of their community. There are countless reasons for relocation, but one of the most prevalent is the pursuit of out-of-state job opportunities. It’s not only the cost-of-living differences that you homeowners need to think about.
According to UrbanBound, 80 percent of companies have a formal relocation policy in place to support employee and new hire relocations. One Silicon Valley company is even experimenting with a “de-location” package to move current employees out of the high-cost Bay Area to a location with a more affordable cost-of-living.
Whether your out-of-state move is by choice or requirement for work, it’s important to be aware of the costs associated with the process— both direct and indirect. So you’re not sidelined by the costs you may not be thinking about, here are four expenses to be aware of:
1. Picking up where your company leaves off
A recent survey shows roughly half of relocations were partially reimbursed or paid by a lump sum only. If your company is assisting with a move, do your due diligence and familiarize yourself with their policy. Typically, your HR rep will provide a list of what services, if any, are covered. In some cases, financial support from a new company will be limited. The good news is deals exist to help you sell your home quickly and save you money on things like title and escrow, which is typically 0.85% of the sales price of the home. For example, on a $200,000 home, that would be $1,700.
2. The cost of unpredictability
We may be in a seller’s market, but there’s always the element of unpredictability when it comes to selling a home when done through traditional methods. If your home takes longer to sell than anticipated, are you prepared to potentially pay double mortgages? And, if you’re selling from out-of-state, will you need to travel back and forth until the sale is complete? Travel expenses can add up. If predictability is important to you, you might consider selling your house online so you can make a clean move to your new residence. Of course it will vary based on the amount borrowed and interest, but $1,000 per month is the average mortgage payment. With some home sales taking three months to find a qualified buyer and another month to close on the transaction itself, unpredictability can cost you $4,000.
3. The cost of your time
One thing many home sellers commonly overlook is the cost of their time, often underestimating the time involved with selling a home. First and foremost, you’ll have to spend time finding a realtor you trust to get the job done, even from across state lines. If you’ve already relocated, consider whether you have to make return trips to coordinate repairs or meet with prospective buyers or your real estate agent? If you haven’t already packed up and made your move, you’ll have to make time for showings, keeping the house maintained and making arrangements for kids and dogs if they are in the home. Also consider the negotiating power a buyer has knowing that you’re relocating and they might be more aggressive in asking for concessions. The time adds up, and that’s a commodity we can never get back. When you’re in a time crunch and preparing for a out-of-state move, think beyond the monetary costs — consider convenience.
4. The cost of stress
Moving is undoubtedly one of the more stressful events we experience in life. From preparing your home, making all necessary repairs, to timing the sale and finding a new place to call home, then orchestrating the move—it’s a lot to manage. Coupled with relocating to a new, unknown state, the stress compounds. To boot, if your house doesn’t sell before you make the move, there’s the added stress of trying to make multiple mortgage or rent payments for an unknown amount of time.
These are important things to consider when planning your move. To help mitigate the stress, see what your employer offers in terms of paying for rent in the new location, home-finding services, or even assistance with selling. Selling your home the traditional way is often met with stress and uncertainty. When you relocate, you need certainty and the ability to create and stick to a plan. Today, it’s now possible to orchestrate the sale of your house entirely online thanks to direct home buyers like OfferPad, and gain peace of mind from the certainty of the sale.
The key to managing costs, stress and the time involved is to plan ahead and explore all possible options for selling. Sometimes, a job relocation will take you by surprise. When time is of the essence and you need to move fast (and have a great experience), OfferPad is here for you.
Are you considering relocating? What steps are you taking to lower costs and speed up the process?