Real estate exchange is a very interesting way to facilitate a real estate negotiation. It also becomes an option in times of crisis, when selling a house or apartment can seem an impossible challenge to achieve.
For these reasons, the real estate agent needs to be aware of all the details of this transaction. As the name implies, real estate exchange is done through the exchange of goods at the same time between the parties.
It is possible to carry out this type of business with houses, apartments, land or commercial properties. However, they do not need to have equivalent values, as the party providing the lower value property can carry out bank clearing.
Although it seems very simple, this property payment option establishes some rules and requires some care so that everything works out. As a realtor, you have an obligation to know the rules of the game to broker the deal in the best possible way.
The conditions of real estate exchange
There is full legal security for real estate exchange. Therefore, there is no need to worry about its legal recognition. The important thing is to have a prior and clearly established agreement between those involved.
At first, the value of the properties to be negotiated need to be evaluated by the buyers. They are responsible for this. The intention to facilitate the acquisition of a residence with another cannot be prejudiced.
What should the real estate exchange contract look like?
Like any negotiation, the contract requires special care. After all, negotiations of this type must be done through public deed. Liability for taxes and delivery date of the properties must also be properly documented.
There are also the standard precautions of any type of real estate contract, such as the cost of the deed, which is between 4% and 6% of the value of the property purchased, and the value of the property. Do you know what renders is?
Rules for Income Tax (IR)
When the real estate exchange is carried out with properties that do not have equivalent values, there is the call to become. This is the amount that must be paid by whoever offers the unit with the lowest value. This amount is also important because it interferes with the payment of IR (Income Tax).
In cases where there is no return, the IRS understands that the value of the property remains the same, as declared by the former owner. Therefore, the real estate exchange is exempt from income tax. In cases where there is a turn, the IR is paid by the person who received it.
It is worth mentioning that all capital gain Income Tax reducers on the property are still applicable. And the value of the capital gain is proportional to the volume of the render.
Other advantages that exist in real estate exchange
Real estate exchange has numerous advantages. For example, the need to take some credit is dispensed with. The bureaucratic process of this transaction is also much smaller, summed up in the agreement signed for the exchange of goods.
In the end, the parties involved must end up with some property that can earn them investments in the future. Positive points that add to the lack of need to use money.
And who pays the broker’s commission?
Considering that the real estate exchange is practically a double sale and the work is also greater, this can be reflected in the realtor’s commission. There is the issue of negotiating property values, the terms of exchange and the need for visits to the properties involved. All this justifies a larger commission that can come from both parties.