In my previous two articles I discussed the growth of co-ownership in vacation homes and provided some tips and potential pitfalls when setting up an arrangement between partners. Now, I’d like to focus on how the internet is disrupting the market, and how it can make the process more efficient—from helping potential owners to find properties, streamlining the paperwork, and even helping match potential co-owners around the world. One new website even fashions itself similar to an online “dating service” for members seeking partners for co-ownership.
In many ways, it makes a lot of sense to harness the power of the web to match parties that are looking for vacation homes. Services such as Zillow, Redfin, and Trulia already are well-established, listing homes for sale. But when it comes to co-ownership, it can be argued that more important than finding the right home is finding the right partner.
Ideally, one would want a like-minded partner when it comes to maintenance, dues and potential future sale of the property, and with usage expectations that complement their own. The traditional methods have been to speak with friends, family, or local real estate agents who might have interest or happen to know others with a similar goal. Now, online tools can allow you to expand your search to virtually the entire planet of potential co-owners, greatly increasing your chance of finding the perfect partner. This also allows you to step into a larger or more expensive vacation home than you could afford on your own, or that you may find your dream home at half the cost.
In 2016, 721,000 vacation homes were sold, and national data shows that most people looking for vacation homes only use the property for three to six weeks per year. This leaves the home empty for large portions of the calendar. Putting a large down payment and mortgage on an underused asset is a luxury few can afford. Professional property managers can, for a fee of course, step in and rent out the property during the owner’s absence.
Rentals often carry a stigma due to fears of damages by the tenants, however, co-ownership can alleviate concerns of owners who don’t want to be bothered dealing with renters or property managers, as they know their partners’ ownership interest aligns with their own.
There are companies with a web presence who specialize in co-ownership agreements, as mentioned in my past articles, such as Canada-based Owner Match International and San Francisco attorney Andy Sirkin. Each help partners to develop terms and agreements but the process is still facilitated the traditional offline way, with human agents involved throughout the process, trying to match up partners, find properties, and negotiate legal agreements.
In an effort to streamline the process, new company Vacation Property Partners (www.vacationpropertypartners.com) or VPP recently launched their website as a one-stop shop for co- owners seeking each other without the need for a 3rd party to guide the transaction.
Created by Ed Kushins and Ed LeMoure, the site functions similarly to a dating service. VPP has potential co-owners fill out a short bio on the website, with additional questions designed to help match their interests and expectations, all online and without the need for a third party. Once registered, members can search to find others whose interests match with theirs and communicate directly with potential co- owners. People can browse for matches by location, times of use, and other related factors. By allowing users to directly contact each other, the website can drastically reduce the time to find the right person, as well as provide a much larger pool of potential co-owners.
Unlike many of the connections on a dating app, however, co-ownership is an ongoing relationship, and a legal one at that. VPP provides a solution to these issues with an automated legal document generator. This proprietary service automates the process of generating partnership agreements through a drop-down menu with all of the standard questions for co-owners needed to generate an agreement. Co-owners can take this information to an attorney or escrow service in the state where the property is located to close the deal. The documents will outline the terms both parties have fundamentally agreed to in advance regarding the structure of the partnership, the terms of usage, management and dues of the property, what might lead to contract termination, or what would happen if a partner defaults on the agreement, and how the relationship will terminate at the end of the agreed-to period.
Once the partnership is established, members will be able to access properties through Partners Real Estate Brokerage in Amherst, MA, a full service real estate agency established by Kushins and LeMoure. In addition, Partners Real Estate will have between 60 and 80 exclusive brokerage agreements in high- value vacation home locations to assist the co-owners in locating their ideal property.
Ed Kushins is a veteran of the vacation industry, and Founded HomeExchange.com, which matches people looking to swap homes for a vacation. The site was prominently featured in the movie, The Holiday, starring Cameron Diaz and Kate Winslet, where two women matched to trade their Los Angeles and English homes over the Winter holidays.
When Kushins sold the site in 2017, he realized that there was potential to use the same matching process to allow people to purchase a home together through co-ownership. He enlisted LeMoure, who became friends and business associates with Kushins through their mutual involvement with HomeExchange. (LeMoure was one of the earlier members). LeMoure has had a successful background in turning small businesses into very large multi-million dollar operations over the years, working at high-level executive positions at Johnson & Johnson, C.R. Bard, and other medical device businesses.
Kushins sees similarities between the growth of vacation home exchanges and vacation property co- ownership—“I have 25 years of introducing a new concept with tremendous benefits with HomeExchange. There was initially a lot of skepticism. First thing was answering people’s concerns, ‘How do I trust it? It wouldn’t be for me’. Over time we were able to change the whole market, and it became like internet dating was, but for travel.”
LeMoure envisions additional ways to apply the model to include co-ownership for boats, recreational vehicles, and ultimately, cars in urban areas. He also sees rapid expansion in major international markets—“We envision a VPP website for international members looking to partner for vacation homes in the U.S., as well as potential VPP sites for other countries such as China and Russia. The possibilities are endless, and we are excited to be at the forefront of a new way of bringing dream vacation homes to people all over the world.”
Today, Kushins and LeMoure expect the primary audience initially to be single and married owners above the age of 40 and expect early candidates to be adventurous early adopters; first movers who can see the benefits of this emerging technology. However as the generation of people raised on the internet moves into their economic adulthood, there is potential for a web-based system that feels intuitive to those who have spent their 20s and 30s online and today are finding homes to rent and buy online to find their match not just in dating, but in other areas as well, including vacation home ownership.