Fractional Ownership in France

So, What is a fractional property ownership?

In 1994, a new concept debuted in the United States - fractional ownership of vacation homes. Patterned after fractional ownership of private jets, the concept formalises the idea of a small group pooling their resources to buy a getaway place.

A second home is the ultimate discretionary purchase. People who own a place at the beach, the lake or in the mountains often are quick to express frustration at not being able to spend more time there. Why have the expense of a mortgage, upkeep, insurance and taxes for a place you don’t use more than a couple of weeks a year?

To deal with that situation, family members and friends often join forces to buy a place. It cuts down on the cost and everyone gets to enjoy a place that is much more than just a hotel room.

Fractional ownership offers individuals the opportunity to buy partial ownership of a really nice place

The ownership arrangements usually divide the ownership into fourths, sixths, or 12ths, with each owner having an equal number of days a year to use the property.

Sharing the ownership of a property is a viable alternative to buying a property that you may only use a few weeks a year. Rising pricesmean that people wanting to own a holiday home are finding it harder to raise the finance - shared ownership could be the answer. You hold the actual Title Deeds and own a percentage of that property. Shared or co-ownership comes with a property deed making it a true asset that will appreciate at full market rates. Good returns on your investment are also possible in the form of rental income if you choose to let out any of the weeks of your occupancy plan that you decide not to use for yourself.

Many outright owners tend only to use their property for 4-12 weeks per year, yet still have to bear the costs attached to 52 weeks. The most significant benefit of buying a property through shared ownership, is the ability to match your purchase with your expected use of a holiday home. When combined with the services and amenities of living within a self-contained resort you have very compelling reasons to consider shared ownership.

The shared ownership concept is based around 4 to 12 co-owners purchasing a share of a property. The purchase is exactly the same as if you were buying a property outright.

Typically, those who buy into shared ownership are people who can afford to purchase outright but do not have the time to use it and do not want the responsibilities attached to outright ownership. Another advantage is that you can purchase a more luxurious property than you may otherwise have been unable to afford.

Summary of Fractional Ownership

The occupancy plans gives you complete freedom of choice.

Maintenance and care of the property can be undertaken by either independent management company eliminating many of the headaches associated with owning a property.

All annual running costs are divided equally among the owners to cover rates, insurance, utilities standing charges, administration, periodic external repainting and maintenance of communal areas.

Shared Ownership schemes are not new. They have been around for many years but mainly associated with the purchase of the ultimate in luxury Private Yachts and Jet Aircraft but now you are able to extend this luxury to a dream home in the sun.

The concept of Shared Ownership in property is now gaining momentum as resort real estate prices escalate and consumers seek a steppingstone to the perfect holiday home in the sun

More immediate returns on your investment are also possible in the form of rental income should you choose to let out any of the weeks of your occupancy plan that you decide not to use for yourself.

Typically, those who buy into shared ownership are people who can afford to purchase outright but do not have the time to use it and don’t want the responsibilities attached to outright ownership.

The purchaser of shared ownership has the flexibility to choose the right option that suits their needs, appealing to retired couples, families and young couples alike.

All owners are governed by the conditions set out in a pre-signed shared ownership agreement detailing procedures for any damage or misuse giving you piece of mind that your investment is still in good hands while you are not there.

Is fractional property ownership for you?

* Are you looking for a second home and you can not use it 100% of the time? * Are you looking to invest and earn from appreciation of a vacation home? * Are you interested in a second home but you can not afford it 100%? * Would you be interested to own a portion of a property and abide by rules and regulations set forth for both operations and future sale?

If you have answered yes to the above, you are a good candidate to look at possibilities of choosing a fractional property ownership.

You will be responsible for your percentage of the down payment, the closing costs and maintenance charges. The financing and obtaining the mortgage and closing the transaction will be the next step as you are responsible to sign the loan documents for the percentage of your ownership.

What are the typical rules and regulations of ownerships?

A typical partnership agreement which must be signed by you and other owners will have the following typical characteristics:

* Duration of the partnership agreement. * A projected goal for the sales price to sell or renew the agreement. * The usage of the property and time periods on and off season. * Procedures to sell your percentage if you need to sell. * Management, maintenance and up keep costs.

Such agreement would than be drafted once your group’s objectives are clear and prior to finalizing the transaction in the notary, your attorney can than have it recorded. Objectives vary depending on your age, long or short term investment goals, usage period.