Home sellers are desperate these days. Can house swapping relieve the pressure of selling in a bad market?
I was interviewed for a Fox TV story that has run across the country, which talked about the need sellers have to unload their properties so they can move on with their lives. Apparently, house trading is becoming very popular on Craig’s List and House Swapping sites have become more popular.
If you do a simple search for “house trade,” 115 milion websites pop up:
GoSwap.com, talks about “permanent house swapping” but also allows you to swap land, commercial buildings, cars, trucks vacation homes, timeshares, RVs and just about anything else you can think of – except maybe your kids.
TradeMyHomeNow.com is getting thousands of views and has dozens of single-family houses, lots, commercial and investment property listed for trade.
OnlineHouseTrading.com has been featured in dozens of stories on print and broadcast media, and even seems to have been featured on The Oprah Winfrey Show.
House Trading Basics
House trading or house swapping seems simple: You pick out a house that seems promising and offer up yours in exchange. With a house swapping site, you could see how a 3-way or 4-way trade would be possible, where each owner swaps for another person’s house.
On OnlineHouseTrading.com, the setup seems familiar: You identify the house you want to trade for, strike up a deal, arrange financing (most homeowners have to get new mortgages to replace the existing mortgage on the other house), hire an attorney (some home traders hire real estate agents or faciliators to help them establish value and complete the transaction) and close on the property. While the site makes it seem as though everyone is a candidate for a house trade – and even suggests that Realtors can double their commission by representing the buyer and seller in a single transaction – the truth is that it may be difficult to complete the purchase if you and the seller can’t establish equal or near equal value for your properties. While you can make up some of the difference with cash, it may not be as easy as you think to complete the purchase.
Watch Out for these House Swapping Dangers
- You’ll need to understand what your home is really worth in the current marketplace.
- Then, you’ll want to make sure you thoroughly understand the value of the property you want to trade for.
- Recognize that you won’t see everything you need to know about the property no matter how many photos are posted online, so be sure to schedule a visit before you complete the trade.
- Hire an attorney to go over the paperwork.
- You may want to hire a profesional home inspector to walk through the property you’re trading for, so you understand exactly what’s right and wrong with the mechanical systems and structure.
- Hire an attorney to help you with the paperwork and protect you in case something goes wrong. You’ll also want to look into title insurance and be sure to purchase an owner’s title policy.
- Do your due diligence on the owner of the other property. Make sure he or she actually owns the property in question.
If you take some precautions, you ought to be able to swap your house and relieve the pressure of selling in a bad market. Here’s a link to the FoxTV video in which I’m quoted.