Fractional Ownership Article Published: 09:09 11/06/2007 Article Classification: Canadian Ski Resort - Fernie
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What is fractional ownership?

So is fractional ownership just a fancy form of timeshare? Not at all, say its proponents. With timeshare you have only the right to use a property for a set number of weeks a year; fractional ownership gives you an actual share of the bricks and mortar.

Timeshare ownership has evolved from the right to a set period of time in a specific holiday property each year to more complex “holiday bond” type arrangements, allowing holders access to an array of properties. The shares become tradeable assets.

Fractional ownership also gives periods of time in a specific property, but buyers actually own part of the equity in the property, often through a company. This means if the price of the property goes up, the value of your share will rise accordingly. Buyers should always get contracts checked out by a lawyer to ensure that there is clean and legal title and no barriers to being able to sell your share on the open market whenever you choose.

This allows individuals to buy into a property and have the benefits of ownership, with possible capital growth and rental income, but for a reduced initial capital outlay. There is also the possibility of self use and a management company looking after the place for you.

Timeshare and fractional arrangements both usually carry service charges.