What marketers do not resort to to attract a client. A new service called “trade-in” has appeared on the real estate market. In fact, this is a marketing product of an accelerated transaction - the purchase of an apartment with an offset of old housing. In the context of a decline in sales, it is in demand among those buyers who seek to quickly close a deal. Experts of the real estate market told more about the trade-in, its pros and cons.
Complete service
The trade-in scheme appeared a long time ago, but initially it was used in car sales. This tool has been adapted to the real estate market relatively recently. Two factors contribute to its spread: the lack of buyers of the entire amount and the presence of old housing, which is planned to be sold.
Under the trade-in scheme, a client can book an apartment in a house under construction with a fixed price, after which the developer (by himself or with the help of an involved agency) will sell the existing housing so that the amount from its sale will be offset.
“This is a full-fledged service, but you need to understand that it is not always possible to find a buyer for old housing. The secondary market is going through hard times, citizens tend to buy apartments in new buildings: they win in terms of quality / price. Therefore, there are many people who want to use the trade-in service, but there are fewer completed transactions under this scheme, ”says Dmitry Mikhalev, head of the service for working with government agencies at SPb Renovation.
In the elite segment of the suburban market, trade-in is practically not developed, in contrast to the automotive business: the life of the car is much shorter compared to an apartment, and even more so a house, which is always taken with the expectation of a long stay.
“Trade-in is, first of all, marketing and a way to boost sales,” says Valentin Zuev, Head of Sales at Villagio Estate. - We had experience of using this technology several years ago. In the crisis year of 2009, when various methods of stimulating demand were used. We had everything necessary to carry out such transactions: a large selection of properties in the villages and a wide pool of partners who could help with the sale of the buyer's home. But a year passed before we managed to close one deal. Then the client exchanged a Moscow apartment for a townhouse in our complex, 20 km along Novorizhskoye Highway. The reason for so few transactions was not a lack of interest on the part of the buyer - on the contrary, many families came to us, counting on a trade-in. It was the tactics of the clients themselves: everyone wanted to sell housing at a higher price and did not want to reduce the prices of their apartments or houses, and we could not keep the lots in reserve for a long time.”
As practice shows, when the seller is not limited in terms, sooner or later one of three things happens: either the owner will adjust the price in accordance with the market, or invest more money in the object to improve its characteristics, or finally there will be a buyer who agrees to pay a little more for a house for some reason (for example, location, unusual architecture, etc.). But when it comes to trade-in service, timing plays an important role. And most developers are not ready to wait for a client for six months and keep a reservation for objects for more than a month.
An interesting fact is that trade-in and netting are two different services. According to Svetlana Birina, head of the urban real estate department at NDV-Nedvizhimost, trade-in is irrelevant in the current market conditions, but the offset share has grown from 30% to 45% of demand. “Today, a trade-in is a profitable and sought-after deal, as people are trying to exchange a falling secondary property for a growing asset, that is, a new building,” says the expert. - The transaction is made at the same time: the client immediately sells and buys an apartment. As a result, market players work precisely with the netting scheme. Moreover, even if the service is called a trade-in, it will probably be the same netting. Here we emphasize once again that the purpose of these schemes is the exchange of old housing for a new one, but the technology of the transaction is different.”
Fixed price
Thanks to the trade-in, the client fixes the price, books the apartment he likes, which he can buy before he sells the existing housing on his own and receives funds for the purchase.
Nikita Chulochnikov, a member of the board of ACON, believes that the benefit is the opportunity to make a deal at a fixed price, which in a turbulent market is a stability factor.
“If the client has standard conditions (both apartments in the same city; an apartment without encumbrances and registered as a property) and standard requirements for the acquired housing, with a shortage of time to select options, then this scheme makes sense,” he notes. “But it must be taken into account that the agency will accept the former housing at a significant discount, possibly up to 20-25%.”
“Under the trade-in scheme, we mean a mechanism under which a company buys out an old apartment, and in return provides the selected option in a new building,” says Svetlana Birina. “Taking into account the fact that the company keeps the object on its balance sheet and assumes the risks of selling housing, the buyout is carried out at a discount, which is the main disadvantage of the scheme.”
By using a trade-in, the client essentially loses nothing. Professionals are engaged in the sale of his apartment, the apartment is booked, the price for it is fixed. An alternative would be to buy a new building in a mortgage, which is subsequently extinguished by selling existing housing. However, the costs of such a scheme, according to Dmitry Mikhalev, are much higher.
“The category of buyers who purchase a new apartment by selling existing real estate, in most cases, draws up an installment plan, planning to close it after the sale of the old housing,” adds Sergey Stepanov, sales director of the Stroitelny Trust company, in turn. “In this case, the client can independently form the most convenient payment schedule, as well as avoid overpayment of bank interest.”
The disadvantage of a trade-in is that, unlike alternative transactions in the secondary market, when buying on a net basis, the client does not have the opportunity to register. The buyer, until the moment of obtaining ownership of the object purchased on the primary market, in fact, lives without registration and without ownership (which can be issued only after construction is completed). With alternative transactions in the secondary market, this problem does not arise - the exchange of ownership occurs at a time.
When concluding an agency agreement for the sale of an old apartment, experts strongly recommend that you carefully read the document. This action will allow you to protect yourself from possible problems. It is desirable that the client had the opportunity to refuse to buy housing in the primary market when selling an apartment. Obviously, in this case, the developer will have to pay part of the commission, but this is a normal situation, since in fact you sold the apartment and paid a lower commission compared to the average market.
Strict selection
Today, several developers are known to offer to make a purchase in their netting projects. For example, the Morton company provides an opportunity to sell an apartment and purchase a new building in any of more than 30 objects under construction and being sold. The same scheme applies to the residential complex "New Vatutinki" from the developer "Investtrast". Special conditions for the purchase of housing by trade-in are also offered in the V Lesus microtown from the ROSE GROUP company. Urban Group also has a similar service.
Since developers buy real estate owned by the client in exchange for an apartment in a new building or a house under construction, developers impose a number of requirements on apartments participating in trade-in transactions. The requirements, according to Renata Belyaeva, head of the legal department of the KASKAD Family, depend on the developer. For example, it is necessary that housing has been owned for at least three years or that there are no registered persons in the apartment at the time of sale, etc. The territorial affiliation of the object is also important.
According to Maria Litinetskaya, managing partner of Metrium Group, the share of trade-in sales in the total number of transactions in the primary market is insignificant. “Firstly, few real estate and development companies offer such a purchase scheme,” the expert says. - Secondly, not every real estate object is accepted on a mutual basis. Thirdly, some buyers prefer to do the selling themselves. When offsetting, a realtor or developer offers their value to the client. However, in some cases, the client does not agree with the announced amount and therefore sells the apartment through a third-party realtor. As a result, the netting scheme, on the one hand, has a demand, and on the other hand, there are limiting factors for its implementation and further distribution. Thus, in the Novye Vatutinki residential complex, the number of trade-in transactions is less than 5%.
Summarizing the above, it turns out that a trade-in is a service that attracts additional interest in the project. The program is gaining popularity because of the crisis and the convenience associated with saving time. However, such a scheme is unlikely to become widespread, since not any property is accepted for trade-in.
The exchange of apartments is a phenomenon that is gaining more and more popularity in the real estate market. Now residents of the Moscow region can exchange their old housing for a new one from Brusniki. We tell you what you need to know about the modern way to buy an apartment.
What is a real estate trade-in?
Trade-in is one of the ways to buy an apartment. The developer buys the client's old apartment and uses this money to buy a new apartment in one of his properties. Two contracts are immediately drawn up - on the sale of housing and on participation in shared construction.
With a trade-in, the client does not need to look for a buyer for his apartment, go to shows, negotiate a price, draw up mountains of documents and wait. He draws up everything at once, and pays for a new purchase by any convenient way: cash, takes in installments or mortgages.
What are the advantages of the exchange program in Brusnik? Unlike most other offers on the market, when Brusnika buys an apartment, a person does not have to wait until a buyer is found. So, you can close the purchase of a new apartment within 5-10 days. At the same time, the client receives an additional advantage: the opportunity to live in his former apartment for another three months.
What apartments does Brusnika accept?
When purchasing a new apartment in Brusnik, the existing housing can be given as payment, even if it is in a mortgage. The apartment must be wholly owned, not under arrest or prohibition, must not be encumbered with the rights of third parties. The owner can participate in the program if his house meets the following criteria: the number of storeys is from 5 and above, without wooden floors, is not in disrepair (less than 40% wear), not older than 1970, or after overhaul, not long-term. In the event that redevelopment was made in the apartment, it is important that it be agreed and documented. Previously, the Brusnika company accepted only apartments in the city of Vidnoye under the Exchange program. Now the geography has expanded significantly. Residents of Chertanovo, Northern and Southern Butovo, Tsaritsyno, Biryulyovo, Izmailovo and other areas of the Moscow region can become participants in the program.
How does the exchange take place?
Becoming a member of the exchange program is simple: you just need to choose and book your favorite apartment in one of the Brusniki houses by filling out an exchange application. Next, a specialist will contact the client and set a convenient date for viewing the apartment. Within two days after the assessment, the cost of the client's apartment and the price of a new apartment in the house you like are fixed. Brusnika employees will help you arrange a mortgage or installment plan for the amount that will be the difference between the cost of the old apartment and the new one, if necessary.
Publication date 05 September 2018Image Source: Lori Photobank
Many owners of apartments on the secondary market are thinking about changing their old housing to a new building: after all, the quality of construction today is completely different, the layouts are more convenient, many residential complexes offer a very interesting concept of improvement and infrastructure ... But the secondary market today is experiencing a noticeable shortage of demand, and not every owner manages to quickly sell their old property. During this time, prices in a new building that you like may rise, and interesting options may go off the market. How to successfully sell the old and buy a new home, portal metrprice.en learned from real estate experts.
Fit in a month
In its classic form, the trade-in service in the apartment market can be provided according to one of the long-established schemes:
- Shorttrade-in with price fixing. The cost of an apartment in a new building is booked for a month, and during this time the owner needs to sell his old home. To meet the deadline, most often you have to agree to a reduction in the price of your home.
- No price fixing. An apartment in a new building is booked without price fixing for a period of about three months, which increases the chances of the owner of the old apartment to sell his home without a big discount. True, it must be borne in mind that during this time the prices in the new building may rise.
Here is an example of the trade-in scheme that the company provides today in the Domodedovo Park and Novogorsk Park residential projects. “Under the terms of this program, the buyer of an apartment makes an advance payment of 1% of its value,” says CEO of MIEL-Novostroyki Natalia Shatalina. - Next, the selected property is booked for 3 months, the cost of the apartment is fixed. But in order to conclude such a booking contract, it is necessary to present a signed contract for the sale of a secondary apartment with a real estate agency or other selling company.
Every tenth apartmenttrade- in
The trade-in service cannot be called highly demanded in the real estate market, the same mortgage is used much more often today. According to Irina Dobrokhotova, Chairman of the Board of Directors, the share of offset transactions today is no more than 10%.
As for the developers themselves, many of them have this option: according to data, in the mass segment, the trade-in service is offered in about half of the projects (49%): Kvartaly 21/19, Fili Grad, River Park , "Water", "Horizon", "Mir Mitino", "Northern", "Peter I", "Park of Legends", "Life-Mitinskaya Ecopark", "Domashny", etc. Buy an apartment in New Moscow on trade-in can be in the LCD "New Vatutinki", "Prima-Park", "Legend", "New Butovo", "Butovskie alleys", "Andersen" and in 6 other projects.
However, despite the prevalence of the service on the market, the number of transactions under this scheme is small. According to Managing Partner of Metrium Group Maria Litinetskaya, the share of such purchases today is about 5-7%. One of the reasons is that owners of second homes often inflate the price tags on their apartments. “Not all owners agree that the developer sets a price for their housing that is adequate to the market, so they prefer to sell the apartment through a third-party realtor,” the expert says.
The number of trade-in transactions has been growing in the last 2-3 years, which is explained by a decrease in the solvency of the population. Typically notices Maria Litinetskaya that netting began to occur even in the elite segment, where, it would seem, wealthy people can afford to buy housing without selling the old one. This once again shows that the crisis has affected all segments of the market.
Who will not be accepted in trade-in
If you are going to exchange old housing for a new one, you need to remember that not every secondary apartment will be accepted into the netting scheme - developers and realtors have quite a few requirements in this regard. For example, in the Metrium Group company, within the framework of trade-in, they do not consider apartments located further than 20 km from the Moscow Ring Road, as well as land, suburban and commercial real estate. “Interestingly, we received requests, for example, to sell a business in order to get an elite apartment in return,” says Maria Litinetskaya.
Real estate must also have order with documents, indicates. “For example, we will be forced to refuse a client who has not yet inherited, but has already decided to sell the inherited apartment,” the expert says. Objects under arrest, encumbrances, etc. will not be accepted for sale. But a mortgage, as one of the cases of encumbrance, does not hurt to exchange housing under the trade-in scheme.
When to "enter" a new building on trade-in?
Buying an apartment in a house under construction, as you know, is most profitable at the start of sales - at this moment, the cost per square meter in the project compares favorably with the average market indicator. However, at this stage, the developer is not interested in TRADE IN deals at all, notes Irina Dobrokhotova (BEST-Novostroy): at this time, as a rule, he has the most active sales, when apartments are purchased not only “for themselves”, but also for investment purposes. The lowest starting prices are usually kept for a month or two, respectively, the developer switches to the TRADE IN scheme a little later, when the first, most powerful, flow of customers subsides.
If a person sells his only home to participate in a trade-in transaction (and according to Metrium Group, 70% of clients who receive this service do this), then buying an apartment in a new building at an early stage of construction under the trade-in scheme may turn out to be not so profitable. Waiting for your new living space for 2-3 years in a rented apartment will be quite expensive. Therefore, it is best to purchase an apartment in a new building on trade-in about a year before delivery. residential complex, He speaks Maria Litinetskaya ("Metrium Group").
The abundance of real estate agencies suggests that every day thousands of people solve their housing issues, which means that you may be lucky to quickly solve your problems.
So, there is a desire to change your old apartments to new ones.
We can bring to your attention a number of proven and often used reliable methods that will help in your business.
Trade-in
We are all familiar with the trade-in system from the automotive business. But few people know that the same is possible in real estate. The method of bartering apartments through a trade-in is as follows.
you attract third party company, which buys the dwelling you are interested in in a new building on the security of your apartment.
Knowing that your dream home has been purchased, you can safely sell your property.
When receiving funds, you just need to carry out buying and selling with an intermediary, leaving him a reward in the amount established by the contract.
After completing this entire procedure, you become the full owner of the desired property while selling your home.
From the developer
If there is a desire to buy an apartment in a newly commissioned new building or, even at the construction stage, then you need to contact the developer.
Offer the firm that built the house to make a barter of a dwelling for a new building. The builder's representative must assess the condition of your home, after which, he will talk about the conditions of barter.
If they are acceptable to you, you sign an exchange agreement with legal entity. After signing, the developer receives your housing, and you receive new apartments.
Contacting a realtor
If you don’t want to delve into the process of exchanging apartments on your own, you are too busy and don’t have time, you can contact a real estate office. Your home will be assessed and offered options by barter.
In addition, some real estate companies, if they consider such an investment profitable, may purchase an apartment on your own, so you will receive not only the option of a new building for purchase, but also money for your property.
Which method to choose - it's up to you to decide based on the circumstances, but for now - we'll talk about the nuances.
In order for the transaction to exchange old housing for a new one to go through properly, a number of nuances must be observed.
We will talk about them in more detail in the paragraphs below.
Where to begin?
In order to make your home attractive for purchase and sale, as well as to rose slightly in market value, preparations need to be made.
In this case, the owners can no longer conclude an exchange contract. They need to draw up a contract of sale bilaterally.
And the party that must make the surcharge simply give the difference before going through the paperwork in Rosreestr.
More for less
When exchanging a larger apartment for a smaller one, you can also require a surcharge. In this situation, it is also filled contract of sale.
Other Features and Complexities
The main difficulty is that old housing is valued somewhat cheaper than new. When contacting a real estate company, remember what they can offer the cost of housing is not higher than 80 percent of its market value.
If you are ready to sacrifice such an amount to save time, be prepared for such a development event.
If funds are expensive, then much It's best to contact the builder directly. or try to realize the apartment yourself.
The exchange of apartments is no longer an innovation in our real estate market, and yet, many citizens are still wary of such a procedure. Having studied all the nuances, we can say with confidence that there is nothing complicated in barter. Good luck with your transactions.
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Trade-in is a scheme in which the developer buys an apartment from the owner at his own expense. At the same time, secondary housing is usually valued at 10-20% below the market value. After the developer becomes the owner of the apartment, he can already sell it on his own. In return, the owner can purchase housing in the developer's new building with the proceeds. However, an important point should be noted: if the money received from the sale of the old apartment is not enough to purchase a new one, then you will have to pay the missing part from your own pocket.
Naturally, such a scheme has a number of inconveniences, and for this reason it is not wildly popular in Russia. On the one hand, it is unprofitable for the developer to buy second-hand apartments and thereby take on the balance sheet another object that is a source of costs: maintenance, resale, taxes. And the owner of secondary housing seems unfairly underestimated.
Therefore, the so-called settlement system is more popular on the Russian market. In short, the owner of the apartment first sells his housing with the help of one company at an adequate cost, and with the money received he already purchases an apartment in a new building. At the same time, it is possible to first book housing in a new building, and only then start selling your old apartment.
Trade-in schemes differ from settlement schemes by the speed of the transaction. In the first case, the transaction is made in the most short time, since there is no need to find a buyer, and only two parties are involved in the scheme. In the second case, of course, the speed of the transaction is significantly reduced: to search for a company that sells housing, then to search for a buyer, to complete the transaction, and, finally, to purchase the long-awaited housing in a new building. But in the second case, the old apartment goes at a higher price, and there is an opportunity to correctly invest the proceeds.
It would be quite logical to ask the question here: if you sell an old apartment and buy a new one in return, how does the settlement process differ from a regular alternative transaction? There are a number of nuances here: a “trade-in” transaction refers specifically to a transaction related to the purchase of housing in a new building, and, which is typical, when putting up an old home for sale, the client already knows exactly what he wants to buy in return, and often already in advance Books a specific accommodation. In addition, first of all, the sale of the client's apartment takes place, and only then - payment for the rights to the new building. In the generally accepted alternative scheme, it is customary to perform these operations simultaneously.
According to experts, the "trade-in" scheme and the settlement scheme in the conditions of the modern Russian real estate market will be used more and more often, since it is a good way to additionally extract funds for the purchase of housing in a new building. Moreover, given the unstable situation on the labor market and the ever-decreasing chances of both getting and paying off a mortgage, "trade-in" for many owners will be a real way out of the current situation, and a real way to improve living conditions.
Be careful: "trade-in" in its purest form, that is, with the redemption of the old apartment by the developer, is a way to greatly bring down the price of your old home. For it usually give no more than 70% of the market value. In addition, developers have a number of requirements for the purchased housing, which must also be met in order for the transaction to take place. In particular, the apartment must be free both legally and physically. Shares and communal rooms in the "trade-in" are not used.
The settlement system also has its drawbacks. In particular, the burning question is where the owner should live in the period between the sale of the old apartment and the receipt of a new one? Also, the participation of minors in the transaction may become an important point. If there are children among the owners of the old apartment, then the guardianship authorities can intervene in the transaction and disrupt it.
It is also worth considering the fact that the term for booking an apartment in a new building for a settlement scheme may be limited. Most often, the developer agrees to reserve housing for two to three weeks, but not longer. Accordingly, the sale of old housing will require urgency, which additionally forces the owner to agree to a lower price.
Nevertheless, this method is quite convenient, real and is a good solution for improving living conditions.