Town House Ownership
A town house is a popular form of housing in urban areas. The term town house is often used to describe any type of housing connected by common walls. In fact, the town-house concept is a cross between single-family houses and apartments.
Title to each unit and lot is vested in the individual owner. Each owner also has a fractional interest in the common areas and is proportionately financially responsible. Common areas may include open spaces, recreational facilities, driveways, and sidewalks. The owner may sell, lease, will, or otherwise transfer the dwelling unit. The rights to the use of the common areas pass with title.
Time-Share Ownership
Time-share ownership permits multiple purchasers to buy interests in real estate, usually a resort property. Each purchaser receives the right to use the facilities for a certain period of time. A timeÂshare estate includes a real property interest in condominium ownership; a time-share use is a contract right in which a third party retains ownership of the real estate.
Illinois Time Share Act
The promotion or sale of all time-share units is strictly regulated by the Illinois Real Estate Time-Share Act of 1999 (765 ILCS 101). The Time-Share Act now provides for minimum requirements of a time-share listing agreement. It provides for disclosures, in addition to those already required, to a prospective purchaser of a time-share that includes the status of assessments and real estate or personal property taxes. It also provides that a time-share resale agent have a real estate license unless the licensee sells less than eight time-shares per year. The Illinois Real Estate Time-Share Act of 1999 applies to both in-state and out-of- state timeshare sales.
In addition, pursuant to the Real Estate License Act of 2000, a person who engages in the sale of time-shares must have a real estate license.
Certain exemptions to the real estate licensing requirement apply:
An exchange company registered under the Real Estate Time-Share Act of 1999 and their regular employees.
An existing time-share owner who, for compensation, refers prospective purchasers, but only if the existing time-share owner:
A time-share estate is a fee simple interest. The owner’s occupancy and use of the property are limited to the contractual period purchased. The owner is assessed for maintenance and common area expenses based on the ratio of the ownership period to the total number of ownership periods in the property. Time-share estates theoretically never end because they are real property interests. However, the physical life of the improvements is limited and must be looked at carefully when considering such a purchase.
A time-share use consists of the right to occupy and use the facilities for a certain number of years. At the end of that time, the owner’s rights in the property terminate. In effect, the developer has sold only a right of occupancy and use to the owner, not a fee simple interest.
The Illinois Real Estate Time-Share Act of 1999 requires:
That all developers and their agents must register with the IDFPR and hold a real estate license unless the licensee sells less than eight time-shares per year.
A time-share listing agreement must provide for minimum requirements.
Each purchaser must be given a detailed public offering statement before signing the contract.
The statement discloses extensive information about the property such as time periods, percentage of common expenses for each unit, use and occupancy restrictions, and total number of units.
In addition, disclosures to purchasers must include the status of assessments and real estate or personal property taxes. The statement also must include information about the developer and property management.
Any purchase contract entered into by a purchaser of a time-share interest shall be voidable (rescindable) by the purchaser, without penalty, within five calendar days after the receipt of the public offering statement or the execution of the purchase contract, whichever is later.
The purchase contract shall provide notice of the five-day cancellation period as well as the name and mailing address to which any notice of cancellation shall be delivered.
Upon such cancellation, the developer or resale agent shall refund to the purchaser all payments made by the purchaser, less the amount of any benefits actually received pursuant to the purchase contract. The refund shall be made within 20 calendar days after the receipt of the notice of cancellation, or receipt of funds from the purchaser’s cleared check, whichever occurs later.
The Real Estate Time-Share Act of 1999 places developers and their agents under strict requirements regarding potential misrepresentation, such as:
Violations can result in the suspension or revocation of a certificate or permit issued under the act.
