The words “fractional ownership” conjure up images of timeshares, a model that was popular in the 1990s, but this new model, which has long been used in the USA, is an entirely different, and more secure, investment: rather than buy an allocated unit of time, investors actually own a share of the legal title to the property: all of the convenience, but based on something concrete.
Convenience is the primary benefit entering into a shared ownership agreement: how often do you plan to use your holiday home? Most people do not go on vacation for more than a few weeks per year, so why pay for the time you won’t use? When a fully-owned home is left empty for the rest of the year, renting it out can be a profitable way to get the most out of it, but that requires maintenance, management and more time-consuming tasks: purchasing a fraction of a property means that you do not have to deal with such duties, so that when you turn up to your holiday home, it is ready and waiting for you to use.
Only using a share of the property also means that you only have to pay for a share of the property: the cost of purchase is therefore significantly lower, which can open up a luxury holiday home to even buyers on a budget.
Merryn Heights in Padstow, Cornwall, for example, is a family-friendly park home community, with a wide range of luxury homes available from £139,950 all the way up to £195,000. Shared ownership, however, starts from just £45,000. With any running costs split between all the owners, the luxury holiday homes become even more affordable.
Liberty Parks Countrywide says that Merryn Park’s fractional ownership options have proven particularly popular, with fractions available in sixths (eight weeks’ usage) and quarters (12 weeks’ usage).
“Fractional second home ownership is ideal for retirees who want the flexibility to holiday at different times of the year,” explains David Cooper, Consultant at Liberty Parks Countrywide. “It beats the cost of hotels and renting other people’s homes! When you purchase a fraction at Merryn Heights, the property is held and legally owned by a UK company on your behalf. Allocation of the weeks is flexible and we can discuss the best usage system for your holidaying requirements for you and your family.”
In a post-recession age, when buyers’ budgets can often be stretched, fractional ownership is well-suited to those seeking second homes away from the hustle and bustle of life, without the added hassle of managing a property. Padstow, Cornwall, is an ideal place to do it. One of the most beautiful parts of the UK, the area surrounding Merryn Heights offers a leading golf course, a vineyard and a wide range of beaches. Within the park, meanwhile, are all the expected facilities of a welcoming resort, from tennis courts and a restaurant to a bar and shop.
With a rental management service also available to generate income when you’re not there, fractional ownership is as much an attractive investment as it is a low-cost slice of luxury: fractional buyers own a share of the park home, so they can benefit from any increase in the overall property’s value, while fractions can also be sold on at any time, much like a fully owned home.
Merryn Heights has 25 plots in total, but after recently coming to market, is already seeing that number drop – fraction by fraction.