Second Home versus Investment Property

Will your Summit County home, or Keystone Condo be a second home, or a rental? Or both?

Lenders have very specific, ever-changing requirements for the types of loan they will offer based on property use, and the IRS has its own set of requirements for income and deduction purposes.


Questions to ask yourself:

Do I plan to stay in this home for personal enjoyment more than a few weeks of the year?

If you answered yes, then this will be a second home.


Do I want to rent this home out a little bit to help offset costs?

If yes, this could still be considered a second home, but to be sure, you should talk with your CPA, lender or financial advisor. The rules are strict and always changing.

Remember, as a short-term rental ‘landlord’, there are many considerations and implications. The income is nice, but be prepared to do a lot of work to put the proper systems in place ahead of time, including vetting and hiring a Property Manager.

We are accustomed to helping our clients find the best of the best. Ask The Mountain Dream Team who they prefer for property managers – the ones who will take great care of you.


Would I be interested in a Partial Share?

If you’re looking at condos in Summit County, and the price looks too good to be true, it may be because the property is a “Partial Share.” This is not a time-share; a partial share is very different.


So, what is a partial share?

A Partial Share is also known as Fractional Ownership, Partial Ownership, Shared Ownership, Shared Interest or Co-Ownership.

In very simple terms, a Partial Share is when one or more people pool their financial resources to purchase a single property. The arrangements can vary from property to property.

Don’t be discouraged. A partial share is an excellent opportunity to have a ski condo that you and your family can return to year after year, build equity, and avoid wasting money on rental fees.


Important things to know about partial shares:

1. You would own a partial portion of the real estate, in many cases 1/4 or 25%. Your portion of the ownership would be recorded on a General Warranty Deed, just like any other real estate purchase.

2. There is an owner’s agreement that spells out the calendar usage, accounting, maintenance items, property management, and other items. As each property is unique, so may be the owner’s agreement for that property.

3. Most owners are very flexible and fun, and enjoy trading weeks.

4. Most partial share purchases require all cash. However, sometimes the seller will finance you, and there are a few lenders that will consider financing. We can provide you with a list of those lenders should you need it.

5. Typically, a 1/4 share will get one week per month. Because ski season is peak season in Summit County, Christmas and Thanksgiving weeks are usually rotated amongst the owners so that each owner gets to use the property during Christmas and Thanksgiving once every four years.

6. Many agreements allow you to have the property manager rent your property on weeks you don’t use it. You receive the profits from that week’s rental. This is one way to help you cover your basic HOA dues.

7. In Summit County, most of our Keystone condos, town homes, and even single-family homes come fully furnished. The furniture, including dishes, towels, and all essentials, are included in the sale as a convenience to the buyer and seller.