Global Mobility is often challenged by local HR about the housing budgets in a given location. What do you do in this case? Do you consider HR’s input and potentially adjust the housing budgets accordingly, or do you maintain the housing budgets based on the data from your provider? This can be challenging. It cannot be ignored that housing is a key, visible, and often emotional element for the assignee. Your local HR team knows this too. The offered housing budget impacts the acceptance and the success of the assignment as the assignee’s family needs to be comfortable living in the accommodation abroad.
In most cases companies follow the housing guidelines / data supplied by the data provider. The main advantage of this approach is that it ensures consistent and defensible housing data across all locations. It also reduces additional administration for Global Mobility.
As a Global Mobility consultant, you need to find the right balance and it is true that some circumstances may require exceptional measures. Obviously, local HR may have valuable input, especially in locations with highly volatile housing markets or limited availability. It is important to get to the bottom of the issue and understand the underlying problem. Getting detailed information from your Destination Service Provider is also very helpful. We recommend changing the housing budget based on input from local HR in exceptional cases only. It should also be noted that adjusting the housing budgets based on input from local HR may not always solve the issue, e.g. a higher housing budget will not increase the number of properties available on the market at a given point in time.
Eventually, the best way to avoid exceptions is to involve local HR in the initial setting of housing budgets (when transitioning to a new data provider and/or when updating your policies). This ensures the housing budgets are set at the correct level and are in line with your company’s housing policy. Having local HR validate housing budgets on a recurring basis, or when updated housing budgets are released, helps syndicate local HR around the policy and ensures that applied housing budgets are aligned with local HR’s expectations in specific locations. However, this may lead to deviating from applying a consistent methodology across all your locations, which makes it difficult to defend housing budgets over time.
Don’t hesitate to reach out to us if you experience this common issue with housing budgets. We have helped many companies in this respect and can help you!