Could @yours2share handle sharing aircraft carriers, sure, but we don't get involved in the contracts - phew! http://ow.ly/2z1zG2 hours ago
RT @WiREUK: PR National Mag Article on xmas/winter based activities to get children out of the house; eco, green or bigger picture Call WiRE 21 hours ago
This created a great deal of interest in yours2share and I’ve spent a fair amount of time since then answering questions. Many people who are trying to sell a holiday home abroad wondered if sharing was the way forward.
There are broadly three ways in which you can share an asset: joint or fractional ownership, fractional rental and timeshare. The principles below apply just as well to boats, planes, motorhomes, cars and any major asset.
Joint ownership
Two or more people own the property: either they find each other first and buy together; or the existing owner of a property sells shares.
In the latter case, if the property was worth £100,000, the owner might think four shares was ideal and look for partners to buy quarter shares. As it takes time to find people to agree the deal, often they will sell one share at a time. This could mean selling a £25,000 share to each buyer.
However it is important that all the partners are like-minded. So the vendor often sells half to the first partner on board for £50,000. Then both owners look for the next partner. The third partner then buys a third share for £33,333 and the first two partners split this between them. If, and when, a fourth partner joins them, their payment of £25,000 is then split between the three owners.
Fractional rental
One or more people rent the property for several non-continuous weeks a year. The owner often doesn’t want to holiday let, but wants to generate some income and to ensure the property is kept in use.
Some numbers help to illustrate how this might work. For example a £100,000 property might let for £200/week in the low season, £300 in the mid season and £400/week in the high season. The owner looks for a partner that is looking for a holiday home for 12 weeks a year, split between the three seasons. If this was a straightforward holiday let, this would cost £3600 per year.
Most owner/holiday lettings company give a good discounts for this many bookings, but between £2000 and £3000 a year is reasonable for the 12 weeks. Usually this kind of arrangement is agreed annually, with all or most of the payment up front. Generally the weeks are not fixed (although the number in each season should be defined in the contract), but agreed once a year for the following year.
Timeshare
One or more people rent the property for one or more weeks a year and pay for the right to do this for several years in advance. This is similar to fractional rental, except all the rent is paid in advance.
Taking the example above, instead of (say) paying £3000 per year, they may pay £10,000 in advance for the right to use the property for 12 weeks a year for 5 years, or maybe £30,000 for the right to use it for 25 years.
Commercial timeshares are generally sold for periods of one to three weeks a year, and there are usually annual management/maintenance fees. There are strict laws on selling timeshare in many countries because, amongst other issues, the timeshare purchaser has to know that the property will be available and properly maintained for the contract duration. In general, I would advise private holiday home owners to avoid the timeshare model: this is why I rarely mention timeshare. However last week I had several questions about possible sharing arrangements which were effectively timeshare. There are many well run commercial timeshare schemes; I just don’t think it works for private holiday homes.
Sharing a holiday home is a great solution if you can’t justify the cost of full ownership and don’t want to holiday let. Finding like-minded partners, discussing and agreeing everything, getting advice, writing the contracts and dealing with the purchases, can easily take a year, or two, or more. If the property is a long term investment, this is fine for many people; they are looking for long term partners. But if holiday home owners need to raise capital fast or are struggling to pay a mortgage, sharing is less likely to be the solution.
I should make it clear that I am not a professional legal, financial, tax or property advisor. The laws on ownership, finance, tax and property vary enormously from country to country and if you are considering sharing property or any other major asset, you must get independent professional legal, financial, tax and property advice. And I mean “must”. Even within any one country there will be several entirely different ways of setting up an arrangement each with advantages and disadvantages. The best solution will depend upon all the partners’ particular personal circumstances. Sharing is very cost effective, but you do need to invest time and money into ensuring that the arrangement is properly set up.
Cheatneutral is a great thought provoking website with a terrific video.
However trading cheating is not quite the same as trading carbon emissions. I’m no expert on this, but I thought carbon offsetting is rather like two friends that both heat their homes using oil fired central heating. They both agree they want to cut their emissions but one of them has little choice of low carbon heating options: there sun and wind are both unreliable, the only option is to insulate and there still needs to be some heating. The other friend lives in a location with plentiful wind and sun, but they are expensive to install. The friends want to do something, so they agree to split the cost of the convertion to solar and wind power at the house where this is viable.
This is better than doing nothing. In the case of cheatneutral, paying a fine is not better than doing nothing. Over all, isn’t cutting some carbon output, better than none, or is it simply hiding the fact that we’ve got a lot still to cut?
(With my yours2share hat on, I can see that sharing the cost of the solar and wind power convertion is practically not a good idea – and sharing anything with friends is fraught with difficulties, but that’s another story.)
Following up from an earlier blog post about RelayRides, there is an interesting article in the Economist today about peer to peer car sharing. As well as RelayRides in the US, there is another operator WhipCar operating a similar peer to peer car rental service. I’ll have to try it out. And I had to comment on the Economist’s website!
There was a great piece in Saturday’s Daily Mail about fractional living with a good mention of various sharing arrangements. Two yours2share members were interviewed and it explained how private syndicates work and the benefits. I couldn’t have written it better if I’d tried.
Many thanks to the two members, Graham Price and Bill Hosie: to the author, Steve Boggan; and toPiers Brown of Fractional Life for putting Steve in touch with me..
As a result we had thousands of extra visitors on Saturday, some interesting new ads were posted and it’s taken me all morning to answer all the questions which people have asked us. Fantastic!
Anyone who has ever owned a boat will tell you that the ongoing mooring and maintenance costs can be considerable. One of the major advantages of sharing a boat is sharing these costs.
So I read this article in the Wall Street Journal today with a little amusement. Sunk costs details the running costs of superyachts. This isn’t for the faint-hearted! People also often don’t realise that even the very wealthy share assets, they just might not advertise the fact.
We all have some fairly expensive assets that we rarely use: second, third or fourth cars that sit unused outside our house for all but an hour a week, swimming pools that are used twice a week, second homes we try to visit once a month, boats we make ourselves sail six times a year to justify keeping them, motor homes cluttering our drives for fifty weeks a year, plus all the sports and gardening equipment filling our cupboards sheds in case we suddenly have the urge to lift some weights or trim our hedges.
Amazingly most people accept this huge waste of resources, hoping they can continue to justify keeping them in their expensive sheds for their annual outing.
But now everyone is reconsidering their finances: some wonder if they can generate a little income or release some capital. Can they their assets work harder for them and still be there when they want them?
What if you could find one or two like-minded people that you trust? Would you consider selling them a share or agreeing a long term rental arrangement where they use the item (say) once a month? Until recently people only found sharing partners through serendipity: at a dinner party, through a friend, or a chance advert at the newsagent.
yours2share enables you to find like-minded partners in an organized manner. Advertise for partners to share just about any asset: property, boats, aircraft, horses, dogs, gardens, swimming pools, motor homes, cars, and so on. For example, if you have a second home, you can advertise to sell a half share or to rent it for a week a month. Or if you’re looking for a second home, you can advertise for people to join you in buying your dream cottage, or find someone with a second home from whom you can rent or buy a share.
Once you’ve found your partners, you need to invest sufficient time (several hours and several meetings) at the beginning to discuss everything properly and negotiate the agreement. This process will establish whether or not you are sufficiently like-minded and compatible: consider the contract as proof of this. For property and any major financial asset you should always take independent professional legal advice (and sometimes financial and tax advice as well). If you’ve already agreed everything, then the legal checks should be relatively inexpensive.
As well as the financial benefits, sharing is also environmentally friendly. It makes much better use of resources and, because the running costs are shared, shared assets are often maintained to the highest (environmentally friendly) standard, to the pride of their owners. Often the higher standard of maintenance means the asset is safer too.
However the greatest pleasure of sharing doesn’t usually strike people until they’ve been doing it for some time. This is the sense of community and of shared responsibility. Whenever I speak to people in private syndicates, even the most cynical, hard-nosed “I never share anything, but my wife talked me into this” men will tell me how lovely it is to have found three (say) great “friends” who love this wonderful boat/property/aircraft as much as he does, and how fantastic it is to have pals to share the management and maintenance issues with. They tell me how extraordinary this is. I smile, because it is ordinary for well designed private syndicates to be extraordinary.
Most sharing arrangements quickly find they need some kind of reservation system so that people can easily see who and when partners are using the shared asset. If they have an arrangement where free time can be booked on a first come basis, then they need the system to enable them to make the reservation too. Ideally this should all be on-line so everyone can access it.
Over the last couple of months several on-line reservation systems have come to my attention, so I thought I’d let you know about the three that look the most interesting.
The first is My Reservations which has been created by Bill Hosie, a yours2share member. Bill has shares in both a light aircraft and a boat, so he has a good understanding of the requirements. The system can either be slotted into your own website (many syndicates have a website about their boat, plane etc) or can be a standalone system hosted by My Reservations. I’ve had a play with the demo and for £45 a year, this gives you all the basic functionality you need for a straightforward syndicate, and it’s very easy to use.
Then I stumbled upon Divvy which is free to use and appears to allow lots of flexibility and sophistication. You can manage reservations on multiple items, and can take payment with reservations. I’ve also had a play with Divvy and set up a reservation system for a client who wanted a system to handle booking at several cottages. Because it is so flexible, it is a bit harder to understand and for a straightforward syndicate, could be overkill, and a bit frustrating if your computer skills aren’t too great.
Finally I heard some good reports about Booking Bug so I had a look. This looks like the most sophisticated system of all and costs the most at £10/month for the basic package. This looks like it has all the functionality of Divvy and more, but has a simpler user interface. I haven’t played with the system, but what I could see of the website looked straightforward. As well as the basic package which would suit a private syndicate, there are business packages suitable for a whole range of booking and reservation requirements.
There are also several more booking systems designed specifically for sharing aircraft and I’m sure lots more for the hotel and bed and breakfast/holiday lettings market, but these three are some of the best I’ve seen that would work for a wide range of private syndicates sharing many asset types.
If you’ve used any other system and have views, good or bad, please let me know, by commenting below.
yours2share now has well over 300 horse share ads, from all over the UK, from Devon to Ayrshire and Cardiff to Surrey (lots and lots there!) I’ve recently spoken to several people who have successfully found sharers through yours2share.
I’ve also spoken to a few who have found a sharer, it’s worked well for a while, and then the arrangement has ended and they are back advertising again. In some cases this is because circumstances changed, but in a couple of cases, it was because the owner of the horse was unhappy with some aspect of the sharer, and in both cases one factor was that the sharer simply didn’t turn up sometimes.
If you are going to share your adored equine friend, I strongly suggest that you do two things.
Firstly make sure the person is suitable. This doesn’t just mean that their riding skills and knowledge of horses are sufficient; it also means are they reliable? Will they turn up on a grey Wednesday in November when it’s pouring with rain? If they have agreed to do some duties in lieu of payment, will they conscientiously do this every said wet Wednesday? You don’t need to take their word for it, ask for two or three references: from an employer, teacher, previous owner of a horse they have shared. And then ring them up. You can tell a great deal from a simple phone call: much can be gleaned from what isn’t said. If your prospective sharer is under 18, call (and preferably meet) their parents and make sure that they know about, and are happy with, the arrangement. Again this will help you to acquire that warm happy feeling, or not.
Secondly, spend some time discussing how the sharing arrangement will work in detail, and then write down everything you have discussed in an agreement. Here are some of the things you need to discuss. Ideally this is proper contract; you can buy a template contract from our friends NetLawman. But even if it is just a statement of all the key points you’ve agreed which is signed and dated by you both, this is better than nothing. In effect the written agreement is proof that you’ve thought it all through and agreed how you will do things. It means that you are much more likely to have flushed out any misunderstandings.
Do these two simple things and your horse sharing arrangement is much more likely to be successful.
Here is another great article from shareable.net (would you share a car with a stranger?) outlines some of the ground breaking car sharing schemes being tried out in the US (astonishing really, as prising the average American out of his SUV isn’t something most of us would attempt, let alone ask him to let someone he didn’t know drive it.) This is a proper discussion of some really innovative and challenging new ideas to get people to make better use of these very expensive and totally underused resources, our cars.
I’ve always thought that informal car clubs, or private syndicates should work well and there is plenty of guidance about this on yours2share, but it takes a while for the groups to form and for word to get around that it can actually work well. I also must admit that of all the private syndicate types, they are some of the more complex to negotiate and set up, although there are organisations that can help you to do this, look at CarClubs for ideas. Furthermore the kind of people who are likely to do this, are often those that cannot afford any unexpected costs or pay for legal advice: potential partners in many boat, property, or aircraft schemes can.
One of the options discussed is RelayRides, the first person-to-person car-sharing service, which will be launching soon in Baltimore. What this means is that if your car is unused for much of the time, you can register it with RelayRides for other people to use in return for a fee. You define the periods when it is available for use, and how much you want to charge. RelayRides sorts out a smartcard which allows the renting person access. There are ebay-like reviews of both renters and owners so that people are incentivised to look after the car, and make sure it is clean and well maintained.
It’s a great idea, but also extraordinary! If it takes off, it will have created a shift in people’s mindsets equivalent to that created by ebay (how do I know that a complete stranger will send me the goods for which I’ve just paid them?) or house swapping (so I’m going to let a complete stranger stay in my house, and go and stay in their house?), both of which are now utterly mainstream. I shall watch RelayRides with great interest and everything crossed.
Some time ago I wrote about swapping property, this is now a popular way of holidaying. I also mentioned that someone had posted an ad with yours2share to occasionally swap their holiday home in Mallorca, Spain for a motor yacht in Mallorca. I looked quite hard for any websites for boat swaps but couldn’t find any. So I was pleased to find out about this website, BVC International, based in Australia, but enabling boat swaps worldwide.
One aspect of swapping that really pleases me is that it is so successful. When people first hear about it, their natural caution screams “I can’t let a complete stranger live in my home – when I’m not there!” But I understand there are few horror stories: I know several people who do it every year, including owners of very upmarket properties. In reality people are generally very respectful of other people’s property, know that any bad behaviour may be reported to neighbours to the owners who are currently staying in their house, and need to ensure that their feedback ratings are good, or they won’t be able to swap again.
Similarly with sharing: most people’s first reaction is “I can’t share my holiday home!” But the reality of the many private syndicates I’ve had contact with, is that people work together to make it work, investing time at the beginning to discussing and negotiating to ensure all the partners are like-minded and compatible, and that all the details are agreed and written down in a contract.
