Selling your House as a Fractional Ownership in Los Cabos

Sell your vacation home as a Fractional Ownership

Fractional ownership is a new, exciting second home ownership alternative. Fractional owners purchase an interest in a residence or pooling of residences, in partnership with other owners. All fractional owners share time in the residence as well as its ongoing costs, expenses and rules.

Typically, ownership is hassle-free as property management oversees the home´s management and maintenance, allowing owners to focus on enjoying their leisure time.

Clients who do not want the typical burdens and heavy costs of whole, outright vacation home ownership but who are looking for a property and usage program that is substantially greater than what is typically found with a traditional timeshare find fractional ownership to be ideal.

What´s the main difference between Fractional Ownership and Timeshares?

Timeshares owners own time (usually in hotels or resorts), which they can use upon availability every year. Fractional ownership is often represented by a deeded interest in the residence, held as tenants in common.

Fractional Ownership

Fractional is an alternative to owning a property that is formed by a series of legal instruments for the proper operation, maintenance and operation. The main advantage is owning a home in a certain period at a lower cost.

Seasonal destinations as in the case of Los Cabos, Fractional market may be a new strategy to offer the sale of a property and need to take the following process in addition to the advantages and disadvantages of it.

Property Management

Buyers want to make sure that your investment is well managed by a property management company. This company is responsible for making payments to suppliers, maintenance and answer any details related to the house.

Determine the fractions to be sold

Owners must establish how much percentage or the property they want to sell as a fractional, and in how many fractions. For example, they can decide to sell the 100% of the property in 5 fractions of 20%.

Operation Manual

This operation manual develop the lawyers with experience in the real estate sector. Some of the points to be established:
Times: One of the most important points is the use of the property by assigned times. The first concern of a new owner will be the use and enjoyment of the house. In the case of multiple owners, a normal case is to rotate the weeks while giving owners the option to change dates.
Maintenance: An external company (a property management) will handle and maintain the property in good condition.
Responsibilities: the faults are logged to the rules of operation. Eg. Nonpayment of fees, taxes, damage to property, remodeling.

Establish a trust or legal instrument recommended

Once we have the operation manual, this is included into the legal instrument (can be a trust) where the new owners accept the conditions of use of property.

Pros VS Cons

Pros
- Own a nice property you can enjoy at a lower cost.
Investment is much more solid that a timeshare.

-Excellent option for those who want to own a vacations house but have a schedule that only allows them to visit during certain periods of the year.

Cons
-Less flexibility as the property is owned by several persons.

-The property is ruled and regulated by an operation manual which limits the decision making for owners.

-Fractional buyers are usually looking for resort-like options, so selling a home as a fractional can be harder to find buyers.