Ten Owners Club System
The Ten Owners Club system has been devised over many years and combines all of the positive aspects of holiday home ownership whilst eliminating the less popular ones which make owning your home outright less attractive.
Many people purchase their own property where they need to borrow a large percentage of the cost and then rely on rental income to meet their loan repayments as well as other running costs. This can work well in some circumstances but we have seen many cases where owners fail to generate the income they need and end up with a liability rather than an asset.
We realise that fractional ownership is not for everyone but for those who plan to use their property for less than 20 weeks each year, it should be considered as a possible alternative to buying outright. The number of owners for a property can vary considerably and is usually between four and thirteen, but our research shows that ten is the ideal number.
With ten owners and each entitled to use the property for five weeks each year, there is greater flexibility as our members are allowed to buy up to four shares in any specific property. This means that they can choose to buy five, ten, fifteen or twenty weeks each year depending on their requirements.
For comparison purposes, a quarter share in a property gives an owner thirteen weeks use each year irrespective of how many weeks they wish to use. This offers little flexibility and unless you are likely to use all or most of your weeks, you will be paying for something that you don’t need both in terms of the purchase price and also the running costs.
Our members enjoy five weeks use of their property every year for each share that they buy. (See chart “Dates of Occupancy” for a breakdown of the weekly entitlement in the Properties section.) Each of our properties is owned by a separate limited company and each of the ten shares is represented by a 10% stake in that company, thus providing total security and, equally importantly, control of their asset.
Compare this to many other schemes, in particular timeshare, where all aspects are controlled by the management company and the members have to pay whatever annual fees are demanded of them. This is the single biggest complaint about timeshare ownership where the members have no say in the running of their holiday home and invariably end up paying excessive annual fees, often more than double what they should be.
With the Ten Owners Club you have a choice of properties in different locations ranging from a one bedroom apartment to a luxury three bedroom detached home with a private swimming pool. The price we quote for each 10% share is inclusive of the purchase price of the property, all setting up costs including the furnishings and legal fees, and also the Ten Owners Club’s arrangement fee for coordinating it.
The only additional payment is an annual fee to cover the running costs of the property for items including utilities, insurance, cleaning, routine maintenance etc. We prepare an annual budget for running the property and then account for every cent spent with detailed accounts provided to the members at the end of each year. Furthermore, in the unlikely event that our members are not satisfied with the way that we are managing their property, they can replace us at their discretion.
The Perfect Ownership Model?
One of the members of the Ten Owners Club team has been involved with fractional ownership for more than 30 years and has observed many changes during this time. Many of the early buyers have now sold their share in the property and, almost without exception, came out with a significant profit.
Our research shows that the main reason that most of the members decided to sell, was that they had stayed at the property so many times that they now sought a change. Typically, this was happening between eight and twelve years after their purchase so our remedy for this is simple – after ten years the property will be sold and the members will share the proceeds of the sale.
In addition to the reason above, it is also anticipated that the property will increase significantly in value over the first ten years providing it is properly maintained. However, after ten years it is likely that an increasing amount of money will be required to maintain it and its appeal as a holiday home may diminish slightly.
It is for these reasons that the property will be sold after ten years thus maximising its investment potential and, in all probability, providing an attractive profit.
If at any time an owner chooses not to use any of their weeks, they can allow family or friends to use them or rent them out either themselves or via our rental programme.