ALPHARETTA - We’ve all been there – or at least I think we have – when in order to get something you have to do something uncomfortable first.

It’s the old dare: You show me yours and I’ll show you mine. No! You first, I said. Really … I’ll show you mine. Really … I will.

I lost that dare when I was pre-pubescent to the judge’s daughter in her basement around the corner. She permanently scarred me from believing that people are fundamentally trustworthy. She took advantage of me at such an impressionable age. I took the risk back then, though. The payoff was HUGE and the potential loss small.

Fast forward thirty-five years and it’s still the same game just with different stakes.

There are scads of people who would like to sell their homes and they are even realistic about having to reduce the price to get it sold.  However, they are reluctant to show you theirs, so to speak, because they are afraid that when they become a buyer that you won’t show them yours.

Buyers have repeatedly told me:  "I’d be more than willing to lower my price $50,000 if I was sure that I could save that $50,000 when I purchased my next home."  The thing is, we all have our own judge’s daughter in our past who has made us distrustful of our fellow man.

The Problem

The result of this situation is a huge real estate log jam.  No one can buy because no one can sell – and many first time homebuyers, who don’t have anything to sell, have already purchased in the last two years or now have more trouble qualifying for a mortgage and/or coming up with the required downpayment.  So how do you solve this trust issue where today’s sellers don’t trust tomorrow’s sellers?

The Solution

One solution has been the "Buy This House and I’ll Buy Yours" program.  You may have seen this on a for sale sign rider.  These programs are run by realtors who are ostensibly trying to help their client sell their home.  The idea is to remove any obstacles from keeping a prospective buyer from buying – you might call this a mini log jam solution, because the programs are really targeted to a single transaction, not an entire marketplace that is in gridlock.

This program is closely related to the "I’ll Buy Your House If It Doesn’t Sell in 90 Days" program.  The buy out prices in these programs are typically so low that you’d probably not want to sell at that price and mostly the purpose of these programs is to generate listing leads and appointments for realtors.  The low buy out price has some shock value in getting sellers to glimpse what their house may truly be worth, but in reality, the realtor doesn’t really want to buy your house.  He wants to sell it and if, indeed, he winds up buying it, his program has failed.

Property Swapping

Another solution, aimed more at the systemic gridlock of the real estate market is the house swap option.

Over the past year, I’ve had more and more people approach me about swapping their home instead of selling it.

The idea here is that by not going out into the broader marketplace you insulate yourself from the possibility that you won’t be able to buy low if you have to sell low.  Remember the judge’s daughter?  I sold low but couldn’t buy low.

If you enter into a swap agreement, both parties are simultaneously obligated to each other – that is the key.  You jointly buy and sell at the same time, agreeing on the relative value of each other’s properties.  Everyone shows everything up front – no chance to be have sold low and now be able to buy low – or at least for both parties to have taken roughly equal discounts.

I know a family with a 4+ acre horse farm on Hopewell Road in Alpharetta (Milton), shown on the right, who would like to trade for something smaller in a subdivision.  They say they can’t reduce their house to what it would take to sell it, but they could possibly trade.

I’ve also known people in the area who were having a tough time selling and voiced interest in trading with someone from Florida.  There are scads of Floridians who would love to move to GA, but can’t sell their house in FL.  How about a trade, Mr. Gator?

These trade opportunities are great, but how do you find them when they are floating around in the heads of local realtors?

To that end, there are some new property swapping website that are coming online.  They are in their infancy, but the opportunity is there for them to make a dent in the real estate log jam.  Check out, for instance, www.PropSwapGlynn.com , which is a site focusing on property in St. Simons and Brunswick, GA.  Anyone want to swap their permanent residence for a vacation property on the beach?

There is also a brand new site for property swapping in Atlanta at www.PropSwapAtlanta.com .  If you want to sell your home, it would make sense to work with a realtor who will also market your home for swap, not just for sale.  You can’t put too many irons in the fire in this market.

If only I had had the internet back when I was interacting with the judge’s daughter.  We both could have gone online, found each other and negotiated our exchage and commitment before we – or at least I – put our tender feelings on the line only to get snubbed.  Lesson learned – and applied to real estate.