Fractional Ownership; How It Operates and Tips on Buying Such Property
This type of ownership allows you to have a quarter, a fifth or even a 25% share in the property you dream of. This can apply to anything, a car, hatch, home or even a handbag. Basically fractional ownership allows you to use property for a certain period of time each year, this can be a few weeks or a few months, depends on the number of owners. The owners are free to enjoy the property the way they like. There are no restrictions as to cleaning it or decorating it. The maintenance and bills of these kinds of properties are handed over to a management company in exchange for a yearly fee.
How does this operate?
In this kind of ownership, a number of strangers come together and purchase a long lease for a percentage of the property, for example for 999 years. The freehold of this property is maintained by a management company. Where the lease is for a short time, like 5 years, then after this time period the property will be sold and the profits will be shared between the owners.
Moreover, owners can sell their shares whenever they want to and come out of the deal. This will be done through the management company or an estate agent. The share in this kind of property can also be passed on like any other property after a person’s death.
Mostly these kinds of properties have four to five owners but in some cases it has even exceeded then fifty. Importantly, fewer owners mean high price and at the same time more access to the property.
Fractional ownership of a country cottage in Edinburgh
These fractional ownership deals are straightforward. People tend to convert these kinds of properties into holiday spots. They consist of a hotel which is surrounded by fractionally owned cottages. These kinds of holiday homes are in demand but sadly enough, they are empty most of the time. However, in a country like Edinburgh, the festival season gets them fully booked.
Fractional ownership in smart locations
Properties are also available for fractional ownership in smart locations. These consist of modern buildings. Mostly this offers a share in an apartment, allowing access for around 2 weeks in a year. After this the property will be sold.
Tips on buying such a property
You should go through all the legal checks, get the property survey done, look at its running costs and most importantly get an independent legal advice. Also you must ensure that there will be no barriers when selling the property. You must also decide on the allocation of the weeks, and if you will be happy with it?
Graham Lamont - About Author:
Graham Lamont is a marketing officer for Greenlet, property lettings website in Edinburgh. If you want more information on Edinburgh Property, please visit edinburgh to let.
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