Fractional Share Partner to purchase 2nd home in The Villages
 

We live in the Orlando are and are seeking one (1) 50% or Two (2) 33% partners to purchase a vacation home in The Villages. Also open to current home owners willing sell a % of their current home.

Fractional ownership is perfect for snowbirds or anyone seeking a second home who doesn’t want to purchase the entire home as they will not utilize it full time. We would agree on usage, with each partner responsible for their share of the cost of the home. We are flexible to the days we would utilize the home, are responsible, clean and pet friendly.

What a perfect way to purchase a home that you’ll not utilize full time! We still work full time in the Orlando are and are desiring a second home we could utilize in The Villages.

Hmmmmmmmmmmmmmm.

One of the things I love about The Villages is the level of care seen by homeowners to their property. I am thinking that Fractional Ownership would not be on that level.

In fact...I read this and tend to agree;

"With so many owners, stays are infrequent and short and upkeep and care is left to a paid person. As a result, there is little emotional connection between the owners and the property. The lack of “pride of ownership” promotes an apathetic attitude toward the property. The high traffic through the unit also means more wear and tear."

This looks like a do-it-yourself timeshare to me.

Exactly, and most people know that there is nothing perfect about timeshares.

Can of worms.

Huh? It is either a time share or a partnership purchase.
History-after all the hype neither works out well for those involved except for the one who sells it to others.

Sounds like a workable idea until a death occurs, or possibly divorce. I see all kinds of problems with this scenario. Better to just rent. When in a partnership, you never know who you will be hooked up with in the future. Some might think, I own a $300,000 home and can sell 2/3rds and get $200,000 dollars. Terrible idea!

Hmmmm, seems there are people afraid of this kind of arrangement! There can certainly be issues with fractional ownership, including disagreements about usage, Maintenence, furnishing etc. I can give you another perspective. We rented winters in TV for four years along with longtime friends and we stayed together and did almost everything together without a single disagreement. Now, this may not be the norm, but it is possible. We discussed and looked into buying a home in TV together 50/50 and almost pulled the trigger on a couple (wish we had they have appreciated about 50%) of homes. We were both going to continue as seasonal residents and we discussed some of the issues such as who would get the master br, or would we alternate, how would we choose the furnishings - etc. I am a Chartered Financial Consultant, so we also talked about executing a buy/sell agreement to address contingencies such as one party wanting or needing to sell, or the death of one of the parties. I had worked with these type of agreements for years so was comfortable with them. The compatibility of the parties is essential, and I would not venture into one of these partnerships with anyone I was not extremely comfortable with. By the way, when we were considering this we contacted the Villages management and were assured that up to four people could be on the title and get full resident privileges. Ultimately we and our friends each purchased separate homes about a quarter mile from each other.

This idea has so many potential problems, they are difficult to count. Suppose someone, who owns half of the house, decides to use the house as an Air BNB hotel and rent it out on a nightly basis, or rents out individual rooms? Or, decides to sell their half in weekly increments like a typical timeshare? How do you get homeowners insurance for the house? What recourse do you have if the person who owns half of the house refuses to pay the ongoing expenses? Who is responsible for deed restriction violations?

You can build a "no rentals" into the purchase agreement. And if someone is financially, legally responsible for a percentage of ownership in something - if the person refuses to pay their share, they forfeit their percentage of ownership.

Pretty standard legalese for timeshares. You can - or cannot - sublet, depending on the agreement. You can - or cannot - refuse to pay an agreed-upon expense, depending on the agreement. If you make it a 2/3 majority vote in all decisions over "x" dollar value, then any of the three might risk losing their share in the property by refusing to go along with the other two.

What could possibly go wrong?!
High percentage of possible unforeseen circumstances.

Most if not all, potential issues can be addressed in a legally binding buy/sell agreement. Again, you had better assume a good level of trust and understanding before entering into a partnership of this kind. It is almost identical to a legal business partnership.

I agree that you can structure a legal contract for just about anything. But, trying to enforce the contract requires hiring a lawyer, going to court, and spending a lot of money. In my opinion, this is a recipe for disaster, just like typical timeshares. Timeshares are so bad that most of them cannot even be given away.

While I agree there a lot of potential pitfalls, shared ownership is nothing like a timeshare.

What if one ownership entity goes bankrupt or does not pay their income taxes and the IRS comes after the property?

What if a 'slip and fall' occurs to a guest on the property while one owner is there and the others as owners also get sued?