It is 5.30 a.m. and, as you wake to the sound of yellow taxi horns blaring and garbage trucks screeching by outside, you realise a toasted pumpernickel bagel with cream cheese, a cuppa joe (coffee) and the New York Times are first on the order of business. A new day in Manhattan rushes in and you are a part of it.

Living like a native "Nu Yawka", Aussie, or Singaporean is possible and inexpensive through home exchanges or house swaps.

Rising hotel prices and currency exchange rates have made visiting some locations prohibitively expensive.

As a result, jaded travellers and those with families are turning more frequently to the swap option which allows them to stay in a local's home. This alternative form of accommodation provides a more intimate and budget-friendly way to travel.

One of the most convenient ways to organise a visit is through a home swap organisation such as Homelink International, Homestay International or Intervac. Exchanges are arranged through the companies' websites or regularly published lists of accommodation containing photos, descriptions and contact information.

In exchange for the stay, the guest offers a similar holiday in their abode at the same, or different, times. The swap may also include use of the family car, bicycle or boat.

Veteran exchangers usually leave maps of the area and a list of their favourite local restaurants, take-aways, shops, off-licences and dry cleaners. More often than not, a neighbour or relation's phone number is provided in case of problems or questions.

Depending on your arrangement, host families may ask you to step into their shoes by caring for their pet, watering the plants or cutting the grass.

Exchanges may be arranged for anything from a week to a year, although most average between two and four weeks at a time.

Budget bonanza: One of the most appealing aspects of house swapping is cost. In most cases, travellers simply pay for airline tickets, transportation to and from the airport, food, entertainment and petrol. Of course, membership of a Homestay organisation - which costs between £40 and £245 - increases the cost.

Another bonus relates to taxation. Renting out your family or second home for a fee incurs a liability on income tax. Fortunately, house swapping is simply an exchange of time and does not fall into the Revenue Commissioners' net.

Standard home insurance policies remain in effect even when there are visitors in the house. From a security point of view, it is less likely that your property or car will be burgled if the home is occupied.

Guests are advised to take out a travel insurance policy covering the country they are visiting.

Homelink International offers a travel insurance policy from the CGNU group. Cover for between nine to 17 days costs £13 when visiting the UK, £17 in Europe and £38 worldwide.

If a car is part of the exchange, motor insurance must be transferred to the guest.

Potential pitfalls: Of course, not every holiday goes as planned. The accommodation may be remote or too far away from the region's attractions for comfortable day trips. The description may not live up to expectations or you may spend too much of your holiday maintaining the property.

Another unpleasant surprise is that some culture's cleaning standard's are different than those taken for granted here.

Pet care can also be a bone of contention if the animal is less docile than described or has special medical needs.

Finding your way around a foreign locale may be a difficulty if no information is provided on local shops and restaurants.

Home swapping tips: Home exchange is touted as a "reciprocal arrangement for like-minded people". To reduce the possibility of surprises when arriving at your adopted home, consider the following tips:

arrange the agreement using a well-known home exchange company or website. These companies offer advice, a good selection of properties and may have insurance arrangements already in place. They may also mediate in the event of a disagreement;

establish a relationship with the home exchange host well in advance of your trip. This gives you time to send photographs, outline expectations and arrange insurance;

ask the host for references from past guests;

ensure that a local contact is available in case of emergency or general queries.