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Is there a premium for buying a fractional
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TOPIC: Is there a premium for buying a fractional
#78
Is there a premium for buying a fractional 3 Years, 10 Months ago Karma: 1
There's an interesting article on sherpareport about "fractional premiums". This is the amount that a buyer pays over the cost of whole ownership.

For example if a home sells for $1,000,000 as whole ownership, but is available as a fractional in 6 fractions of $250,000, then the premium is (6 x $250k - $1m = ) $500,000 or 50%.
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Last Edit: 2009/03/25 22:26 By FracRep.
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#156
Re:Is there a premium for buying a fractional 3 Years, 1 Month ago Karma: 1
Here is an interesting live example of the fractional premium.

The Rocks Club in Scottsdale, Arizona has listings on its website for both 1/7 fractional interests and for 7/7 whole ownership.

For a 3 bed, 3 bath residence the 1/7 fractional prices are $315,000. Whole ownership of a 3 bed, 3 bath is between $1.35m and $1.40m. So the premium is:

2,205/1,375 = 160%

For their 4 bed, 4 bath residences the 1/7 share is $325,000 and whole ownership is $1.795m, for a premium of 27%.
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