Can you trade in your house like you can trade in your car?
When you're ready to buy a new car, many dealerships offer the option to trade in your old car. You show up at the lot, test drive the new cars, sign some papers and you're on your way in your new ride, bidding a fond farewell to your old jalopy. If only selling your house was that easy.
Putting your home on the market in these uncertain financial times can be a stressful experience. Home values have fallen 21 percent on the national level, and houses on the market are taking an average of eight months to sell [source: USnews.com]. Months upon months of cleaning and vacating your house on short notice with dogs and kids in tow so potential buyers can have a look gets old pretty quick. The market is in a slump, so it's likely that you'll have to wait months for a good offer, and if you're looking for a quick sale, you're probably going to take a hit on the value of your home.
Few homeowners are financially able to take on two mortgages, so buying one house means waiting for the other one to sell. Then there's the business of scrambling to find a new home once the offer is in. This can mean moving into a costly short-term rental or paying for storage for your belongings until you find the right house.
In today's sluggish real estate market, people are finding new and creative ways to sell their houses, and trading in a house is one of those ways. You can pick your friends, you can pick your house, and you may even be able to pick your friend's house!
In our next section, we'll talk about how trading in your house works.