There are many benefits of having a second home in a recreational area. This includes your ability to creatively exchange your home for other lifestyle and monetary options that might appeal to you.
You might occasionally envy those who have a timeshare in a resort area, because they can trade their timeshare allotment of a week or a month in their home location, for a timeshare in some exotic or tropical area of the world. You might think this is an attractive feature in case one tires of going to the same location all the time.
Of course, you could rent your home periodically or seasonally, and use the money to cover all or part of your travel costs anywhere you want. Or you could become a snowbird, and rent your winter or all-season vacation property, for example if you are in a ski resort area, while you spend up to 6 months in the U.S., Mexico or some other location.
However, if you own your own vacation property, you have many advantages over the timeshare option when it comes to utilizing your property for other appealing purposes, quite apart from the capital gains appreciation, and the pride of ownership and control over your property.
The main option attractive option is a home exchange anywhere in the world. A secondary option is a trade exchange, which is sometimes referred to as a bartering network.
Home or Vacation Exchange
You probably know people who have done home exchanges, or you are familiar with the terminology but not the details of the process.
Home exchanging has become a very established and popular trend over the past 20 years. In simple terms, it means exchanging your vacation home and/or primary residence with other people’s homes for a short time, such as a long weekend if they are in the geographic area, or a week to a month, or long-term for up to 6 months or a year. Home exchanges are available everywhere in the world, and can be simultaneous or non-simultaneous. Exchanges frequently include a car.
Home exchanging is an incredible and rewarding lifestyle experience. It allows you to travel almost anywhere in the world inexpensively, with your accommodation being free, and generally the car available for usage as well. Your only costs are the airfare, tourist activities, fuel for the car, and meals. As you would be eating and driving anyway back home, the net outlay can be very minimal, especially if you are using airline points, or get cheap flight deals. So, you can easily vacation away from your vacation home, and experience new adventures, sights, scenes, people and culture.
Profile of Typical Exchanger
There is no typical exchanger. They range from 30 years to 80 plus, from retirees with time and a desire to travel, to parents in their 30’s with young children not old enough for school; from teachers with the summer off as well Christmas and Easter breaks, to parents with school age children who want to travel in the summer time; from a single or couple taking a 6 month or 1 year sabbatical from work with or without kids, to adults who want to experience a year or two in different parts of the world by having a continuous series of sequential exchanges, or a long-term exchange in various countries.
Some people wish to travel around the world for many years, and knock off each item on the checklists from the various books on, 1001 Places to See Before You Die, before they pass on to the ultimate extended vacation in the hereafter. The common denominator is a love of travel, and the joy that comes from new experiences, and exploring diverse and different parts of the world.
Home Exchange Websites
To find companies who do online home exchanges, you can do a Google search under “home exchanges”, “home swaps”, “house exchanges”, etc. Some of the popular ones used by Canadians, are: www.homeexchange.com, www.homelink.ca, and www.intervac.ca.
Many home exchange sites also have additional features available for you to offer if you so wish, such as: vacation rentals, long-term exchanges, home-sitting, simultaneous or non-simultaneous options, etc.
Trade or Barter Exchange
You have likely heard of bartering networks, barter trades or contra deals. The concept is simple. People exchange one commodity for another. In other words, goods and services for similar goods and services of equal value, or obtain a credit of the fair market value to be used in the future. It can be a formal or informal process.
Over past 20 years or so, the practice of bartering for goods or services has evolved into a sophisticated computerized and fully automated system of commerce proliferated by independent or franchised, member-only barter clubs, where credit units possessing a notional monetary unit value, have become a medium of exchange. In this type of system, which is a form of trade dollar currency, commodities of different value can be exchanged, resulting in a debit or credit to the account of the member.
Some of these trade exchange companies cater primarily to small business owners, as well as individuals. The sophistication and technology has prompted many businesses to increase their sales, efficiency and profitability. With the trade dollar concept, members can buy or sell goods and services without any of the traditional restraints imposed by needing the perfect match and comparable product values. The trade exchange company is in effect acting as a bank, and tracks accounts and transactions using a system similar to that used by credit card issuers. A popular Canadian company is Trade Exchange Canada. Their website is: www.tecvan.ca.
You can see a possible option that could be enticing to consider for your vacation property. If you already rent it out seasonally, periodically, or full-time, you are familiar with the process of having other people use your home for revenue generation purposes. There could be times in the shoulder rental season, or when you are not using it for your personal needs, when there is limited or no demand for a normal rental. Or possibly you want to consider making your property available at peak or otherwise high demand times. In these situations, you might wish to use the barter system for a “rental” You would set the best retail rate you believe you could obtain for your vacation home, eg for a week or two weeks, or long weekend, and dollar credits accordingly.
There are no tax implications relating to home exchanging, but there could be for trade exchange. Obtain advice from your tax accountant.
You can see that with some initiative and marketing effort, there are creative ways of making your vacation home an even more appealing investment and lifestyle choice than you thought!
