Homeowners Turn To Online Home Trading Sites

MIAMI (AP) — Diane Peek needed to move from Georgia to central Florida, but for six months no one even showed interest in the house she and her husband built outside Atlanta.

In suburban Orlando, Andrew Bou needed to sell his family home to move to Atlanta, but also no luck. Peek and Bou each joined a Web site that matches people willing to trade their homes. They punched in their needs, their likes and dislikes and like two singles finding love on a dating site, they became a match. About seven months later, they swapped homes.

Peek and Bou are part of a small but growing number of homeowners who are turning to the Internet to swap properties. The sites — there are about a dozen — allow interested homeowners to browse potential swaps narrowed by giving preferences like price range, number of bedrooms and bathrooms, and city of choice. The homeowner also creates an account with the same information for others to browse.

"It was a wonderful experience for us," Peek said. "To me it's just a great thing with the housing market the way it is right now. It's a great way to hold on to your equity if you have to move."

But some experts say they don't expect online house trading to become a major trend because in most cases it's usually simpler to sell one's home, move to the other city and house hunt. Swapping also limits choices because the traders have to be swapping regions.

"I definitely know it's a growing market and certainly there are opportunities," said Paul Habibi, real estate professor at the UCLA Anderson School of Management. "I think these are still going to be one-off transactions and not the norm."

Brian Stroka, owner of www.onlinehousetrading.com, the site Peek used to swap her home, said the swaps aren't pure trades — it's a little more complicated than that. Each party buys the other's home, getting a new mortgage. That gives a bit more flexibility as the homes can be of widely differing values.

I'll Buy Your House If You Buy Mine

By JENNIFER LEVITZ
Eager to move closer to their grandchildren in Tennessee, retirees Allen and Wilma Sawtelle put their home in the Southwestern Nevada town of Pahrump up for sale in August. They got nowhere. "The market is just dead," says Mr. Sawtelle. At their open house, he says, "I think one guy came, and he'd been drinking."

Poking around the Internet for home-selling tips, Mr. Sawtelle, a 71-year-old former investigator for a law firm, discovered that anxious sellers like him are trying a new tactic: connecting with other sellers who might agree to "swap" -- or buy one another's property. The Sawtelles found a couple who were looking to move to Nevada, and whose house for sale was within driving distance of their grandchildren.

The concept of trading homes temporarily for vacations has long existed, but now it's being adapted to the slumping real-estate market as people, particularly in the Sunbelt and other slow spots, scout for ways to unshackle themselves from their property. Anecdotal evidence suggests the number of people doing this is still relatively small, but it has popped up from virtually nothing in recent years.

While some form of bartering has been going on since the beginning of time, experts say they aren't aware of house swapping being done in previous down housing markets. The technology and access to it didn't exist several decades ago. The current model is based on new technology that enables computerized matching of a large number of properties and owners' swap criteria.

Fans say swapping is suited to the current down market, where people are extra nervous about buying a new house before selling their old home.

Not everyone is a potential swap candidate, however. Swapping typically requires one party, or both, willing to settle for a new dwelling that is less than their ideal, either in amenities or exact locale. And searching for a swap is much like using a dating service: The odds can be good but the goods can be odd. Before finding his match, Mr. Sawtelle first had to deal with six unsuitable swap propositions, including one involving 450 hectares -- more than 1,000 acres -- in Costa Rica.

Getting Financing
Experts say it's probably best not to get involved with someone who owes more money on their house than what it is worth -- because they could have a tough time getting financing. And the transaction itself isn't without challenges. www.OnlineHouseTrading.com recommends that both clients use one title company that knows not to complete the deal "until everyone signs off." Daniel Westbrook, the co-founder of the company says, "the scariest thing that could happen is that you buy someone else's house and they don't buy yours."

Stuck In Your Home? Swap It

CBS Evening News: Housing Swap Web Sites Are Helping Connect Sellers In Recessionary Market

(CBS) With two kids, Melissa Petrocco and her husband needed more space, but couldn’t move until they sold their 1,900-square-foot townhouse outside Atlanta. CBS News correspondent Kelly Wallace reports that it sat on the market for nearly two years.

“We really thought in this market, we’re going to be here forever,” Petrocco said.

Across town, Lyca Shan wanted to downsize from her four-bedroom home, but had little food traffic at open houses.

“My whole plate of cookies was still there. I know that was a bad sign,” Shan said, laughing. “I was like, ‘There’s no cookies gone and those were good cookies.’”

So Shan got creative, and swapped sweets for a new strategy. So did Petrocco. They each heard about online trading sites where the idea is simple: I’ll buy your house if you'll buy mine.

“Basically, it’s like a dating Web site for houses,” Petrocco said. “Really.”

On Dec. 1, Petrocco listed her townhouse - and her wish list for a new home in the same suburb - on www.onlinehousetrading.com. Less than two weeks later, she was matched with Lyca.

“Melissa’s house popped up on there, and I was like, no way, this looks cool,” Shan said.

Just two weeks after that, Shan bought Petrocco’s house and Petrocco bought Shan’s. Two closings at the same time.

Petrocco never though she’d be using a “dating service” to sell her home.

“But it’s a brilliant idea,” she said.

Trading homes the new wave in real estate