13 July 2020

Property Ownership Types You Might Not Know About

Low angle view of two high rise buildings under blue sky
Low angle view of two high rise buildings under blue sky (image via pexels.com)
Property ownership isn’t something we often think about. Probably we are familiar with how our parents organised their finances, and that is good enough for us as well.

There are, however, a broad range of options when it comes to property ownership and asset management. The social and economic landscape is always changing, and a new generation of people are finding ways to invest in properties collectively successfully.

Also, opportunities exist for fractional ownership of luxury assets such as vacation villas, yachts, and even private jets. In this post we duck under the surface and take a look around.

Communal Ownership

Did you ever hear about the one about the twenty-something woman who bought a dilapidated property with some friends and together they turned it around in a matter of weeks? She was soon renting the rooms out to her friends which more than covered the mortgage payment and provided a steady stream of passive income. Pretty smart right?

Brown wooden center table
Brown wooden center table (image via pexels.com)
This type of story is becoming more common for a number of reasons. The economy is one of them, but so are the attitudes and expectations of younger generations coming through, like the Gen Zeds. Years of austerity and massive student loans have encouraged young people to think outside the box, and communal property ownership is one thing they’ve come up with.

In this model trusted friends invest in a property. It could be somewhere rundown that requires some heavy lifting, or a brand new flat in the city, somewhere just out the wrapper. It all depends on the investors and their preferences. Initially, the rooms can be let to those same investors, but there is flexibility too. If someone needs to move away for instance, the room can be let out.

Built To Order Flat

Built to order flats (BTO) are unique to Singapore but that doesn’t mean you can’t take advantage of the fantastic opportunities on offer as an American. Have you ever been to Singapore? It’s one of the most modern and diverse city-states in the world and a perfect hub for exploring the riches of Asia. A BTO flat in Singapore could provide you with a second income or a unique vacation home.

The way BTO homes and flats operate is very efficient - a bit like Singapore in general! An allocation system offers flexibility in timing and location. Eligible buyers can apply for apartments in their preferred areas and when demand is higher than 70% construction will begin. Otherwise, the project is abandoned. At the moment there are some upcoming HDB BTO 2020 locations on offer.

Imagine subletting a flat in one of the most lucrative cities in the world where business people are coming and going all the time. When it is not in use you could always jet off to Singapore yourself and take advantage of the excellent weather and culture.

Fractional Ownership

Have you ever dreamt of owning your own luxury house on the beach, flashy car, or even private jet? What was once the preserve of the super-rich is becoming more accessible to ordinary people with systems like fractional ownership.

So what’s it all about?

Fractional ownership is different from a timeshare in a number of key ways. With a timeshare you pay an annual fee in order to rent a property for a particular time of the year, but with FO you invest, along with other buyers, in the property or asset, and share it with them based on an agreed schedule.


Woman laying down on bed inside room
Woman laying down on bed inside room (image via pexels.com)
There are many advantages to this. Firstly, as a part share owner, you will benefit from tax incentives and an increase in the value of the asset. Furthermore, you will not feel compelled to use the property at every opportunity, the way you might if you entirely owned a vacation home. You will have a set schedule for the asset, and you can choose to use it or not.

Joint Tenancy

Joint tenancy is when two or more people share an equal undivided interest in a property. You might think this is limited to spouses but you’d be wrong. It’s common for friends and business partners also to use joint tenancy as an ownership option. That said, there are particular advantages if owners are married.

If owners are married and one of them dies the value of the deceased property transfers to the living spouse. Conversely, if individuals are not married the value of the property is incorporated into the deceased estate. This can make it a potentially risky ownership strategy for unmarried individuals.


But, if it is a short term investment opportunity, if buyers are young, healthy, and trustworthy; and if they are looking to buy a property in order to renovate it and sell it on for profit, then a joint tenancy agreement can be a useful option. Speak to a financial consultant about this and ensure you have a solid business plan if you intend to go ahead with it.

Vacation Home

If joint ownership is not your thing you might be more interested in the sole ownership option. Have full control over your asset, use it any time you like and benefit from its entire value when sold. This can be an excellent choice if you are single and wish to buy a primary residence, or if you like the idea of having a second home, either as a vacation spot or as a passive income stream.

There are many advantages to owning a vacation home that go beyond the obvious. There are tax breaks available, convenience, rental incomes, along with chosen familiar surroundings for leisurely breaks. Firstly, if a second home is primarily used for vacations and is not rented out for more than two weeks of the year, it qualifies for tax-deductible mortgage interest and property taxes. But if you feel you would be better off renting it throughout the year this can also be a lucrative option.

A vacation home is a comfortable and familiar place that is perfect for a family vacation once or twice a year, as well as gathering for special occasions such as weddings and anniversaries.