Partial Ski Home Ownership

[gmcunni]

I've been playing "fantasy life" where i pretend i have lots of $$ and little responsibility.

looking at homes for sale in ski country and finding lots of options for 1/4 or 1/2 ownership in a home where you get 1 or 2 weeks per month.

Anyone have experience in this type of setup, strangers sharing ownership of a fairly expensive asset?

 

[cdskier]

I've never seen individual homes for sale like that...but I have seen "Condo" type units where they are managed (such as Claybrook at Sugarbush). From people I've talked to, one of the potential downsides is that some are very strict with what you can and can't do. Many times there is very little personalizing that you can do. Some people don't care about this, but to me it is kind of like living in a place that doesn't really feel like "your own". Then there's always the challenge of not being able to go whenever you want. Some people don't mind either of these things. You really need to look at the fine print and rules in the specific unit you are looking at. Even consider what type of storage is available for your personal gear and clothes when you're not there, etc.

 

[bdfreetuna]

Haven't done that but bit the bullet on a RCI / InnSeasons / Wyndham timeshare membership over the summer. Using that for the Tahoe trip and probably after that a trip out west most years and Puerto Rico every now and then (where my wife is from).

The way the program is set up it's more like a travel plan program than a regular timeshare membership. Makes it relatively affordable to go just about anywhere in the world of skiing.

 

[bigbog]

I've never seen individual homes for sale like that...but I have seen "Condo" type units where they are managed (such as Claybrook at Sugarbush). From people I've talked to, one of the potential downsides is that some are very strict with what you can and can't do. Many times there is very little personalizing that you can do. Some people don't care about this, but to me it is kind of like living in a place that doesn't really feel like "your own". Then there's always the challenge of not being able to go whenever you want. Some people don't mind either of these things. You really need to look at the fine print and rules in the specific unit you are looking at. Even consider what type of storage is available for your personal gear and clothes when you're not there, etc.

+1

 

[mbedle]

Those are called fractional shares and they are becoming very coming. Stowe Mountain Lodge is a fractional share setup. As cd said, if you don't mind the lack of personalization and the restriction on use, it might be a way to get some that you otherwise couldn't afford alone. I've never seen a ½ fractional share before. That might not be bad if you can work with the other owner to personalize it. Association fees are always going to be a killer with any kind of sharing.

 

[gmcunni]

Those are called fractional shares and they are becoming very coming. Stowe Mountain Lodge is a fractional share setup. As cd said, if you don't mind the lack of personalization and the restriction on use, it might be a way to get some that you otherwise couldn't afford alone. I've never seen a ½ fractional share before. That might not be bad if you can work with the other owner to personalize it. Association fees are always going to be a killer with any kind of sharing.

The 1/2 share I saw was buying two 1/4 shares. And yeah, The HOA fees I've seen are nuts. Like $500+ per month. But I tell my wife it isn't that bad because it included utils tv internet and stuff.

 

[cdskier]

The 1/2 share I saw was buying two 1/4 shares. And yeah, The HOA fees I've seen are nuts. Like $500+ per month. But I tell my wife it isn't that bad because it included utils tv internet and stuff.

I spend around $500-600 a month in the winter for my condo dues, cable, and utilities, however one big difference is that I can use it 100% of the time vs 25% of the time. In the off-season my utilities drop. I could save even more by turning off cable non-winter, but I leave it on as I still use my condo from time to time during the off-season.

While I can't comment specifically on where you are looking, I know in the area where I am you can get many good deals on condos in slightly older complexes where you will pay less per month for whole ownership compared to what you will pay for 1/4 ownership in a new fancy place. The condo/HOA fees are something to keep a close eye on though as they can vary a lot even from unit to unit in the same complex.

 

[jimk]

Don't have first hand experience, but just got back from the NC shore where my brother owns a home one row from the ocean. (The only thing better than owning a beach house is having a brother who owns a beach house. It's great, but the wear and tear and recurring maintenance on a rental house that close to the ocean is insane.) But I digress.
A couple lots from my brother's house is a large six bedroom house with a pool. It was built about six to eight years ago and we toured the inside of it then. IIRC it was set up as a 1/10th share. It used to be hopping with guests when it was first occupied, but in recent years it's a lot quieter. My brother says the multi-share arrangement somehow busted up and it is owned in a different format now. The problem was some people took better care of it than others and there was resentment. Some people were better prepared financially to participate in the arrangement and some were strapped. There are a lot of variables that can present problems down the road when a place is shared by multiple owners.

 

[VTKilarney]

I looked into it for the beach, and ultimately decided against it. Here are the primary reasons why:
1) It is not a good idea for an activity that is significantly impacted by the weather. I don't want to be told what my weeks are. I want to go when the weather is the best.
2) You won't use nearly as much as you pay for. A lot of your "weeks" will only be used for long weekends. And you probably won't use lots of your weeks in the off-season.
3) For the same money, or less, I can do what I what, where I want, and when I want.
4) Owning a place is great for the convenience of having your own place. It's worth a price premium to lots of folks to have a place where they can just turn the key and know that all of their stuff is there. Equipment is there, food is in the cupboards, etc. Fractional ownership takes away the one real advantage of ownership.

The best arrangement, IMHO, is to get a half interest in a private place with a VERY good friend. I have seen those arrangements work extremely well.

 

[gmcunni]

3) For the same money, or less, I can do what I what, where I want, and when I want.

what do you mean by this one?

 

[crank]

I used to ski with a guy I worked with years ago and his Dad owned half a house near Mt Snow. It was a 2 family house and they had had it for over 20 years. At first each partner used one unit. Years later they rented the bottom floor out as a seasonal and split weekends for the upper level. Worked out great and I am sure they still own the place.

The downside: Skiing MT Snow for 30 years would drive me nuts.

 

[cdskier]

what do you mean by this one?

Perhaps that the cost of renting as needed is cheaper than the cost of owning a place if you add up how much you would spend in a year on each. There's a lot of variables in that though. If you're the type of person that goes away and stays overnight somewhere every weekend, then I think finding the right place to own can certainly work out cheaper (and it is an asset that you can eventually sell if you no longer want/use it). Personally I love not having to worry about finding a place to stay and being able to go up even at the last minute without an issue.

 

[VTKilarney]

Perhaps that the cost of renting as needed is cheaper than the cost of owning a place if you add up how much you would spend in a year on each.

Correct. I've run the numbers. Owning is great for the convenience of owning, but you pay a premium for that convenience. By the time you pay property taxes, utilities, maintenance, etc. - renting is cheaper. While you are correct that you have an asset if you own, there are other ways to grow your money.

I'm not against owning. I'm just pointing out the economic realities of owning. If you can accept those, there are definitely arguments in favor of owning.

 

[Edd]

Correct. I've run the numbers. Owning is great for the convenience of owning, but you pay a premium for that convenience. By the time you pay property taxes, utilities, maintenance, etc. - renting is cheaper. While you are correct that you have an asset if you own, there are other ways to grow your money.

I'm not against owning. I'm just pointing out the economic realities of owning. If you can accept those, there are definitely arguments in favor of owning.

This is how my wife and I see it. We rent several houses in various places each year for vacations, often along with friends. Investment-wise, we use different avenues. But, it is a completely personal choice. This works well for us. If we had kids, we would be singing a very different tune.

 

[dlague]

Depending where you buy, there can also be HOA or condo fees in addition. We are considering a season rental this year. Thought we might test the waters.

 

[Jully]

While you are correct that you have an asset if you own, there are other ways to grow your money.

I'm not against owning. I'm just pointing out the economic realities of owning. If you can accept those, there are definitely arguments in favor of owning.

But will the extra cost of not owning and saving the money to invest yield more money than the money purely lost from renting? I haven't run the numbers so I don't know.

I would think it depends on the location in which you own. If you own a place in Stowe, North Conway, or MRV, then the home is a lot more likely to increase substantially rather than a home in say, Kingsfield ME.

 

[VTKilarney]

The numbers are going to be different depending on your personal situation.

All I can say is that, for me, the costs of ownership (excluding the purchase price) were greater than the costs of renting by a large margin.

But, again, there are benefits you get with owning that you don't get with renting. Those benefits just weren't worth it to me. But that's a personal decision. And keep in mind that I was looking at a beach house. The season for true beach weather is much shorter and the house would be closed entirely in the off-season.

 

[cdskier]

Correct. I've run the numbers. Owning is great for the convenience of owning, but you pay a premium for that convenience. By the time you pay property taxes, utilities, maintenance, etc. - renting is cheaper. While you are correct that you have an asset if you own, there are other ways to grow your money.

I'm not against owning. I'm just pointing out the economic realities of owning. If you can accept those, there are definitely arguments in favor of owning.

I don't view the place I own as a way to grow my money or as an investment...I'm simply expecting that the price will not significantly change and that I can get back close to what I paid for the condo itself at some point (ideally after many, many years of enjoyment and use).

Running the actual numbers is interesting and I just did it for my specific scenario. I'm paying approximately the same per year (or even a bit less) than what a seasonal rental would cost and I have the added benefit of being able to use it all year long. Based on a rough count of how many days I used my condo the past year, it is costing me about $170/night (excluding the mortgage). I could certainly find single rooms at inns for less than that per night, but if I wanted a condo I'd be paying more. Having a condo means being able to cook and saves some money in that regards as well vs staying in inn-style rooms and having to go out.

Distance is of course a factor as well. Some people closer to the mountains than I am could get away with driving to the mountain early Saturday and only staying Saturday night and saving money on lodging there. With a 5 hour drive, I need a place to stay both Friday and Saturday nights on weekends.

But of course there are pros and cons to both. Owning a place can mean less flexibility with which ski resorts you go to. I was ok with that, but some people wouldn't be and I fully understand that.

It really comes down to a personal decision and running the numbers for your specific scenario to see what makes sense. One thing I am decidedly against though is partial share ownership. Either rent as needed or find full ownership somewhere. Partial ownership takes away a lot of the advantages of owning your own place (although obviously there are people that seem to like this and it works for them).

 

[drjeff]

One variable that I haven't read yet in this thread, and have both experienced it myself and heard many friends who also made the jump from fractional or full seasonal rental situations to full ownership situations, is that very often you discover that the region that you enjoy enough for winter sliding on snow purposes has just as much outdoor enjoyment options in the summer months, and that's even from people who are beach people and boaters.

The reality that I have experienced in over 9 years now of full ownership is that as a family, even as my kids have gone from pre-school and daycare ages when we first bought to busy middle schoolers now, is that we're using our place more and more in the summer and fall than my wife and I ever thought we would when we made the decision to go from multiple years of seasonal rentals to full ownership

 

[cdskier]

I'm only averaging about 10 or so days in the Summer/Fall over the past couple years, but would definitely like to increase that over time.