When considering fractional ownership, it’s not enough to just find the perfect private residence club, prospective buyers need to know the process of purchasing the residence. A word to the wise – the best pricing is offered in the earliest pricing during the first phase of sales, even before the residences are constructed. Catch the plans while they’re hot – Helium Report frequently announces private residence club prospects, and our directory includes some locations in development.

The Purchase

The first stage of purchasing is a reservation agreement, where prospective buyers submit a deposit, demonstrating their intent to buy. This deposit is refundable, though the buyer may be required to cover a small escrow fee. The reservation gives them a place in line, but does not necessarily guarantee that a unit will be available. Occasionally, some prospective owners are bumped to subsequent phases due to overbooking.

Prospective owners are presented with a series of documents, including a purchase agreement and operating rules and regulations. They also receive an extremely detailed explanation of the overall resort and specific residence. This document includes specific dimensions and layout; architectural detail such as colors, finishes and trim; and the brand and model of key appliances.

Upon signing a purchase agreement, prospective buyers submit another check, bringing the payments up to the required down-payment. These payments are now non-refundable. Depending on state laws, there may be a rescission period (typically seven days) when prospective owners may back out of the purchase, with a full refund. A common provision allows buyers to back out of the purchase with a full refund if certain construction or occupancy milestones are missed.

Helium Report’s Decision Guide to Private Residence Clubs goes further, with in-depth analysis and due diligence questions.