The Holiday Property Bond (HPB) offers an interesting alternative to the traditional timeshare concept.

The "bond" is actually a life assurance bond which invests up to 65% of its funds in holiday properties in Britain and Europe. After fees and charges have been deducted the rest of the fund is invested in British government bonds, Eurobonds and other income producing securities.

Investors receive an annual allocation of Holiday Points according to the amount of money they have invested in the bond. The minimum initial investment is £4,000 and one point is allocated for each pound invested. However, the investment is inflation-proofed to protect members' booking power year by year.

Bond members may use the points to book rent-free holidays in any of the available properties any time of the year, as long as they have enough points to cover the "points charge" of a particular property, and provided the property is not fully booked.

It should be noted that "rent free" does not mean "100% free" because Bondholders are expected to pay a "no-profit user-charge" which, according to the HPB portfolio catalogue, is a "contribution towards the actual costs of servicing" the property during the period of occupancy. This still represents good value, especially as the terms of booking stipulate that "all the facilities on most sites are provided to Bondholders at no extra cost."

One problem Bondholders may encounter is that their preferred holiday site is already fully booked, especially during the peak holiday season. HPB management maintains that even if every bondholder were to book a holiday in the same week ten percent of the accommodation would still be empty. In other words, although some holiday sites fill up quickly there will always be accommodation available somewhere.

The Holiday Property Bond was launched in 1983 with just one holiday property in the Canary Islands. Twenty five years later the portfolio has grown to include 19 properties in Britain, three in France, two in Spain, Italy and the Canary Islands, and one in Austria, Portugal, Turkey, Madeira and Majorca, so HPB may be said to offer more choice and flexibility than the traditional timeshare model.

The portfolio includes a castle, a manor house, mansions, farmhouses and country cottages in Britain; a French chateau; a medieval palazzo and a trulli development in Italy to mention just a few. On site or nearby facilities can also be impressive, such as a championship golf course in Norfolk, a salmon beat in Scotland, and skiing in Austria.

Each property is sympathetically decorated, comfortably furnished, and fully equipped. The sites are maintained to a high standard.

As well as the properties under HPB ownership, further choices available to members through the HPB Tenancy Programme, which extends the range of countries covered by the portfolio and takes it beyond Europe to the USA (Florida and New England) and South Africa (Capetown).

The Bond is issued by HPB Assurance Limited, which is registered in the Isle of Man. Bondholders who wish to cash in can do so after two years. Unlike some timeshare schemes, there have been no reports of difficulties in encashing.

However, investors looking for major financial gains would be advised to look elsewhere and encashment after just a few years has tended to result in losses on the initial investment.

For many Bondholders, the real value of the Holiday Property Bond lies elsewhere, in providing a life assurance vehicle that allows investors to enjoy holidays in attractive and well-maintained accommodation in a variety of interesting locations.