Fractionals Making Vacation Dreams Come True

Many people cherish the dream of owning an exclusive vacation home in a desirable getaway location. For a growing number of consumers ready to turn dreams into reality, fractional ownership is the appealing solution. At the upper end of the segment, “private residence clubs” provide owners with the benefits and amenities normally associated with five-star hotels combined with the space and accommodations typical of a luxury vacation home. New research findings offer a look inside this growing market’s ability to make vacation dreams come true.

Fractionals, as they are often referred to in the resort development industry, provide their members the opportunity to own the vacation home they always dreamed about, often with a higher level of services and amenities, in a package that is easier to afford and maintain than a whole ownership vacation home of comparable quality.

The private residence club concept sells “fractions” of resort real estate in intervals of more than one week, which is usually the norm for resort timesharing, but is less than whole ownership. Shares or “fractions” typically range from two weeks to three months of ownership. Four and five weeks of annual use are the most widely offered packages. This means that each unit has fewer owners.

As of April 2003 over 138 fractional interest resorts could be identified.Ê An additional 31 resorts were identified in various stages of planning.

Most fractional resorts are located in ski destinations followed by beach locations, then golf and urban locations.

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Satisfaction: A full 96 percent of those who own luxury fractionals, and 89 percent who own more moderately priced fractionals, report that they are satisfied with their purchases.Ê

he primary distinguishing characteristic of fractional interest owners is their high household income, at a median of $241,000 in the luxury segment and $108,000 in the more moderately priced segment.

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