Thursday, May 30, 2024

Revolutionising real estate with fractional ownership

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Fractional Ownership is relatively a new business model that promotes the idea of shared ownership. This approach allows multiple individuals to buy a small share of the asset. Each of the investors is liable to pay a fraction of the total value of the high-end asset. This concept aims to make expensive assets more accessible to a range of investors. The asset could be a real estate property, airplane, yacht, artwork, luxury car, rare diamond, etc. So, one doesn’t need to pay the entire price yet enjoy the benefits of a high-end asset.
Fractional ownership in real estate is a major trend in the western countries but is now gaining popularity in India too. The real estate property could be a vacation home, commercial property, and high-end villa, to name a few. Multiple owners share the rights and responsibilities of the real estate property. A shared title allows the users to enjoy the asset for a specific period allocated to each.
The fractional ownership model is a unique way to own a portion of the property without paying its full price. This appealing concept attracts many investors to become part owner. Some of the prime benefits of fractional ownership in India are:

Lower financial burden
Co-owning a property allows you to split the cost and gain access to the asset. With a small financial commitment, you get ownership of the asset you have been
eyeing on.

Diversification
Diversify your investment portfolio by having fractional stakes in different assets. Investors can have a share in real estate, artwork, and other asset classes. This mitigates the risk and improves profitability.
Professionally Managed
The co-owners need not get into the hassle of upkeep of the property. The Asset Management Company manages the property. The company takes care of the repairs, staffing, etc. to enable the investors to enjoy the asset.

Sharing of Responsibilities
The ongoing annual cost of the property is shared among the multiple owners on a pro-rata basis.  This uplifts the affordability quotient. The sharing of responsibilities makes the management of the asset viable.

Scheduling of Usage
Proper guidelines are issued to all the co-owners about how they can use the property. Each investor is allocated a specific period throughout the year to use the asset. This eliminates the chances of conflicts among the co-owners.

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