You can still buy real estate, including property, homes, appartments, townhouses, commercial and industrial properties, even though you don't have sufficient trade available to pay for it. Trade exchange members have recently purchased a apartments in Surfers Paradise, 64 storage sheds in Perth, penthouses in Wahroonga, houses in Ipswich, a commercial showroom in Sydney, an industrial warehouse in Brisbane. These transactions ranged from $360,000 to over $5 million. Typically, the buyer paid a 30% down payment in Trade Dollars. Where the member did not have sufficient trade Dollars in their account the balance was financed with a barter mortgage, just like in the cash world.
Contracard makes mortgages available to qualified buyers of real estate, Contracard does not charge interest on these mortgages unlike a bank which does. You provide your product or service to Contracard members and deposit the Trade Dollars into your account. A set amount is deducted from your account each month to cover the mortgage payment. Even better, Contracard brokers refer the new business you need to make the payments, and online sales can enable you to pay off the property even faster. It's that simple.
A recent offering was some new apartments on the Gold Coast. The developer had the apartments listed with a local realtor for more than 12 months and was finding sales very slow. Because he knew that he could spend the Trade Dollars on his next development, he was willing to take 30% of the selling price of the apartments in Trade Dollars. The asking price was $460,000 which was the same price that an independant valuer valued the apartments at. The 30% deposit of $138,000 was paid in Trade Dollars, the balance of $322,000 was paid by obtaining financing with a bank mortgage.
An example of creative trading would be for the buyer to apply for 80% financing of the $460,000 and get a $368,000 mortgage to purchase the apartment. The seller only requires $322,000 in cash to pay off his indebtedness, leaving an excess of $46,000 cash that the buyer keeps. The buyer can then afford to pay all legal fees, stamp duty and Contracard fees out of the $46,000 cash, after these expenses the buyer would still have approximately $18,000 in cash remaining. If the buyer only has say T$38,000 in trade in their trade account, leaving a barter mortgage of $100,000. This can be paid in product or service of approximately T$20,000 a year over the next five years.
Bottom line is, the apartment can be bought for trade and cash, the buyer walks away with $18,000 in cash and lives in or rents the apartment for five years. The apartment can then be sold for at least $560,000. Pay off the remaining cash mortgage of approximately $300,000, and walk away with another $260,000 in cash less selling costs of approximately $18,000.
If you are interested in creative trading that turns Trade Dollars into cash, let us know. Then the next time a deal comes along, you'll be the first to know.