Does It Add Up?
Fractional property investment is finally becoming acceptable in Europe and is already contributing to an increasing number of major commercial projects.
In the past 10 years fractional investment hotspots have appeared in India, South Africa and the US. More recently some have even started to appear in the UK.
To confirm further the maturity of Fractional sales, a market is beginning to appear to cover for the sale and resale of Fractional Investments, not only that, but this is a fully regulated market.
In the very near future International Property Securities Exchange (IPSX) will enable developers to raise capital via the sale of shares / fractions on a regulated market basis, just as one would purchase stocks and shares. IPSX is to be the world's first regulated stock exchange dedicated to commercial property.
IPSX is aimed at prime commercial operations in major cities, where property values are known and confirmed by major players.
What does this mean for -
Firstly, the introduction of this major market tool and further scrutiny of its activity has finally allowed Fractional Ownership to break free of the “Timeshare” stigma that was attached to it in the early days.
The biggest difference between the two has now become glaringly obvious: With Fractional Ownership the purchase is often a deeded, tangible, equity stake in a property not just a piece of time.
Fractional Ownership is targeted at the at the “Real Ownership” end of the market, someone who could buy the whole property but doesn't want it hanging around empty most of the year and definitely doesn't want all the upkeep headaches kept to themselves.
In today's world property markets we are beginning to see that while IPSX provides a great service for those big investors there are properties available for the non-institutional investor.
At FPA we see the need for a marketplace for the non-institutional investor but while we see clearly that Fractional Ownership has a strong future we know at times it has seen a dubious past.
Fractional Property Agency Exchange
Here at FPA we are at the beginning of a new property market. Today we are looking to offer the sale and re-sale of Fractions in leisure, tourism and commercial properties and leave the market to set the prices. It will however take time to establish firm guidelines on resale values.
However we are already aware of important things that we know our clinets will want and that we intend to look for in every property / development we offer:
- The developer must be held responsible for the rates of commissions charged and declare them.
- It is our intention to monitor and advertise properties with commissions, fees and charges indicated separately.
- It is our intention to monitor and advertise properties where we can clearly see the developer has explained any guarantees, opt-out clauses, securities and buy-back options.
- It is our intention to monitor and advertise properties where we can clearly see the developer has explained any additional charges, annual fees or service charges.
FPA accept and practice commissions of up to 10% for low budget sales, as there is the same amount of work required on any size sale.
If you are looking for investment opportunities in the Fractional Market FPA are here to assist you in finding good quality secure opportunities. Contact us today to learn more.
Photos on this page are provided by: Melia Dunas Resort and Spa.