Fractional ownership - an alternative residential property investment vehicle

Braam Lowies, Robert Whait, Christa Viljoen, W. Stanley McGreal

Research output: Contribution to journalArticle

Abstract

Purpose
The purpose of this paper is to determine the profile of the typical online fractional residential property investor in Australia. This study also seeks to understand the motives for engaging with and investing in alternative residential property investments.

Design/methodology/approach
This study employs a survey-based design via an online questionnaire to gather information on investor age, gender, type, education levels, time horizons and investment history and risk and return expectations. It also gathers information regarding investors’ financial literacy including tax implications of fractional property investment.

Findings
The findings of this study suggest amongst others, that fractional property investors tend to be younger, although the platform also attracts older investors including older females. The study also found that investors do not select alternative investment platforms in anticipation of super-normal investment returns. Return expectations are realistic and are based on a balance between capital growth and income.

Practical implications
This study indicates that alternative investment platforms lowers the barriers of entry into residential property for first time investors. It therefore creates opportunities to allow many first time individual investors to invest in property, often as an alternative to bank savings or investing in the stock market.

Originality/value
This study enhances our understanding of the influence of alternative investment platforms on investment decision-making. More specifically, it contrasts fractional property investment with more traditional investment opportunities to understand the motives of investors for diversifying into online investment vehicles.
LanguageEnglish
Pages513-522
JournalJournal of Property Investment & Finance
Volume36
Issue number6
DOIs
Publication statusPublished - 17 Jul 2018

Fingerprint

Ownership
Investors
Residential property
Property investment
Alternative investments
Investing
Design methodology
Tax
Investment opportunities
Savings banks
Stock market
Anticipation
Questionnaire
Education
Capital growth
Time horizon
Income
Individual investors
Financial literacy
Investment decision-making

Keywords

  • Motivations
  • Online
  • Property
  • Residential
  • Investor
  • Fractional

Cite this

Lowies, Braam ; Whait, Robert ; Viljoen, Christa ; McGreal, W. Stanley. / Fractional ownership - an alternative residential property investment vehicle. In: Journal of Property Investment & Finance. 2018 ; Vol. 36, No. 6. pp. 513-522.
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Fractional ownership - an alternative residential property investment vehicle. / Lowies, Braam; Whait, Robert; Viljoen, Christa; McGreal, W. Stanley.

In: Journal of Property Investment & Finance, Vol. 36, No. 6, 17.07.2018, p. 513-522.

Research output: Contribution to journalArticle

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