Ins and Outs of a Group Home Purchase
If sole ownership of a vacation home in the Lake Tahoe or Truckee region is not an option for you, it may be worth considering some sort of group or shared purchase.
While this arrangement is less conventional, it’s still a valid option that employs some specialized knowledge of property law to create fractional ownerships. No, this is definitely not the same thing as a timeshare, your name will be on the deed...along with several others! This kind of ownership arrangement has many benefits, as well as some drawbacks, that potential buyers should consider before signing on the dotted line. Here are some questions to consider...
- How much time will you have? One of the most pressing questions to answer ahead of time is the scope of your ownership deal. How many owning parties would be sharing the schedule, and what decision-making process will be used to deal with it fairly?
- Who will manage it? Will it be you and your fellow owners, or will you want to hire a management company if the property is also used as a vacation rental? These can quickly add into planned monthly costs, speaking of...
- How will you manage the additional expenses that arise? On top of monthly payments there will be repairs, new appliances, the usual home ownership list that rears its ugly head, so you’ll want some sort of shared slush fund to cover these quickly. You and your co-owners may also want to setup a long-term savings plan to make renovations down the line.
- How will you decide when it’s time to resell? Buying it in the first place is challenging, but selling can introduce major complications, especially if some of the owners don’t want to make moves.
- How much do you trust your partners? At the end of the day, shared ownership of a property is a lot like owning a business, and different motivations and perspectives are always at play. Be sure these are people you can commit to working with over several years, you’re in it for the long haul!
- And lastly, who will help represent you to make the purchase? This type of work often requires lawyers that specialize in fractional ownership agreements, as well as a real estate agent.
You can get started on your shared vacation home purchase by giving Classic Tahoe Properties a call. We are here to help with all of your vacation home buying needs in the Lake Tahoe and Truckee area!