Overview

The Ragatz Associates survey of residence clubs, fractional interests and destination clubs shows total sales of $505m in 2015.

The National Association of Realtors (NAR) just reported that sales of vacation homes in the US rose 7.0 percent to 502,000 in 2011 from 469,000 in 2010. This is certainly an encouraging sign after falls in prior years and reinforces the trend seen in fractionals, where overall 2011 sales were up 4%.

The annual North America survey by Ragatz Associates showed a slight increase of 4% across all shared property types, including fractionals, private residence clubs and destination clubs.

Many second home markets have seen price drops of 20-40% over the last few years. Private residence clubs and luxury fractionals in these markets have reflected these overall real estate trends. In some cases the prices are down by over a hundred thousand dollars. Here are some examples in some sought after locations.

Reach Advisors surveyed 378 members of nine luxury private residence clubs located in top ski resorts. The survey assessed the satisfaction with availability and the likelihood that members would recommend the club to friends and family.

When looking at Private Residence Clubs and Luxury Fractional Homes, you might come across some unfamiliar terms. This glossary describes some of the most commonly used terms and phrases.

Are you in the market for a Luxury Fractional or Private Residence Club (PRC)? Do your homework and ask the following questions to help ensure blissful vacations for years to come.

Variety - this term often has a positive connotation; however, with private residence club (PRC) and luxury fractional reservation systems, variety can equal confusion. There are dozens of clubs out there and several different ways to organize usage plans.

So you've decided fractional property ownership is for you. You realize that owning a second home is not as economical or practical as you once thought because you only use it a fraction of the year. You want the best, most desirable location without having to worry about upkeep or finding renters when you are not using the property. But before you buy, you still have some burning questions.

One of the strongest selling points of fractional ownership properties has long been the flexibility that it affords owners. However while the opportunity to purchase a fractional ownership property at a single destination is appealing to some, for globetrotting clientele being tied to a given destination resort can be less than ideal. Enter: the luxury fractional trading program.

If you're looking at buying into a private residence club or a luxury fractional home, then at some stage you'll probably ask "Is this a timeshare ?".

Nowadays it's fairly straightforward to obtain a mortgage to buy your luxury fractional or private residence club home. The bad news is that not all lenders are familiar with the concept of fractional property, so you might not be able to obtain a mortgage from your neighborhood bank. The good news is that the number of lenders who are offering mortgages for fractional property including private residence clubs is growing all the time. In fact for the banks that do lend for these types of loans it's essentially no different from getting a mortgage on any other second home.

We hear a variety of reasons as to why people buy into private residence clubs and luxury fractionals. Usually there are several factors that persuade people that this is the right way to go for their vacation property. We've summarized the main reasons here.

What are Private Residence Clubs?

When we go on vacation, we often feel at our most relaxed if the environment we're in seems like a 'home away from home'. But it's also nice to experience the luxury of a first class hotel. A private residence club offers a combination of both of these things. Located in prime vacation settings (beachfront, mountain, leisure resort, vibrant metropolis), private residence clubs offer luxury apartments and freestanding houses. Each property is furnished to the same high quality as a first class hotel and most importantly each property has several owners.

Destination Clubs and Private Residence Clubs have a lot in common. The terminology can be confusing and the lines between these two are getting increasingly blurry. In many cases the terms are used interchangeably so you'll find some companies that might fit closer to a Destination Club (definition), but which refer to themselves as Private Residence Clubs (definition).