I have a question about timeshare ownership vs vacation property ownership

Why do people prefer to purchase timeshares over actually owning their own place. I've never understood the fascination with timeshare when so many people get scammed repeatedly. Does it not make sense to just own the vacation property? Or does the annual maintenance and management of a second dwelling make it unattractive to own.

Please help me figure it out.

jurih wrote:

Or does the annual maintenance and management of a second dwelling make it unattractive to own.

Simply put, Yes!

Think about the house you own (assuming you own it). How much do you pay each year in property taxes, repairs, cleaning, renovations, insurance, security, landscaping, etc.?

Now apply that amount to a second home - in a city far away. Now think about how much vacation time you get each year. Do you think it makes sense to own a year-round property for something you'll use just a few weeks each year?

Also, if one little thing goes wrong with your vacation home (and things like these tend to happen at various times during the year), can you leave at the drop of a hat to go attend to that problem - before it becomes worse?

Then, when you try to sell your vacation home, think of the real estate, taxes, moving, and other expenses of selling that home.

You raised a good point, Lancec13, however vacation property will typically go up in value- doubly so if its on the water. It all depends what you're willing to do to upkeep the place, but you can stand to make money just like any other real estate transaction.

A resort vacation club membership just costs you money and you get nothing in the end.

I have never seen the interest in owning a property, either. The upkeep on two different places, often hours from eachother does not appeal to me at all. I relax and get out of the city as often as I can in the summer.. but I doubt owning a cottage would give me more time away.

jurih wrote:

Why do people prefer to purchase timeshares over actually owning their own place. I've never understood the fascination with timeshare when so many people get scammed repeatedly. Does it not make sense to just own the vacation property? Or does the annual maintenance and management of a second dwelling make it unattractive to own.

Please help me figure it out.

I'll offer my input, based upon personal experience with both; I have owned a second home (i.e., vacation property) in the past (but no longer). It can be argued that SOME real estate ownerships MAY increase in value whereas MOST timeshares definitely will NOT. However, there are numerous other factors to consider too. I have nearly 30 years of timeshare ownership experience (all weeks were resale purchases), so I'll directly compare the two:

There is something to be said for a guaranteed, routinely maintained condo, with lots of space, full kitchen, on site maintenance staff, pool, etc. --- with access on guaranteed dates in locations of your choice and preference. Pre-cleaned and fully prepped before you check-in (as opposed to "do it all yourself" (with appliances, cookware, dishware, linens, cleaning, seasonal maintenance) upon each and every arrival and visit as an individual vacation property owner.

Unlike individually owning a vacation property, a timeshare owner is NOT personally responsible for handling grounds maintenance (mowing grass, plantings, pruning trees, removing downed tree limbs and branches, trash removal, etc.), or property security, pest control, property insurance, facility maintenance, plumbing, heat and air conditioning, roofing, and the nuisance (and cost) of periodically upgrading and / or repairing appliances or furniture.

A timeshare owner pays only his / her own portion of property taxes (not a full year bill) only for the week(s) they actually own. Who wants to pay a full year's property tax bill for a costly property; personally owned but used for only a few weeks per year? Not me. I did it for some years, and ultimately felt that I was just throwing away a few thousand dollars every year in property tax costs.

Timeshare ownership is certainly not for everyone. However, for many people (including me) who appreciate and enjoy all of the benefits described above WITHOUT all of the maintenance headaches (and much higher costs) of actual individual property purchase and maintenance, the annual maintenance fees associated with timeshare ownership are quite acceptable. Of course, the purchase itself must have been "resale" (i.e., not from a developer) in the first place for timeshares to make good financial sense.

As far as "scams" in the timeshare industry go (...and there are certainly many), people who use their heads (for something besides wearing a hat) don't get scammed in the first place. Smart people NEVER buy directly from developers at exorbitant prices and they NEVER pay ANYONE ANY money "upfront" for ANY alleged "service" associated with timeshares. Those are two very simple rules. The people who get scammed either don't know, don't understand (or just simply ignore) these two simple, basic rules. As a result, they essentially make the CHOICE to VOLUNTEER to get scammed.

Different strokes for different folks, as they say...

Great response and elaboration for the both perspectives.. My parents owned a cabin up north for most of my childhood and they poured most of their free time and money into that thing. it was fun to have while I was growing up, but i dont think it was worth it for them.

I personally think that when you dump that much money into a vacation property that you don't even own - just so you can have some management company bilk you out of thousands annually - makes no sense.

kerrik17 wrote:

I personally think that when you dump that much money into a vacation property that you don't even own - just so you can have some management company bilk you out of thousands annually - makes no sense.

With all due respect, you don't have your facts or figures straight as far as ownership details and / or annual maintenance fee costs for timeshare ownership.

For specific example, I currently own 9 separate weeks at 6 different decent quality resorts, all of them in high demand coastal locations. My maintenenance fees range from $512 to $753 per week, depending on the individual resort. I couldn't even rent a decent motel room for a week for the amount I pay in annual maintenance fees for ANY of those 9 weeks.

Where on earth do you get the idea that maintenance fees are "thousands annually"? Even a very high end, prime, waterfront Hyatt Sunset Harbor week in expensive Key West, Florida is not much over $1,000 per year in maintenance fees. If your cited annual maintenance fee numbers were correct, you might have a valid point, but the figures you cite, as quoted above, are not even remotely near accurate.

And by the way, a timeshare owner generally DOES own their week / property, just like owning any other real estate --- except that the ownership is "partial" (i.e., one week "intervals"). Exceptions are "right to use" clubs and contracts, in which there is no actual ownership, just a contractually granted access for a defined number of years, but the vast majority of timeshare ownerships are indeed OWNERSHIPS, with a recorded deed just like any other real estate.

I agree with Ken - you figures for a maintenance fee is out in left field. How can any management for a vacation property charge that much.

The above statement is definitely true.. a holiday property is difficult to maintain and the effects of being hours from your home could bring a severe loss of value through property damage.

It would be great to own a holiday property, but timeshare seems much more viable.

jurih wrote:

Why do people prefer to purchase timeshares over actually owning their own place. I've never understood the fascination with timeshare when so many people get scammed repeatedly. Does it not make sense to just own the vacation property? Or does the annual maintenance and management of a second dwelling make it unattractive to own.

Please help me figure it out.

(A) Vacation Ownership is a larger basket of Products covering a spectrum from Rentals to Whole Ownership. Timeshare is one of the major components of VO. Even in a mature market like US, TS still forms a very large chunk of the VO Industry. Over time, TS has become a popular terminology to represent the VO Industry. In India TS is not generally owned and the majority of TS Owners have a right to use (say One Week in a year) as against mature markets where it may be Deeded (or Owned). Having a TS has several advantages: a basket of Resorts around the world to choose your vacation - a unique facility provided by Exchange Companies as RCI. Scams are not native to TS. They occur in all Industries from time to time. The consumers have to be discerning in their selection of the Resort Company while making their purchases. TS offers an inflation proof vacation option for the entire family spread over 25 / 30 years and is easilky transerable. In the net sum TS if correctly chosen can provide a secure, enjoyable and cost effective vacation to the entire family for may years. In India TS is in a development and growth phase. All India Resort Development Association (AIRDA - www.airda.org) has been set up as a Self Regulatory Body to represent the interests of the Industry in India.

bs159 wrote:

TS offers an inflation-proof vacation option for the entire family spread over 25 / 30 years and is easily transferable. In the net sum TS if correctly chosen can provide a secure, enjoyable and cost effective vacation to the entire family for may years.

Inflation-proof? Uh, Buddy, have you seen what's been happening with TS maintenance fees over the last 5-10 years? They have escalated relentlessly. I know one thing: Maintenance fees where we own have increased a lot faster than my wages.

Easily transferable? Have you seen how many people are desperately trying to give their TSs away (usually due to the relentlessly escalating maintenance fees) without success?

Maybe I misunderstood your post but owning timeshares is neither "inflation-proof" nor "easily transferable" (unless you are the one buying).

The question about timehsare ownership vs owning your holiday property comes down to management of the second property. Is that the gist of the conversation?

I wish I could afford a vacation property.. domestic or internationally.

miket298 wrote:

I wish I could afford a vacation property.. domestic or internationally.

If you can afford the yearly maintenance fees then this is the very best time to own a vacation property .... many timeshare weeks are being given away with the giver paying closing costs and this year's maintenance fees.

We put away money each month for maintenance fees that come due in Jan.

I agree with JayJay .. look on ebay .. there are plenty of timeshare properties going cheap.

now is definitely a good time to buy your international vacation property and get cheap management fees.

I bought two timeshares in the same resort in PA for $1 each. Maint. is about $550 a year X 2 or $1100 year. Since one had a RCI points account I have been able to parlay this into 4 -6 weeks a year. The other I get 2 for 1 weeks with DAE . So 2 timeshares $1100 plus 8 trades at 200= 1600= $2700 yr in fees. /8 weeks = $337 week or $48 day for a 2 bedroom condo in the place of my choice. Not a bad deal