Vacation Clubs With Equity
Equity funds (for vacations) are groups of people pooling money to buy real estate. They are similar to timeshares but could be a better investment and come with more perks. When you invest in an equity vacation fund, you’re buying titled ownership in real property which may appreciate. Some corporations even buy them as perks for their employees.
This is a type of fractional ownership lets you own vacation homes in multiple destinations.
How It Works
When you choose to invest in one of these vacation clubs or equity funds, you own a small part of the underlying real estate.
Once you’ve decided to invest, you pay an upfront fee that funds the vacation club’s investment into new real estate. In addition to the initial investment, you’ll also pay annual membership fees, ranging from $3,000 to $15,000 a year. This money goes towards paying for the maintenance and management of the properties in the portfolio.
Depending on how much you choose to invest you can vacation with your equity club up to two months out of the year, while the minimum stay is usually around one to three weeks
Current Vacation Offerings
$100,000 and up - Ownership/Equity Fund
Whether you love the beach, the city, or the mountains, the Ritz-Carlton Destination Club has a property for you. Everyone loves the luxury and world-class…More Details
$142,500 and up - Ownership/Equity Fund
Equity Residences is one of the top rated equity funds in vacation ownership. With low annual fees, low visit fees, and home equity, investors…More Details
$147,500 and up - Ownership/Equity Fund
Destination M is an exclusive club of private owners of a group of vacation homes and is Canada’s most exclusive vacation ownership option. Owners…More Details
$147,500 and up - Ownership/Equity Fund
Traditional equities and bonds have a place in every portfolio. Many people, however, look for more exciting or exotic investments which come with financial and…More Details
Perks of Membership in Vacation Clubs
Plenty of people who invest in equity vacation clubs don’t have time to vacation as much as they would like, which results in the clubs offering last minute deals. Often these available times are made available to members at no cost, allowing you to vacation, or gift a vacation to a loved one. Members who have a flexible schedule and can quickly get to a destination can take advantage of these free vacation times as they are available.
Every member enjoys staying in high-quality, beautiful locations with excellent 5-star service. Some people invest primarily for the potential appreciation, corporations buy them as a perk for executives, and others participate for access to specific locations. Depending on your vacation preferences and investment interests there are a few different kinds of equity vacation clubs you should consider.
Equity Funds for Vacations
When you invest in an equity fund, your investment will be leveraged to purchase new properties for the shared investor portfolio. These properties are expertly chosen, not only to give you the most vacation options but to see the greatest appreciation in value. Usually, the properties are retained for 10-12 years, after which the homes are sold, and the funds are distributed to all investors. Investors share in the profit upon sale of the properties.
Unlike buying a traditional vacation home, investors have a share of the time in which each can use the property. Many equity funds have 50+ different properties around the world in their portfolio. Some even have relationships with resorts that allow you to use those properties as well. While traditional vacation home ownership requires you to manage the property, an equity fund has a management company that maintains the homes and manages the details of purchase and resale when it comes time. If the property has any unused time, the property management company will rent it to non-investors to increase the income potential. This management is included when you invest in an equity fund, so you’ll have one less stress to worry about when you’re on vacation.
Destination Clubs – A Type of Vacation Club
Similar in structure to a timeshare, destination clubs are usually run by resorts. Within this model, a company builds vacation condos or resorts, which limits the amount of shares they can sell. Members buy into the resort and can usually visit any of the resort’s participating locations.
Unlike equity funds, there is no point where the company makes a sale and distributes funds to investors, nor can you sell back your membership at an increased value. If you want to unload your membership, you must independently find a seller to purchase it. Although you are making a concrete investment, you likely will not see a financial return on your investment because resorts rarely appreciate in value.
Destination clubs grant you guaranteed access to some of the best resorts in the world. You’ll enjoy amenities like world-class spas, fine dining, private beach access, and resort service on every vacation. Destination clubs also load up the perks and discounts.
Clubs are an excellent option for families who love to travel together. Although there are some adults-only options, most resorts have fun programming and activities to keep children busy. Some destination clubs, like the Marriott Vacation Club, grant you access to all their resorts around the world, while others limit you to a portfolio.
Equity Clubs with Real Ownership
Equity clubs primarily invest in luxury homes but do not turn over the properties on a planned schedule. These clubs also purchase a limited number of resorts to enable investors to choose resort amenities for a portion of their vacation time. Because the homes are not liquidated on a schedule, it allows your investment to continue to appreciate for many years. Corporations that run equity clubs will offer to buy back your interest at the current value, less a 5-10% discount, if you are interested in leaving the club.
Although the resorts aren’t expected to appreciate in value, the investment in homes typically appreciates enough so owners can expect to see a return on their investment.
Usually, equity clubs purchase homes and sometimes resorts. Resorts don’t often increase in value; rather they usually decrease in value over time. Despite that fact, members still enjoy investing in resorts because it gives you the option of vacationing at a 5-star resort for a fraction of the cost. Although the resorts may not benefit you financially, many travelers think the amenities and top-notch service outweigh the cons. Equity clubs usually rely on the appreciation of their vacation homes to balance out any losses from the resorts.
The Ultimate List of Vacation Clubs
If you’re curious to see if this investment is right for you, you should check out this list of popular equity vacation clubs.
Equity Estates is an equity fund, meaning you will invest in a portfolio of more than 60 vacation residences in 30 countries. You can choose between beach, leisure, city, and mountain properties, so whether you want an alpine holiday or beach retreat, Equity Estates has choices for you.
In the current fund, each property is valued at $2-$5 million. Eventually, each of these properties will be liquidated and replaced by properties expected to see higher appreciation, using the financial investments of members.
Destination M is an equity club, which owns exclusive destination homes and dream luxury vacation resorts for unforgettable family holidays without a planned liquidation event. Based out of Canada, Destination M offers more than 30 luxury vacation properties in North and South America, the Caribbean, and Europe. The properties are all close to amenities like premium shopping, delicious restaurants, sports, and wellness facilities and more fun activities, which influences their future valuation.
Based out of the UK, staying with Rocksure Property is indeed a luxury experience. Unlike other equity funds, you’ll have the choice of multiple portfolios in which to invest. Portfolios specialize in a part of the world, one city, or a type of home. Depending on which collection of properties you choose, you’ll have access to villas and apartments across Europe, Asia, Australia, or the U.S., all set to be liquidated within 7-10 years of purchase.
Rocksure Property is truly a luxury brand. Each apartment or villa is designed to the highest standards. The villas all feature a housekeeper and a cook, so you won’t have to worry about cooking or cleaning on your vacation.
Equity Residences operates properties within the U.S. but has multiple portfolios from which to choose. Equity Residences specializes in U.S. residences, but you can access vacation properties across North and South America, Asia, Africa, Europe, Australia, Russia, and the Caribbean through their partners.
Previous funds managed by Equity Residences, like the sold-out Equity Villa Fund, have appreciated more than 50% since its inception in 2012.
Investors in funds like this one have access to hundreds of other affiliate homes and fractional resort residences with on-site concierge and resort facilities. Members can exchange usage times for access to THIRDHOME’s portfolio of more than 9,000 luxury residences and world-class resorts around the globe.
When you invest in the Ritz-Carlton Destination Club, you’re investing in a trust that owns a title to the real estate, which means you can pass your membership on to your children. Unlike other destination clubs, instead of buying an amount of time, you’ll purchase points which can be used at your discretion. Point values for vacations are dependent on the length of stay and choice of destination.
Whether embarking on an adventure with the entire family or planning an intimate escape for two, these exclusive destinations and experiences will help you make cherished memories.
With membership in this club you’ll have access to all five of the Ritz-Carlton Club locations in the United States and the Caribbean, as well as 50 Marriott Vacation Club Resorts worldwide, and additional adventure and specialty travel options like safaris, wine tours, and cruises.
Banyan Tree Private Collection
Banyan Tree Hotels and Resorts are Asia’s premium resort organization. Banyan Tree Private Collection operates their own residences but also has relationships with resorts and other companies which grants you access to over 100 different luxury properties.
Banyan Tree PC is a vacation club with the option of selling or transferring the membership to someone else at any point. With this club, you can choose between 7-night or 14-night memberships. As investors join, the portfolio grows, so you’ll never run out of exciting vacation destinations to visit.
Membership is filled with perks including the ability to invite friends and family to stay with you free of charge and a membership card which grants you special discounts and privileges. If you don’t have time to plan your travel, Banyan Tree PC’s agents can handle that for you.
Luxus Vacation Properties
Many distinguished travelers prefer flexibility when choosing their next elegant vacation destination. Luxus Vacation Properties is a very exclusive organization that expands travel experiences for the extremely wealthy by invitation only. As an equity fund, Luxus Vacation Properties invests in the hottest vacation spots around the globe. To view their select portfolio of international luxury properties, you must submit a request on their website to get permission.
The Hideaways Club
The Hideaways Club, also based in the UK, was designed as an alternative to buying a vacation home for people who love to travel but are usually too busy to deal with any of the related hassles. The Hideaways Club has multiple portfolios from which to choose.
If you’re looking for a city retreat, the City Collection features exquisitely designed apartments in cities like Dubai and Rome. This collection currently offers 11 properties managed by the Hideaways Club, but through investing in this portfolio, you’ll have access to more than 70 properties run by their affiliates in the Middle East, United States, Asia, and Europe.
The Classic Collection features 36 villas and chalets designed to bring you true relaxation in 25 of the world’s best vacation destinations. When you invest in the Classic Collection, you can also visit over 200 other properties through their partners and affiliates in North America, Asia, and Europe.
The Hideaways Club is an equity club, which means there is no schedule for liquidating property and distributing funds. The Hideaways Club hopes to expand each of their portfolios to feature at least 100 properties.
Equity vacation clubs can give you the opportunity to invest your money wisely while having the chance to travel all over the world for the price of your investment. Why buy one vacation home when you can have access to five-star service in dozens of beautiful properties in all corners of the globe? Get all the perks of luxury home ownership without the downsides of maintenance by investing in fractional real estate.