In this economy, is it wise to hire someone who needs to relocate for the position?

You want to hire the best person for the job, and if that person requires relocation, consider the value of bringing that individual on board versus the investment and risk. In today’s market, relocating a family can present challenges. For instance, moving someone from the mid-west to a much higher cost of living area may encounter a last minute turn-down unless all relocation issues are addressed up front, including but not limited to 1) will the spouse be able to find new employment or transfer within their company? 2) is the new school system acceptable for the children? 3) will they be able to find affordable housing? 4) will they be able to sell their current house……and what options are available if they don’t? On the other hand, because it is a buyer’s market, this may be the best time for someone to take advantage of relocating.
Some people are willing to walk away from their home (letting the bank foreclose) because they bought in an inflated market and know that selling their current home would be a losing proposition. Your recruiter will be able to help you with this decision. Candidates usually disclose insightful information with their recruiter that is not be divulged on an interview, so take advantage of this time to have serious discussions with your recruiter which may help strategize and determine if this is an investment worth taking.