I’m always on the lookout for signs of an improved real estate market within mobility programs. And while there are certain areas where selling homes is still difficult, Weichert’s recent research shows an overall decline in the need for loss-on-sale in the departure location for mobile employees and that many companies are finding a healthy and stable rate of home sales.
In fact, more than half of the companies participating in our 2015 Workforce Mobility Survey reported that they provided loss-on-sale assistance to less than 10% of their home-owning transferees.
It’s great to see mobile employees (and their companies) enjoying the advantages of an up market with a low number of homes going into inventory, increased payout of home sale bonuses (due to properties not going into inventory) and low interest rates that make purchasing a new home attractive. That said, there are still instances where home prices in the destination location exceed what an employee can reasonably afford. When this happens, there are signs that mobility professionals must look for: Continue Reading →
Fall usually means football and the end of baseball. This fall, all eyes are on the Fed as the threat of an interest rate increase is the main concern. Interest rates are the wild card in the continued slow but steady housing recovery. My view is that housing has “recovered” because 2006 peak prices were never sustainable.
If a rate increase occurs, there are two schools of thought on the potential impact. First is that the increase will reduce purchasing power and snuff out any further chance of continued price increases and demand. The second is that sideline (rate) watchers, those who have contemplated a home purchase, will jump into the purchase market for fear of losing out.
This second scenario will add to what we have largely seen over the past several years as a “rate-driven” demand. When we can get to a point where rate changes are offset by substantive wage growth, and both first time buyers and others can act based on needs, we will have cleared a major hurdle.
The report provides an outlook for workforce mobility trends affecting all industries, an analysis of such mobility hot topics as flexible programs and programs for millennials and a discussion of major challenges that could impact the deployment and management of mobile talent in the coming years.
Some of the most valuable insight in our survey comes from breaking down the results by industry. So for our latest infographic, we’ve pulled out some of the insight we collected from companies in the financial services sector. Here’s what they told us.
Amidst tougher competition for the best and brightest employees, 60 percent of companies say that relocation policy benefits are critical to recruiting talent. This was one of the key findings of Weichert Workforce Mobility’s ninth annual survey to identify the top relocation challenges and trends and offer best practice recommendations.
This year’s results are based on the input of approximately 170 corporate relocation managers in the US and Canada.
Reducing cost was the most commonly cited driver of the changes companies made to their relocation programs over the past year. In fact, “controlling relocation spend” was the number one reason cited for the wider adoption of flexible relocation programs, which include temporary, rotational and commuter assignments, lump sums and extended business travel. These programs not only offer less costly alternatives to “traditional” assignments, but also make relocation appealing to a wider range of employees and keep talent more readily deployable as new opportunities arise.
When it comes to workforce mobility, the mantra is, “be flexible, but be cost-conscious, too.” When managed right, flexible programs allow companies to be both.
Drawing on the results of this year’s survey and my own experience consulting with HR leaders, I offer the following additional strategies for optimizing workforce mobility: Continue Reading →
A quote from Frank Nothaft, Chief Economist at Corelogic, accurately sums up the current “mood” relative to US Real Estate: “The overall economy has provided mixed signals on its performance so far this year, but one thing is clear: Home sales are off to a brisk start through April. We expect house prices in our national index to be up about 5 percent in the next 12 months, and mortgage rates are likely to move higher over the next year.”
To bolster that claim, Corelogic reported the following on June 9, 2015: “The National foreclosure inventory fell by 24.9 percent year over year in April 2015 to approximately 521,000 homes, or 1.4 percent of all homes with a mortgage. This marks 42 months of consecutive year-over-year declines.”
Additionally and supportive of positive market conditions, CoreLogic also reported (June 8) that distressed sales—real estate-owned (REO) and short sales—accounted for 12.1 percent of total home sales nationally in March 2015, a 3.2 percentage point drop from March 2014 and a 1.9 percentage point decrease from February 2015. At their peak, distressed sales totaled 32.4 percent of all sales in January 2009, with REO sales representing 27.9 percent of that share.
The Consumer Financial Protection Bureau (CFPB) is implementing the new TILA-RESPA Integration Disclosure Rule (TRID) effective October 1, 2015. The objective of this new regulation is to implement easier-to-use mortgage disclosure forms that clearly lay out the terms of the mortgage for a homebuyer.
Under TRID, the Loan Estimate form replaces/combines the Good Faith Estimate (GFE) and initial Truth in Lending (TIL) disclosures. As per current regulatory guidelines, the Loan Estimate form must be delivered to the customer within three (3) days of loan application.
In addition, the Closing Disclosure replaces/combines the final TIL and the HUD-1 Closing statement. Under new regulatory guidelines, Lenders/Closing Agents will be required to issue this disclosure three (3) business days prior to closing. Any material changes (loan amount, product, APR) to this disclosure from time of issuance prior to closing will result in a re-issue of the disclosure as well as a new three (3) day waiting period.
Here are some things that our clients should be aware of: Continue Reading →
Our 2014 Workforce Mobility Survey polled approximately 200 North American companies on the ways they deploy key talent.
In an effort to shed light how trends cascade across specific industries, we have created a series of infographics showcasing key findings filtered by sector. We believe this data provides good insight to how different industries use workforce mobility to achieve their business goals.
Our latest infographic focuses on the financial services sector. Give it a look (you can click it to enlarge) and, as always, for more information and further breakdown, feel free to contact us.
The leading indicators weigh heavy on the positive side as summer ends and the (normal) seasonal slowdown commences. Unemployment is improved at 6.1%, 30-year fixed mortgage rates are up but still reasonable at around 4.1%, gasoline prices are at a four-year low, consumer confidence and consumer spending is up slightly and in September, the Federal Reserve committed to keeping the short-term interest rate untouched in the near term.
For employers, this indicates a generally favorable landscape for relocating homeowners and renters and the business climate in the coming months.
More good news was heard when it was reported that FHA would eliminate a prepayment penalty — the interest rate charge — starting next year. For FHA borrowers who pay off their mortgage before the end of the month, the lender is allowed to charge to the borrower the interest rate costs on the loan from the day the loan is retired until the last day of the month. So, if a borrower paid off the loan on Sept. 10, the penalty would be 20 days of interest payments. That can be hundreds of dollars. Once the change takes effect, on Jan. 21, 2015, lenders will no longer be able to apply that interest charge to the borrower. Given the track record of financing challenges presented post-recession, employers should be aware of this positive news for home buyers.
More qualified home buyers are being left on the sidelines simply due to their credit scores. That was the big takeaway from the recent Mortgage Bankers Association (MBA) Expo and Conference, where David H. Stevens, President & CEO of the MBA, warned that the secondary market is negatively impacting mortgage affordability and availability, increasing costs for borrowers and even preventing many from obtaining homes, and stifling a full-blown market recovery.
The current average credit score in America today is about 700, while the average credit score of a borrower with a loan backed by Fannie Mae in Q1 2014 is 741. On top of these strict credit criteria, there are loan level price adjusters, overlays and ever-increasing guarantee fees. In this system, according to Stevens, only those with the most pristine credit can afford a home. This clearly indicates that while credit availability for mortgages may have improved since the recession, homebuyers still face “credit challenges.”
Continue Reading →
Our annual Workforce Mobility Survey provides a comprehensive snapshot of the state of workforce mobility across North America. It’s designed to shed light on how organizations are leveraging workforce mobility to support talent management initiatives. It also gives organizations critical insight into emerging trends, best practices and demographic shifts that they can leverage to maximize the value and efficiency of their mobile workforce.
Our 2014 edition has recently been conducted and the results are being analyzed. In the meantime, I wanted to share some of the key findings from my initial read through the data:
Talent remains at a premium. “Talent Shortage” was ranked among the highest external (78%) and internal (60%) factors driving the need for a more agile workforce.