Hidden Timeshare Fees: What You Need To Know
Buying a Timeshare, Timeshare Agreements
3 min read
In 2017, the average timeshare cost was $22,180. So, those same timeshares are currently worth about $22,000, right? LOL. Unfortunately, unlike most real estate investments where the value tends to increase over time, deeded and right to use timeshare worth plummets as soon as the ink on the contract is dry. In fact, timeshares are kind of like cars that way. However, unlike cars, timeshares can be hard to sell. When owners try to resell their timeshare, they are often surprised to find that their timeshare worth is much lower than what they paid. That’s because on the resale market, your timeshare is only worth as much as someone else will pay. So, what factors influence what buyers will pay? Read on to find out.
Like traditional real estate, your timeshare’s worth is closely tied to its location. If your timeshare is in a highly desirable location, like Hawaii or Florida, then you’ll probably see a higher value. Your timeshare worth will also depend on the timeshare company itself. Reputation varies greatly from company to company, and even from resort to resort within a single company. Plus, your unit’s location within the facility also factors into the worth. Do you have views of the ocean or the parking lot? Are you right next to the dumpster? Finally, what week you have matters. Got a holiday week? You’re in luck! Have a lousy week? That’s going to be trickier.
We all know how much timeshare companies love fees. Unfortunately, most consumers are less fond of them. Plus, timeshare owners cite maintenance fees as the number one reason why they want to out of their contracts. When determining your timeshare worth, be sure to take fees into account—especially maintenance fees. If annual maintenance fees exceed what it would cost to rent that unit for a week, that’s going to be a tough sell. And if your HOA has a history of steep maintenance fee increases or high special assessments, that makes your timeshare even less attractive.
Of course, other factors influence timeshare worth as well. For example, does your company have the right of first refusal? And if so, how likely are they to exercise that right? Or does the resort have any current litigation that would affect owners. Does the contract allow owners to rent out unused weeks or participate in exchange programs? That kind of flexibility can be very valuable to a prospective buyer. Of course, amenities like granite counter tops, stainless steel appliances, and awesome layouts are key features. And finally, resort amenities like pools, gyms, and restaurants also play a big part in timeshare worth.
However, even if you have a great location, reasonable fees, a flexible contract and amazing amenities, there are a lot of other people out there who are also selling their timeshares. You’ll be competing with an internet full of sellers. And if another owner is selling a similar unit for less than yours, then you’re likely going to have to lower your price. Or if there are many similar units available, you’ll also need to find a way to differentiate your listing. Some options might be offering seller-paid closing costs or paying maintenance fees in advance. The timeshare resale market is a buyers’ market, so if you were hoping to make a profit on this, you’ll be very disappointed.
Unfortunately, most owners find out that their timeshare worth on the resale market is very, very low. And it’s also very hard to find a buyer at any price. If you can’t sell your timeshare and are ready to get out, we can help. We work with timeshare owners every day and help them exit their timeshare contracts safely, ethically, and forever. Contact us for a free consultation today.
(Image Source: Pixabay)
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