Fractional Ownership / Shared Ownership
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What is "fractional ownership"?
To be clear from the outset - this is NOT timeshare. It is a freehold purchase by multiple purchasers just the same as if you purchased a property with family members or friends. The principles are identical. We put together a group of compatible investors who want to enjoy the use of a luxury property - enjoying their own private use of agreed weeks - but at a fraction of the total property price.
How the property is purchased?
An SCI company is formed - this is the most common method for non-resident investors to purchase property in France and has tax advantages. The company itself purchases the freehold of the property - each fractional owner owns a percentage of the shares in the company.
Management of the Property
This is by agreement between the owners themselves. There are no rules imposed on the owners but there are formulas that are tried and tested, such as a strict rotational system of ownership, or you purchase fixed weeks, such as Xmas / NY, Feb Half term, Easter etc.
Immoboulevard Normandie can act as a central management system to manage the property, draft a management agreement and act as a point of reference. Equally if one owner is only interested in using summer weeks, the system can be adapted to suit any preferences. It can be as flexible or strict as the owners themselves decide. We are experienced in ensuring that compatible owners work together, and there are rules in place for all eventualities.
Funding the purchase
Cash purchase or we can arrange finance with a French bank.
Selling your investment
You can sell your share of the freehold at any time. Usually there are rules placed in the management agreement that you must offer your share to the other fractional owners first, and then after an agreed time if they decide not to purchase your share - you place your shares on the open market.
Because we choose only exceptional properties on exceptional
locations to offer fractional ownership - all our shareholders have
either sold at a profit (substantial in some cases), or have shares
valued in excess of their purchase price. It is not uncommon for the
total value of the shares to be worth more than the property as a whole.
Some buyers have seen leaseback apartments and villas as a way to acquire property in France, the guaranteed returns paying the mortgage, but others would prefer something old in the heart of one of our historic villages, or a new build but on a small estate.
This is why we are now looking at French property on a "shared ownership" basis. A unique limited company is created which owns each house, and the owners owning all shares in that company.
No more than 12 owners for each property, so that all can have 4-5 weeks usage/year.
A management company looking after the property.
Annual rotating choice of weeks in the high, mid and low season, with an owner's swap shop so that they can exchange chosen weeks.
Summary of Fractional Ownership
The occupancy plans gives you complete freedom of choice.
Maintenance and care of the property can be undertaken by either independent management company eliminating many of the headaches associated with owning a property.
All annual running costs are divided equally among the owners to cover rates, insurance, utilities standing charges, administration, periodic external repainting and maintenance of communal areas.
Shared Ownership schemes are not new. They have been around for many years but mainly associated with the purchase of the ultimate in luxury Private Yachts and Jet Aircraft but now you are able to extend this luxury to a dream home in the sun.
The concept of Shared Ownership in property is now gaining momentum as resort real estate prices escalate and consumers seek a steppingstone to the perfect holiday home in the sun
More immediate returns on your investment are also possible in the form of rental income should you choose to let out any of the weeks of your occupancy plan that you decide not to use for yourself.
Typically, those who buy into shared ownership are people who can afford to purchase outright but do not have the time to use it and don’t want the responsibilities attached to outright ownership.
The purchaser of shared ownership has the flexibility to choose the right option that suits their needs, appealing to retired couples, families and young couples alike.
All owners are governed by the conditions set out in a pre-signed shared ownership agreement detailing procedures for any damage or misuse giving you piece of mind that your investment is still in good hands while you are not there.