Housing co-ownership becomes fashionable, even among wealthy buyers

Housing co-ownership becomes fashionable, even among wealthy buyers

When inflation in Spain exceeded 10%, the incomes of the population did not keep up with this level. This population has no choice but to calculate savings and divide expenses among as many people as possible.

For example, with the rise in the price of gasoline in recent months, which costs about €2 per liter, it is expensive for many people to travel by car without carshering or finding companions. They need to find people to share fuel costs.

And the real estate market requires the same sharing and is actively developing. When housing prices almost all over Spain are no longer affordable for buyers, they need to either choose a rental, or look for co-owners or roommates.

Today, Spain’s minimum wage (SMI) is just over €1,000. Rents for housing in major cities, such as Madrid and Barcelona, exceed €600-700 per month. In this situation, young people drop out of the list of possible buyers, but older categories with better jobs and higher salaries will think twice about such expenses.

If economists' recommendations are followed, the rental costs for a well-to-do household should not exceed 30% of total income. In such conditions, the growth of real estate sharing was inevitable, and there was a phenomenon as "coliving"/"cohousing". This method of acquiring residential real estate works as a cooperative that shares not only the house it owns, but also the values that guide all residents of this property.

However, wealthy buyers unexpectedly also share housing. This segment of the market is becoming more and more significant, attracting new business. The representative of such a business is VIVLA, a company engaged in selling "fractional" ownership of residential real estate in Europe.

The company was organized by Carlos Gomez, the former owner of the prop-tech company Rento, as well as Carlos Floria and Ivan Rodriguez. Having entered the "post-COVID" European real estate market, their company conducted a thorough study of it and identified an interesting category of buyers who are ready to co-own even elite properties.

These are people over the age of 40 who own a large amount of money. They want to spend their vacation in a luxury house, but on the one hand, they don't want to rent it, and on the other hand, they don't want to buy it. It is for such people that VIVLA's offer of "fractional" ownership of elite housing was suitable.

The idea of such ownership is to divide the right to real estate into equal shares by periods of the year and the number of weeks. Each property owner gets the right to fully and in any way dispose of housing for a certain period of time. Next to such a house, there is a warehouse where you can find everything, even furniture, that a new tenant may need and can be installed in the shortest possible time.

Gomez in an interview with Business Insider España explains: "We have done an in-depth market analysis, and we have learned that there are huge opportunities before us. In the USA, there is a company engaged in a similar real estate sale scheme (Pacaso). We decided to master the luxury secondary housing market in Europe, which is estimated at about €5,000 billion."

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