From a financial point of view, investing in fractional properties is a smart strategy, since it allows you to maximize capital profitability by reducing costs and spreading risks. When investing in a full property, the investor assumes all the risks and all the costs.
However, there are other elements that are interesting to consider when choosing this investment alternative.
For example, a fractional property can be considered a dollar-denominated asset, thus providing a store of value for savings, while offering returns that are above those of traditional real estate investments.
In turn, by being located in established tourist destinations, these properties gain appreciation over time as the project and destination mature, and they are an excellent alternative when liquidity is needed, since they have a higher resale speed than most real estate investments.
In addition, investment in fractional vacation properties offers the following comparative advantages over full vacation property ownership.
Diversification: by investing in fractional properties, the investor has the possibility of diversifying their portfolio. By investing in fractional properties, you can distribute your capital across different locations and segments of the real estate market. This reduces the risk associated with having all your money invested in a single asset.
Lower initial investment: investing in fractional properties allows participation in the real estate market with a lower initial investment compared to purchasing a full property. By sharing costs with other investors, it is possible to acquire a fraction of a property at a more accessible price.
Simplified management: as the owner of a fraction of a property, the investor does not have to worry about daily management and maintenance. For this reason, it is important that the administration and operation of the property be handled by a company specialized in hotel management, which can guarantee service quality, maintenance, and proper administration.
Access to high-quality investment opportunities: fractional properties are located in privileged locations and are high-quality or luxury properties, situated in exclusive tourist destinations that might otherwise be out of reach without a fractional format. These properties may have high appreciation potential, since they feature excellent locations and luxury amenities such as golf courses, spas, international-level restaurants, theme parks, among other attractions that help increase the value of the property.
