A Look Into the Major Difference Between Domestic and International Relocation Expenses

In today’s competitive job market, hiring the best employee for an open position can be a long, but rewarding process. In order to remain a top contender for talent, it is important to ensure your recruiting efforts are backed by well-optioned relocation services, allowing you to source talent outside of your immediate region. Companies who work with a relocation management company (RMC) give their HR department and recruiters access to important tools that enhance their ability to hire the best possible employees, taking the company to the next level. 

The operation of any relocation program comes with necessary expenses, however, the relative cost of these expenses and their service categories will vary by the services utilized and the type of relocation being performed. For example, the service mixture (and by extension, the total cost) of a typical relocation that occurs within the United States and one that is international can be very different. 

Let’s explore a few of the primary cost factor differences between a domestic relocation and an international relocation.

Typical Costs Incurred During Domestic Relocation

When accepting a position in a new state, the high-cost services are usually moving costs and real estate assistance. Most companies include assistance for both in most average relocation packages. Short-term or temporary housing is another benefit that is usually included in relocation services that can help to increase the overall cost. Let’s take a deeper look at some of the more common domestic relocation benefits:

Selling Your Home

Oftentimes, selling a home isn’t a simple process. Listings and showings alone can take weeks before the ball starts rolling with suitable offers to purchase. Additionally, the sale of a home is not considered cheap. The cost of selling your property can easily rise to several thousand, if not tens of thousands, of dollars. Many employees simply don’t have the liquidity or equity to cover such an expense.

Some relocation management companies include real estate assistance in their relocation benefits. These benefits can include home-sale programs like the BVO, GPO, and Direct Reimbursement, in simpler terms this part of the relocation package is real estate assistance. Each program has different pros and cons but overall can help in any situation. These various programs are all designed to help alleviate the financial stress of selling what many transferees would consider their most expensive asset. 

Relocation companies typically are always up to date with real estate trends and offer real estate agents who specialize in the relocation process. There is also a chance that using one of these programs, if the relocating employee has a hard time selling their home, the RMC will purchase the home from them so they can continue their relocation on a reasonable timeline.

Short-term Housing Options

Also known as corporate housing or temporary housing, short-term housing is a great relocation benefit when utilized. These are usually furnished apartments where the relocating employee and their family can stay, usually for 30 to 90 days, while they await their belongings from the moving company and look for a more permanent home. This gives the employee a better chance to research neighborhoods and schools where they would want their family to live. 

As with many things, time is money. The longer the stay in short-term housing, the higher the overall direct cost. This causes temporary housing costs to be one of the key cost considerations for many relocations.

Moving & Transportation

Moving locally can be complicated enough, when it comes to moving an entire household to a new city or state, many do not fully understand the costs involved. Manpower costs and shortage in the HHG industry are a historic challenge, but market pressures on items such as packaging materials and fuels have become a new dynamic that have caused transportation costs to climb in recent years.

The packing and transporting of the employee’s belongings to their new destination in a safe and timely manner is important for a successful relocation. Using a quality moving company to ship all household goods greatly reduces stress and increases efficiency in the moving process.

Typical Costs Associated with Global Relocation

When it comes to international relocation, there are (generally) additional costs to consider above and beyond those that occur in a typical domestic relocation. Most of the benefits stated above are also included with global mobility assignments or permanent relocations, along with some more in-depth benefits that have to be involved when relocating to a new country. One key benefit should be assistance in applying and obtaining the correct visa and immigration paperwork. Here are some of the benefits included in an international relocation package that will have their own impact on the overall cost of the move:

Visa Fees

Visa applications and renewals can be a trying process. Depending on the employee and their situation, it can cover over $1,000 for all paperwork to be filed. Relocation companies tend to work with visa experts to avoid missteps, which will save everyone time and money in the long run. Companies who are hiring international candidates typically include provisions in their policies to cover any visa and immigration applications that are needed to be able to work for them internationally.

Moving Insurance

There will be some common coverage for household goods through the household goods transportation company, but oftentimes when it comes to international moves, items are sent by sea. This requires different types and ranges of coverage when compared to a domestic move. Purchasing property transportation insurance can help cover any mishaps to items as they arrive at the new destination. Most RMCs will urge companies to cover this cost in their relocation packages.

Storage Costs

International moves can be hard to coordinate, so one may find themselves in need of storage for a period of time. In most cases, HHG storage assistance is needed because the transferee hasn’t been able to find a new home yet. Others may need long-term storage as they are on an extended assignment and it is not necessary to ship their entire household to their assignment location. When there are storage options available in the relocation package, it can help the relocating employee greatly.

GMS Can Help No Matter Where You’re Headed

Global Mobility Solutions has dedicated teams for both domestic and international relocation. Our certified relocation coaches and assignment managers have handled moves from almost any state or country and can help no matter where you’re headed. Our domestic relocation services include handling all aspects of the move, including pre-decision, departure, and destination services. On the international side, we provide assistance from pre-assignment to assignment management to repatriation. 

Relocation costs can add up, but working with GMS, you gain access to a vetted and competitive mobility service provider network, complete end-to-end management of your program, and the industry know-how to ensure your program is running as efficiently as possible. Reach out to us today with any questions regarding global mobility.

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Senior Vice President, Global Account Management Sam joined Global Mobility Solutions in 1996 and has a unique perspective with her 25 years of industry experience. Samantha offers her clients relocation expertise and a commitment to excellence in her. Her proficiency in orchestrating the BVO and GPO Programs, as well as relocation policy design and implementation, are invaluable assets to the accounts she manages. Her experience in administering Pre-Decision Relocation services to enhance the recruiting process further demonstrates her unique abilities to service her clients. Samantha’s diverse experience, leadership, and outstanding communication skills enable her to manage the relocation process for her clients with finesse and polished professionalism.

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