Destination clubs are the alternative to owning a second home
By Melissa Wirkus
Second homes have been
growing in popularity amongst all types of homeowners
within the past few years.
Traditionally, most people have thought that owning
a second home was only for the extremely wealthy and
upper class citizens; but this is definitely not the
case anymore.
And no longer are people buying one second home in a
vacation town or ski resort, many are turning to a new
type of second home ownership that actually does not
involve owning any property
at all.
Enter the world of destination clubs.
A December 6, 2006 article by Amy Gunderson of The New
York Times, “When a club is the destination,”
discusses how many second homeowners are sick of dealing
with them and are selling
their homes for a membership in a destination club.
The article discusses the Weintraubs, a couple who recently
sold their vacation condo in Colorado and entered into
a membership with a destination club.
“In 2001, the couple sold their condo, having
grown too frustrated dealing with its upkeep. But in
2004, they found an alternative. They joined Exclusive
Resorts, a breed of vacation club that marries the services
of a five-star resort with access to multimillion dollar
homes.”
“The Weintraubs signed up for 30 days of travel
a year. The initiation fee was less than $300,000, and
annual dues worked out to about $450 a night.”
Not only does the couple now not have to worry about
the condo in Colorado, but they get to travel all over
to different luxurious
homes.
“The initiation fee and annual dues generally
include a set number of days a year, and upon resignation,
clubs promise to return anywhere from 80 to 100 percent
of the initial membership fee.”
They have recently spent time in Arizona, New York and
Utah. Next year they already have trips planned for
Cabo San Lucas and Hawaii.
These clubs are attractive to many people because they
get the perks of a second home or a vacation home without
having to worry about the upkeep.
“Before joining, prospective members should ask
in detail about a club’s financial status. Vetting
a club should include questions about the average appraised
value of homes, the number of members who have resigned
and booking restrictions around the holidays, according
to Jamie Cheng of Helium Report, an independent research
company.”
If you are looking to make an investment, which the
clubs discussed do not offer, there are some new destination
clubs that offer partial ownership as well.
“Recently, other clubs have started to present
alternatives to the standard destination club model.
Crescendo, launched in the summer of 2005, is structured
as a real estate investment where members have access
to its portfolio of eight homes, but are also offered
a stake in the value of the homes.”
Before you go into a destination club agreement, check
out the homes and locations they have to offer as well
as any stipulations regarding your membership fees and
dues. Above all, make sure it is a financially feasible
option.
Back to Articles
|
