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Fractionalizing Makes Luxury Vacation Homes Easier to Afford
8/14/2007 2:19:27 PM
Forbes.com recently published an article regarding luxury vacation homes and the best places to purchase them. A second home in the Hamptons used to be only a dream for most people (and it still is), but by purchasing a fractionalized property, it's becoming much easier to get that home alongside the kinds of amenities that would otherwise be well out of reach.
It's true that the "main thing motivating a vaction-home buyer is utility." You want to maximize your purchase and enjoy the ability to focus on a specific recreational activity like skiing, surfing, or hiking.
But what can the investor do when the best locales for these activities are too expensive? Simple - opt for a fractional luxury vacation home, and enjoy the place of your dreams for less. Whether it's skiing the mountains in Colorado, or snorkeling in Mexico, or hiking in Utah, all of these are available as well as 5 star accommodations, and the benefits of a management team to arrange all the details for you.
And if you decide you want to resell, you've got the security of knowing that having invested in fractional luxury homes means you're participating in the only real estate investment that's been holding steady, and improving, while the rest of the market is flat.
As it says at Forbes, the places of your dreams are likely "extremely expensive," or at least, before fractionalizing, they used to be.
Fractional Ownership Offers Real Estate Value
4/27/2007 11:05:55 PM
As more and more fractional ownership properties are being snatched up off the market, issues of resale and investment value are garnering attention. Will fractionals hold up in the market in the same way that traditional second homes do?
According to marketwatch, the answer is a resounding yes, if not better. These fears had originally been based on the resale value of traditional, cheap timeshares. With these kinds of shared ownership properties, you're lucky to get 50% to 60% of your original purchase price, and that's before you add in maintenance fees.
But fractional ownership properties are more luxurious, more exclusive, and therefore more likely to resell (if you so choose) at a good price. "The fact you have a deeded property with more flexible use in a higher quality development, often in a better area, loaded with amenities, helps you out."
Even in today's "flat market" fractional ownership properties are reselling for around a reported 100% of original purchase price. And, with all the amenities like management teams, 5 star accommodations, and no maintenance worries, fractionals are an attractive buy for anyone searching for that magical vacation home.
Then again, these same amenities have made fractional ownership so popular in the first place, so chances are that resale values won't be an issue when you are basking in the luxurious vacation home of your dreams!