You won’t find many new real estate developments that offer fractional ownership or quarter share ownership. The banks don’t really like them because of liquidity.

These type of opportunities have offered many families to obtain a piece of the recreational market whether it is on the lake, ocean, golf course or the mountains.

Now – this does not mean that you can’t buy a resort property with a friend, relative or sibling. Buying whole ownership properties with a partnership agreement is a great way to own a piece of paradise. You can split up your year in any manner that fits your schedule. You can share the costs and you can even have your own mortgages. This makes sense for so many families today that live busy and active lives with their children.

As an example you could buy a cabin today that is priced in the mid $400 K range, put 20% down ($90,000 or $45,000 split between partners) and with today’s borrowing costs could achieve a monthly mortgage payment of $1200 or $600 each. For most families this is affordable and the family benefits are measurable. This same 3-bedroom cabin would rent for roughly $2200/week in the summer months.

Here is an example of the annual costs and what they look like with shared ownership.

Purchase Price $450,000

Financing – 20% or $90,000 ($45,000 each)

Annual Operating Costs

Mortgage $14,400

Property Taxes $2100

Hydro and Tel./Cable $1500

Strata Fees $2500

Total Annual $20,500 / 2 = $10,250 or $855 per month

What you get for this is whole ownership titled real estate, year round use, a lakefront cottage community, 600’ sandy beach, private marine, pool / hot tub and friends for life!

So when you are having dinner with your friends or you are talking about owning a recreational property with some relatives, think about a joint ownership opportunity. It will be very rewarding.

Steele

Hummingbird Beach Resort

Is it any surprise that families are the real buyers of recreational and resort homes? The push in the market that led up to 2008 allowed for some speculative investors to take advantage of an active market. Now that the market has adjusted it really is geared towards the buyer seeking a quality lifestyle and investment in their family. These two traits were important to the buyers at Hummingbird Beach Resort eventually and we see this pattern continuing.

This isn’t to say that owners of recreational and resort homes don’t like how rental income offsets the annual operating costs – I just mean that for the most part families that are buying are using.

Continuing on with this thought, I am often asked when is a good time to buy? Generally speaking now is the time to buy. The market pricing seems to have levelled off and the family buyers seem to be back. It is always tough to hear this from an owner developer but the truth is that if you are buying for the reasons mentioned above then now is the time.

Just like the purchase of the primary home, the recreational home purchase is equally as important. What we hear is that the buyer does not want to make a pricing mistake. I understand that, but a sound investment exists when the buyer considers recreational property as a long-term proposition. In the course of time they will see their real estate appreciate and their rewards from investing in family. They will witness a development of lifelong friendships, maturation of their family and they will witness a real sense of family commitment. The experience of a family growing together and making memories together is very rewarding.

The family buyer for the cottage wants to make the right decision. The buyer today is armed with information and they seem to know what is important. What is important to you? Is it whole ownership with title and year round use? Is it a true lakefront cottage community? Is it four seasons of activities or is it a warm lake, private marina and nearly 600’ of sandy beach?

Share your thoughts with us – we would like to hear from you.

Steele

Hummingbird Beach Resort – (877) 707-0097