EXPAND YOUR HORIZONS Make the Right Connections Homeowner to Renter Challenges.
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Transcript of EXPAND YOUR HORIZONS Make the Right Connections Homeowner to Renter Challenges.
EXPAND YOUR HORIZONSMake the Right Connections
Homeowner to Renter Challenges
Homeowner to Renter DefinedTransferee Choice:• Loss of equity• Insufficient equity• Home not selling• Extended selling time• Uncertainty• Credit issues
Corporation supporting destination rental:
• Moving to High Cost Area• Anticipated additional
move w/in 2 years• Employee moving from
depressed market• Critical talent
ERC Survey Results – Reluctance to Relocate
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2011
Depressed Housing Market
Origin Home in Negative Equity Situation
High Housing Cost Areas
Source - ERC 2010 Transfer Volume & Cost Survey and ERC 2011 Transfer Volume & Cost Survey
Assignments 2007-2011
Source – Wm French Buyers Real Estate Services, Inc.
2007-2011 Buyer Assignments Who Rented
Source – Wm French Buyers Real Estate Services, Inc.
Homeowners Choosing Not to Purchase at Destination
0%
5%
10%
15%
20%
25%
2005 2006 2007 2008 2009 2010 2011
Homeowners Choosing Not to Purchase at Destination
Source - Altair Client Data
ERC Survey Results
14%
53%
31%2%
Homeowners Choosing to Rent in the New Location*
A significant increase
Somewhat of an increase
No discernable change
Don't know
*ERC 2010 U.S. Transfer Volume & Cost Survey
Buyer to Renter Ratio
Source – Wm French Buyers Real Estate Services, Inc.
ERC Results – Homeowners vs. Renters
38%
62%
Homeowners
Renters
*ERC 2011 Transfer Volume & Cost Survey
Homeowner to Renter Impacts
• Corporate
• Transferee
• Service Provider
Corporate Impacts
• Declined offers for relocation• Increased recruiting efforts• Increased costs
– Loss on sale– Property Management– Dual Housing
• Decreased costs– No Home Sale needed
• Increased exceptions requests– Storage– Multiple moves– Temp Housing
• Distracted employees• Alternative policy type needed• Potential management fee
impacts
Transferee & Family Impacts
• Refusal to move or move uncertainty• Extended family separation
– Difficult decision process• Not selling departure home, dual housing• Need more benefit $$$• Lower Rental Supply (single family homes)
Service Provider Impacts
• Change in move type– Potential pricing
changes– Change in counseling
process• Reduced RMC revenue• Supplier fees impacts
• Higher level rental assistance need– Lease negotiation– Destination services– Fee increases
• Reduced broker/agent revenue
Rental Market Challenges
• Foreclosure Impact
• Decreased Rental Inventory (single family homes)
– Non professional homeowner landlord challenges
– Increased emotional connection
• Landlord driven market
– Increased pricing
– Decreased negotiation
• Increased rental requests
• Property search issues (MLS, Craig’s List)
• I
Policy Solutions Today
• Loss on sale• Short Sale counseling• Dual housing• Extended home
purchase• Extended storage
• Property Management
• Rental Subsidy• Increased
destination/rental assistance
• Incent to rent
Future Impacts
• Real estate impacts
• Future solutions
• Alternative move types
• “Now am I a renter or homeowner?”