How Plum Is Simplifying Real Estate and Vacation Co-Ownership
How Plum Is Simplifying Real Estate and Vacation Co-Ownership
Everyone looks forward to their upcoming vacations. That’s great and can be a recipe to combat burnout. And make no mistake: People are back to vacationing now that Covid is somewhat in the rearview mirror. In fact, ValuePenguin’s research shows that more than half of all Americans are planning a trip in the near future. However, figuring out where to stay can be a sticking point. For many, vacation co-ownership offers an attractive alternative.
What makes pinpointing the perfect place to hang out for a week so difficult? Despite the proliferation of sites like Airbnb and VRBO, finding budget-friendly lodging in a prime location isn’t always easy. Many travelers end up feeling like they’re not getting the best possible accommodations for their money. As a result, plenty of individuals and families consider purchasing vacation properties or seeking timeshares.
Getting a Break…Without Breaking the Bank
There are problems with both these solutions, though.
Investing in a home, condo, bungalow, or cabin in a tourist hotspot can be pricey. That’s why so many people rent out their vacation properties. Unfortunately, the most lucrative times to rent are during popular times of the year. Accordingly, many property owners give up the opportunity to enjoy their vacation homes during peak seasons.
Timeshares aren’t necessarily a better option, which may be why so many people are unloading timeshare units en masse. Though timeshares seem to cost less upfront, they’re very limiting.
Plus, timeshare “owners” are only owning time. They’re not actually investing in real estate. Therefore, they can’t possibly profit from a timeshare arrangement, making it a bad choice for budding investors.
What should individuals and couples eager to be able to go to the same getaway vacation after vacation do then? Serial entrepreneur Matt Williamson asked himself the same question a few years ago. His answer became the seed of his startup venture, Plum CoOwnership.
A Streamlined Avenue to Owning Real Vacation Properties
Williamson built Plum so vacationers could get off the “Where should we stay?” rollercoaster permanently through a co-ownership agreement. Property co-ownership is exactly as it sounds: Several people or couples buy a single property together.
For example, four friends may want to buy beachside cottages individually. Yet each friend can only purchase a home up to $ 250,000. That’s not enough to get close enough to hear the waves, let alone have a great view.
But if they work together, they have the buying power to purchase properties listed in the $ 1 million range. If they invest in that type of higher-end property, they can each spend 13 weeks there annually while saving.
Not only do they share ownership of the real estate but they have a place to stay in a location they love. And they own the property outright instead of paying a third-party entity for their time.
To be sure, co-ownership is not a new concept. In fact, there are over 2 million co-owned vacation homes. Still, it can seem daunting for groups interested in purchasing vacation homes.
After all, there are multiple considerations, including how to set up a co-ownership group, find the right realtor, and set up fair use schedules. Williamson’s brainchild platform Plum aims to remove the biggest barriers to co-ownership, making vacation property ownership feasible for those interested.
The Plum Approach to Streamlining Vacation Property Co-Ownership
Backed by advanced technologies, Plum serves as the launching pad for aspiring co-owners to realize their vacation home dreams.
Individuals can set up Plum accounts for free to start their journeys. If they don’t have a group in mind, they can advertise for other property investors to join them. Once a group has been set up through Plum, the site’s intuitive system walks the group through the co-ownership process.
Below are just a few benefits for co-owners who leverage Plum.
1. Co-ownership groups can become LLCs through Plum.
Rather than hiring outside legal help, co-owners have the option to let Plum help them form an LLC. The LLC then becomes the entity that officially owns the property.
LLC backing protects individual owners and makes the experience more secure and satisfying. LLC standing also makes it more efficient when setting up a joint bank account that’s transparent to all LLC members.
Though Plum recommends only a few members be given access to transfer funds, full and transparent access to monthly statements and all transactions should be available to everyone.
2. Co-owners can outline their must-haves and negotiables on Plum.
It’s critical for property co-owners to outline everything from house rules to maintenance schedules. The earlier this happens, the fewer surprises are likely to happen in the long run.
The Plum system walks groups through the process of negotiating all responsibilities. Final results are laid out in a document. Ideally, the document will be created prior to bidding on a vacation property to lessen the chance of misunderstandings.
3. Co-owners can bring properties to the table or search on Plum.
When Williamson first began investigating co-ownership in-depth, he realized some people already owned vacation properties. But they were interested in splitting the property into shares to spend less per month on mortgage payments, taxes, etc.
Plum allows those kinds of owners to seek out other owners to form co-ownership groups. For groups that don’t have a property in mind, Plum’s site offers a property search feature. Additionally, Plum can suggest co-ownership-friendly realtors and lenders interested in selling to co-ownership groups.
4. Users can rely on Plum for property financial management.
After investing in a property, co-ownership groups have every reason to keep the property running smoothly.
Plum ensures this happens by including a reserve fund in its original financial projection. Each month, co-owners funnel a certain amount of money into the reserve fund. That way, the fund can grow and support routine and emergency maintenance costs.
Ultimately, the property stays in better shape and co-owners have fewer unbudgeted expenses.
A Plum Future for People Interested in Purchasing Vacation Properties
Although Plum only just launched, it’s gotten quite a bit of notice.
Recently, Plum was featured on Entrepreneur’s Elevator Pitch show. The outcome was a $ 175,000 investment from Netflix’s former CEO. Williamson and his team plan to use the investment dollars to further improve the site’s advantages for users.
In the meantime, Plum presents an attractive way for people to finally achieve vacation home ownership with less stress. After all, stress is the opposite of what travel should be all about! With Plum, everyone can spend their vacations relaxing in homes that they not only love but own as well.
Featured Image: Pixabay; Pexels; Thank you!
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