Fractional Ownership News

Fractional ownership rated as a top trend for 2008

Date: 28/09/2009
Article source: Property24.com

JWT, the largest advertising agency brand in the USA, has published its third annual trends forecast, and Ten Trends for 2008 highlights "cooperative consumption" or fractional ownership as one of the trends.

"Fractional ownership is moving beyond the shared planes of the jet-setting elite. The masses are already sharing everything from property, art to cars to designer handbags, and as pooling demand and resources becomes increasingly sophisticated, this model will be applied to an even wider range of categories."

Co-founder of fractionalownership.co.za and member of the South African Association of Fractional Intermediaries (SAAFI) Working Committee, Dirk Wilson, agrees.

"In Europe, for example, they are using the concept of fractional ownership and applying it to different luxury assets – appreciating or depreciating. They literally just apply the concept to something that isn't a 'necessity purchase' (such as your primary residence or family car), but rather items that people aspire to or want, such as a luxury holiday home overlooking the Atlantic, or a supercar while on holiday in Camps Bay.

Fractional ownership of handbags is a big thing in the UK now – and they recently fractionalised ownership of a rare dog."

Wilson says that while fractional ownership is a huge, globally growing trend enabling people to own a share in a desirable vacation property, fractional ownership of other assets, such as supercars and luxury boats, is also growing quite rapidly here in South Africa. SAAFI is now looking to regulate the concept of fractional ownership to apply not only to property but rather to all jointly owned, appreciating assets.

"SAAFI Chairman Thys Geyser recently attended the World Fractional Ownership Conference in San Francisco, USA, and learnt that fractional ownership vacation ownership property operators and promoters in the USA also seek to have their own defined industry and to not be confused with timeshare, as is the case in South Africa. Fractional ownership confers the right of ownership and usage as opposed to simply owning usage time. This means there is a common issue in the industry globally which needs to be addressed," Wilson says.

"As discussed, fractional ownership does not apply only to luxury vacation property – it could apply to shared ownership of a racehorse, for example. However, the Timeshare Control Act, which regulates the timeshare property sector, cannot apply to anything except immoveable property – not a fast car, a racehorse or a boat – or a handbag. This adds even more credence to our wish for our own regulatory body – one that governs ownership and usage of an asset as opposed to the just the joint use of an asset.

"We don't think the market in South Africa is going to move towards fractionalising handbags or dogs just yet – but there are plenty of things that can be successfully fractionalised if the promoters take the correct steps to ensure best practice and compliance before they market their offerings."

For more information contact Dirk Wilson on 021 556 5032  or info@fractionalownership.co.za