Beware of ‘Dressed Up’ Time Share schemes

Consumers need to be extra cautious when looking to buy a house on fractional ownership according to the National Association of Estate Agents International.14-07-2009

As fractional ownership becomes more popular, many of the large established time share organisations have ‘rebranded’ their operations to try to compete.
 
There are clear differences between time share and real fractional ownership schemes which consumers need to be aware of.
 
In simple terms, fractional ownership gives potential buyers a percentage share of the property, whilst a traditional time share only gives usage for an allotted period of time each year with no claim to ownership of the property.
 
There is no legal definition of ‘fractional’ but there is of timeshare. But be warned, in many circumstances the way developer’s package “fractional” can mean that the schemes fall within the legal meaning of timeshare.
 
Richard Edgar, spokesperson at NAEA International, said: “Fractional ownership has become a popular choice for investors because it enables them to buy into a quality product which they may not be able to afford individually.
 
“Also because lenders tend to consider fractional ownership homes as ‘an appreciating asset’ loan applications can be easier to secure.  
 
“From the outset consumers need to be clear on the differences between fractional ownership and timeshare. The market place is full of different ownership options, many purporting not to be ‘time share’ when legally they are.
 
“Consumers need to get their lawyers to check the contracts before signing on the dotted line - and check whether they have a cooling off period. Otherwise they may find themselves tied into a timeshare with no property rights”.
And make sure you’re dealing with an experienced and professional agent.