European Interest in Fractional Ownership

The International Herald Tribune ran an interesting article today on the European interest (or lack thereof) in fractional ownership.  The link is:

http://www.iht.com/articles/2007/10/25/properties/refraction.php

This corresponds roughly to the trend that I am seeing as well.  I am sure that part of this reason is that my marketing efforts for Paris Home Shares are directed to the English speaking world, and most of my enquiries are from The US, Canada, Australia and New Zealand, with a few from Ireland and the United Kingdom. Part of this is due, I am sure, to the familiarity and exposure that many here in the US have had with the concept over the last 20 years.  Secondly, I think that at least in the real estate market, Europeans tend to be more conservative, and are less apt to quickly embrace a new concept.  The mortgage industry in Europe is just now adopting some of the loan products that have been around in North America for decades.  (Of course, the European real estate market isn’t paying the price that we are for some of the crazier lending practices adopted in the US in the last 5-10 years either!).

 Where are we headed in the future?  I am not sure, but I do think that fractional ownership is a concept that just makes good sense for those who would like to have a 2nd home somewhere without the complications of debt service or rental management.

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2 Responses to “European Interest in Fractional Ownership”

  1. yours2share Says:

    I was also interested in the article and would certainly agree that there is currently less interest in fractional ownership in Europe than in the US.

    However I think that the idea will grow in popularity. It does make good sense – that’s why families and friends have been doing it for years. I also hope that people can be encouraged to get together themselves to buy fractionally – that’s a key objective of yours2share (http://www.yours2share.com).

    Of course if there is a ready-made fractional development that fits your requirement, then this makes life easier. But do-it-yourself fractional ownership allows people to find the right partners, for the type of property they want, exactly where they want it, with a usage arrangement that suits them. There won’t be many people that are perfectly compatible, but then finding “needles in haystacks” is just what the internet is good for.

  2. Fractional Ownership News Says:

    Hi Steve

    There were a couple of things in the article which were inconsistent/incorrect. One contributor said that fractional ownership IS timeshare which it isn’t (at least not in the form that you provide it).

    Later on in the article the lack of a re-sale market is discussed. It is stated that this is mainly because of the small number of developments/small size of the market. It is then stated that fractionals could never appreciate in value because the market would always be saturated by new-build offerings!

    The long-term success of the true fractional ownership market depends on the success of operations such as yours (and Sophie’s even though she is slightly in competition with me!). It is also important that the consumer can see a difference between good fractional developments such as yours, syndicate formation services such as Sophie’s and mine, and the brand of “fractional ownership” being pushed by some of the big companies that is really close to being timeshare. The Marriott development in London is a case in point – it is absurdly overpriced!

    Neil

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