Choosing between custom luxury or co-ownership: A grand home with glass detailing.

Custom Built Home or Co-ownership Home?

Did you know the global vacation rental market was valued at almost $75 billion in 2021?

With such a large market comes a lot of options to choose from. Deciding on a vacation home of your own can feel daunting, but we're here to help you get started. There are a lot of options out there, but we're here to tell you about the pros and cons of a custom-built home vs. a co-ownership home.

Read on to learn everything you need to know.

Benefits of a Custom-Built Home

Having a custom-built home does, of course, come with its benefits. You're creating something entirely your own, with no worries about other opinions, but that's not all. Here are a few more things to consider.

No Scheduling or Resale Issues

One of the biggest turnoffs of a co-ownership vacation home is the fact that you have to figure out scheduling issues. Further, if you want to sell the property, then there are other people to include in the process. With a custom build, though, you don't have to worry about any of that.

The home is all yours. You can travel to it whenever, and you have the option to sell it whenever the time feels right for you.

Fewer Complications

Those aren't the only complications you don't have to deal with, though. Complications could mean something as simple as where to place the coffee maker in the kitchen, or how to decorate the interior and exterior of the house. Multiple owners mean multiple opinions, but in your own home, you don't have to worry about any of that.

If things happen during the build process, you don't have to worry about consulting anyone to make a decision. You're the only one involved, and it can speed things along nicely.

All Your Own

That brings us to the last point: Your custom-built home is all your own. Its design, layout, finishes, and even architecture are all your own to design and decide upon.

The process itself can be quite liberating, but that doesn't mean it's for everyone. Co-ownership also has its fair share of benefits to brag about.

Disadvantages of a Custom-Built Home

Custom-built homes do have their advantages, but nothing is perfect — especially not this process. Here are a few of the biggest disadvantages that come with building a custom home.


If you opt for a custom-built home, you're taking on all the responsibility that comes with owning a new piece of property. That also includes breaking ground and waiting for your contractor to gather all the necessary materials for your build.

Once everything is complete, you'll also have to walk through the house and have it inspected. If anything is misplaced or incorrectly done, then you have to wait for your contractor to approve the repair, potentially gather more new material, and then schedule a time to have it addressed.

Permitting and shipping delays are also common problems to be aware of.

Money / Build Budget

Not only does is the process of custom building a home more involved, but it's also going to cost more. Material prices have surged in the United States, so everything has gone up at least five to 10 percent. Further, for a custom-built home in Florida, you're looking at spending anywhere from $280,000 to $525,000. Not to mention Land Costs.

You may be looking to build and then own a luxury 4-bedroom home on the coast, but depending on the area you move to that price is going to go up.


Compared with existing homes, the time you're going to be waiting for your custom home is a lot longer. If you're in a rush to have access to your vacation home, then custom building might not be ideal for you.

This is also going to depend on your builder. So, if you run into any mishaps with your builder, you could be looking at further delays. The longer your build takes, the more money you're going to end up spending, and you could end up going over budget.

The most popular custom home builders include companies like Lennar Homes and Taylor Morrison, but even they can take anywhere from seven months to a year to complete a custom home build.

Also, if you're looking to vacate in one of the communities that's still under construction, you'll have to deal with the noise and vacation in a construction zone until it's completed.

Successful Build

The success of you Custom home build hinges on not going over Budget too much, the construction time not going overt the alloted time, the experience of your construction team to not take shortcuts but to deliver the higherst possible building standards, the logistics of building materials being availiable for purchase and arrriving on-time, there are so many scenarios that you may not account for, the most stressful being the planning phase.. If you decide on Custom Building your home just be prepared for these likely pitfalls and hopefully you will have a vacation home build that comes within the alloted timeframe and inside your budget too.

Maintenance Costs / Management

After construction is complete, and you have a beautiful New-build, your very own Vacation Home, it's now time to  make sure that as the home ages, it will be properly maintained to keep everything at a high standard for years to come.  A property maintenace compnay and a rental management compnay will most likely be needed to reduce the amount of work needed to keep the property mainaned and rented when your not enjoying your time at your home.

Rental Management

Many investors who go to the expense of buying a vacation home outright, will most often rent out the home to offset the costs of mainaing the home. Historically most single owners who have vacation homes, only use the home 4-6 weeks of the year anyway however some owners do not feel comfortable having thier vacation home occupied by so many renters. (at Lifestyle Asset Group we limit the amount of investors to a few families that own the home. We believe that there is a big diffence between someone who is a renter and someone who is an owner of the same home).

A Rental Management Company will syndicate rentals via airbnb,, VRBO etc to rent out the weeks that you set out for rental and you will have some expenses too for cleaning services.

Benefits of a Co-Ownership

Just because a custom-built home sounds good, though, doesn't mean that a co-ownership is worse. In fact, there's plenty to consider with a deal like this as well.

More Buying Options

Since you're cutting the purchase price, you're gaining access to a lot more buying options than you might've had before. In some instances, you're cutting your end price by at least half or more.

You also have more options based on your financial situation. So, if you have a lot of cash with questionable credit, but your friend has great credit with little cash, then teaming up to purchase a vacation home can make a lot of sense.

It increases your overall buying power greatly and allows you have a higher chance at getting the home of your dreams, rather than settling.

Not a Timeshare

With a co-ownership, the home is yours. You have all the rights and privileges that come with ownership, including things like equity, the right to sell, and free use of the property according to your share.

More Location Freedom

You also gain more freedom with your home's location. Some areas are great to vacation in, but they can be expensive to buy from. When you team up with other people to buy a home, though, there's a lot more freedom in where you ultimately settle.

So, if there's a specific location you want to be in, you're a lot more likely to find something within your budget if you go for co-ownership.

7-8 Year Resale of Home / Exit Strategy

With Lifestyle Asset Group, we structure each home so that there is an exit event wherby we sell the home via a selling agent on the market. Historically the housing market has around a 3% appreciation on homes each year making it possible to not only get your initial investment back but any profit that is to be gainied by a 7-8year appreciation minus costs will be distributed back to investors. Lifestyle Asset Group only takes a small fee in the process.

How Buying a Co-Ownership Home Works

Co-ownership might sound good, but how does the buying process work? Are there any stipulations you need to be aware of?

Here's what you need to know.

Sharing Expenses

Figuring out how you're all going to split up expenses is important from the beginning. This can look like chipping in a set amount each month, or splitting utilities and maintenance up according to their usage.

When you have a set amount to chip in, it's easier to overestimate those costs so you can build up a reserve for major repairs or even remodeling later down the line. You might also find that it's easier to hire a management company to handle scheduling, cleaning, maintenance, repairs, and also paying those expenses each month.

Scheduling and House Rules

With fractional ownership, it's important to remember that only one owner is going to be using it at a time. That's where the importance of keeping a schedule comes into play. If you decide to hire an outside management company, this is something they can help with.

The system you use is dependent upon what works for you and your group, but it can usually look like scheduling out certain weeks or months of the year to stay. You can use the same one each year, or you can opt for a new one each year.

You can also rely on spontaneity and simply sign up to use the house whenever you'd like.

No matter what, it's important to ensure the system you use works for you and the other co-owners. Remember, if problems begin to arise, you can always switch things up to make them work in your favor.

Don't Treat It as a Timeshare

Most importantly, don't treat this as a timeshare. You're still an owner of this home, and it's yours to care for.

You have more jurisdiction here than you would with other home options, and it's important for you to remember that. The power you have with this home is a lot more tangible than it would be with a timeshare.

How Does Resale Work?

Most of the time, resale is going to be split into portions. You and the other co-owners can decide to sell the home collectively, but you should still ensure that you're able to sell your portion of the home with little to no hassles.

It's also smart to ensure you have a right to refusal, or even a right to reject a proposed buyer. Make sure you have a valid reason for doing this but also remember that it can help you maintain a bit of power in the buying process if another owner decides to resell their portion.

Can You Rent the Home?

The last thing you should consider is whether or not you or the other owners want to be able to rent out the house during the time it's yours to use. With fractional ownership, you're not as likely to need this option, but it might be something beneficial for owners to have.

On the other side, you can also lay out an agreement to allow other owners to rent out your time if you're not going to use it. So, instead of allowing the property to go to waste, another owner can take on that month or week for their own use. Either way, it's important to work this and any other related issues out before signing on.

If you decide to outline this in your agreement, you'll need to include things like:

  • How often it can be rented out?
  • How are renters approved?
  • How much can you charge?
  • What happens if the property is damaged?

Regardless of whose renting, having things like this (and other potential implications) laid out ahead of time can help relieve a lot of anxiety.

Is Sharing a Vacation Home the Best Move for You?

Now that you know a bit more about the basics, do you think sharing a vacation home sounds like the best move for you? It's important to remember that having a custom-built home does come with certain benefits, but so does a co-ownership home. It's important, to be honest about the things that would best suit your needs and then go from there to figure out which you'd like to make a move on.

If you're interested in learning more about what a second home partnership might look like for you, contact us today. We can tell you more about the process to help inform your decision.

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