In 2006, the movie, The Holiday, starring Cameron Diaz and Kate Winslet, introduced many people to the concept of home swopping. This now classic film inspired a trend across the travel world, whereby two people or families temporarily exchange their homes, generally for holiday purposes.
Home swopping dynamics
It fits nicely into the 'sharing economy' ideal; which is an economic system driven by the value gained from temporary access to goods in preference to ownership; or whereby assets or services are shared between private individuals either for free or for a fee, and which are typically accessed through the internet. Many endorsers of a shared economy do so because of the negative impact of hyper-consumption on societies and the environment or the need for more sustainable behaviour. In the case of home swopping, the ‘individualised/authentic tourism experience’ is highlighted as a shared economy and sustainable experience because it reduces - in even the smallest measure - the impact of tourism on local communities that do not enjoy vast numbers of tourists in their environments.
While it might not be for everyone, home-swopping has recently gained popularity. Love Home Swap UK saw an 82% rise in its membership last year, and global Home Exchange, which has more than 100 000 properties available for exchange, grew by 79%.
This increase in popularity is attributed to the current financial climate whereby swappers are not burdened by hotel or rental accommodation costs and can, therefore, enjoy more experiences within a limited budget. Further savings are made if the homeowners agree to use one another's cars and care for the family pets, and of course, there are no worries about leaving your home empty and vulnerable while away.
The biggest concern for those who have never used the service is the idea of strangers living in your home without supervision and whether valuables will be safe. Yes, there have been some horror stories with, for example, families returning to their homes to find their cars sold, but this is all addressed by having the right insurance or adjusting it temporarily and locking away or storing valuables in a safe environment.
All the home swap websites emphasise that while they take as many precautions as possible to protect home swoppers, homeowners should also be vigilant. Such would be not exchanging too much personal information in the early stages of exploration, and a video call is essential after the swap has been agreed to. This allows all parties to understand what each requires, where to find things, what is and isn't allowed, how appliances or the home operates community dynamics, and local tourism interests or experiences.
First-timers are encouraged to exchange with an experienced home swapper, which will remove any anxiety and allow the swap to be as smooth as possible. Also, there is a strong emphasis on only using credible home swap websites, as these usually have large teams who can guide users through the different processes.
Permanent home swop
The concept of home swapping can be taken one step further into permanent house swapping. This is basically a trade whereby two owners agree to swap homes. There are permanent home swap sites, but these are few in South Africa. No specific laws regulate home swapping, and neither do many, if any, property agencies list those, but there are such offers presented from time to time on popular online trading sites like Gumtree.
In the case of a permanent home swap, also known as a Simultaneous Sale, each sale is treated as two separate sales of properties. As such, the traditional transfer process is followed using the services of a conveyancer. The only significant difference between this type of sale and any traditional sale is payment.
Instead of money changing hands, the monetary value of one home is offset against the monetary value of the other home. There is, however, an exchange of finance if one property is valued higher than the other.
South African tax laws do apply from the basis of the 'barter' system, which the SA Income Tax Act governs. As this is somewhat of a grey area, any two parties interested in permanent home swopping should engage the services of legal tax professionals, who can determine what part of the simultaneous sale is considered taxable income. This also applies to a hospitality swap, whereby tax experts can determine how the right of use will accrue to the individuals concerned and what, therefore, is then taxable.
Overall, permanent or hospitality home-swopping does encourage people to consider visiting or buying into locations they may not have considered before. Using your home as currency means you can literally indulge in visiting places may you may have discounted as too expensive. Even better, especially if you have children, you have the opportunity to step into a home-to-home experience that caters fully for your needs without the need for transporting weighty luggage. Without the constraints of paying for accommodation, you could literally explore the world.
Writer: Kerry Dimmer
