Glossary of Terms
Glossary of Vacation Home Exchange Terms
Vacation Home Ownership
Fee simple ownership of a second residence, typically located in a resort destination. Owners are free to use, rent, gift or otherwise allow usage of their residence at any time and are responsible for all costs associated with ownership.
Fractional Ownership
Shared deeded ownership of a home, condo or other asset (yacht, aircraft, etc.), evidenced by a deed, TIC or legal entity. Shared ownership typically allows usage of the asset according to a pre-arranged schedule (either fixed weeks or months, or rotating weeks/months or a combination of both fixed and rotating periods of time). Fractional properties typically consist of a home or condo contained within a fractional resort, with all maintenance, scheduling and guest services offered by resort management. However, standalone fractional residences do exist, consisting of shared ownership of a vacation property by several different parties.
Fractional Resort
A real estate development consisting of homes and condominiums built and sold specifically for shared ownership. Fractional owners own a deeded share in a specific residence and are allotted usage pursuant to a rotating or fixed schedule. All maintenance, scheduling and guest services are handled by resort management.
Residence Club
Similar to a Fractional Resort. However, owners may not necessarily occupy their owned residence during each stay. Owners may be housed in a similar home, cabin or condo upon arrival, rather than the residence they own. Scheduling is greatly simplified with this approach, but owners have no guarantee of using their residence.
Destination Club
A for-profit entity that owns and leases prime vacation properties for use by its membership. Typically, a destination club is organized similar to a golf country club, with members allowed to use club assets, but having no ownership of the assets. Members typically pay a fully (or partially) refundable initiation fee and monthly dues. Except in limited circumstances, members do not own any portion of the destination club. Destination Clubs offer a wide variety of destinations to their members and a hassle-free vacation experience, but unlike ownership, members may not rent their usage, but may be able to gift their usage to others.
TIC (Tenants-in-Common) Ownership
Tenants in Common (TIC) ownership is often paired with a TIC Agreement giving each owner an exclusive right to occupy a particular space (such as an apartment, house or office) within a residential or commercial property. Assigning occupancy rights in a TIC agreement creates an arrangement that feels and acts like a subdivision when legal subdivision is impossible, unaffordable, or too time-consuming.
Condo Hotel
Full- or fractional-ownership of a residence contained within an operating hotel. Hotel management provides all services to the residence.
Fractional Rotation
A pre-determined fixed or rotating schedule defining usage by multiple owners of a fractional property.
Standalone Fractional
Shared ownership of a fractional property not part of a fractional resort. A standalone fractional property may be within a vacation resort, but consists primarily of a property originally developed for sole ownership, rather than fractional ownership. Standalone fractional properties may be self-managed or professionally-managed.
Timeshare
A right-to-use concept consisting of an agreement allowing a non-deeded “owner” the right to use a property for either a rotating or fixed time period each (or every other) year. The right-to-use typically expires after a specific period, with usage of the property reverting to the property owner (typically the original developer).
Home Exchange
An owner-to-owner arrangement to exchange usage of residential properties, primarily consisting of primary homes. In the event primary homes are exchanged, owners typically arrange a simultaneous exchange consisting of the home and optionally, vehicles and sometimes pets. Second-home exchanges are easier to arrange, as the exchange need not be simultaneous and property of a personal nature (photos, valuable items, business records, etc.) is typically not maintained at a second-home.
Fractional Home Exchange
An exchange of a fractional property with another vacation homeowner.
FractionalExchange.com®
An owner-to-owner exchange website consisting solely of vacation homes, condos, fractional homes, condos and second-homes. Members arrange simultaneous and/or non-simultaneous exchanges with other members, thereby greatly enhancing the utility of their ownership.
Exchange Facilitator
A company specializing in the exchange of vacation properties. Vacation property owners typically pay an annual membership fee and a per-exchange fee when utilizing an exchange facilitator. Note: Fractional Exchange is not an exchange facilitator; it is a website that offers users the ability to message other users to arrange for the exchange of luxury leisure assets (homes, condos, fractional units and residence club shares). Examples of Exchange Facilitators: The Registry Collection® (www.theregistrycollection.com) and Preferred Residences® (www.preferredresidences.com).
Luxury Leisure Asset
A vacation home, fractional home, condo, yacht or other property.
The Registry Collection®
A popular exchange facilitator, with approximately fifty resort affiliations in the United States. The Registry Collection® typically markets its services to a fractional resort developer, charging the resort an initial affiliation consulting fee and a yearly affiliation fee thereafter. A fractional resort developer typically gains value from the consulting services of The Registry Collection® and ultimately, the ability for owners to exchange use of their property for use of other resort properties adds value to the fractional resort development. The Registry Collection® charges an annual membership fee (to owners) of $250 and a per-exchange fee of $250 for exchanges that are successfully arranged. The Registry Collection® is affiliated with and owned by RCI®, a large company involved in timeshare exchanging and timeshare resort management. www.theregistrycollection.com
Preferred Residences®
Another exchange facilitator. Preferred Residences® typically markets its services to a fractional resort developer, charging the resort an initial affiliation consulting fee and a yearly affiliation fee thereafter. A fractional resort developer typically gains value from the consulting services of Preferred Residences® and ultimately, the ability for owners to exchange use of their property for use of other resort properties adds value to the fractional resort development. Preferred Residences® charges an annual membership fee (to owners) and a per-exchange fee for exchanges that are successfully arranged. Preferred Residences® is affiliated with and owned by Interval International®, a major company involved in timeshare exchanging and timeshare resort management. www.preferredresidences.com
HomeExchange.com™
An owner-to-owner exchange website consisting mostly of primary residences throughout the world. Owners typically arrange for simultaneous exchanges of their primary residences. www.homeexchange.com
Lockoff
Typically a closet, cabinet or room where access is restricted by use of a locking mechanism, typically consisting of a keyed door lock. Owners typically utilize a lockoff for storage of personal property at their second- or fractional-property while they are not in residence.