How to House an Expatriate

One of the biggest worries on the mind of an expat is how he will be housed during his assignment overseas.

And that's also one of the biggest worries on the mind of the company's international human resource manager as well.

Across the board (barring perhaps remuneration), housing expenses takes up the biggest chunk of funds in an expat's package. This is especially so if the expat is being sent to a developed city. Surely you couldn't ask him to stay in the countryside which is a 2 hour drive away from the office he's being assigned to. Well, you could, but is that really wise, all things considered?

Many companies leave the selection of housing to a local agent, perhaps considering that they will have more experience in the local real estate than either the company or even the expat on the way there. They are quite right in thinking so, but this is where one needs to be careful. Do you include the local real estate agent as a partner, or do you simply hire them as if you were hiring any outsourced labourer?

These questions need to be asked because when an agent is being hired to simply find a room for the expat, chances are that they will find a house or room that fills out the whole housing budget, or even exceeds it. They will attempt to convince the expat to take these highly-priced rentals. After all, that's the height of their budget, isn't it? And if possible, they may even push the expat to try to renegotiate with the company or expatriation management about the housing budget so they can get a better house with more amenities - just because they can. This is something that may happen when the agent is simply that - an agent. And they are concerned first and foremost about their bottom line - more so than the welfare of your purse strings or that of your expat's.

By offering to partner with the agent and offering them reasonable incentives to recommend housing that is within or below the budget, you would be telling them that you are interested in a long-term relationship, and they in turn may be happy to take that first step in line with your requirements.

Things may not always work out that way, of course, so many companies actually leave the house sourcing to the expat themselves. A budget is still involved, but reports show that most expats max out the housing budget all the time - again, just because they can. This is not a good attitude to cultivate, so some companies successful with their international mobility projects have utilised something rather radical - a system called profit-sharing.

This time, the incentive is offered to the expat. If they can manage to find satisfactory housing below the budget they have been granted, the company allows them to keep half of what remains. This provides a powerful push for the expat to find the best housing possible - at the lowest cost. The company benefits as the expat is no longer using up every last cent of his housing budget, but the expat benefits as well, seeing the fruits of his wise budgeting habits by being able to help himself to half of whatever remains.

Of course, there are many other methods a company can use to ensure the housing budget stays controlled. The point is to craft a system where both sides can benefit fully. Remember, controlling costs, not cutting them, is the key!