7 Steps to holiday home co-ownership

Stress-Free holiday homes: Co-Own, Relax, Repeat!

For a lot of people, owning a vacation home feels like an unattainable dream. However, could you imagine buying your dream home for a fraction of the price, owning the underlying asset, never having to worry about maintenance, and just being able to show up and enjoy your holiday home? 

While co-ownership isn’t common in Australia…yet, it is very common in Europe and the USA with thousands co-owning homes through the help of co-ownership companies like Pacaso (US), August (Europe), Pied-a-Paris in France and Partment in Egypt. 

Co-ownership presents a smart, modern way to make that dream a reality! Here are the 7 steps to co-ownership. 

Step 1: Find Your Co-ownership Provider

The first step towards co-owning a vacation home is to select a co-ownership provider that aligns with your needs. 

Kocomo is a co-ownership aggregator and you will find a comprehensive guide to the world’s leading providers. 

In Australia, Faction can facilitate joint ownership of holiday properties and enable groups of like-minded people to share the expenses and enjoyment of a home. Take a look for a provider who knows the challenges and pitfalls (read this article) and has a strategy for how to overcome or reduce each one. 

Step 2: Create legal agreements and attain finance 

By diving into the research and understanding the potential challenges of co-ownership, it becomes clear that a well-crafted co-ownership agreement is crucial to success. This agreement should address all key terms upfront, such as how the booking schedule will be managed, what happens if something breaks, and what the exit strategy looks like. And, of course, who will handle property management? A reliable co-ownership platform, like Faction, should take care of that for you!

Your co-ownership provider will create a detailed agreement that covers the rights, responsibilities, and decision-making guidelines for all owners. It will spell out financial contributions, property usage schedules, and how the provider will handle maintenance tasks. Plus, it will include clear steps for resolving any conflicts, ensuring smooth collaboration and preventing future misunderstandings.

Step 3: Find your dream home 

Explore homes that are available for co-ownership on platforms like ours (Faction). Or, look at Kocomo - they have an extensive portfolio of co-ownership properties from the industry’s top providers. 

Faction will have homes in three categories; classic (entry), luxe (mid-price point) and inspired (luxury / high end) so there will be homes for every category.  

Step 4: Due Diligence 

After you’ve selected your home the due diligence should still be the same. 

Due diligence for a co-ownership property shares similarities with a regular home transaction but also includes additional considerations unique to shared ownership. For both types of purchases, you’ll need to assess the property’s condition, location, legal status, and market value. However, with co-ownership, due diligence goes further to include reviewing the co-ownership agreement, understanding the financial structure, clarifying usage schedules, and ensuring there are clear terms for property management, maintenance responsibilities, and exit strategies. 

Step 5: Financials

A company like Faction will help you understand the requirements for acquiring financing. This is a unique transaction and we have trusted lenders that will help you with a co-ownership loan.  

Step 6: Manage and Maintain

A key advantage of co-owning a vacation home through a co-ownership provider is the shared responsibility for property management and maintenance. Most co-owners 

The provider usually oversees tasks like routine maintenance, repairs, and bookings, keeping the property in great condition and maximizing its rental potential when co-owners aren't using it. This takes the hassle out of ongoing upkeep, allowing co-owners to simply enjoy their time at the vacation home.

Step 7: Enjoy Your Dream Vacation Home

The best part about co-ownership is that you can show up at your home and just enjoy your time there. You don’t have to think about all of the maintenance that needs to be done, or the new linen that you need to acquire because the old linen is getting past it’s used by date, instead you just show up and start creating memories. 

Imagine that? You get to buy your dream home at a fraction of the price, own the underlying asset, and just show up and make memories with friends and loved ones,

Here’s a brief graphic of the process from Faction.