Tips for Buying a Rental Unit
In a Resort Vacation Community

Question: I live in Australia and currently own two one-bedroom units in the Saddlebrook Resort in Wesley Chapel, Fla. I have been happy with the outcome and resort management. I have searched many times for other units similar to the setup offered at Saddlebrook without success. Many resorts claim to offer such a deal, but then I learn that the management company owns many of the units (which will always be occupied first). Is there an agent who specializes in the type of property I want nationwide?

-- Brian J. Luecke, Australia

Brian: Yours is a multilayered question, and a good one. To get a sense of the type of property you like, I called Saddlebrook's real-estate office to learn how the community operates. John Fahey, president of Saddlebrook Investments, says the resort is sometimes miscategorized as a "condo hotel" but is actually a "condominiumized resort."

A condo hotel (or "condotel") is a vacation community built by a developer or resort company. The developer owns some units and sells others to individuals. Both the developer's condos and the individually owned ones are rented out through a rental program, and a management company maintains the properties. (In exchange, owners pay dues, a portion of rental revenue, or both.) The condo hotel gives investors the chance to own property and have access to an on-site property manager.

Saddlebrook differs from condotels in that all of its units are owned by individuals (not the resort), Mr. Fahey says. But, just like a condo hotel, property owners must participate in the company's rental program.

To find communities similar to Saddlebrook, Mr. Fahey suggests looking at older condominium properties. (Saddlebrook was built in 1979.) Recently constructed units are more likely to be managed like a condo hotel. To find real-estate professionals who specialize in investment and second-home properties, go to EscapeHomes's Web site. The National Association of Realtors has a dedicated training program for agents on the second-home market. You can use the tool on their Web site to locate resort specialists in a particular area.

Alternatively, you could consider buying "traditional" condominiums in vacation destinations and hiring local management companies to handle upkeep, renting the units and paperwork. Such properties may not have resort amenities, but if they are near popular slopes, beaches or other recreation, you will get renters. Once you find appealing locations, finding local real-estate agents who specialize in second homes won't be difficult.

On the other hand, you could consider fractional ownership of a resort property. With fractional ownership, you own a partial share (that is deeded, like regular real estate) of the property. You are granted the right to a use the home for a certain number of days or weeks. These properties are overseen by property managers and may carry some of the benefits you seek. Visit www.luxuryfractionalguide.com for an overview of higher-end fractionals in the U.S.

Good luck with your search, Brian. Yours is a lucky dilemma.

-- Ms. Hodges is a free-lance writer in Seattle. She answers questions about managing second homes in Owner's Manual. Please send your questions to RealEstateJournal@wsj.com.

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