In Orlando, Florida, life coach Susan White traded two half-hour coaching sessions with a designer for work on her business website. A bartering veteran, White made a similar trade a few years ago with a massage therapist. “The woman needed practice students while she established her business,” White says. “For six months, I worked with her and got Reiki massages in exchange.”
“Shopping your closet” is in vogue now, even among the trendiest. Instead of donating or selling items on eBay as before, though, style mavens are swapping clothes to save money. Monika Royal Roberts, a self-described clotheshound in Cincinnati, usually spends $200 to $300 a month on her outfits. “I like to change my wardrobe seasonally, and I don’t like to repeat seasons from one year to the next,” says Roberts, who works for a marketing firm and writes a fashion blog. The recession has forced her to scale back her shopping, “or else I’ll never retire,” she says.
Roberts recently attended a clothing swap, sponsored by a website in a conference center ballroom, that featured not only used clothing but also new items from local designers, along with wine to keep things festive. She took four items from her closet—including a Tory Burch sundress that no longer fit—and got $100 in credits. In return, she brought home eight pieces, one of them a designer dress by Miu Miu. As she wrote in her blog: “My take? Go to shop-and-swap events, and go often.”
Other fashionistas use meetup.com, a site that connects people with common interests, to swap clothes. Between May 2007 and May 2008, there were about 180 Meetup clothing swaps across the country, and in the following 12 months, almost twice as many were arranged through the site.
As real estate continues to slump, homeowners trapped by the sluggish market are joining the swap economy too. House trades have long been a niche option for vacation homes and investment properties. Now primary residences are being traded.
In 2006, when Sergei Naumov, a computer programmer in St. Augustine, Florida, got no bites on his house in three months on the market, he launched a house-swapping site, goswap.org. In its first year, the site received about 90 listings. Today, it has more than 10,000 accounts, listing houses all over the country, including a four-bedroom colonial in Leesburg, Virginia, and an upscale condo in Seattle. “We even had a guy who swapped his boat for 300 acres in Canada,” Naumov marvels.
Ryan Flickinger, an educational fund-raiser, spent more than a year—564 days, to be exact—trying to sell his 2,000-square-foot, three-bedroom town house in Oak Park, Illinois. He and his wife had bought the home in 2006 for $435,000, but after they separated in 2007, the house was too big for him (as was the monthly mortgage payment). He listed the property with real estate brokers and repeatedly cut the price, but he still couldn’t find a buyer. “I had something like 40 or 50 showings and a dozen open houses, and I got zero offers,” Flickinger says.
Finally, he listed it on several of the new home-swapping sites. A few early offers fell through—one was from a developer in downtown Chicago looking to unload some fancy condos—and then he got an e-mail from a woman, who coincidentally also lived in Oak Park, with a 1,100-square-foot, one-bedroom condo that she wanted to trade. After due diligence, Flickinger closed the swap deal just two and a half months later. The homes weren’t worth the same amount—Flickinger asked $395,000 for his town house, and the woman wanted $200,000 for her condo—so the closing paperwork was set up as a simultaneous buy-and-sell. He had to show up with about $8,000 to cover closing costs, but he walked away with a substantially smaller mortgage.
Plus, his moving costs were minimal. “I was willing to move to Florida or Boston,” says Flickinger. “But I wound up four blocks away.”
Such swaps are becoming so common, they now have their own specialists. Dave Dessecker, a real estate broker in Orange County, California, has arranged 30 residential trades for clients. Right now he’s working on a four-person trade involving an undeveloped lot in Maui and homes in Carlsbad, California, Prescott, Arizona, and Durango, Colorado. As long as the real estate market stays cold, he says, people will get creative.
And as long as the recession lingers on, people will keep trading with each other. Some, like Ron Trejo, say it’s working so well for them, they plan to continue bartering even when the economy turns around. Why stop when the deals just keep getting better? Recently, he and his wife had their master bathroom retiled. They also both got LASIK eye surgery and had their teeth whitened.
While Trejo can’t predict the next boom, he has a pretty good idea of his next vacation. “We’re thinking about a trip to Miami,” he says.