The key to a successfull fractional property is a combination of a number of factors.
The first thing that would attract a buyer to your development is its location.
A fractional has to be in a great location – be it based in a city, beach or mountain
area. It has to be the sort of place that people love to visit time and again. More
off-the-beaten track locations have some appeal too, but developers must carefully
consider what it is about that area that will be a draw to buyers.
Popular destinations for fractional properties include:
Beach areas: Cornwall in the UK, Southern Spain, Portugal, The Canary Islands, Cyprus,
Greece.
Cities: London, Paris, New York, Washington, Rome, Bangkok, Barcelona.
Other locations: Dubai, South Africa’s Garden Route, Tuscany, Provence.
Sales potential will be maximised if the fractional is developed in a
destination where similar properties are in short supply. This enhances its
attractiveness to those looking for a good investment and will increase its
appeal to buyers looking for a holiday home. ions have year-round seasonality or offer rotational
or customised ownerships. These offer buyers more flexibility and thus will ensure
the likelihood of greater sales.
A fractional will offer something for everyone. They should be good new-builds or
be located in renovated existing properties, such as medieval hamlets in Tuscany
and Provence, where permission for “new” builds can be difficult to acquire. The
property can attract a niche market but those that appeal to mainstream buyers will
be most successful. It should have quality fixtures and fittings, good leisure facilities
such as a swimming pool, 24-hour security and excellent management services. The
most successful developments offer buyers a choice of unit sizes and some also offer
lock-off accommodation which allows the owner to use part of the unit and rent or
exchange the area that he is not using. These also give developers more flexibility.
A well-structured and totally transparent usage plan is essential. Potential owners
need to be able to easily understand the exact use they will get from the property
and when.
It is important that developers set maintenance fees at a reasonable level. Buyers’
price sensitivities are often based more on on-going costs than the actual purchase
price and this is especially true of the lower-priced fractional.
Recent research
has proven that a fractional which is associated to an external international exchange programme,
is likely to be more successful, so consider affiliation to The Registry Collection
or Preferred Residences.
Finally a fractional property should offer buyers something quite different. Be
it a great investment or a longer-term holiday home, buyers should not be able to
cross the street and find another identical property.