FRACTIONAL PROPERTY
It’s interesting that David Rogers comes
The properties also include services such as cook, housekeeper, and concierge services – high end,
but not ultra-ritzy.’
davId burden tIMbers resorts
a good income, they’re still in work but they also want to have some fun. They pay cash, we pay cash – there’s no gearing in the Rocksure fund. Our target is wealthy, but not super wealthy.” Les Milton, on the other hand, divides
fractional buyers into three main types. Mature couples, looking for a family holiday property within 3-4 hours flight time, younger people using fractional as a way of getting started in overseas property. And then the pure investors, who want a trouble-free investment and perhaps the chance to diversify their property portfolio by holding fractions in different countries rather than buying a single property. David Rogers says that diversification
is often a motive for fractional purchase, particularly with Rocksure which offers a fund, rather than a single-property investment. “They’re attracted by the idea of overseas property assets, but they don’t know enough about it and are worried about the time involved and the need to select wisely. The spread of destinations, gives them a spread of risk. They like the fact that there’s a planned exit.” But there’s also a lifestyle motivation. Piers Brown says, “Another key driver for fractional becoming more popular is that people’s time is more constrained and more valuable.” Purchasers don’t want the responsibility of maintaining property – they want a trouble-free investment that is managed for them, and that is what developers are increasingly offering.
16 MARCH 2010 PROPERTYdrum
from a travel background, not from the property sector. He is clear that what Rocksure is offering is a lifestyle choice. “Instead of taking £800,000 to buy a house in Provence all for yourself, have the hassle of looking after it and the knowledge that you have an underutilised assets, you can spend £189,000 and buy a share in six properties around the world, and in different climate zones, so you can use them at different times of year.”
Is It good for estate agents?
So far, most developers are marketing their fractional properties direct. David Burden says, “For the most part it’s direct, though we market to intermediaries too and look for referrals from them.” David Rogers says “We haven’t yet got to grips with how agents should be working with Rocksure.” Piers Brown believes most agents will
struggle to make money out of fractional property. For a start, he says, it’s
PORTUGAL
a completely different sales process from whole ownership; he also points out that there is less commission on a fractional sale. “You might make commission on a £44,000 fractional sale but on £250,000 for a whole house sale – and sales people are usually greedy, and they go where the money is.” That hasn’t stopped Morgan Forbes
from bringing estate agents into its marketing mix for the sale of fractionals on its Madeira development, Ponta do Pargo. According to John Ward, marketing manager at Morgan Forbes, the company wants to increase its third party list in the near future. “Agreements are still to be finalised, however at this stage we offer an eight per cent commission,” he says. While commission from fractional sales is lower, he says that repeat business is often easier to get than with whole property sales. And he states, “We can also upsell from a fractional product to a 100 per cent ownership.”
Left: Ponta do Pargo, Madeira, 5 star luxury, available from £18,000 through Morgan Forbes www.morganforbes.com Below: Halcyon Hills on the Greek island of Samos. 4 weeks each year, from £22,000. www.halcyonhills.co.uk
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