With more timeshares than ever before, are timeshare dangers on the rise?
The American Resort Development Association released its annual study on the timeshare industry in June 2018. The study analyzes a wide variety of indicators. Results reveal the industry’s eight straight year of growth in almost all categories. We worry that more timeshares mean more timeshare dangers.
The survey breaks down the basics.
Sales volume was $9.6 billion. This shows an almost 4% increase over 2016’s $9.2 billion.
The average timeshare occupancy rate was 81%—higher than the average hotel occupancy of 65.9%.
Revenue from timeshare rental was $2.3 billion, a 20% increase over 2016.
The United States has 1,570 timeshare resorts with around 205,100 units.
Average annual maintenance fees increased 1% to $980.
Island resorts had the highest occupancy at 90%.
Beach resorts were the most common with timeshares occupying 34% of all resorts.
So…what does all of this mean for consumers?
First, the expansion of the timeshare industry means more sales reps and the potential for more scams and high-pressure sales tactics. In 2017, the survey reports more than 1,500 resorts offering timeshares. Just imagine the number of reps needed for that many locations! You’ll need to know how to protect yourself.
Just say no to free gifts. In the timeshare industry, there’s no such thing as free. Everything comes with a price. Repeat after us: Free gourmet dinner? No. Free rental car? No. Free sunset cruise? No. Timeshare reps are notorious for using “free” gifts to get you in the door. Of course, then the door closes behind you and the pitch begins.
The pitch itself varies from rep to rep, resort to resort, but we see many key features that hurt consumers. A relentless focus on the positive is a hallmark of timeshare sales pitches. Of course, that’s a common sales tactic in many industries. However, what timeshare reps leave out or gloss over has a major impact on consumers. Don’t expect a pitch to include much about how a timeshare does not appreciate in value over time. Or about the difficulty of exiting a timeshare agreement. Or about how the contract can extend beyond death and become the responsibility of the consumer’s heirs.
And they won’t take no for an answer. We’ve heard so many stories about people who’ve said yes to a pitch because they just couldn’t get out of the room! The increase in consumer awareness around timeshares pushes reps to be more creative. In fact, we get plenty of calls from people who thought they knew better. Find out more here.
The study reports island resorts at 90% occupancy. That seems like a good thing, right? No timeshare dangers lurking? However, consumers may find themselves out of luck scheduling their week. Both fixed week and floating week arrangements can be affected by high occupancy.
Floating week scheduling is often challenging. Meaning, with occupancy rates that high, consumers will almost certainly need to schedule far in advance. And of course, floating week scheduling is based on availability. If you do the math, 90% occupancy means 10% vacancy at island resorts. There’s no guarantee you’ll be able to access your timeshare during a week that works for you. How many years could that be your reality?
Fixed week arrangements are more stable. However, those who find themselves unable to make their week will face difficulty switching. This is a common issue for fixed week timeshares but is made more complex with high occupancy rates.
Maintenance Fee Increases
As usual, we see increases in maintenance fees. This follows the pattern timeshare owners have come to expect. Maintenance fees increase each year. The amount of increase is unpredictable. Although this year’s average increase is modest, consumers still find themselves paying more this year than last year. And individual increases will vary. Some timeshare owners certainly wrote much bigger checks.
Maintenance fees typically cover a variety of routine expenses. These expenses can include housekeeping, landscaping, utilities such as water and electricity, repairs, and taxes. But the maintenance fees don’t reflect additional assessments resulting from larger upgrades or unexpected major damages.
The report focuses on the modest increase in fees from 2016 to 2017. While it’s true that fees remained relatively flat, the average fee was $980 in 2017. The average timeshare owner pays almost $1,000 in maintenance fees every year. Let that sink in. A thousand bucks for something they only use one week a year. If maintenance fees on houses were that high, most people would be looking for a new handyman! That’s why the maintenance fees are one of the most common reasons consumers want out of their timeshares.
With more timeshares out there, consumers must continue to be careful. Have you fallen victim to timeshare dangers and are looking to get out? We’re here to help.