1. What is fractional property ownership ?
Fractional ownership simply means the division of an asset into shares.
If the "asset" is a property, the title or deed can be legally divided into shares. Those shares can then be purchased and owned by more than one individual.
Shared ownership of the property and its deed will also entitle shareholders to certain usage rights, usually in the form of weeks. Fractional ownership can be structured in many different ways, normally goes from 1/4 (13 weeks usage & 25% title) to 1/12th (4 weeks usage & 8.33% title), for example: A property fractionalised into 5 equal shares: Each share (of 20%) will enable the shareholders to use 10 weeks each per year (with the remaining 2 weeks being utilised for renovations, repairs and re-decoration etc).
Each owner of a 1/5 fractional share would be able to sell their 20% of the property when they chose, independently of the other 4 owners. If the value of the property has increased during their ownership period, then it is fair to assume their 20% share in it, has too. Therefore fractional owners can enjoy a capital appreciation in their property, as well as use it when they go on holiday. Usage rights for a shareholder Year 1, may be the first 2 weeks in March, May, August, October & December. In Year 2, it would be the second 2 weeks in March, May, August, October & December. And so on... This gives everyone a rotational allocation of weeks, which means over a period of time, all owners would get fair share of peak weeks. The purchase and maintenance costs of the property are split equally amongst the shareholders
2. Fractional Ownership vs Timeshare Fractional
Ownership is NOT timeshare
The two are often confused – which is a mistake.
Conceptually, Timeshare is a flexible form of holiday vacationing, however the industry suffered dreadfully from bad practices and sales tactics. Similarly to Timeshare, Fractional Ownership provides you with much of flexibility and choice, however, the fundamental differences are that with Fractional Ownership, you own title or shares in a deeded property while with Timeshare, you own units of time. Because Fractional Ownership is asset based, owners will not only be able to vacation in their property, they will also enjoy any growth in the property’s value. Timeshares simply get usage of a property and therefore cannot experience any capital appreciation.
3. Why Fractional Ownership in Tuscany ?
Fractional ownership, is growing rapidly, increasing to $1.65 billion in sales last year for the United States, Canada and the Caribbean, up more than 30 percent from 2005.
Such properties appeal to buyers who want exclusive getaways but who may be unwilling or unable to purchase a second home they will use for only a few weeks a year. The younger generation of buyers is viewing it as an alternative to full ownership because of the ease.
You’re not paying for when the property is vacant and It’s become a convenient way to own a second home without all of the problems. Tuscany has a high demmand on fractional ownership but planning authorities place strict controls on property’s developments in order to preserve the unique beauty and character of the region. With character properties in short supply, and new builds strictly controlled, demand looks set to far outstrip supply. Add the higher incomes enjoyed by buy-to-let owners in the sought-after area, and the prospects for investors looks very good indeed. Tuscany continues to experience worldwide demand and broad attraction.
All the elements exist for sustained, profitable growth, making this an ideal choice for investment.
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