Friday, January 13, 2012

Wanna trade?? - My bike for your……

Coming through the adjustment to the market we have been experiencing these last months has brought some ingenuity and creative ideas to Sellers, Buyers and their REALTORS®.

Moving is something you may want to do but what if you can’t get your money out of your house?  

A Common question! 

Common justification that REALTORS® will make is, “Even though you may not get what you want, Mr. and Mrs. Seller, you are also buying into the same market and can very likely save an amount on your purchase, similar to or greater than the amount you believe you are losing by selling right now.”

Good logic actually.  It makes even more sense for those Sellers who are ready to buy ‘more’ house than they currently have.  Commonly, the higher priced the property – the more adjustment seen to their market price.  The higher end of the market sees less activity simply because there are fewer Buyers, which results in excess inventory (IE., more competition). Buying ‘up’ in the market helps a seller recover the price adjustment they feel they are making to sell because they can benefit from the larger price adjustment in the higher market.  Buying ‘down’ in the market can still lighten the blow for the high end Seller as a Buyer’s Market will provide a break on price regardless of what price point you are shopping in.

Here’s an idea:  I’m now an empty nester and don’t need as much space, plus I want to move a little closer to stores, doctor, day to day conveniences’.  My house is perfect for that young couple who has saved from working two jobs over the last years, is now starting a family, needs a yard, a basement, a double car garage for bikes and things.  That young couple, with the first or second child on the way, or teenagers that want more privacy, and the second car to get to school, hockey, dance, must be feeling a little cramped in that lovely little home they started out with a few years back.  

LET’S TRADE? !               

A very practical idea many good REALTORS® will bring forward to their clients.

Through networking with their colleagues and using the Trade book at the office and the website that is available to our Coldwell Banker Realtors, we have seen many successful negotiations go this way.

You don’t have to find something of the same value – one of you does have to pay the difference .  
Your Mortgage Broker can help you work through financial details.  Often save you fees if you are simply rewriting your mortgage to increase for the different – no payout penalty, no lose of great interest rate.  It can depend on the type of mortgage you currently have but asking the questions of a Mortgage Broker that can negotiate for your benefit doesn’t cost you anything and will very likely save you.

Your REALTOR® will address all the necessary clauses in the contract that will allow you, and your trade partner, to do all the necessary research, inspections and qualifying that you need to do.  Just because they found you someone to trade with doesn’t mean you shouldn’t be sure about what you are getting.

 A smart REALTOR® will protect you from
 agreeing to sell your home before you are
 sure you want to buy the other one. 

“Subject to the Buyer and Seller entering into an unconditional offer to purchase (the other persons home address), on or before (date this the day after you have all done your homework).  This condition is for the sole benefit of BOTH the Buyer and the Seller.

Contractually, this allows you and the Buyer to do all your homework, be sure you can finance, check out the condition of the home, be certain on all the things you expect to be included, find a date that will work for both parties to move and THEN tell them you are ready to go firm –they in turn must do the same. With this Condition being for the benefit of both of you – you BOTH have to sign off and agree to move forward – together.  Otherwise one of you could have sold your house without the other party agreeing to sell theirs.  
Trades can work, and do work, very well – you need an experienced REALTOR® and Mortgage Broker to protect your position so things turn out they you intend them to.

When the going gets "Tough"...just call me.

Susan Tough

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