Property Investment Gets Flexible
If the idea of owning a luxury asset to use occasionally appeals or if your budget does not stretch the whole way, fractional ownership may be for you. For a fraction of the price of the whole, you can own part of the asset. For many, this investment vehicle offers the gateway to investment in luxury (including property investment), allowing those without seven-figure bank balances to enjoy high-end assets.
Flexible freehold ownership, also known as fractional or collective ownership, has been a popular concept in the US for many years because it offers an innovative alternative to investors. Not surprisingly, the idea is fast catching on in the rest of world.
Flexible or fractional ownership involves buying part of an asset (usually luxury) – for example, property, private jets and cruisers, racehorses or even a vineyard – for a small part of the cost of the whole asset. Investors purchase a part and can sell, donate or bequest this at any time. Since investors are direct owners of the asset, they also benefit from increases in the value of the asset should they decide to sell it.
Although fractional ownership is sometimes confused with timeshare, it is radically different. Investors in flexible ownership directly own a part of the asset. Participants in a timeshare scheme do not own any part of the asset – just the right to use it at an allocated time – nor do they benefit from any increase in the asset’s value. Timeshare is a cost, not an asset.
Another fundamental difference between timeshare and fractional ownership is that no financing options are available for timeshare. On the other hand, many banks and financial entities will provide loans for purchases of fractional ownership. Since fractional ownership is an asset owned for perpetuity and is ‘sellable, giveable and willable’, it is no different from outright ownership.
“While fractional ownership doesn’t suit everyone,” says James Gonzalez, Market Analyst at Obelisk Investment Property, “it does mean that you can get a bite of the luxury cherry without paying the full price.” James recommends choosing a fractional ownership investment very carefully – “You might not be buying 100% of the asset, but due diligence and research must still be absolutely 100%.”
For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE). From abroad:(+34) 952 820 319.
Obelisk also produces its Absolute Guide Series which contains the most recent investment information on 30 of the world’s top emerging markets. They can be downloaded free of charge at http://www.absoluteguideseries.com.
Email: info@obeliskinternational.com or visit our website: http://www.obeliskinvestmentproperty.com.
Flexible freehold ownership, also known as fractional or collective ownership, has been a popular concept in the US for many years because it offers an innovative alternative to investors. Not surprisingly, the idea is fast catching on in the rest of world.
Flexible or fractional ownership involves buying part of an asset (usually luxury) – for example, property, private jets and cruisers, racehorses or even a vineyard – for a small part of the cost of the whole asset. Investors purchase a part and can sell, donate or bequest this at any time. Since investors are direct owners of the asset, they also benefit from increases in the value of the asset should they decide to sell it.
Although fractional ownership is sometimes confused with timeshare, it is radically different. Investors in flexible ownership directly own a part of the asset. Participants in a timeshare scheme do not own any part of the asset – just the right to use it at an allocated time – nor do they benefit from any increase in the asset’s value. Timeshare is a cost, not an asset.
Another fundamental difference between timeshare and fractional ownership is that no financing options are available for timeshare. On the other hand, many banks and financial entities will provide loans for purchases of fractional ownership. Since fractional ownership is an asset owned for perpetuity and is ‘sellable, giveable and willable’, it is no different from outright ownership.
“While fractional ownership doesn’t suit everyone,” says James Gonzalez, Market Analyst at Obelisk Investment Property, “it does mean that you can get a bite of the luxury cherry without paying the full price.” James recommends choosing a fractional ownership investment very carefully – “You might not be buying 100% of the asset, but due diligence and research must still be absolutely 100%.”
For more information on overseas property investment and to find out about Obelisk's latest projects, contact Obelisk free on 0808 160 0670 (UK) or 1800 932 514 (IRE). From abroad:(+34) 952 820 319.
Obelisk also produces its Absolute Guide Series which contains the most recent investment information on 30 of the world’s top emerging markets. They can be downloaded free of charge at http://www.absoluteguideseries.com.
Email: info@obeliskinternational.com or visit our website: http://www.obeliskinvestmentproperty.com.
Labels: fractional, freehold, investment, ownership, property, real estate
posted by Alison Kane at 4:22 pm
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