5 Things No One Tells You about Buying a Timeshare
Interested in buying a timeshare? Think twice before spending your heard-earned money. Here are 5 things no one tell you about this kind of investment.
You and your family are beyond ready for your annual vacation. The question is, what should you do about your housing? Would buying a timeshare be in your best interest, or should you simply rent a unit or even spring for a hotel?
If you guessed “buying a timeshare,” you are correct. Timeshares aren’t just poor investments. They can be horrible financial investments for a number of reasons.
So, think twice before you spend your hard-earned money on one.
Here’s a rundown of five things no one tells you about buying a timeshare.
Let’s jump in!
1. You’re Not Investing in Your Future by Buying a Timeshare
When you purchase a timeshare, you gain an interest in the particular property on which your rental is situated. But that doesn’t mean you have the same advantages that typically come with owning real estate.
First off, your interest is in the exact same unit in which other individuals who are participating in your timeshare have an interest. In other words, you do not enjoy standalone ownership, which means you cannot do whatever you’d like to do with your timeshare unit.
For instance, you face strict limits when it comes to the time periods during which your family can occupy your timeshare unit. Therefore, unlike a real vacation home, you cannot rent out your unit whenever you’re not spending time there on vacation.
In essence, purchasing a timeshare is purchasing only fractional ownership interest in a vacation unit or property. It’s nothing like buying your own vacation property outright.
Unfortunately, many providers of timeshares seem to target those who are financially inexperienced. As a result, they oftentimes become getaway properties for those who honestly can’t afford these types of properties.
When you read through the timeshare brochures and other sales materials, you may see phrases like “You get to live in the lap of luxury.” Unfortunately, what salespeople don’t tell you is that a timeshare doesn’t come with an investment return.
When you decide to spend money for your future, it should be making you money in the long run. Timeshares do the opposite — they are expenses, not income generators.
Sure, you might get some pleasure out of them, but they still aren’t investments. So, steer clear of them if you’re serious about protecting your financial future.
2. Timeshares are Depreciating Assets
A timeshare is a lot like a new vehicle: As soon as you drive it off the lot, it loses value.
Take a quick peek online to see how much timeshare units are going for. You’ll likely discover that the listing amounts you see online are far less than retail prices.
And the kicker is, most of these for-sale units are not even selling.
Unfortunately, the majority of timeshare owners pour so much cash into these units and are not realistic about these units’ actual values. As a result, they struggle to price their timeshares at market rates, or the rates at which these units would realistically sell.
You won’t have this problem if you say “no” to timeshares from the start.
3. Timeshares Are Not Very Liquid
Another reason why buying a timeshare isn’t the best move? These aren’t the most liquid assets around.
For this reason, you’ll easily see more individuals trying to sell their timeshares than trying to purchase them.
If you buy a timeshare, your chances of recovering the initial investment you made in the unit is extremely low. Part of the reason for this is that new timeshares are constantly being built, so who would buy your used one when they could get a brand-spanking-new one?
On top of that, many websites that allow you to market your timeshare will charge you listing fees as well as yearly membership fees just to use these sites.
And there’s still no guarantee that you’ll be able to unload your timeshare.
On top of that, the timeshare reselling industry is known for featuring a great deal of fraud.
Scammers prey on the owners of timeshares by vowing to sell their properties for them — for upfront fees. Then, once the timeshare owners cough up these fees, they never hear from the scammers again.
Again, you won’t face this issue if you don’t buy a timeshare to begin with.
4. You’ve Got Maintenance Fees
Yet another reason to watch out for timeshares is that they all come with maintenance fees.
In other words, every year, whether or not you use your timeshare week, you’ve got to pay up.
To make matters worse, the maintenance fee rises each year.
After all, the money used to cover the cost of running the resort and to pay the property management company needs to come from somewhere, right?
5. Rental Rates Are Better
The timeshare industry is one industry where renting is better than buying.
So, if you’re set on purchasing a timeshare, be sure to check websites that offer timeshare rental opportunities first. You can usually rent another person’s timeshare week for much less than this person is paying in timeshare maintenance fees.
In many instances, timeshare owners cannot use their timeshare weeks in the next year or two, so they’ll rent them out. In fact, so many are rented out at one time that they usually go for a lot less than the initial asking prices.
This is definitely not a nugget of advice you’ll receive from the resort salespeople trying to sell you a timeshare.
How We Can Help
If you’ve already bought a timeshare and are regretting your decision, all hope is not lost.
We offer premier timeshare experts and consumer advocates who are willing to work hard to free your family from your undesirable timeshare contract. We will always put your best interests first and keep you up to date on each step of the process.
If you’re not happy with the results, you’ll get 100% of your money back. Guaranteed. That’s our pledge, and it’s not a promise you’ll find many other places.
We realize how stressful a timeshare contract can be. Get in touch with us to find out how we can help you to break free from it and thus start vacationing and purchasing assets on your own terms each year.