Timeshares - Good or Bad?

[Andy R]

I have been surfing around trying to get some education on whether time shares are a good or bad thing. My wife and I have a little baby (less then a year old) and would like to figure out the most economical way to vacation in the years to come. I happen to like the idea of going to the same "little town" year after year for one of our vacations as the place becomes special and it helps develop some traditions. So the downside of being stuck going to one place is OK if we love that place. The idea of being able to trade to other locations is a nice option too.

From what I have read so far it seems smarter to always buy a timeshare on the secondary market and not from the developer. I also understand some timeshares have very high maintenance fees and some have lower fees. I am not sure what drives this variable, is it a lower entry cost and higher fees vs paying more upfront and less per year?

If any of you have experience with timeshares would you mind outlining some of the plus and minuses of owning a time share? Am I crazy for thinking this could be a smart way to lower our overall costs for vacationing in the future?

 

[TomCat]

Hi Andy...as a Forum "expert" you are probably aware of the Forum "TUG"...Timeshare Users Group? It is FULL of info as you begin to study timeshare world. I studied for about a year but never did buy. You can learn whatever you need to know on TUG. MANY posting members and a great history to search.

First "rule" you learn is as you say...do NOT buy from developer...re-sales are priced very low always...and super low right now. One isse is the maintenance fees are creeping higher...many over $1K per year...an issue for some...particularly some of the lower priced TS units.

I stayed at a Marriott in Park City Utah and it was really nice...Marriott are among the nicer units.

Take a look at TUG and keep us posted...TomCat

I have been surfing around trying to get some education on whether time shares are a good or bad thing. My wife and I have a little baby (less then a year old) and would like to figure out the most economical way to vacation in the years to come. I happen to like the idea of going to the same "little town" year after year for one of our vacations as the place becomes special and it helps develop some traditions. So the downside of being stuck going to one place is OK if we love that place. The idea of being able to trade to other locations is a nice option too.

From what I have read so far it seems smarter to always buy a timeshare on the secondary market and not from the developer. I also understand some timeshares have very high maintenance fees and some have lower fees. I am not sure what drives this variable, is it a lower entry cost and higher fees vs paying more upfront and less per year?

If any of you have experience with timeshares would you mind outlining some of the plus and minuses of owning a time share? Am I crazy for thinking this could be a smart way to lower our overall costs for vacationing in the future?

 

[Rich_by_the_Bay]

We have owned 2 weeks in New Orleans for maybe 20 years. 1 week is spring and the other week floats so that it always lands on Jazz Fest week (which is why we bought it). Your research is accurate in my experience. The secondary market is the way to go, but caveat emptor -- lots of scams out there.

The nice thing is that you will belong to Interval or RCI most likely, so if you get tired of your home unit, you can trade for another. Still, there are ongoing fees, etc. that need to be filled in

We used it a lot at first, but less so recently (able to rent it out consistently when we weren' using it, and that covered our expenses). I have a feeling we'll use it more when I FIRE.

 

[Andy R]

Tom, I spent some time on TUG earlier, I read over their Timeshare FAQs. As you point out the current market could lend some opportunities.

Rich, I recall your other posts about the place in NOLA for Jazzfest, good call on that week.

I am thinking about something in Colorado so we can drive from Texas.

I'll spend more time on TUG but if any other E-R.org members have feedback I'd love to learn from your experience as well.

 

[NW-Bound]

Never been to TUG, though we are also timeshare owners. I had read that timeshares have poor resales values, but never bothered to check out resales units. Then, many years ago, my wife went with a friend on a vacation and fell for the sales pitch. So, I found myself a timeshare owner, and tried to make the most of it.

People who still w*rk (and with little kids at that!) probably like to come back to the same place year after year just to relax. For us, we like to try different places each year, and have been able to use RCI to exchange it for different locales. We were able to get a 3-bedroom 1,800-sq ft townhouse in Palm Springs one year for example. Last year, we got TWO nice suites in Las Vegas, each with Jacuzzi and a full kitchen.

Despite the bad reputation, I think timeshares are OK IF you use it. They aren't cheap, but as it is already a sunken cost I am "forced" to enjoy accomodations at a higher class than my cheapskate nature would normally go for, if I have to open the wallet every night. Of course, we would save money by buying a resales.

 

[Katsmeow]

When our kids were younger we had points in the Disney Vacation Club. We used it quite a bit and could use it every other time for out of Disney trips. We had points in a particular Inn (Boardwalk Inn in our case) but could stay in others which we often did. We did eventually get tired of being tied so much to Disney and sold it on the secondary market. Unlike most time shares we sold it for more than we paid for it. At the time Disney always had a right of first refusal on any sale (that is, Disney could buy your points for whatever your buyer was paying). Anyway, it worked out very well for us overall.

 

[clifp]

I've stayed at timeshares and attended a number of timeshare presentations. About a year ago I started to seriously looking at buying one since the prices had fallen significantly. I think downside listed in the TUG FAQ ultimately were why I didnt get one. I determined that was easier to find deals on the internet each year then buying a timeshare.

• [SIZE=+1]You must continue to pay the yearly maintenance fee, which can increase over the lifetime of the resort, whether you use it or not.[/SIZE]
• [SIZE=+1]You could be required to pay additional "special assessments" arising from unexpected costs of maintaining or repairing the resort. [/SIZE]
• [SIZE=+1]Some people feel that owning a timeshare requires excessive advanced planning in attempts to reserve a popular floating week or to obtain a good exchange week. Planning a timeshare vacation a year in advance is not unusual.[/SIZE]
• [SIZE=+1]The majority of concerns with timeshare ownership seems to center around dealing with cost and interaction with exchange companies. It's often not the straightforward process the timeshare sales staff would have you believe.[/SIZE]

 

[Moemg]

When my children were young we owned one two and 1/2 hours away and used it for summer vacations . We had bought it from Condolink (secondary market ) . It was in a large resort in the Pocono mountains which had a lake ,swimming pools , movie theater ,restaurants , miniature golf and lots of activities for the kids . It worked out great . We did trade it a few times and since we bought it for ten years it expired and we never renewed . Our cost to buy it was $2000 and we paid yearly fees of $250 so it was a real reasonable family vacation .

 

[Achiever51]

For the past 15 years or so, we've owned 2 consecutive deeded weeks at a resort on Hilton Head Island...and feel that the investment is a good one, for us at least. We bought the weeks on the secondary market and paid much, much less than the weeks would have cost if purchased from the developer. The annual fee is, I think, reasonable -- about $525 per week (x 2 or $1050 per year), and we've not had any "special" assessments. (I think in large part because the resort has a very good board that watches expenses carefully; and also because we bought our weeks after a major renovation was completed.)
While we do generally go to HHI each year, we have traded our weeks through Interval International for other resorts and have enjoyed weeks in Hawaii, San Francisco, London, Arizona and the Bahamas.
If you're planning to buy a timeshare, I strongly suggest you:
- visit the area (and the resort) before you buy.
- buy only through the resale (secondary) market.
- ask to see the financial statements of the resort to avoid any assessment surprises
- unless you plan to use your week at the same resort every year, buy into a resort that is an attractive "trade", either because of the location and/or the week.
- and, unlike a former boss of mine, after you buy the week -- USE IT or trade it.

 

[Gunni]

Try VRBO (Vacation Rentals by Owner). For the cost of the annual Timeshare maintenance fee you could probably enjoy the same benefits. And going to the same location would be easy. My 2 cents.

 

[harley]

Never owned a timeshare, but DW and I (along with DD) have rented people's timeshare units a few times, mostly in Orlando. We've also gone for the low cost trips a number of times, and sat through the sales pitch. We have no problem with saying no, collecting our plastic freebie and staying in a nice place really cheaply. They beat the heck out of a hotel room, but there's no way I'd buy one. It's so easy to find one and stay inexpensively without having to deal with the ownership and ongoing cost issues. YMMV, of course, but that's how we like it. Personally, I sort of enjoy watching the sales people throw everything they have at us. Makes me feel like Superman, bullets just bouncing off.

 

[clifp]

In the past, I've made cash offer at 1/2 price they were offering. They have to go back and talk to the boss who tells them no and then I get up and leave.

 

[traineeinvestor]

I certainly wouldn't buy one from a developer.

In any case, even if the numbers made sense, I'd rather have the flexibility of chosing where we go on holiday rather than being locked into the same destination each year.

 

[brewer12345]

Try VRBO (Vacation Rentals by Owner). For the cost of the annual Timeshare maintenance fee you could probably enjoy the same benefits. And going to the same location would be easy. My 2 cents.

This is what we do when travelling with small kids. You can get into a wide range of properties all over the place and you are not tied down or committed. We have stayed in everything ranging from a 1920s Sears kit house on a private island to a unique NM home designed and built by an expressionist artist who is also an architect (crazy chandeliers in that one). I like the freedom a lot better than buying a time share, and you can generally get a LOT for your money.

 

[Cruisinthru]

We have used VRBO a few times and been very pleased with the units and the prices..

My husband and I travel many times a year. I think we can rent a time share unit or privately owned condo much cheaper than the maintenance fees. Time shares do not seem like a cost effective way to travel. Just my 2 cents.

 

[MovingtotheCove]

We've been very happy with our timeshares. We own a total of 6 weeks....5 on the beach in SW FL and 1 in Orlando area. We've rented out the weeks each year we don't use and made a profit. We only purchased on the secondary market and never from a developer. The SW FL units have low fees and are in a small resort but the trade value through RCI has been great. The one in Orlando has fees a bit high but is a very large and well kept unit that we usually use ourselves vs. trade or rent. Again, make sure the fees aren't too high. You might want to rent a a resort and test drive it before you buy...we did that in both resorts we eventually bought into. Ask to look at their books and see the % of owners in default, etc. and study their fees over time. Also ask about insurance....when Hurricane Charley hit us on the beach we had really good insurance and our special assesment for non insured repairs was nill. We know others that in other resorts really got hit with big $$$'s due to poor insurance. Good luck on your search!

 

[jimnjana]

While I wouldn't recommend it, sounds like the advice you are getting about not buying from the developer is right on. I would also find out if there are any informal "owners association" or websites put up by owners that have gripes or good things to say about the resort. people who do own them and are happy either enjoy the place or are successful in renting it out.

 

[ChrisC]

From what I have read so far it seems smarter to always buy a timeshare on the secondary market and not from the developer. I also understand some timeshares have very high maintenance fees and some have lower fees. I am not sure what drives this variable, is it a lower entry cost and higher fees vs paying more upfront and less per year?

If any of you have experience with timeshares would you mind outlining some of the plus and minuses of owning a time share? Am I crazy for thinking this could be a smart way to lower our overall costs for vacationing in the future?

I've purchased three timeshares, each from the developer, and two after I became a regular lurker and poster on the Tug bulletin board. Generally, it is smarter to buy a timeshare on the "resale" or secondary market. There are instances, however, when buying from the developer can be very smart; for instance, if you want to buy in a new resort, in a specific unit and at a specific time, then in many instances the only game in town is with the developer who, in many instances, might also offer "pre-construction" prices that might be attractive. Also, bear in mind that many "developers" or homeowner associations offer steeply discounted timeshares for sale from inventory that has come back from prior sales; I've known of several timeshare resorts where you could obtain a decent timeshare for "free" or for a modest price from the developer or homeowner's association.

Timeshares should not considered as financial investments -- they are essentially prepaid vacation packages at a condominium unit, with continuing maintenance fee obligations that can make your prepaid vacation package quite expensive over the years.

I don't think you're crazy in looking at timeshares as a cheap way to vacation; yet, there are cheaper ways without obligating yourself to mainenance fees in perpetuity. You can rent houses, condos and even timeshares. My family, friends and I have really enjoyed our timeshares over the years and we have also rented houses, condos and timeshares over the years as well. Size up your vacation needs, first, before thinking about buying a timeshare. Also study and learn the differences in timeshare programs -- weeks-based (e.g. Marriott) and points-based (e.g. DVC) as well as different exchange programs -- Intervalworld International, RCI or SFX. Tug is an invaluable resource for this.

 

[kcowan]

When I looked at Timeshare, I found that the weeks (fixed time and unit) were 4x what a comparable fulltime unit would cost when purchased from the developer. So as a rule, the resale price should start at 25% of the purchase new price (and go down from there). I took a pass.

Then, in my new relationship, I found myself the owner of a timeshare in PV. It was an oceanfront, ground-floor unit (3BR, 3 bath) fixed time. We found it great because we got to know the other owners during the weeks that we were there. It was like the cottage where you look forward to seeing your cottage friends each year,

When we retired, we decided to buy a fulltime condo in PV, and we sold the TS. At the time, the maintenance fees were $915/week! It had 5 years to go on a 30-year TS and we sold the three weeks for $4k total. We go to the resort during those three weeks to visit with our friends. And then we invite them to our condo and go to dinner, etc.

 

[Sarah in SC]

Another voter for VRBO.
I am someone who focuses a lot of attention on my fixed expenses, so an annual cost like a timeshare would be of no interest to me--what if there was some financial crisis and I needed to marshall all of my resources? Sure would suck to know I was tied into a vacation that I could ill-afford to take.
Meanwhile, something like VRBO you can always do on the spur of the moment and when you have the cash in your pocket.
But I'm a worrier.

 

[wolf]

NO to timeshares.

Just rent.

No hassels, no contracts.

Go where and when you want.

 

[Johanna]

As an owner formerly advertising on VRBO, I vote VRBO.

 

[strt]

buying timeshare is a bad idea. rent it. far, far cheaper in my opinion

 

[lightspeed]

My parents bought 3 weeks for my family and my siblings family to use, and I must say since then it has enabled us to have nice family reunions together in very nice places we would never have paid for on our own. Yes, it will probably still be cheaper to rent these places every year, but it motivates us to get together, and the value of these family vacations and getting all the cousins and siblings together can't be counted monetarily.

 

[RonBoyd]

No Fewer Than Forty-Four Different Organizations Compete to Offer Vacation Stays in Condos or Private Homes​

The use of condos or vacation homes in place of hotels may well be among the most important trends in travel. A nationwide service that acquaints the public with these residential properties, has recently (and selflessly) published the internet names of forty-some-odd competitors, and I think it's useful to our readers to retain this important listing for their own vacation planning.

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