Newport Beach residents say "fractional ownership" has turned the city into a party town
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- Опубліковано 13 вер 2024
- Some residents in Newport Beach, California are pushing back against the growing trend of “fractional home ownership” that's taking over the city.
Locals say the practice is turning luxury homes into timeshares and party houses and transforming the suburban community into a resort town.
Fractional ownership is the practice where ownership of a home is split among multiple parties, typically anywhere from 4 to 12 owners on average. The arrangement is most common for owners of vacation homes.
KTLA's Chip Yost reports on March 29, 2023.
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Rich people who buy and rent out homes in poorer neighborhood hate that they have to experience what they do to others in order to have a passive income.
Yep, the hypocrisy is strong here
🎯🎯🎯
Y are Soo right.
So true!
Well said
These are the same neighbors that block beach access even though it’s public land. Same thing with Malibu.
Now they know how we feel when they come in to our town with their big money and push out the locals
But they actually make the neighborhood better .
@@renaudvillacis8066 for who?
@@steve-O1for me. I live in a beautiful part of brooklyn coffee shops nice restaurants gyms . Wasnt shiet out here in the 90s . I grew up in jamiaca Queens in the 80s . Get ur self together get a decent job and you can afford the rent too
@@renaudvillacis8066 You are a terrible person. I can’t imagine anyone in your life honestly enjoys your company.
Brooklyn???
Get a grip, FFS
Towns like Laguna, Dana and Newport were never ‘shietholes’ to start with until the carpetbagger R/E speculators started leaching.
The open acreage-surrounding these places was nothing but citrus and avocado groves in my 70’s youth.
The fact you opted for a gentrified onetime shiethole over that is entirely on you.
America, not just NB, has literally sold its coast to foreign investors, big corporations, and short-term rental conglomerates. Even if you inherit your family's old beach cottage you can't afford the taxes due to multimillion rentals causing the property taxes to rise so then you sell to the sharks. Our cities don't care because besides that you spend money in the city, they are getting in their share with bed/vacation rental taxes. So Picasso found a way around this tax by having "owners" who may or may not ever stay on the property and it gets taxed as a single home. Sneaky and the city don't like it which is now why they "care". They don't seem to mind that these people don't care about schools, hospitals, parks, the sand erosion,or there being a view of the coast from the road. The livability or quality of life for the few who do live there concerns no one. Only those who create a fairly constant stream of revenue do matter. Community, charm, and historical significance do not produce money.
Not true. Prop 13 limits tax increase.
exactly. Look at places like Dubai and Nice and Antalya. They are so well maintained and publicly accessible. Orange County beaches are stunning and all their beauty has been skinned by the rich folks in OC
Let me know if you ever need a job. It's rare to find anyone with sense, especially on here.
Too bad rich people this has been going on since the courts in California ruled that single family homes in an area zoned for single family homes, can be occupied by 10 families of the owners want, the cities be damned and the neighbors be damned. Of course I sometimes forget the two tiered system of justice in America these days.
The state died, it breaks my heart to see this happen.
But hey, at least we are not racist. [coughs]
It's all a shared ownership. It takes 8 people to buy a home in CA.
😂 facts
The people who pay a million dollars for 1/8th of a home leave their empty caviar bottles all over the street. It’s a real problem
This is what happens when lower income people do the same thing as what rich yts do when they flip houses in other neighborhoods and increase the cost of living. How does that taste rich yt people?
Took my ex wife to a party in Newport Beach about 1973. She was 16, went out to the car to get cigarettes, got stopped by cops and was arrested and taken in for curfew. She passed away in 2013. Anyway yeah, it's been a party place forever. Anyone living there knows. Summers are crazy near the beach. Crappy parking as well. But you can spend upwards of 10 million for the experience.
Lucky guy, 16 gf was your wife up to 2013.
@@jhnyjoejoe69 Long story... we did divorce in 1978 and kept in touch, we had two great kids. The son, who we considered losing to abortion, is 49 and a lead Architect at a prestigious firm. The daughter had become an international model since 17 years old, now 47 and still working.
@@BootsEditor11 do u respect what your daughter does? it doesn't make u feel any type of way that her career consists of sexifying herself as an object for other men to fantasize and oogle over being intimate with etc?
Nah. Not crazy. Not “crazy.” /
@@jordanjohnson9866 You know something I don’t? Why spend millions with a mortgage, say $25,000 a month, to be in a place with wild, drunk and drug parties all summer? No gate guarded communities on the beach. Just free for all beach partiers making a nuisance and driving you nuts. You might like it while young and participating in it. Eventually you grow up.
It isn't a timeshare. Real estate laws cover multi-owner properties. There's nothing they can do to stop this, literally.
They deserve this 💖
Multiple investors on properties aren't setup like this. This is no different than timeshare because they're occupying for a set block. And happening because these companies tried to airbnb these places for thousands a night and couldn't rent them. I mean a person isn't really smart to buy 1/8th of a house to begin with. But multi owner is usually a board of investors and the property pays quarterly dividends. And they don't live in it. Newport has a particular crime that this enables also and the news failed to report that angle.
@@darlenemestas5839 its a shared vacation home for the lower rich class.
just like airbnb....leading to devaluation of neighborhoods with the riffraff that comes in
Yeah no doubt, a couple from Newport Beach bought the 2 condos next to mine about 2 hours away from Newport, now they rent it out to the trashiest people ever.
Hope they enjoy the Karma.
Only if the Airbnb/VRBO owners are absentee oblivious dipshits who never felt any obligation/connection to their neighbors when they bought the property in the first place.
Let's face it - It's not as if there's some epidemic of this kind of behavior in small town coastal CA - say, Summerland, Cayucos, Aptos, Half Moon Bay, Stinson Beach, Jenner, Bodega Bay...
Fractional ownership or no - the kind of people that are in a position to be snapping up short term rental properties in NB today are likely folks who never had any roots in the community anyway - and have no desire to acquire them.
Why would anybody be shocked to discover that their short term tenants would be cut from the same cloth?
Complain all you like about NIMBYism - they've NEVER been wrong in my 60 years here on the coast.
Welcome to Carpetbagger, CA - enjoy your stay
Rich people problems
They never explain exactly how this works. Does Picasso purchase the home under the name of an LLC then sell 7 other shares to other parties and keep one share for themselves? The reporter does not do a very good job of explaining it. Picasso obviously makes money on this venture. I don't think any of these owners ever live in the house . When the house is rented out short term , how much is it rented for. I'm guessing it isn't cheap.
Other things: Is there 8 names on the deed? Property taxes? The bank has to qualify 8 applicants?
@kendall Evans Title is likely held in an LLC, the eight owners would have shares in the LLC. The LLC would be responsible for paying property taxes.
@@mizzury54 Interesting! Thanks!
@@kendallevans4079 in the future, one owner could just simply sell their shares in the LLC to the other members of the LLC or to another buyer.
kind of sucks to be a local - this is nothing new, they have been doing it in ski towns for years
Mostly likely same as a New York Co-op.
As a real estate broker-good luck banning fractional ownership
It will be blocked. Its another RE get rich quick scam.
OK, your a surfer and you want your 1/8th of the year in Newport Beach - How do you get July rather than January? Seems to me the better option, and the less expensive option, is to stay at a 5 star hotel.
No because the home will appreciate because of the fantastic location, the expenses such as property tax and HOA are reduced because of the split.
This is a cost efficient way to invest in a prime location without having to spend insane amounts
Hey so the Wedge is literally not a surfers paradise.
It's a crappy wave that has broke the neck of many fools.
I remember what happened to Corona Del Mar. Rich people buying multiple properties tearing them down. Building McMansions😢
Exactly right. Can't redline or blockbuster home ownership, but can regulate use of the homes
Hey..
That's the standard for Latino neighborhoods. When three relatives all go in for one home ownership. Everybody shares. That means garages become converted ADU's, add-ons, and so forth. That's the only way people can afford real estate now.
The old man for Picasso was yt. This is your doing yt man not brown people. You don't like it, maybe go back to Europe.
100%
That is rampant in Santa Ana.
When I was in RE in 1979 LA Metro was all worked up over "illegal garage conversions"... Now they are begging people to do it.
That how fires start. Illegal and unsafe conversions. Not just Latino neighborhoods, Asian too, in fact maybe even more so. While Latino's might do it for family, Asians, especially Chinese do it for the money! I knew of a Chinese lady who turned her backyard/patio in 4 "sleeping boxes" with 2X4's and plywood, extension cords running all over the place, total fire hazard. I dropped the dime and turned her into the City of Garden Grove but I doubt they did anything about it!
Palm Desert - Palm Springs and Joshua Tree are also 24/7 Party Towns now. Not just affecting the wealthy but everyday working people just wanting a peaceful home life in formerly residential neighborhoods. Picasso is here. Air BnB rules. Sucks to live here now if you aren't here to party.
ikr. i stopped going to palm springs years ago because young people had taken over the place from retirees and gays.
The old people there did not invest in growth, the are old and on there way out. Get out the way old lady the kids new economy is in play.
The palms oases for instance is a piss poor stop for gross food and angry racist services.
@@MrMadbrowncow maybe you would get better service if you act more respectful and grown-up and less entitled.
The good thing is I am there to party
The party starts around Thursday pm. It becomes chaos, from the triangle square down to the beach/peninsula. Friday gets crazier, with uncontrollable traffic all the way until midnight. Then Saturday and Sunday morning local hospitals are flooded with overdosed kids or pumping stomachs from too much alcohol. It’s become a hell house over there. 😅
It’s always been like that, this isn’t due to fractional ownership. The teens you speak of aren’t buying fractional million dollar homes lol
Whatever the case, I sold my place about 10 yrs ago and moved south county. 😁
@@GruneD I don’t blame ya! When it took me an hour to get from the 55 to the peninsula every weekend, I knew I had to get out too.
@@jintazticful yeah the 55 was chaotic back then. I don’t go much but my wife owns a business there still but she knows what back streets to take. 1hr to go in and out is terrible though😅
@@jintazticful Truth! I grew up in OC and graduated high school in 1975. Even then it was a zoo most weekend nights in the summer/ July 4th was the worst.
NIMBY for millionaires
I don’t want that in my community……Egads, I like quiet neighborhoods. Nice to know your neighbors too.
Corporations now own way too much pricate residences. The rich clowns did it to themselves.
It's a single family home that identifies as an eight family home.
Why not sell each house to 365 x 24 people, and then each of them could have it for one hour per year.
Don't give them any ideas! They would love the numbers on that!
I’m thinking 52 ppl and everyone gets a solid week.
Sounds like a rich people problem
How are you gonna ban this if you don’t ban corporate ownership?
So this is what rich people worry about 😂
It’s most of their income. Buy a part of a house and rent it out in sections… running out of ideas
This is a classic economic case of negative externalities. Picasso wins, fractional buyers win, everyone else in the neighborhood who have no say loses (via reduced home values, noise, strangers in their streets, etc.).
Yup. Pure exploitation
They shouldn't have sold their houses and moved to Florida!
Votes from 30 years ago have repercussions today.............
Being the first there does not automatically grant you the right to a resource or location. I know everyone likes to act like it, but it is BS.
Anyway, the funny thing is each of these homes could potentially have the vote of 8 households instead of 1 so it will be interesting how those people handle will vote in the local elections against the political people trying to interfere with lives to prevent change and stay on top.
Its not like the water is being poisoned.
Land regulation (including property rights) is inherently a public matter as there is limited land, each parcel is unique (a monopoly unto itself), each parcel is affected by neighboring parcels. Useable land is seldom independent of government services - roads, sewers, water, fire, schools, police, etc. There's tons of regulation on land use as well. Free market ideas are not really applicable - externalities are unavoidalbe.
Noise can be regulated.
Strangers in the streets - if the street is a public street (paid for by public money), they have no right to limit access to anybody else. If they don't want strangers - there are gated neighborhoods with private streets.
Home values go up and down for various reasons - macroeconomic factors, access to commerce, access to transportation infrastructure, demographic changes, improved services like schools, police, parks, etc etc. Its not really something that can/should be regulated.
Fractional home ownership does not devalue other homes in the same neighbourhood. Why are you spreading lies?
While there are people WITHOUT housing. Why not build an apartment area instead of trying to sell 1/8 of a place. Ridiculous.
This is the dumbest thing I ever heard buying a fraction of a home. It’s still millions of dollars when you split the yearly property taxes
Weekly rentals are taking over Newport Beach as well. It’s no longer a nice community with people who care about the neighborhood. The residents of West NP where I live are greatly impacted by the way the city has allowed these rentals to go unchecked.
Glad to hear! Baby boomers and NIMBYS created this, they made their bed, now they can lie in it.
Oh, gee! That's terrible. And by terrible, I mean, karmic!
It's been an ongoing nuisance in over-developed Austin as well.
Aw, you sound so jealous. Let me guess, mom & dad didn’t give you all the resources you needed. Did they pay for college or just send you out to fend for yourself. Be less jealous of those who have more than you do.
@@meatpopsicle1567 How is it 'karmic' if your one great crime in this life is having been born and raised there?
You DO realize that there are thousands of us still out there - in beach towns across the state, right?
Some of us have never wanted to be anywhere else. Why is it suddenly our obligation to shoulder the whims of a relentlessly extractive carpetbagger culture?
And worse than that - STILL be lumped in anyway with the morons whose only imperative is commerce?
But OGs like me are supposed to take being called 'NIMBY' as an insult???
Comedy.
I have a friend that does air bnb and tells me how his place is always getting ransacked and he looses money but somehow sees dollar signs still with the air bnb scam. This is just another scam that caters to the greedy but benifits none.
Some of those home owners have rental properties them selfs in surrounding cities they never bother to check on those renters so I really don’t care what takes place down there
Here come the "low" income crowd.
You can not ban joint tenancy. If that was the case, then you would have to ban family inheritances.
Big difference.
@Eugene Firebird my apologies I mean tenants in common
All these Capitalist want to shut done capitalism when they don’t like it.
There is no way you can ban this ownership model. Many homes are owned by multiple people. My wife and I each “fractionally own” our house. LLCs with many members often own a single property.
Why would anyone want to live in a house, owned by God knows how many people ?! Gross!
California banned single family zoning R-1 in 2016.
fractional ownership also limits the real estate market in certain parts of newport beach such as the peninsula as more of the homes in the market are only available as rentals or “fractional ownership”
Isn't AirBnB a major part of the reason that many San Fransisco communities got destroyed? Isn't that part of the reason so many got displaced from their homes in the first place? Landlords saw the light in letting AirBnB take over the lease or rental at a higher cost and then the people who had lived in the space were displaced (possibly homeless)? The ironic thing is that now who wants to go to stay in San Fransisco?
Um, yeah.
That - and 35 years worth of Bay Area cities happily subsidizing extractive venture capital - like the construction of the (now defunct) Oracle campus in Redwood Shores.
But God forbid any of the elected representatives of San Mateo and Santa Clara County's 'librul' political class actually have the balls to compel a carpetbagger POS like Larry Ellison to FILL the housing demand that something like that his enterprise creates INSTANTLY overnight.
Crazy talk, right?
I live in an apartment with 5 other roommates. That makes six of us. It's the only thing I can afford. The landlord rents out the rooms through some funky legal contract that qualifies as a "joint" lease. The whole place feels like a transient halfway house. It sounds like something similar is happening to Newport.
Is there a law there allowing people to put a toilet in their front yard as a planter?
hopefully this is enough to make them know how much of a problem loud speakers are, it's not just partying.
Rich people vs rich people. Oh the humanity!!!! 😱
Poor rich people.
Don't be jealous of successful people, go back and finish school and some day YOU could be successful too. Perseverance, son.
@@DerrickW30 you sound like you have some serious issues with your own success.
"I'm so successful, I have 7 figure income, 9 properties, and more stocks that you'll have in money in your whole life😂. Stay poor."
Saved you the trouble.
@@DerrickW30 These people are literally trying to ban a form of ownership that is perfectly legal and reasonable in a free market. It’s not about being jealous, it’s about the fact that a bunch of entitled brats want to restrict access to others entering their neighbourhood just bc they don’t like “loud music.” Don’t buy a house right next to the beach and expect it to be reserved and sectioned off just for YOU and YOU only.
This is the dumbest thing ever. I can't believe a company rebranded time shares and duped a bunch of millionaires to buying into it.
Fractional reserve lending equates to fractional reserve ownership. End Fractional reserve.
Newport hasn’t changed its stripes in 60 years
There not saying who can or cant own the homes, there just saying that 10 ppl cant own the same home. Theres several legal reasons for this.
Oh yeah, What are those reasons?
Lmao it’s when they split 8 owners 😅
Irony is many weekly vacation rentals are owned by wealthy NB residents, but they're just in other NB neighborhoods.
And these same people who are complaining do this same thing in my town.
It’s not fractional ownership it’s fractional ownership in a corp that owns the home.
Cher Calvin opens the segment saying “there goes the neighborhood” didn’t know she was RACIST!
I thought Florida didn't like regulation? Do they want "big government" telling them what to do?
This is in Southern California
@@ladyramen7655 Maybe she's confused because there is a Orange County, FL also
Someone has been huffing paint, it seems. Why would KTLA, a local station in Los Angeles, California, air a report about real estate issues in Florida?
@@meatpopsicle1567 Each state has an Orange County, she must be confused. Apparently, you didn't know that either so you have no room to talk.
My brother and I owning a vacation house together should be illegal? Wtf. These nimbys should move if they don’t like it
It’s a scam ! It sells liability and passes maintenance fees ! THIS IS A SCAM !
Do these people not realize that people do this but house but rent it out for a drug rehab. This is no way a timeshare.
CANT SAY I BLAME THEM
IT COSTS A LOT OF MONEY TO LIVE THERE
NOT EVERYONE CAN
This is not new. Costa Mesa and Newport became hanky panky since the beginning of 2010’s. Reason why I left to south county and sold my condo on the peninsula 😅
Then live somewhere more affordable?? I live in newport (rent), but will and have purchased property in areas more affordable for me
why do you need to ban fractional ownership, aren't there already laws in NB against having crazy, loud, drunken parties all through the night ? Why not just enforce those laws. If I own my home outright, and throw the same crazy, loud, drunken parties all through the night, then that's ok because I own 100% of the house ? Anything to derail business in California
Homes should be for living in, not for making money.
This is nothing new. Been going on in Newport since the 2000’s. It’s just been monetized now on a bigger scale. Nothing more than a timeshare scheme.
if these rich people can't afford to live in an ever more exclusive neighborhood, then they should take a second job
Haha! exactly. They need to stop being so lazy and make better life choices.
They just don't like it that poorer people figured out how to stay there. If the party is the problem them regulate parties not ownership.
Of course Newport Beach is a resort community. These current residents just don’t want anyone else in their resort.
It doesn't sound much different than a timeshare to me. Whatever this company is, are they claiming cities can't enforce their own zoning laws just because it effects their business?
yep - they are not owners - they "share" ownership and each are allotted equal amounts of "time" at the house
This sounds like a new way to advertise time shares. Buy 1/8 of the house and live in it for 1/8 of the year! No thanks!
Noone owns a home in America. Stop paying taxes and find out who owns it
Can't buy a Fractional Home. You can Buy the Home and rent it out as a Vacation Home. What's the difference ?
Well then allow developers to build more housing in these communities!!! Many of these beach towns forbid building of apartments 4 stories or higher which is ridiculous. This old archaic idea of California only being accessible to the very wealthy few is no longer realistic.
And what is the problem here? I don't understand. I mean if i have the money and I want to buy a house there and then rent it, I don't see the problem..
1/8th of a home for a little less than a million is crazy
Yeah -
Who could've predicted that somebody accustomed to treating that kind of bankroll as monopoly money would turn out to be an amoral a - hole with an air of utter impunity toward his/her neighbors???
Go figure.
How is this different than timeshare being reimagined????
Glad to see Pedro move up!! He did great reporting for us here in nor cal
What’s different from permanent capital buying up single family residence?
If you cant afford the whole price for the house, then you cant afford to live there. you can vacation in the near by hotels.
Ha Ha, remember when Newport beach was all Oil Derricks in the 60s.
Gee, you mean fractional owners who pay and obey the codes
have the same rights as anyone else who pays and obeys the codes?
Who knew?
Yeah the difference is the old people bought their house for 80-150k to where now the houses there are 1 mill plus
The terms of their fractional ownership allow them to sublet. So, they could manage their shares as rental properties.... glorified hotels with a very high turnover and booking online. So, if the neighborhood is not zoned commercial, fractional ownership is defnitely trying to get around zoning laws.
Not quite
nope
Fractional ownership in the sense that if each of the family members or non-related co-owners are booking people in for short stays, and charging them, then they are managing a commercial property. Because they are making money from it. Ergo they are challenging the zoning laws. Making money off of short stays -- it's just the same as if they were charging people for massages or serving lattes or selling area rugs. As it is, the property management companies know this, and are offering house cleaning services.
Why would we the people put more rules on our own property?! No matter what the case; we are robbing ourselves of the freedom and rights that we have to our own property; soon we will have no rights to our own land if we keep this up; we are giving our freedoms to the government. It would be wise of we the people to just mind our own business and let others mind their own.
What if 100% of the building goes up in flames? Do you still pay only 1/8th of the damage?
“ I call the house for Christmas and new years!”
How sad? So it's ok when rich people and big investment companies buy out homes and apartments just to rent out the already expensive inflated living situation in California in non rich neighborhoods and gentrify neighborhoods but hate when less fortunate people live in the actual neighborhoods those same rich people live in.
I'm going to buy a $5M Newport Beach for 1/8 fraction and pay $625k. Then I'm going to AirBnB my 45 days for $1k per night and make $45,000 cash flow per year.
This is definitely a way around zoning ordinances.
I'd would love to live there and even be able to afford a surf board
Just buy a surfboard and a day pass?😂
People haven't left California yet?
This is great, can I do this in Tahoe?
That’s how it is at Pacific city,Oregon! Investors bought all the condos and offer a fraction ownership. I had no chance to buy one after they were built!
bummer.. LOL. High class problems. 950k for 1/8th of the year = 45 days you can stay there per year. That is a stupid investment.
F the rich owners. They voted for their current laws. It’s ok when 12 immigrant families occupy homes in less expensive neighborhoods. But when 12 families want to split the months they don’t like it.
These homes all get elevated in value regardless. It floors me that normal people can afford 4/5/6/10 million dollar homes. I don’t understand how so many people do it. The coast lines are literally lined with these properties. Tell me how someone even making 250k a year (175k a year for those who don’t realize that money is taxed) afford these homes. Especially with todays interest rates at 7-8%
The Wedge isn't a surf spot....
Why not create another housing bubble as these fractional prices skyrocket due to lower overall cost of entry.
Why would you spend 1 million on a fractional home? Just go buy a damn house for yourself
How does home ownership work when there may be several people purchasing a fraction of the same home? Who ultimately owns the place? Are all parties responsible for the taxes and upkeep? What happens if someone wants to sell their interest in the home?
This trend is all over the country.