CEO World Class Group, Michael J. Tolan
Cyprus and Dubai Real Estate set to Boom again through Fractional Ownership
In the wake of the global financial crisis, real estate has taken the brunt of the consumer chill.
Surveys indicate that many end users are simply waiting for the prices to fall further, while some indication is the fractional ownership space will actually enjoy a renaissance.
Many developers in areas such as Dubai and even Cyprus have been hit hard as projected values have plummeted and financing has dried up.
Fractional ownership may be one formula that offers a win -win to the developer and consumer.
First of all the consumer will acquire a luxury residence for the time of year they could actually use it, while sharing the capital outlay with up to 12 other families, who in turn, own a real slice of the equity in the asset.
Properties using this scheme that provide hotel style management will cater to the wishes of consumers who only want to see their investment grow over the years, while enjoying the usage of their vacation home annually.
Unlike timeshare, fractional ownership actually provides an easy exit clause, should the buyer wish to sell on at a later stage, with a long term view of having the property increase in value.
The property should be a location of desired annual vacations and areas such as Malaysia and Thailand also hold much promise. Phuket Island is the hub of this activity today.
The developer has the opportunity to open up a market never before available, and by dividing the cost of the asset to more members or property partners, makes it more saleable and much more attractive.
There are various legal schemes to apply these principles, and consumers should insist that an independent trustee is in place to protect the covenant of the agreement throughout the duration of the ownership.
Fractional Ownership could be the answer that provides both developers and consumers with the perfect formula for today’s appetite for value for money.
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Michael J. Tolan is a consultant based in Dubai, with over 15 years of shared ownership experience. He is CEO of World Class Group.
For further information, contact: mjt@worldclass-
00971 50 157 2321
Photo:
http://www.prlog.org/
