REMARKETING

Remarketing is the ability to conclude the sale of an investor/collector’s Property to a third party buyer at a price which is reflective of a fair and reasonable valuation. Many dealers will encourage their clients to trade-up to more expensive items of Property. This is not a remarketing strategy. If the traded-up Property has been sold at a retail price, this only exacerbates the problem. When it comes time for the investor/collector to remarket in the classical sense, the investor/collector would have expended even more capital to arrive at the same place. 

Of course, there are exceptions. Had the investor/collector been given a fair and reasonable credit for the traded-in Property at fair market value which was treated as currency, and applied towards the purchase price of an item of significantly greater value, this would constitute a form of remarketing; provided the acquired item was offered at a fair and reasonable price as well. 

However, even if this were the case, the investor/collector remains in the precarious position of having to remarket the more valuable (expensive) item at some future undetermined date. If the dealer does not have an exit strategy in place, the problem remains the same. Many investor/collectors take the position that acquiring Property for an extended, long-term hold is a form of legacy or succession planning. Notwithstanding this position, ultimately the beneficiaries would be put in the position of remarketing and they may be less informed about the pitfalls associated in doing so than the person who provided the legacy.