Townsville developer Tropical Homes has made upgrading easier by giving homeowners the chance to exchange their existing home for up to two thirds of the value of a new property.
When someone wants to trade in their home, two agents will look at the property, provide the owner with a valuation, and tell Tropical Homes how long it will take them to sell.
If the valuation is accepted, Tropical Homes will buy the property and give it to one of the agents to sell.
General manager Chris Walters told REB that Tropical Homes has so far signed up three agencies for the scheme, which is available in Townsville only.
Mr Walters said the exchange program will encourage upgrading because homeowners will have a guaranteed buyer, they won’t have to pay agent fees and they will be allowed to remain in their home if the development hasn't been completed.
Agents will have to sell the property in the time they specified. If they have given an estimate of 60 days but fail to sell the home in that time, they will lose the listing and be removed from the Tropical Homes panel, Mr Walters said.
“So the agents have to abide by what they’re telling us, not what we’re telling them,” he said.
Ray White Kirwan, which is part of the panel, expects to win extra business from the exchange program, according to owner Brenden Southey.
“It will provide us with more listings and develop our relationship with Tropical Homes as well. We’ll get to meet more people and sell more property,” he told REB.
“Someone can upgrade their home, trade it in, pick up a new one, we’ll get to sell it – we might sell it to investors and tenant the property, so it’s an ongoing thing for us,” he said.
Tropical Homes got the trade-in idea from a UK developer that operates a similar scheme, according to Mr Walters.