Holiday Property

[Friedpet]

Our family owns a holiday home on the coast for a few generations now. One person is not interested in his share anymore and would like the rest of the family to buy him out. Problem is that no one is in a position to buy him out right now. The house also needs a lot of renovating.

Is it possible to buy him out buy doing renovations to the house? What I mean is that everyone that wants to have a share in the house invest through renovations, while he that is not interested does not invest.
On one side this makes sense, but then again he loses his shares but doesn't get anything out of it?

 

[F1 Fan]

Nope. That does not make sense at all. You could all club together and split the share

 

[Arthur]

Seems like he needs cash. Why don't the rest club in and pay him out? Then do the renovations.

A set-off on future renovations and possible future value is a notional and non-realisable value, whereas his interest right now is tangible and slightly less non-realisable.

 

[ToxicBunny]

Our family owns a holiday home on the coast for a few generations now. One person is not interested in his share anymore and would like the rest of the family to buy him out. Problem is that no one is in a position to buy him out right now. The house also needs a lot of renovating.

Is it possible to buy him out buy doing renovations to the house? What I mean is that everyone that wants to have a share in the house invest through renovations, while he that is not interested does not invest.
On one side this makes sense, but then again he loses his shares but doesn't get anything out of it?

Unfortunately the only people who gain from that are the people keeping their shares...

The one who wants out, gets nothing.

What you COULD do, is value the property now, in its current state, then finance some renovations and revalue the property aftewards and adjust the share percentages... then at some point in the future buy the unwanted shares out.

 

[Cius]

Sounds like a money pit. Perhaps sell.