| The dream of owning a luxury home, yacht, race | | | | maintenance will typically be taken care of via a |
| horse or some other luxury item can become a | | | | management contract you will be free to simply |
| reality with Shared (fractional) ownership. | | | | enjoy the property, rather than worrying about |
| So What Is It? | | | | looking after it. Of course you will only pay a |
| Shared or fractional ownership, not to be confused | | | | proportion of the maintenance fees which makes |
| with timeshare, is where a number of people | | | | sense, since most owners only actually use their |
| contribute funds to buy a leisure asset (e.g. house or | | | | property for 4-10 weeks of the year! |
| yacht) and share the use of it. Crucially you also own | | | | Possible Problems |
| a proportion of the asset, which is where it differs | | | | Conflict with other group members over issues such |
| from timeshare. If the value of the asset increases | | | | as change-over times, damage, and time allocation |
| then (in theory) the value of your share increases | | | | are probably the most likely problems. These can be |
| too. Contrast this with timeshare, where you only | | | | overcome by the use of a proper contract and |
| “own” the right to use the asset for the | | | | management company. Also look out for high |
| specified period of time each year. | | | | management charges, and the options available for |
| Example | | | | selling your share. |
| A group of people who are interested in buying a | | | | More research can be undertaken at the following |
| property in Mallorca, total cost £250,000, | | | | shared ownership web sites is a community |
| decide to buy it together. They each buy a 10th | | | | dedicated to the promotion of shared ownership (of |
| share for £25,000 which entitles them to 5 | | | | almost anything!). You can browse the current shared |
| weeks use each year. The allocation of weeks is | | | | ownership schemes and/or suggest your own. |
| handled by season, with each group member | | | | Particular features of the schemes currently listed are |
| choosing 1 week from high season, 2 weeks from | | | | the provision of specified end dates for the groups |
| mid-season, and 2 weeks from low season. The | | | | (usually 3-5 years), the low share values (from |
| order in which they choose their weeks is initially | | | | £100), and the option for the schemes to be |
| chosen by lottery, and rotates thereafter. After a | | | | self-managed (cutting out management fees). |
| fixed period of 5 years the property is sold and the | | | | More examples |
| value returned to the share owners. Each share | | | | [ A two-bed, two-bathroom apartment at Sugar Hill, |
| owner will pay a 10th of the maintenance fees. The | | | | near Mullins Beach, in Barbados. A 10-week fraction |
| time allocation and maintenance will be handled by a | | | | costs £95,000, with a management fee of |
| management company. Lower share sizes are | | | | £3,751 pa; the estimated rental return is |
| possible, e.g. 50th shares which in the above example | | | | £4,405. Twenty-one days a year in one of 10 |
| would give 1 week each year. Share sizes lower than | | | | 4,300sq ft beachfront houses at Pezula Private Island |
| 50th would entitle the share owner to entry into a | | | | & Residence Club in the Seychelles costs |
| lottery to determine whether they were entitled to a | | | | £145,000 plus £3,000 pa service charge. |
| week in a year. Both of these options give a | | | | Four weeks a year, in two rotating two-week slots, |
| low-cost way to enjoy ownership, with the possibility | | | | in a five-bed house at Zimbali near Durban, South |
| of increasing your share size over time. | | | | Africa, costs from £27,000 to £33,000 |
| Benefits | | | | (depending on sea view), plus £500 pa service |
| Lower purchase cost is the major advantage. | | | | charges. |
| Alternatively if you have a lot of money to spend | | | | [ View millionaire properties for sale from around the |
| you could purchase something of much higher value | | | | world. |
| than you would otherwise be able to! As | | | | |