Intrigued by 1/4 ownership

[Krteczech]

Are there any TUGers with experience in 1/4 ownership of vacation condo?
This is privately owned, not enrolled in exchange program. What challenges do you sense or you know about?

 

[Beachclubmum]

We have a villa in Hilton Head and the unit next to us is a quarter share, owned by 4 couples who know each other. It seems to work well enough for them, and although I'm not sure what the exact schedule is, we do see the same cars parked for substantial lengths of time. They may switched off more or less monthly with each family getting 3-6 weeks at a time. The one couple I was friendly with ended up buying their own place to use full time; not sure how they worked out who would take over their share. Overall there seems to be stability and people enjoy being there.

Another friend of mine owned a 1/12 share of a beachfront house in Folly Beach..it was a disaster after a hurricane, due to the foundation being exposed and the codes not allowing repairs or a way to protect the house from future storm damage. Plus no one in the group could use it for over a year. They sold their share at a deep loss and were happy to get out and just be normal renters after that.

 

[x3 skier]

I own a 1/4 share of a Studio Condo at the Steamboat Grand in Steamboat Springs.

It’s not part of any system but you can trade it thru RCI. I’ve traded it once or twice in the past but have since just left it in the rental program where it basically pays for itself. I use the facilities (pool, garage, ski storage etc) when staying in an Airbnb or my other property during the ski season.

If the complex has a good location and properly managed like The Grand, I’d have no hesitation owning a similar property.

Cheers

 

[CalGalTraveler]

I haven't owned one of these so YMMV, but here are some thoughts:

I would vet and check it out very carefully especially in the areas of governance, budgeting, decision-making.

Is there a management company? Who decides if the mgt company needs to be changed. Or are they baked into the deal? Does the management company make HOA budget decisions? Who communicates with the management company. How do decisions get made in terms renovation priorities, reserve fund? What if someone is not paying their fare share of the bills or trashes the unit with parties during their fraction (places unfair burden).

For renovations do you know and get along with other owners? Are your decision making styles similar? i.e. cheapest, never spend on upgrades ever or free spenders with luxury all the way and increase the budget.

What happens if you or someone wants out. Do the owners vote on who gets in like a coop? or could anyone buy i.e. PITA to work with.

Do these hold value? or do they drop to earth like timeshares resales?

Good luck!

 

[am1]

My wife purchased a beach house and we pay almost 100% or expenses but lend it out to people when we can. It is 20 minutes from our house and less from our sons school but a world away.

If one can make a 1/4 share work either with a management company or just an agreement go for it.

 

[Krteczech]

Thanks to all responders. I am in contact with a realtor, but still looking for suggestions on what questions to ask. From public records it looks like originally purchased new by four professionals back in 1987. One is selling his 1/4 share thru agent. It is a low key condo in high demand ski area that appreciated almost 5 times since purchased. Other units in the building are whole ownership, but managed by HOA. Nice view, dated interior, which “ we could live with”. It is 4.5 hrs drive, in same state. We would use it ourselves and perhaps rented few weeks out. What questions are appropriate to ask as educated buyer and what questions would get me in trouble and perhaps hinder the transaction?
Thanks in advance, TUGers.

 

[spirits]

It is really good that you came here to ask questions. I would like to give you one piece of advice. There is always another timeshare to buy. Don't be in a rush to commit to something that you are not totally sure you want to own.

If possible I would rent a couple of weeks there. Go talk to the staff...talk to neighbors. People love to talk about their investments if they own there. If most people are 100% owners, that is a good sign. Lots of places that rent out units tend to get really worn down. Owners maintain the property better.

There is a place my husband and I have visited for almost 20 years. I call it my piece of heaven. It is a former timeshare complex that went into receivership30 years ago and the local people bought the units. There is a strata homeownership group. One woman we rented from kept on buying units to rent out. She did not live in them...just rented them. At one time she had 9 units. She told me that they were her retirement plan.

In that complex I think there are about 60 2 bedroom apartments. Some are owner lived in, but most are rented out. Our owner that we have rented from for the last 10 years lives in Calgary, and this place is on Vancouver Island. She uses it for her holidays and rents it out for the rest of the year. At the pool I was talking to a couple I had seen for the last few years. (We tend to go at the same time of year) They showed us their unit and told us they live in Vancouver along with 3 other couples. They bought their unit 30 years ago and have always shared ownership and costs. Now that they are getting close to retirement, one couple wants out. They want to travel to different places instead of just returning to the same place all the time. My husband and I decided not to buy because it is on the third floor with no elevator. His hips are not good anymore and we do not want to haul groceries and luggage up three floors all the time. (our unit is on the main floor)

I think that the unit might be a good buy IF YOU PLAN TO USE IT. People's lifestyles change all the time. Unless you can commit to a long term plan, I think I would just bite the bullet and rent. Air b and b is the most common place to rent holiday stays. And you can find a lot of places in the world without the commitments and obligations of ownership. I am saying this as someone who has rented their dream holiday place and really really wanted ownership. My husband has always talked me out of it and I am glad he did.

Glad you are here on Tug. You will learn lots.

 

[Beachclubmum]

Sounds like a nice place to go.

I would want to meet with the other 3 owners and make sure you are on the same page regarding things like upkeep, renovations, etc. Is there an agreement in place a knot the partners regarding things like being able to rent out your weeks? Renting can be hard on a place...what happens if your renter breaks something? How does a large ticket item like a new furnace system get paid for? How do the week's get distributed? Is it the same every year or do they rotate through the holidays?

 

[x3 skier]

First thing I would ask for is the actual deed and tax records, second, any agreements that are in writing between the partners (if there aren’t any, I run, not walk, away) and third, the HOA governing documents.

Cheers

 

[glenmore]

We bought into a quarter share in 2006. Really lucked into a fine group of friends

We keep it simple

I keep the calendar. Partner’s email other partners to check dates Condo is free. We agree and I send out an updated calendar

Another partner collect monthly payment for taxes, insurance and utilities. We build up a nest egg to cover replacement of appliances, furniture etc

We do not rent our unit. It is just for family and friends. We love the arrangement we have and highly value the reasonable, courteous and fun partner’s we have

Good luck!!

 

[T-Dot-Traveller]

In Canada -
we call that inheriting Mom & Dad's cottage with your 3 siblings .

Some families make it work . Other times it blows up & everyone loses .