investment in fractional property?

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Replied by Wanderer on topic Re: investment in fractional property?

As a follow on this topic, I live near a ski and golf resort that built a lodge and free standing A Frames. Many jumped into buying interests in the two types of developments. When housing and the secondary housing markets has upsets the people scramble to sell. Today after the big housing bust many can't sell their properties at fire sale rates and now many are in foreclosure and their credit is shot for seven to ten years. Also, the lenders are very much more leary of financing second homes (or similar related) so the availability of loan funds never came back at the pre-housing bubble rate. My view ... be very careful as you likely have more to loose than gain (and as I said in another post, I am risk adverse on this type of investment). Might as well jump on precious metals or go to the casino.
Last edit: 2 years 1 month ago by Wanderer.
2 years 1 month ago #1

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Replied by FrankN on topic Re: investment in fractional property?

Pinky wrote: I guess you and me both, Centsiblesaver. Born to be in the poor house because my risk tolerance is just about nil. I just can't seem to bring myself to put money into something that is not guaranteed to some degree or another. Just means that I'll never be rich except in family.


I would agree, with the exception of my retirement savings. I am so far off from retirement, I am willing to ride the waves of the stock market and believe over time they will go up.
2 years 1 month ago #2

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Replied by Pinky on topic Re: investment in fractional property?

I guess you and me both, Centsiblesaver. Born to be in the poor house because my risk tolerance is just about nil. I just can't seem to bring myself to put money into something that is not guaranteed to some degree or another. Just means that I'll never be rich except in family.
2 years 2 months ago #3

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Replied by CentsibleSaver on topic Re: investment in fractional property?

Goldbug wrote: I know there are places that sell individual hotel rooms through this type of scheme. People buy them and then get most of the fee when it is booked.

Sort of like a timeshare maybe? I have some CDs and bonds which were given to me. For investments, I'm sticking with ETFs. Like Wanderer, I'm leery of risky investments. I'll never get rich and I'll hopefully stay out of the poor house too.
2 years 2 months ago #4

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Replied by FrankN on topic Going back to the question...

Definitely don't disagree with you. I think it would only work in limited situations and you have to trust the GP in a variety of ways.
2 years 3 months ago #5

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Replied by Wanderer on topic Going back to the question...

Kept quiet until now ... maybe I am too shy and reserved but investments in fractional interests seems like being a limited partner and the general may get all the spoils. Also, if someone else is managing how do you know you are getting the real information and I could go on ... Makes me nervous!
2 years 5 months ago #6

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Replied by FrankN on topic Going back to the question...

Goldbug wrote: Just going back to the original question, where one company recruits people to buy a property as joint owner. Does the company just take a matchmaking fee, and then leave the owners to sort things out, or do they also manage it (presumably for a fee)? I'd be very wary of this if they weren't managing it, because if one member drops out, dies, or goes bankrupt, there is always a risk the property could be seized or frozen as an asset.


My understanding is generally they will help manage, but they take a high management fee and most of the times its not worth the charge.
2 years 5 months ago #7

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Replied by Goldbug on topic Going back to the question...

Just going back to the original question, where one company recruits people to buy a property as joint owner. Does the company just take a matchmaking fee, and then leave the owners to sort things out, or do they also manage it (presumably for a fee)? I'd be very wary of this if they weren't managing it, because if one member drops out, dies, or goes bankrupt, there is always a risk the property could be seized or frozen as an asset.
2 years 5 months ago #8

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Replied by FrankN on topic Re: investment in fractional property?

I agree with that GOLDBUG. There are many real estate ETFs out there as well as would give you the same exposure you may be looking for.
2 years 8 months ago #9

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Replied by Goldbug on topic Re: investment in fractional property?

I don't know anyone who buys timeshares as an investment anymore, because word's got out that they are so hard to get rid of, and can be expensive to buy. The last phonecall I got trying to sell me one insisted it wasn't a timeshare, it was a "periodically divided off-shore available property". There are not enough rolleyes for this.

If you want a safe way to invest in fractional property the safest and cheapest way might be to buy into a property fund or trust on the stockmarket.
Last edit: 2 years 8 months ago by Goldbug.
2 years 8 months ago #10

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Replied by Lexie on topic Investment in fractional property?

I have never heard of this either. You are right wanderer. This is not for the little man. Rather the high rollers and risk takers. Also from what I have heard, time shares are a full time concern. Have some friends that had great difficulty getting theirs sold. People are beginning to wise up but the P.T. Barnum quote still holds true.
2 years 8 months ago #11

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Replied by FrankN on topic Re: investment in fractional property?

I have actually never heard of this. I know you can buy time shares, but that's a little different.
2 years 8 months ago #12

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Replied by Moneyes on topic Re: investment in fractional property?

Goldbug wrote: I know there are places that sell individual hotel rooms through this type of scheme. People buy them and then get most of the fee when it is booked. It never seemed like a great idea to me because you're relying on the management company of the hotel for so much, and if you take advantage of the free stays you don't earn for those days. A few schemes rotate the room bookings, or split the earnings across all room owners, to avoid having some rooms not making much.


I don't why, but the first thing I thought of when I read that was, "That sounds like something a gambling addict would do". That just sounds so desperate.
2 years 9 months ago #13

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Replied by Goldbug on topic Re: investment in fractional property?

I know there are places that sell individual hotel rooms through this type of scheme. People buy them and then get most of the fee when it is booked. It never seemed like a great idea to me because you're relying on the management company of the hotel for so much, and if you take advantage of the free stays you don't earn for those days. A few schemes rotate the room bookings, or split the earnings across all room owners, to avoid having some rooms not making much.
2 years 9 months ago #14

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Replied by FrankN on topic Re: investment in fractional property?

I agree, you should really do your research and inquire on this.
3 years 4 months ago #15

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