Making $$$ With Fractional Vacation Home Ownership

If you're someone who loves vacationing in a particular resort community, fractional vacation home ownership could be a smart investment strategy. Not only does fractional ownership allow you to own a stake in a vacation property, but it can also help you make money through short-term rental income.

According to a SuperMoney article [1], fractional ownership is different from timeshares in that it grants you actual ownership of the property, not just time. This means you can use the property for a few weeks per year and rent it out for the rest of the time.

Short-term rental income can be a great source of extra cash. In fact, short-term rental properties can generate anywhere from 5-25% in yearly income [2]. This is in stark contrast to long-term rental properties, which generally only produce 1-5% yearly income. While short-term rentals can be riskier and require more hands-on management, they can be an excellent option for someone who has retired and is looking for a way to make some extra money while befriending guests.

Of course, fractional ownership does come with its own set of costs. Annual fees can be as high as $1,000 per year and increase with inflation at around 3.0% annually [3]. However, these fees can be offset by short-term rental income, especially during peak vacation seasons.

In summary, fractional vacation home ownership can be an excellent way to own a stake in a vacation property while also generating income through short-term rentals. While there are costs associated with fractional ownership, the potential income from short-term rentals can make it a worthwhile investment.