That is a good question and one that is often asked. Traditionally, Timeshares are products that allow you to purchase a specific usage of time in a resort. In the Fractional Concept, it allows you to purchase an actual undivided intrest in Real Property. There are a lot of different Fractional Products out there today, but true Fractional Ownership allows all the benefits of Proeprty Ownership without the headaches of maintaining and paying for a property by yourself that you will only use 5 or 6 weeks out of ther year anyway.
It is sill pretty new in NC, but we have gone to some of the local banks and pitched the concept to them and they are actually very receptive to the idea. Because there is no real market for Frational Ownership loans, the banks here have to create their own product and warehouse the loan instead of selling it off in the open market. They see this as more secure, because 1) with our units, the purchase price will be under $150K per fraction, 2) there are other built in owners of the property that have first right of refusal in case something does happen.
Obviously the person obtaining the loan will have to have good credit and it will be a fully documented loan based on a 80/20 LTV. It takes a litte work to get set up, but as prices in Resort areas such as ours continues to increase in only makes sense for this concept to start becoming mainstream.
Yes. Fractional's are still growing in popularity, especially those which are deeded. At Wrightsville Beach, the Sundance homes are the latest additions to the market with owner friendly documents, high demand locations and upscale amenities.
Existing owners have first right of purchase on units that become available for sale. For that reason, resales rarely become available on the open market and are not usually listed in the MLS.
As of August 2015, the developer had only one Co-Ownership Interest available for sale and has begun a wait list with plans to add several new properties to accommodate demand. Current availability may be seen at http://www.ownalittlebeach.com. You may reserve on a first call basis at 910.620.2570.
In addition, the website has a variety of user friendly features: (1) A Daily Blog that keeps pace with the latest breaking news about the Fractional Industry and new fractional products coming to market; (2) 36 classifications of classified ads for individuals looking to sell, trade or rent their fractional assets, professional services for sellers, buyers and developers, and employment opportunities; (3) A â€œFinancial Concierge Serviceâ€ to assist buyers and developers locate financing; (4) A huge database of educational information including hundreds of articles; (5) And a Broker Participation Program to assist brokers worldwide locate fractionals for their clients.
Thanks for your answer. Here in IL they are pitching a similar concept for investment properties calling it tennants in common. The idea here is that rather than buying an entire small rental propety and enduring the headaches associated, you buy whole units in a larger rental property complex of sufficient size to afford on site maintenance & management. You are supposed to receive all the same write off's as if you owned the entire building. I like it better than condo-tels because you receive long term renters in each unit and credit is verified by the propety manager. Do you do this sort of thing in your area too? Nonetheless, the biggest concern I would have with fractional ownershis would be how does the bank reposess if an individual fractional owner defaults on their loan commitment?
It would seem to me that Wrightsville would be a perfect place for something similar in the future due to its very finite land space. If you run across any 1/4 to 1/5 share opportunities let me know.