Timeshares And Fractional Properties - A Unique Way To Increase The Value Of Your Property By Tony Seruga, Yolanda Seruga And Yolanda Bishop At Isnare.com Ezine Articles

Timeshares and fractional properties have recently emerged as popular practices for owning properties. The premise behind these two concepts is a significant reduction in the amount needed to buy prime properties which enable a larger percentage of the population to buy.

A timeshare is as simple as the name suggests; this practice enables people to own any form of vacation property such as condominiums or cooperatives. This concept has been extended to apply to houseboats, yachts, campgrounds, motor homes, and cruises. Initially, the company owns the property and sells time periods of it to varied owners who share its costs collectively. Primarily, timeshare properties are available to the owners from one to three weeks during a year. These owners have several options to use their timeshare properties; these include

• Personal use
• Rental property
• Gift to anyone
• Exchange internally with other owners within the same property
• Exchange externally with owners of other timeshare properties

A fractional property is different from a timeshare in terms that it is a more expensive asset. A company is usually the primary caretaker of the property and it manages the property on behalf of the owners. The owners are allocated time periods ranging from two to thirteen weeks spaced out during a year’s length. Fractional properties offer several benefits to its owners over timeshare properties including a share of income from the fractional asset property.

Benefits

The concept of timeshare properties emerged in the early 1960s in Europe. It is extremely significant to research a property before buying it; typical areas of research should include the management scheme, time of year, exchange mechanisms and other details. People take the initiative to buy timeshare properties for a number of reasons:

• Timeshares allow individuals to own a slice out of vacation homes and the owners have the liberty to use it as they will. This implies that owners can also rent it out to others when they are not using it.

• Timeshares provide the privilege to own vacation property in various destinations at substantially lower costs.

• Timeshare properties are equipped with kitchens and laundry facilities which allow the owners to lead an economical time at the properties.

Fractional ownerships seem extra attractive to people mainly due to the cost element. The reasons fractional properties are becoming popular are:

• As mentioned above, the low cost allows owners to get an interest in the asset for a fraction of the cost that has been paid.

• Fractional properties’ interest can be sold or transferred.

• Owners of the fractional properties collectively determine the functions of the management company

• The management company takes care of all maintenance issues; this removes a big burden off the owners’ minds

• Fractional ownership enables people to lead the lifestyle they dream and enjoy as per the conveniences of the owners

Types of Properties

Timeshare properties are generally apartment-style units ranging from studio units to three and four-bedroom units. They include kitchens, a dining area, dishwasher, TV, VCRs and more. Luxury items such as planes and luxury cars have also been incorporated within the timeshare property range.

Fractional properties, on the other hand, include a broader range of assets including:

• Aircraft and jets
• Art
• Boats and yachts
• Classic cars
• Corporate hospitality
• Destination and private
• Residence clubs
• Handbags
• Helicopters
• Hotels
• Lifestyle
• Luxury vehicles
• Property
• Racehorses
• Spirits and champagne
• Sport
• Supercars
• Vineyards and wine

Fractional properties tend to appreciate better and financing a fractional property is easier as backs and financial institutions realize the values of these properties.

Locations

Timeshare and fractional property ownership is primarily meant for vacation purposes. Thus, the properties bought through these practices should be located in vacation destinations overlooking scenic areas. Examples include beach resorts overlooking the beach, farm houses overlooking the countryside views and so on.

Potential Buyers

Timeshares and fractional ownership have created a trend of allowing anyone to have a share in exclusive vacation properties and to enjoy the luxurious benefits thereof.

• Second Home Owners
• Realtors
• Developers
• Investors

All these people have vested interest in timeshares and fractional properties. Second home owners enjoy the ability to purchase a vacation home for low costs; realtors can make good commissions out of the sale of timeshares, sales commissions can be as much as 40%-50% for timeshares. Also, developers and investors have opportunities of developing and investing in such properties that are gaining popularity by the day.

Fractional and timeshare properties present unique opportunities to buyers to increase the value of their property. The low costs make them exceptionally attractive and the also absence of obligation to continue ownership i.e., ownership can be transferred at any time.

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