Brussels 22nd April 2009 – The Fractional and Shared Ownership Trade Association (FSOTA) has become a member of the trade body for vacation ownership, Resort Development Organisation (RDO). RDO promotes best practice and fair trading in the industry while protecting consumers through its code of conduct. While remaining a stand-alone association, FSOTA members are now bound by this code.
Formerly known as OTE (Organisation for Timeshare in Europe) RDO changed its name and opened up its membership to reflect changes in the vacation ownership industry, which has moved well beyond traditional forms of timeshare to include offerings such as ‘floating weeks’*, the points system*, fractional ownership*, private residence clubs*, destination clubs* and condo hotels*.
“We renamed ourselves as RDO so we could truly reflect the extensive range of holiday options now available in the vacation ownership market,” said Richard McIntosh, Chairman of RDO. “With FSOTA joining us we are able to significantly increase our representation of the fractional ownership market. It will allow FSOTA members to benefit from our eleven years of experience at promoting best practice, working with governments for fair legislation and working with the authorities to combat fraudulent activity. Very importantly, people who own fractional properties with FSOTA members will now be protected by our code of conduct.”
Piers Brown, chairman of FSOTA commented: “We were set up to represent fractional property developers and to promote responsible growth of the industry. Joining RDO is a very positive step for us as our members can benefit from being part of a wider association which has a track record of representing the industry and enforcing high standards of conduct and professionalism. We expect fractional and shared ownership to continue to increase in popularity and membership of RDO will help the industry grow.”
*Glossary of terms
The vacation ownership industry is made up of:
Timeshare means buying the right to spend a set time period in a holiday property each year for three years or longer, usually paying an annual management fee.
Under this system you own rights to a specific week, usually in a specific apartment/villa.
In the ‘floating system’ you own occupancy rights to a week in an apartment type, within a season. Each year you have to book the specific week that you want, subject to availability.
Points are a form of holiday currency. Owners use their Points to pay for holidays, selecting accommodation that is in the scheme’s accommodation pool.
Fractional ownership gives buyers ownership of, or occupancy rights to, a property normally in perpetuity or in some cases for an agreed period of time, with a fixed or rotating term of residence, eg ⅛ or ¼ share each year. An annual management fee is usually payable.Many fractional schemes are in fact timeshare but some are share based or a lease may be granted for a percentage of a property. In some fractional schemes, when the property is sold, any profits on sale are shared between the owners.
Private Residence Clubs
Private Residence Clubs are high-end fractionals, enabling the consumer to own a part of a luxury home, often in unique locations and with the added benefit of maid or concierge type services.
Destination Clubs are based around consumers sharing a portfolio of fully-furnished, multi-bedroom residences around the world. Members usually pay an upfront deposit and an annual fee for exclusive access to a multitude of properties which can be a mixture of holiday beach, ski and city residences. This can be an equity or non-equity interest, depending on the scheme.
Condo hotels are typically luxury hotel properties in outstanding locations. Essentially, consumers buy a legal interest in an hotel room giving them personal use of a specific number of weeks. They normally participate in an organised rental programme and share in that rental income.
For RDO’s Public Relations Office in the UK, contact:
Jackie Murphy/Will Brewster
Flagship Consulting Tel. 0207 886 8440
Jackie.email@example.com or firstname.lastname@example.org