While real estate sales are improving day by day from what we experienced over the past 18 months, they are still not at the pre-boom error. I make the assumption they will never be as good as they were in 2005 and 2006; however, they are able to come back to a more predictable level as financing and more money is available in the market place.
One really bright spot in the real estate market is the sales of fractional properties. Fractional sales have lead the overall real estate industry for the past two years for several reasons. One, a Buyer can purchase the second home/vacation home property they desire for approximately 10 to 15 percent of what it would cost to own the property in whole ownership. Two, given the industry statistic that a second home buyer only uses their home 20 to 25 days per year, it no longer makes sense to own a home outright. Rental income rarely produces enough income to offset to cost of vacation home ownership not to mention the wear and tear on the property. Fractional ownership allows the Buyer to have all they want and more in a second home decision and only pay about 10% of the cost of owning a home as the taxes, upkeep, insurance, H.O.A. fees, etc., are all divided equally between all the owners in a given property. An other distinct advantage of fractional (shared) ownership is significant concierge services which are provided to each owner. Finally, you are able to trade one or all of your weeks of usage and go to other equal destinations throughout the world. Fractional ownership is not timeshare, it is not a real estate gimmick, it is a legal, recognized method of owning a home in the area where you wish to spend vacation time.
Over the next fee weeks, I will write more about fractional ownership and some of the advantages and what is involved. Please stay tuned for more.......
Monday, August 24, 2009
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