Why Rising Interest Rates May Bode Well for Fractional Real Estate Ownership?
As we watch the Feds continue to raise interest rates in their efforts to temper inflation, we see its affects as Real Estate prices steadily fall trying to reach the bottom.
Real Estate Brokers & luxury Homeowners who wish to sell are all in a “wait and see” mode. Spending their time evacuating the market trying to judge the right time to jump back into the “for sale” game.
With more and more people searching for sensible ways to invest in luxury real estate, fractional ownership has become the darling for meaningful, fun ownership that is sure to continue to grow in popularity.
The advent of Air BNB has blown up the entire shared/rental landscape teaching homeowners its ok to share. Owners now realize that sharing their home for a nice return is a fun, easy way to earn extra money.
But wait!! There’s another way to own luxury homes!!
As the world of luxury travel continues to evolve, so too do the options for luxury accommodations. One of the most popular trends in this arena is the fractional ownership of luxury homes.
What if you didn’t have to buy the entire vacation home along with the responsibilities and cost? What if you could legally buy a part of a luxury home making it affordable even with these current high interest rates?
What if someone told you that by virtue of your Shared Ownership you could become a globe-trotting vacationer, perhaps exchange it and yes, even rent some of your time out if you please.
But what is Fractional Ownership you might ask? Well, it has been around for more than 30+ years. Originally offered in larger resort developments, offering a way for buyers to own a deeded share of the resort itself for personal use or renting. This ownership concept brought that family back to the resort year after year creating a loyal guest/owner for the developer.
Suddenly it’s the rage!! Luxury homes are now being turned into fractional vacation ownership opportunities the world over. Companies such as Pacaso have spent millions on their marketing efforts with great results.
Large public & private companies as well as billion-dollar hedge funds are jumping into the fray as both seller and buyers understand the advantages of this concept of ownership.
Even Public companies have formed allowing folks to get a piece of a luxury home. ” Realpha” Invest have just announced they have raised more than $175m creating the first opportunity for the “everyday Investor” to invest in luxury homes which become fractional offerings just as you would buy stocks. for prices starting as low as $1,000.00 per unit.
What’s driving the sudden growth of fractional ownership you might ask, especially during this time of rising rates? Flexibility, travel is important factor as well as less money out the door.
When a property is fractionally owned, the owners can use the property for their own personal use, and also exchange it in some programs, see Third a wonderful array of properties affiliated with several major fractional companies or they can opt to rent it out to generate income offsetting their share of fees. Overall, fractional ownership models are looking very promising within the current market. Higher interest rates are not slowing the high demand for these products and in fact, may well be spurring the momentum on.
Fractional ownership providers and developers are well-positioned to take advantage of this demand. with more and more people searching for ways to invest in the luxury second home real estate market, fractional ownership is an opportunity that is sure to continue to grow in popularity mainly due to its affordability and flexibility.
You might begin your fractional education here by visiting Luxury to see several exciting fractional opportunities. This site is one of the best around for current listings as well as up-dated fractional ownership information. You can choose from several different properties – often in different, worldly locations – all part of the fractional ownership program.
Another great site for even more “in-depth fractional” information regarding fractional ownership of every kind from fine homes to Yachts and private Jets. visit Sherpareport They have years of expertise with an amazing array of fractional ownership concepts including up to date reporting
Fractional ownership means that you can vacation where you want, when you want, without the hassle and expense of maintaining a second home. The true attraction of fractional ownership is that it is more affordable than your traditional vacation home ownership not to mention the care & maintenance nightmare associated with a personal second home…
When you purchase a fractional real estate ownership interest, you are only responsible for a portion of the cost of the property in ongoing fees. This can be a great way to enjoy the benefits of owning a luxury vacation home without the full cost of second home ownership.
With more and more people searching for ways to invest in luxury real estate, the lower entree cost and advantages of fractional real estate ownership is an opportunity that is sure to continue to grow in popularity even as interest rates continue to climb.
In conclusion, fractional ownership is a great option for those looking to invest in luxury property with far less risk. This allows one to get more for their money giving you the chance to invest in a property that you may not have otherwise been able to afford.
If you’re interested in learning more about fractional real estate ownership of luxury homes or perhaps interested in “DIY” I can help, contact me, thank you,