Postal Service Buys $1.2 Million Dollar Home?!
The Postal Service bought this 8,400-square-foot South Carolina home so an employee could relocate. (CNN)
That’s right. The same USPS that is talking about how tough times are, that they may need to stop Saturday delivery, is the same one also in the house buying business. Here’s how our postage stamp scam works. Employees (generally execs I presume) go out and buy their glorious home. Once the USPS decides to transfer them elsewhere, they will buy their home from them to sell later as part of the relocation package.
Relocation packages are common, and all-in-all, not a bad thing. But the buck has to stop somewhere. According to the article on CNN (Postal Service draws criticism for $1.2 million home buy), the USPS has lost an average of $58,397 per home in 2008, accounting closing costs, legal fees, etc. To put that in perspective, that’s 139,040 1st class letters per house. Now take a look at this home. A beautiful home in Lake Watertree, SC (about 30 miles north of Columbia). The Postal Service has it appraised, and it comes back at $1.2 million. Holy jumping Jehoshaphat’s! I’m fairly astounded, living in Charlotte, NC, and having little positive opinion for SC (if you live here you’ll learn why quickly). The house once belonged to the former Lexington, SC Postmaster, Ronald Hopson and his wife. Wow, I didn’t know Postmasters were bank rolling like that.
Well, the house now belongs to the Postal Service, who is crying about not having enough money and wanting to cut back operations by 1 day. Maybe we shouldn’t be paying $1.2 million for houses in the middle of a housing bubble burst. Odds are, when it does sell, it will be quite some time and for quite a loss.
So now some change is definitely needed. This program, while directed under good intentions and meant to help retain talent (as they say), is showing its nasty flaws. How can we fix it? Simple. Instead of the USPS buying the house upfront, they should consider paying the mortgage payment while it is listed, and handle the listing and such. They can provide the cost for the closing and legal fees, then if the home’s owner makes a certain percentage or more, recoup those costs (i.e. set a baseline for the employee to make x% of profit prior to collecting specific fees).
Another viable option would be the one similar to the one my in-laws dealt with. In 2005, my father in-law was relocated to Greenville, SC (one of the few bright points in the state). Ironically this happened shortly after they finally paid the house off. He got to pick a realtor from a list provided by his company. They paid for all moving costs, etc. Once in Greenville, they were provided with a company condo for a couple of months, until they could locate a place to live. Once again they used a realtor designated by his company. After a couple of months they decided on a house and purchased it. The company covered the down payment and closing costs. During this time, if they had had a mortgage on their old home, my in-laws would’ve been responsible for it until they purchased the new home, which at that time his employer would’ve taken over house payments on their previous residence.
Maybe I should consider a job at the post office. Pay is good enough for million dollar mansions, and they even do a buyback guarantee when I relocate! Awesome!
This process will change though. As much heat that is on businesses for lavish expenses, this counts too. I guarantee it.
