Vacation Co Ownership

How Plum Is Simplifying Real Estate and Vacation Co-Ownership

Everyone is looking forward to their upcoming vacations. This is great and can be a recipe to combat burnout. And make no mistake: People are taking vacations again 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 determining the perfect place to hang out for a week so difficult? Despite the proliferation of sites like Airbnb and VRBO, it’s not always easy to find budget-friendly accommodation in a great location. Many travelers end up feeling that they are not getting the best possible accommodation for their money. As a result, many individuals and families are considering buying vacation properties or looking for timeshares.

Get a break… without breaking the bank

However, there are problems with both of these solutions.

Investing in a house, apartment, bungalow or cabin in a tourist hotspot can be expensive. That’s why so many people rent out their vacation properties. Unfortunately, the most profitable times to rent are during popular times of the year. As a result, many property owners give up the opportunity to enjoy their vacation homes during peak seasons.

Timeshare is not necessarily a better option, which may be why so many people are downloading timeshare units in droves. Even though timeshare seems to cost less up front, it is very restrictive.

Moreover, timeshare “owners” only own time. They don’t actually invest in real estate. Therefore, they cannot possibly benefit from a timeshare arrangement, making it a bad choice for budding investors.

So what should individuals and couples who are eager to be able to go on the same getaway vacation after vacation do? Serial entrepreneur Matt Williamson asked himself the same question a few years ago. His answer became the seed of his startup, Plum CoOwnership.

A streamlined avenue to owning real vacation properties

Williamson built Plum so that vacationers from the “Where should we stay?” roller coaster permanently through a co-ownership agreement. Property co-ownership is exactly what it sounds like: Several people or couples buy a single property together.

For example, four friends may want to buy beach cottages individually. However, each friend can only buy a home up to $250,000. It’s not enough to get close enough to hear the waves, let alone 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 high-end property, they can each spend 13 weeks there each year while saving.

Not only do they share ownership of the property, but they have a place to live in a place 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 to groups interested in buying vacation homes.

After all, there are several considerations, including how to set up a co-ownership group, find the right broker, and set up fair usage schedules. Williamson’s brainchild platform Plum aims to remove the biggest barriers to co-ownership, making vacation property ownership attainable for those interested.

The plum approach to streamlining vacation property co-ownership

Backed by advanced technology, Plum serves as the starting point for aspiring co-owners to realize their vacation home dreams.

Individuals can set up free Plum accounts to start their travels. If they don’t have a group in mind, they can advertise for other real estate investors to join them. Once a group is established through Plum, the site’s intuitive system guides the group through the co-ownership process.

Below are just a few benefits for co-owners using Plum.

1. Co-ownership groups can become LLCs through Plum.

Rather than hiring outside legal aid, co-owners have the option of having Plum help form an LLC. The LLC then becomes the entity that officially owns the property.

LLC support protects individual owners and makes the experience safer and more satisfying. LLC status also makes it more efficient when setting up a joint bank account that is transparent to all LLC members.

Although Plum recommends that only a few members be given access to transfer funds, full and transparent access to monthly statements and all transactions should be available to all.

2. Co-owners can list their must-haves and negotiable items on Plum.

It is critical for 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 guides groups through the process of negotiating all responsibilities. Final results are detailed in a document. Ideally, the document will be created before bidding on a vacation property to reduce the chance of misunderstandings.

3. Co-owners can bring properties to the table or search on Plum.

When Williamson first started looking into co-ownership in depth, he realized some people already owned vacation properties. But they were interested in dividing the property into shares to reduce monthly 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 website offers a property search function. In addition, Plum can suggest co-ownership friendly brokers 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 that 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 remains in better condition and co-owners have fewer unbudgeted expenses.

A plum future for people interested in purchasing vacation properties

Although Plum was only recently launched, it has received quite a bit of attention.

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 enhance the site’s benefits for users.

Meanwhile, Plum offers 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 about! With Plum, everyone can spend their vacations relaxing in homes they not only love, but own.

Featured Image: Pixabay; Pexels; Thank you!

Brad Anderson

Brad Anderson

Editor-in-Chief at ReadWrite

Brad is the editor who oversees contributed content at ReadWrite.com. He previously worked as an editor at PayPal and Crunchbase. You can reach him at brad at readwrite.com.

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