No matter what that slick salesman tells you, vacation timeshares aren’t a good deal. Surprised? Don’t be. Many timeshares owners lose the freedom to vacation wherever and whenever they choose — or even skip one, considering annual maintenance fees averaging $731. Timeshares are also notoriously overpriced to cover sales commissions approaching 35% and marketing expenses for prizes used to lure potential buyers suckers. Maybe that’s why timeshares depreciate faster than new cars; they’re so unpopular, weary owners have trouble selling them.
The bottom line: Most people who bought a timeshare will say they’d have been better off hiding their money in a time capsule. Sell yours now.
Photo Credit: egevad
I bought and timeshare about 8 years ago and it was the biggest mistake of my life. I still have it and can’t sell it but I pay $908 in fees every year. Stay far away from them.
I’m sorry to hear about that, Phil. Hopefully, you’ll eventually find somebody who can take it off your hands.
11 years ago my husband & I bought a timeshare that is points based. I won’t say it was a good investment, but I don’t regret it either.
We stay in much nicer, spacious & comfortable places when we travel with our kids. Maybe it’s spoiling them a little because we recently had to spend a night in a hotel – they were in complete shock that we all slept in the same room, had to get ready using the same bathroom, and couldn’t fathom the thought of not eating a leisurely breakfast made right in our room. It’s also given us the opportunity to give our families & friends some generous gifts in sharing it with them – we gave my sister a week at any resort for her honeymoon, my dad took a second honeymoon to Hawaii, my in-laws have been on several long weekend getaways, next year we’re heading to a four bedroom penthouse in Anaheim with close friends for spring break . . .
I’m not saying any of these situations are reason enough to buy a timeshare, but for any of your readers that have or condemn those that have, it’s not necessarily as bad as others make it out to be.
Fair enough, Melania. I’m glad it works for you!
I’ve never been as uncomfortable as I was during a high pressure time-share presentation.
I would never recommend it, unless you just want to get a lesson in old fashioned salesmanship without any ethics. And no I didn’t buy it.
I sat through one last October with Marriott — and while it wasn’t high-pressure, they were, let’s say, enthusiastically persistent. I mean, I said no about five times and they always had a gentle counter-argument parrying my stated reason not to buy.
I don’t disagree with you, Len, timeshares are a horrible investment IF one is buying them as an investment. They aren’t bad for a vacation bargain but only under certain circumstances, which are…
1) Don’t pay more than a buck or two for a timeshare. I bought two for $2 apiece plus one-time closing costs on each of $199. Each is for one week annually in New Orleans. I’ve used them every year there for the past few years but can trade to other locations if I choose. Which brings me to my next point…
2) Make sure the resort/hotel you buy into can be banked with RCI (or some other trading organization), and that your week is in a good time of year. For instance, I mentioned that ours are in New Orleans. Both are in the Fall — late October and early November. Have you ever experienced a Louisiana Summer? Buy a stay in NOLA in July and you won’t be trading for nuthin’ nowhere.
3) Look at the annual maintenance fees. This is the most important cost factor. Ours are about $500 apiece. You cannot stay in a cheap motel room in New Orleans for a week for that price much less have a suite on St. Charles Ave and the French Quarter with your own kitchen and living room. As for those annual maintenance fees…
4) NEVER EVER NEVER BUY A TIMESHARE IN FLORIDA! Florida has insane property tax rates on timeshares. Just like taxes on rental cars and hotel rooms, Florida gouges tourists rather than residents. They do the same on timeshares. Your home resort passes those costs along to you in your annual maintenance fees. I mentioned each timeshare in New Orleans costs $500/year. Florida would have been $1800/year. You can always bank your week(s) with RCI and stay in Florida without paying FL prices.
I know there will be special assessments at some point on our fees and that those fees will surely increase in time. Hotel/Motel rates will also increase. I consider it a wash. For me, my timeshares are a vacation bargain but they certainly weren’t for the original owners. I paid $2 apiece. They paid $13,500. For each. I bet they wish they’d subscribed to your column, Len!
Thanks for the great tips, Kelly!
Obviously, it’s impossible to get into any detail on these “100 Word” posts and every week it’s readers like you who do a terrific job of filling in the blanks.
We have a timeshare company here in town and they tried to suck us in to one of their presentations with the lure of a free cruise. We said no but that we’d call if we were interested later and got his phone number. Luckily when we got home we realized that the fees to take the cruise almost cost as much as a whole cruise itself! The timeshare industry seems really scammy in general but maybe there is someone out there who feels like they get a great deal from their timeshare. It just won’t ever be me.
Me either, Lance. I prefer to keep my powder dry.
If it feels scammy then it probably is. This is very interesting and I never knew very much about them other than that some friends had bought them in the past. Transparency leads to confidence but it sounds like there are hidden fees, etc. Your insurance for not getting scammed, it seems like, is to stay far away.
My husband I went to Mexico at our friend’s timeshare. Yep, we fell in love with the whole vacation idea and became suckers. After a few visits, and numerous news articles about the drug cartel and the whopping airfare, we haven’t been back. Yea, we can go to Cabo. But, it’s too easy to stay in the U.S. and get more bang out of the buck. Fortunately, or rather unfortunately, we got the every other year deal. So, it’s going to take longer to expire our maintenance fees. If there is a legit way to sell timeshares to those seeking one, I’d love to know how.
Probably the most viable option is to cancel your timeshare and check if any money can be recovered. Even there, there are companies who will -that might be linked to resell scams- that will claim to have experience and knowledge in the in and outs of the industry to help you recover your deposit. Take a look on Mexican Timeshare Solutions website, they don’t charge upfront fees.
Attending a Timeshare presentation is like trying cocaine – it can turn into something bad quickly that will be very hard to get away from.
I had an older couple as clients that could not see past the fact that their Timeshare was destroying their future – even though the math and late payments of other bills were staring them in the face! They were completely sold that this was a great way to vacation and, after enjoying a couple good years with their kids in a Timeshare, they believed it. You can’t convince them otherwise. Very sad.
Time Share Sales! Redweek.com
That sounds like the opening line to a bunch of BS — however, we did just sell our Hyatt timeshare and I got the check yesterday. If you think I’m fibbing, I can tell you I’m THRILLED to have ONLY lost 60% on it. With maintenance fees creeping up to nearly $1,000 a year, I consider getting rid of it, a tremendous relief, and getting a little money back a windfall. That is how terrible a deal they are.
Truthfully, we were able to visit some places that were not generally available to the public, but the cost was crazy-high. And in years when we were short on cash, we could not afford to vacation anyway — after all, the lodging is only one part of the expense, usually about 40% of our vacation cost. So we would not go, and lost out entirely.
And here’s the trick. We priced it the lowest of any unit in the location. We used the Redweek sales to make all the transaction happen. It cost about $1,000 of the sales price to do that — but the albatross is gone, and we have about $3,500 in our pocket.
Funniest thing! That same day when the check came? I got a call from Hilton time share sellers — giving me a ‘deal’ to come to Los Vegas to hear their pitch! They could not have picked a worse prospect — a 15 year Time Share victim. I tried not to laugh too loud… I don’t know if I managed to control myself. 😀
The best of luck with getting rid of yours [I think that having the Hyatt name on ours made it sellable at all] — and if you are thinking of buying one, put that money in a vacation fund, and keep it in your control.
— Lisa
My friends bought a time share in Las Vegas. Very nice building, well maintained, but the maintenance fee was at least $500 a year and no one has ever (even when the economy was good!) wanted to buy this thing! Since they were not able to sell it, they decided to donate it to charity this year. They were then hit with a $3500 transfer of ownership fee! Totally scammy!
OMG, Aunt Jenny! That is absolutely despicable. I guess that’s reason #265,726 why we should all stay far far away from timeshares.
Oh how I wish I read this prior to buying a timeshare several years ago. We tried selling it with no luck. We finally were so frustrated with the maintenance fees and the inability to use it, we tried to give it back to the place we purchased it. Guess what, they wouldn’t take it back without us paying an additional cancellation fee of almost $600. I never wanted it in the first place but thought I would do it for my wife since she lit up when the salesperson did his presentation. We chaulk it up to lesson learned. I very expensive lesson.
Those interested in timeshare as potential investment opportunities should think again. Timeshare owners make money on a sale rarely, if ever. Usually, timeshare purchases end up as money-wasters rather than money-savers because the value of the property depreciates drastically over time. In bad economic times, timeshares can be especially foolish investments since they can often be impossible to give away for free sticking the owner with all the yearly fees.
Great point Len. Timeshares need to be looked up as a purchase and not an investment. Regardless of how timeshares are presented, they don´t perform as well as a house or stock investment. If you look around the resale market for timeshares on websites like EBay, Redweek, or TUGBBS you’ll find that you can buy a timeshare for far less money than what the first owner purchased it for!
I think timeshares can be a considerable option for those who love traveling, but they come with huge financial risks. Besides the initial purchase price and the down payment, there are other fees to consider. Timeshare maintenance fees are the most important charge that the resorts make to the owners.
Time shares have always been a bad buy. But for those who really feel they need one I make one recommendation: Never buy from the developer. Always wait for timeshares to appear on the secondary market, usually at half-price. People like you get excited at the new developments and jump right in, only to become disillusioned later and dump the property onto the secondary market, at a loss, for a patient, informed buyer to take advantage of.
There are good timeshares out there, as well as there are people who feel happy about their timeshare purchases, especially those who enjoy to vacation at the same place and are not spontaneous travelers. Unfortunately, due to the big number of timeshare scams being committed against many vacationers, the industry has gained a terrible reputation.
Timeshares are a purchase and are not a financial or real estate investment. Timeshare is a good investment only if your purpose is to have a place to spend your vacations and not as a financial investment to have a profit.
The truth is that Timeshare scams are increasing, and every day more victims fell for them. Fortunately, there are many solutions to get rid of an unwanted timeshare; however, the best way to dump a timeshare is by cancelling the contract. Timeshare cancellation has many advantages, but the most important is that once the contract is properly cancelled, there are no further responsibilities attached to the resort.
Timeshares have always been a bad buy. But for those who really feel they need one I make one recommendation: Never buy from the developer. Always wait for timeshares to appear on the secondary market, usually at half-price. People like you get excited at the new developments and jump right in, only to become disillusioned later and dump the property onto the secondary market, at a loss, for a patient, informed buyer to take advantage of.
First thing you should know about being a timeshare “owner” is that you don’t own anything. Your suite is owned by the resort. You’re just pre-paying for a rental. It’s exactly the same as phoning any hotel right now and letting them put charges on your credit card in case you ever decide to go there. That’s stupid. If you actually “owned” anything you’d be able to write part of it off when the value goes down. You can’t. It’s not real estate and it isn’t an investment. Timeshares are for suckers. You want to accumulate points or whatever for stays in hotels? Join the hotel’s club. (Starwood etc.) It’s free, and you don’t even need to tell them your name. It’s just a card. You stay, you get points, then you stay for free. Duh.
That’s one of the best explanations I have read about timeshares!
Our household is proud to say we dodged that bullet. Makes no sense.
When you stop and really think about it, Dr. P, it doesn’t.
We bought a timeshare 20 years ago at Smugglers Notch in Vermont. Best thing we ever did. Paid cash. Many family memories there. Within driving distance from our home. Exchanged it sometimes to go all over the country.
Several years ago we acquired another one for free in New Hampshire in the White Mountains. . Love it. Able to stay there when visiting our son who lives about 25 minutes from it.
You have to understand what you are purchasing and how to use it, as they are all different . Do not take out a loan for this kind of thing.
All I can say is we pay less in maintenance fees than staying in a hotel for the week and we have an entire condo at a resort Roth lots of amenities and activities.
I might add that the value of a timeshare is in using it and having experiences.
Also, for our ownership we like the fact that we have fixed weeks where we just show up and have our same units all the time- the one we picked with the views and so on. Its like having a second home without all the costs, upkeep and hassles.
I’m glad it worked out for you, Mary Ann!