Own a Second Home… at a Fraction of the Florida Home Mortgage!

So what if you’re not a millionaire. You can still live like one in the Southwest Florida housing market.

Right now, you can buy a Gulf-front mansion on Bonita Beach, for a fraction of the price. Make that fraction: 1/10.

Longtime home builder and Bonita Springs resident Jeff King has started a new venture, Fractional-Homes LLC, selling vacation homes by the slice. He calls his first three-story estate on Bonita Beach “Casa Playa.”

He puts the home’s value at $5 million. But you can buy a one-tenth share of it for just $498,000. That gives the owner the right to live in the home at least five weeks out of the year.

One share of that is gone.

“There are people that can afford it, but may elect to do this because they don’t have to invest as much,” King said. “It does open it up to people who want to say they own a beach house, and they get it at a fraction of the cost.”

Since King started marketing the estate, he’s seen a lot of interest from potential Florida mortgage applicants. At times, people have lined up behind the property to pick up an information sheet.

“I know that owning a single-family home residence won’t be for everyone,” King said. “We are talking about all the people in the world and there are only nine people in this particular project that are going to get this opportunity.”

Fractional ownership has worked for private jets, yachts and luxury resort clubs - condotels developed by the likes of Ritz-Carlton and Four Seasons. So why not offer an exclusive home in a prime location? The idea is spreading.

Research shows second home buyers or vacation home buyers predominantly only use them a few weeks out of the year.

“It’s a stupid thing to buy a $5 million home and let it sit empty three quarters of the year,” said Dick Ragatz, president of Ragatz Associates in Oregon, a consulting and research company.

Fractional ownership works like a timeshare, where buyers purchase the amount of time they have vacations to use, and discretionary income to spend on.

Owners will pay $12,700 annually to cover the maintenance and operating costs, including insurance and property taxes. A concierge service isn’t included, and the cost for it is based on the services requested.

That’s on top of whatever the Florida mortgage loans end up costing the individual buyers, of course.

Continue reading in the Naples Daily News …