[original print from the News & Observer]
One is an F15 pilot in his early 30s and living in Durham.
Another is a venture capitalist.
A few are civil servants.
One couple just had their first child, while others are parents of teenagers. A pair of grandparents is also in the mix.
They started out as strangers scattered across the Triangle. But they had one thing in common: A desire to own a second vacation home.
Enter Plum, a Durham-based fractional ownership platform offering “match making” services to help bring co-buyers together and simplify the process of banking, taxes and accounting.
Unlike a timeshare where owners buy “time,” Plum’s model is based on fractional ownership, also known as shared ownership, where multiple owners or families can acquire a portion of a property, matching their share of the purchase price.
Last December, four couples — the Summe-Gulas, the Cormiers, the Munson-Russells and the Pflaums — met through the site.
Not long after, they connected in person for the first time in Surf City, about a 138- mile drive southeast of Raleigh. Newly acquainted, they formed a caravan of four cars. Then, armed with available listings, they went house-hunting.
“We toured 15 properties that weekend,” recalled Hope Pflaum, who was joined by her husband, Tim, both in their 60s. “Plum had done the background checks, so we knew everyone was checked and vetted.”
In a short time, they became “a little family.” They quickly learned to speak up about their “must haves.” They also figured out when to compromise and be a little more flexible.
“We got to see everybody’s hot takes on properties,” said mother-of-one Jenn Summe, 37, from Durham, who spearheaded the group. “We just took everybody’s cares into consideration.”
CONDO VERSUS BEACHFRONT HOUSE
Separately, most of the couples’ previous searches had targeted two-bedroom condos priced under $300,000. But now, as a group, they could think bigger. And more luxurious. Something in the $1 million range.
That weekend didn’t produce the house of their dreams.
But a few months later in March, the group found a property that came close: a four bedroom oceanfront home, with two decks and steps leading straight onto the beach in Topsail Island.
“Half of the group didn’t even go to the property before buying it,” Summe said. “We kind of just trusted each other. We jumped on it pretty quick.”
Called Coral Reef, it’s less than a mile from the Surf City Pier and the town’s nightlife. The price tag: $929,000, which they financed through a tenancy-in-common mortgage.
For Plum’s part, it created the terms of ownership, and helped the group form its own Limited Liability Company, or LLC. It also assisted with opening a joint bank account to place the down payment.
Another bonus: The furniture conveyed with the property. “A week after we bought it, we put it on Airbnb and started renting it,” Summe said.
Less than a year into the arrangement, the co-buyers have no complaints. (Summe’s husband, Jeff Gula, now works for Plum as a developer.)
The house is rented full time during high season, which covers most of the mortgage, Summe said. Outside this period, each couple gets to use the property a couple of weeks in the off-season. As for maintenance, they use a shared Google document to divvy up tasks, and stay in touch through monthly video calls.
“We’re all aligned,” Summe said. “If somebody wants to get out early, or if there’s a divorce or if somebody dies, we’ll follow whatever contingency plan that’s laid out.”
A RISING TREND
Fractional ownership, as a concept, isn’t new.
But it’s resurfaced as an alternative home-financing solution in recent years amid inflation, high mortgage rates and home prices.
Co-ownership sites, like Pacaso, already exist targeting high-end vacation real estate. But Plum founder Matt Williamson said he wants to make that market more accessible.
“We’re building a co-ownership platform for everyone,” he told The N&O.
Launched in 2022 with $1.5 million in funding, including local investors like the Triangle Tweener Fund, the startup is hoping to scale quickly.
“The time is right for co-ownership, in general, because property values are sky high and aren’t coming down,” Williamson said. “If people are going to own vacation homes, something has to give.”
WEIGHING YOUR OPTIONS
Cory Sherman, a broker with Homegrown Real Estate in Durham, said he isn’t surprised new mortgage products like Plum are popping up in today’s market.
While he wouldn’t necessarily recommend them to first-time buyers, he said co ownership makes a lot of sense for a vacation home. “Most people can’t afford a $2- million beachfront property on Bald Head Island on their own, but a company like Plum lowers that barrier of entry,” he said.
A premium vacation property probably commands “very attractive returns,” he added.
But he and other Realtors also urged caution.
“You don’t have full ownership. Sharing anything can be complicated,” Tana Widdows, a Chapel Hill-based broker with Terra Nova | Compass. “There’s also less of upside when you sell.”
AnnMarie Janni is founder and leader of Element Realty Group at Allen Tate Realtors and a member of Raleigh Regional Association of Realtors (RRAR). She’d advise would-be co-buyers to consider all the possible outcomes in case they wanted to sell.
“Other details may be important to them. Read the fine print.”
