MacDonald traveled to Yahk to accept the trade and then turned it around for a small-panel truck -- a far cry from a home, but at least it had heat and doors. He was getting closer.
After swapping the truck for a recording-studio contract, he met a young singer-songwriter named Jody Gnant who desperately wanted to record her music.
"I offered one year of free rent in a one-bedroom apartment in lovely downtown Phoenix," Gnant said.
It was this trade that made MacDonald realize that he was part of something very special and that he was not only bartering for a house, but he was in the business of granting wishes.
"She said, 'I really want that recording contract. … This is my opportunity to get my album done,'" MacDonald said. "Her personality just came through over the phone. … And I said, 'Done.'"
So, with a legion of media in tow, he made the trip to meet Gnant and exchange the recording contract for the apartment.
"People said, 'You got your house, you know. You made it to this house,' and I was like, 'Well, it is a house, but I only have it for one year,'" he said. "'I'm going to keep going until I own a house.'"
With millions of people now clicking on his Web site and with MacDonald now appearing on TV and radio shows across North America, this big adventure was about to take an extraordinary turn.
A woman named Leslie Criger, who also lives in Phoenix, was about to make an offer that would propel "one red paper clip" to a whole new level.
"She says, 'I would like to get you to hang out for an afternoon with my boss,'" he said. "I said, 'Who is your boss?' And she goes, 'Alice Cooper.'"
Though Criger, who works in the rock star's restaurant, hadn't even spoken to her boss about it, his reaction couldn't have been more positive.
"I started thinking about it and going, 'That's genius,'" Cooper said. "The smart thing is, he doesn't make a trade unless the other guy is getting a great deal."
So MacDonald headed back to Phoenix to meet Criger to trade one year's free rent in a Phoenix apartment for half a day with a rock legend.
Before MacDonald moved on to find his next trade, he was asked to join Cooper on tour in Fargo, N.D., where he was brought on stage holding the symbol of his journey.
"Being on stage was totally surreal," he said. "The fact that we were holding a red paper clip over our heads together made … this whole project really come together."
When MacDonald posted an opportunity to hang out with Cooper on his Web site, offers came pouring in by the thousands.
His next trade would be different from all the others, and would stun and baffle his fans.
He traded the hang time with Alice Cooper to a concert photographer from Cincinnati, for a motorized Kiss snow globe.
The move turned out to be the right one as actor Corbin Bernsen, best known for his role on the hit TV show "L.A. Law," was waiting in the wings to snatch it up.
"I have 6,000 of them," said Bernsen, an avid snow-globe collector." I never heard of the Kiss snow globe."
Bernsen said that when he saw the snow globe: "I said, 'Got to have it.'"
He then traded MacDonald the snow globe for a speaking role in a film he's about to direct titled "Donna on Demand."
"There's someone out there who wants to be an actor," MacDonald said. "I think this is an amazing opportunity."