Hurricane Harvey Relocation Update
Paul Sorrentino, Vice President, Corporate Partnerships
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Hurricane Harvey Relocation Update
With the unprecedented events in Houston having an effect on many NuCompass clients and their employees, we invoked our teams at the beginning of the storm to be prepared in the aftermath for the needs of relocating employees.
This event can affect relocating employees in all stages of relocation, from those in the process of leaving the Houston area to those who had planned to relocate into Houston. In addition, homes that were in NuCompass’ unsold inventory or BVO sales that were scheduled to close in the near term will likely be impacted.
Below is an update on key activities that we have initiated:
We continue to contact and attempt to contact employees who we believe may have been impacted by Harvey to determine their status and learn how the storm may have impacted their relocation plans. As we learn of specific situations or needs, we are contacting clients to discuss individual situations and options.
Departure Properties Under Contract
Whether it’s a BVO sale awaiting closing or an inventory property, we are assessing the status of each property and plausibility of closing each particular sale.
Currently, insurance companies have placed moratoriums on the issuance of new property insurance policies in areas affected by the storm. If buyers for these properties are unable to obtain insurance, closings will be delayed until the moratorium is lifted.
In addition, it is likely that any outside buyer will want to re-evaluate the condition of a property they were intending to purchase prior to closing. If repairs are required, this could delay the closing or cause the sale to fall out. In the event of a sale fall out, the property would enter NuCompass resale inventory.
For any BVO sale or guarantee buyout offer where an offer has been accepted and the employee has not yet vacated the property, NuCompass will need to evaluate the property to ensure that the home is in the same condition upon vacate by the employee as when the offer was accepted. Full acquisition of the property may also be delayed until NuCompass can insure the property.
Unsold Inventory Properties
As we can access inventory properties and assess their condition, we will provide information and next steps to you as needed. If there is damage, insurance claims will need to be filed and repairs undertaken by NuCompass.
Home Sale Properties in Process
For employees in the midst of the home sale process where the home is not sold or a GBO offer has been extended but not accepted, NuCompass will need to re-evaluate the condition of the property through new or additional inspections. We will also likely need to ask each homeowner to complete an updated disclosure form so that potential new buyers have full disclosure as required. As mentioned earlier, since insurers will not issue policies until further notice, we will be unable to acquire any properties until the moratorium is lifted.
Home Finding Sales
Employees who were planning to purchase homes in the Houston area are also subject to the same issues as home sellers: damaged or destroyed properties, delayed or cancelled closings, and inability to obtain homeowners insurance. We are checking on the status of these transactions and contacting these employees to determine their needs since this event may change their relocation plans or timelines.
Household Goods Shipments
Until Houston’s transportation and nearby port systems are back to normal, shipments of all types will be impacted. These issues are being assessed relative to the effect on an employee’s move.
Other Affected Areas
As Harvey has begun to move east, we are also turning our attention to the Louisiana coast, making the same assessments as mentioned above.
Long Term Effects of Harvey
While it is still too early to fully assess, we know that the recovery process could take years. One element of concern is recent news reports that between 75% and 85% of Houston homeowners did not carry flood insurance. Depending upon the amount of the loss, this could result in homeowners walking away from severely damaged properties, creating a property foreclosure and rebuilding issue over a wide geographic area. At the same time, a critical shortage of habitable housing could drive prices up in some areas.
The conflicting forces of extensive property and economic damage vs. market demand for intact properties will need to play out over the next several months. NuCompass will keep you updated on these and other issues related to Hurricane Harvey.