Published by carratelli4 years ago

The exchange of goods is regulated and governed by the Civil Code, and more specifically by Articles 1552 to 1554...

Contract of Real estate exchange: the alternative to buying and selling 

The exchange of goods is regulated and governed by the Civil Code, and more specifically by Articles 1552 to 1554. In particular, Article 1552 mentions the exchange contract as that contract whose object is the mutual transfer of ownership of goods, or other rights, from one contracting party to the other. 

 

An exchange, essentially, involves a mutual exchange of goods or rights governed by a contract and without the exchange of money. This is possible because the contracting parties recognize, based on evidence and the objective characteristics of the properties involved (appraisal), that the value of the exchanged goods is the same. An exchange presupposes the consent of the parties involved in the exchange of goods. The absence of monetary payments is the characteristic that distinguishes this type of exchange from an actual sale. 

 

In itself, the exchange contract, once signed, has a transfer effect. In the real estate sector, however, the exchange contemplates two scenarios:

  • - pure exchange (does not require the payment of money because the exchange is between two real estate units of equal value)
  • - "impure" exchange with adjustment (involves the payment of an agreed sum to cover the difference in value between two properties)
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Real estate exchange: how does it work?

The real estate exchange This is a rather rare circumstance when considering property exchanges between private individuals. For a successful exchange to occur, two owners of properties of comparable value must each have an interest in the other's property. This can happen with a second home or a luxury villa: wishing to relocate, without giving up a property intended for leisure and relaxation, the owners consider the possibility of an exchange. Other circumstances in which the real estate exchange find application are:

  • - exchange between building area and housing unit to be built on the same (but not yet built)
  • - exchange of parts of land belonging to neighbouring properties for the purpose of regularising the boundaries
  • - real estate exchange between relatives
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The economic advantages of real estate exchange and its limitations

Although a trade is a rare occurrence, the resulting economic benefits make it attractive. First of all, in the case of a trade, a single notarial deed must be drawn up, not two separate deeds for each property. The sum, of course, will be split between the two parties: the costs are halved. Regarding taxes and other fiscal obligations, even in this case, some payments are one-off. These are all details that the professionals at Carratelli RE They'll be happy to explain. When is a swap not possible? The swap cannot involve a property still encumbered by a mortgage. In this case, the mortgage must be paid off before proceeding with the swap agreement.

 

Carratelli RE - Real Estate Professionals

If you're considering a swap, rely on a reputable agency that can guide you through every step, from checking the requirements to finding the property. Carratelli RE places all the experience and professionalism of its team of professionals at your disposal. Contact us if you want to know more!

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