In a property co-ownership model, multiple individuals are able to co-own a home. Also known as fractional ownership, the approach aims to make typically high-value assets more accessible. Although the concept is not new, its practical implementation becomes expensive and complicated without an appointed neutral administrator to manage the model with full transparency and fairness. Enter Fractal: We have completely rethought the concept, taking care of the hassles and complexities that come with a co-ownership structure so that you as an owner can focus solely on enjoying your home.
What is Fractal?
Fractal is redefining the experience of buying, using and selling co-ownership interests in luxury properties in select European cities, starting with London. We use technology to radically simplify the process of scheduling your stays, paying your bills, maintaining the home and any other homeowner responsibilities. We focus on minimising the administrative work for owners and providing them with a hassle-free homeowner experience.
Is Fractal a timeshare?
Fractal homes and timeshares are not the same thing. With Fractal, owners acquire a fraction of the property via a limited company set up specifically to own that single property. Owners can therefore capture any asset appreciation when/if the home’s value goes up over time. We also facilitate the sale of your Fractal property interest fractions should you decide to sell. With timeshares, you are only paying for the right to occupy the homes for a certain amount of time every year. This typically results in a loss to the buyer should they decide to sell their timeshare back to the property operator or should the timeshare expire. Timeshares usually give you access to interchangeable units in hotels or resorts; with Fractal you are buying the home of your choice in prime locations across Europe.
How many co-owners are there per home?
Each home is divided into eight equal fractions, and a single owner can buy up to four shares per home. This means that each home can have a minimum of two and a maximum of eight owners. Each Fractal owner will therefore be entitled to a minimum of six weeks of home occupancy per year.
How does Fractal make money?
Fractal charges two types of fees: an upfront service fee and a monthly admin fee. The Fractal service fee amounts to 12% of the fraction’s value. This allows us to facilitate the purchase transaction and handle all of the administrative work. The Fractal admin fee amounts to (£/€ 200 per month). This allows our team to handle the ongoing administration of the homes. The ongoing running expenses of the home are passed on to the homeowners at cost, without any markup by Fractal.
Can I purchase more than one co-ownership stake?
If you’d like to increase your occupancy allowance in your Fractal home, you can buy multiple fractions in a single home. Any owner can purchase up to four fractions per home, which provides 24-plus weeks of occupancy. This also means that you’ll benefit more if/when the property appreciates in value.
Do I actually own the property?
Yes, you own all the home together with the other co-owners through a UK limited company that is registered for the sole purpose of purchasing the property.
What am I paying for as part of the Fractal property interest price?
The price per fraction of each Fractal home includes: closing fees, home upgrade fees and the Fractal service fee. Closing fees refer to the legal and administrative fees required to purchase the home. Home upgrade fees refer to the investment required to bring the home up to Fractal standards (such as design, refurbishment and furniture). The Fractal service fee refers to the fee that we charge to operate our business and make all of this happen.
Can I purchase a Fractal property interest through a legal entity?
You can purchase a fraction directly in your name or in joint names. You cannot purchase fractions through a legal corporate entity.
Can I visit the home before buying?
Yes, you can visit the home you’re interested in before making any commitment. Your Fractal expert will be happy to arrange for a virtual or physical inspection of the property. We want to make sure that you have full confidence in your decision before moving ahead with the purchase.
Who decides on the interior design of each house? Who pays for it?
To make sure that all homes meet Fractal standards, we only work with the best interior designers in the market. The home interior design costs are included in the fraction purchase price.
How long is the buying process?
It all depends on the number of interested Fractal owners and the number of fractions they decide to buy. Usually, it will take anywhere between 1 week and 3 months to close on the home.
Can I finance the purchase of the house?
We currently don’t offer a financing solution but are working with our banking partners to provide such a service in the near future.
Are there any checks or vetting of co-owners?
All prospective Fractal owners go through a thorough vetting process. This includes identity validation, credit checks, employment status and assets verification.
What if I have a home I want to buy, but it’s not one of Fractal’s listings?
Please reach out to one of our Fractal experts to discuss homes of interest that are not listed on our platform. If the home meets the Fractal standards, we can look into listing it on our platform and finding co-owners to purchase the property.
In addition to the land and the house, would I also own the furniture and the appliances etc.?
As a Fractal owner, you will have an ownership interest in the home and all related assets. This includes fixtures, furnishings, decorations, appliances, electronics, linens, cookware, tableware and supplies.
Do I need a lawyer to purchase a home in Fractal?
You are encouraged to seek advice from a legal counsel for the review of the operational and legal documents. In accordance with our terms and conditions, Fractal’s standard documentation cannot be changed.
Can personal items be stored in the house?
Yes, Fractal homes come with separate storage spaces for each co-owner to securely store some of their personal items. Should you require a larger storage space, this can be arranged at an additional cost.
Can I rent out or transfer the time I don’t use?
Yes, co-owners have the flexibility to rent out some of their allocated occupancy weeks. Fractal will manage the rental process, and income generated will be sent straight to the individual owner’s bank account.
Once I purchase a stake in a Fractal home, what costs will I incur going forward?
Every year, Fractal will provide an estimate of the home’s operating expenses that shall be paid by all co-owners according to their ownership proportions. The expenses include Fractal admin fees, insurance, property taxes, cleaning, property management services, preventive maintenance and repairs. Naturally, the amounts might fluctuate based on the home’s needs. Fractal passes on the operating costs of the property to the co-owners without any markup. Additionally, we charge a Fractal admin fee of (£/€) 200 per month for property administration and technology cost.
What is included in the Fractal Owner app?
Each owner has access to a mobile app where they can book their stays, make payments, request additional services and contact our 24/7 concierge service. Moreover, Fractal experts will be working in the background to ensure you have a frictionless experience staying at and managing your home.
How do I ensure that the recurring expenses are fair and transparent?
All recurring operating expenses (tax, utilities, maintenance) of the home are passed on to co-owners at cost and shared proportionally between them. The financials and transactions of the limited company holding the property will be accessible to all co-owners.
Who takes care of the home?
The administration and management of each home is handled entirely by Fractal. We take on the responsibility of managing all legal and financial affairs, such as the payment of taxes and utility bills and the management of each limited company’s accounts. We also work with the best property managers in the market to ensure the highest standards of preventive maintenance, deep cleaning and speedy repairs, etc.
What decisions can Fractal make on behalf of the owner group?
Always working in the interest of its co-owners, Fractal is authorised to make decisions that relate to the day-to-day functioning of each home, such as critical maintenance and the replacement of basic appliances. Major decisions can be put forth for a vote by any co-owner through the Fractal Owner app, where Fractal will act as a neutral party to action the decisions of the group. Note that each fraction will represent one vote.
Would I have to pay for maintenance and repair costs resulting from acts of a particular co-owner?
No, any maintenance and repair costs arising directly from damages caused by a specific co-owner will be their sole responsibility.
What happens if a co-owner defaults on any of their payments?
In the case where a co-owner defaults on their monthly operating expenses or any other dues, Fractal will step in and guarantee all payments to protect the co-owners group.
Where would the money of the co-owners be kept?
Each Fractal home will have completely separate bank accounts; there will be no shared accounts between different properties or with Fractal’s own accounts.
Will Fractal prepare an annual budget for the home?
Yes, annual budgets for each home are prepared by Fractal and sent to all co-owners via the Fractal Owners app.
Which monthly statements of account or other reports or records will I receive (utility bills, taxes, etc.)?
Every Fractal owner will receive financial statements for the limited company holding the property, including a balance sheet and statement of cash flows. Upon request by the owner, Fractal can also provide cost statements with a breakdown of incurred expenses such as operating expenses, taxes and insurance premiums.
Will the property be insured?
Yes, all Fractal homes will be fully insured for building and contents.
How many days per year can I use my home?
Each Fraction grants you a minimum of six weeks of home occupancy per year.
Is there a minimum stay period?
Stays are set as minimum one-week blocks, which run from Saturday to Saturday.
What are check-in and check-out times?
Fractal owners can check-in starting at 15:00 p.m. and have to check-out before 12:00 p.m. When possible, we will always try to accommodate requests for early check-ins and late check-outs.
Are there any restrictions or blackout dates?
No blackout dates and restrictions are applicable. Based on their priority ranking for the year, Fractal co-owners will be able to choose the dates that best suit them.
How does scheduling work?
Each fraction (representing 1/8 of the home) gives the co-owner access to a minimum of six weeks of home occupancy. Four of those weeks are planned in advance (fixed weeks) and the remaining two weeks can be booked on short notice (floating weeks). Our booking system ensures a fair and equitable distribution of priority rankings based on a rotational model. Get in touch with our Fractal experts to learn more about scheduling.
What are fixed weeks?
They are weeks that are booked in advance for the coming year, each fraction granting the co-owner four fixed weeks.
What are floating weeks?
Each fraction gives you access to two or more floating weeks. Floating weeks can be booked at short notice, up to 24 hours in advance. Fractal co-owners can only have one active floating booking at a time, and a floating week reservation needs to be spent before booking another one.
When can I select time at the property?
Fractal co-owners can book their stays for the current year as soon as they purchase their fractions. Bookings for the following calendar year open up in November for the fixed weeks. Floating weeks can be booked at short notice, up to 24 hours in advance.
What’s the maximum amount of consecutive time I can spend at the property?
Stays are capped at a maximum of two consecutive weeks per fraction. If you own multiple interests in a Fractal home, the applicable maximum is four weeks. Subject to availability, you can also add a floating week to extend your maximum stay.
Can I modify a reservation?
Yes, subject to availability, all reservations can be modified up to 30 days before the booking start date.
Can I cancel a reservation?
Yes, all reservations can be cancelled up to 30 days before the booking start date. Cancellations made within 30 days of the booking start date will result in deductions from your overall balance if other co-owners do not book the home during the cancelled period. To reduce the likelihood of this happening, Fractal will always notify all co-owners of any cancellations that free up occupancy.
Can I sell my stake of the house?
Yes, co-owners can sell their Fractal shares at any time. However, to protect the interests of the co-ownership group, each co-owner must hold the share for one year before being able to resell.
Can I sell my share of the house to anyone or do potential buyers need to be eligible by Fractal standards? Do they need to be approved by other co-owners?
The only requirement for Fractal homeownership is passing our vetting process. We make sure that all co-owners have no criminal record and are able to make good on their financial commitments.
How long does it take to sell a home in Fractal?
Conditions specific to the real estate market are the main determinant of the time required to sell a Fractal property interest.
How is the selling price of my share fixed?
Fractal experts use market data to recommend a reasonable price point for each fraction/interest. Ultimately, each co-owner is free to sell their shares at any price they deem satisfactory.
What happens if I cannot sell my share in the market—is there a guaranteed exit at any point?
To achieve guaranteed exit visibility for co-owners, all properties are subject to an automatic sale of the property 10 years after it was first purchased. A mandatory sale at market price will occur at that point in time, unless all co-owners unanimously agree to keep the property or unless co-owners wishing to remain agree to buy out those who want to sell.
SELL US YOUR HOME
Can I sell my house through Fractal?
Yes, please reach out to the Fractal experts if you want to sell your home through our platform. The Fractal model allows you to keep a certain level of ownership in your home should you wish so you can keep enjoying it while minimising the associated costs and hassles.
How does the selling process work?
Selling through Fractal is easy and hassle-free. We purchase the home directly from you and set up a limited company to allow for fractional ownership. At the same time, we leverage our network and existing clients to find interested buyers.
What needs to be prepared in order to sell the house?
Fractal will take on all the preparation work required to sell your home. Our real estate experts will create custom marketing collateral that works best for your specific home. If needed, we will also perform basic maintenance, repairs and refurbishments to maximise the value of your home.
What level of ownership can I keep in my house?
You can retain up to 50% ownership of your home.
How do you select owners?
In addition to agreeing to Fractal’s terms and conditions, each prospective Fractal co-owner has to go through a rigorous vetting process.
Do I get to keep my home decoration and personal items?
If your home decoration and personal items meet our design and quality standards, Fractal will buy them from you and distribute their ownership across the group. If they don’t, our interior design team will replace them with items that are in line with the group’s expectations.
Book a time with one of our home experts to learn more about Fractal