Business has been booming for the timeshare industry, a now $7.6 billion business, the same size as Major League Baseball in the United States. Since the first timeshare opened in Kauai, Hawaii in 1969, timeshare ownership has steadily grown to over 8 million owners.
The numbers don’t lie, and hotels around the world, small and large, are taking notice. Big name resorts such as Marriott and Starwood have already announced new timeshare projects this year, with even more announcements expected to come.
So, you want to get in on the action, but don’t know what to look for when buying a timeshare. In an industry plagued with scammers, high-pressure sales pitches, and endless rumors, how do you know what to look for when thinking about making the plunge into becoming a timeshare owner?
Timeshare purchases are often impulse buys, but that doesn’t mean you can’t shop smart. Here are four of the most important things you should know before buying a timeshare.
Resorts have a lot of competition when trying to get new timeshare owners. Because of that, and the nature of a timeshare purchase, hotels have resorted to high-pressure sales pitches that leave participants drained.
Like any piece of real estate, timeshare prices can be bargained. Never buy a timeshare for the first price offered and don’t be afraid to haggle, whether working with a resort or resale company.
Buying a timeshare resale is a great way to go. You’ll often get the best deal when working with a resale company than through the hotel or owner directly. And in an industry where timeshare contracts can be full of confusing language, it’s good to have a timeshare real estate agent on your side to help negotiate the deal.
2. Know What You’re Buying
There are three important questions to ask when deciding on a timeshare. First, you’ll want to know whether you’re buying a deeded property or a right-to-use ownership. Most properties in the United States are deeded and work just like any other property, you can rent it out, pass it on to your heirs, and get foreclosed for defaulting on payments. Properties outside of the country, such as in Mexico or Aruba, are often right-to-use ownerships which will expire at a certain date and are subject to the country’s property laws.
Second, know your right to refusal. Because of the timeshare industry’s reputation for scams and high-pressure sales, many states have combated that with legal protections that allow the purchaser to back out of the buy within so many days. Make sure to read the verbiage pertaining to your right to refusal in the contract and keep all correspondence in writing if you decide to back out of a deal.
Finally, learn the trade and exchange intervals for your property. Most properties can either be traded for points that can be used at a different time or resort, or can be exchanged for time at another resort. This is one of the many perks to timeshare ownership, but the rules can be tricky. Make sure to ask your timeshare real estate agent the best way to trade or exchange your timeshare.
3. Know Your Investment
Timeshares are not a real estate investment. Although possible, timeshare properties aren’t likely to increase in value. And often, when the time comes, timeshares are resold for a loss. However, there are a number of advantages to owning a timeshare that make it an investment in vacations, rather than real estate. Timeshares guarantee vacation time and often have accommodations such as kitchens and washing machines that regular resort rooms don’t have. These amenities make it easy to vacation with family and friends regularly, which make timeshares a valuable investment in fun and memories.
4. Beware Timeshare Scammers
Although a number of laws have been passed, scammers have been jailed, and legitimate businesses have sprung up, timeshare scams still run rampant in this industry. It’s vital to protect yourself and your loved ones from timeshare scam artists.
The first and most important rule to avoiding timeshare scams it to NEVER PAY UPFRONT FEES. You should not have to pay to advertise or sell your timeshare. Finding a timeshare resale company, like Premier Timeshare Resale, that doesn’t charge to post a listing or sell a timeshare is the best way to sell your timeshare.
Also, never give out your information to cold call companies that promise above market deals with an anonymous buyer. That’s the most common tactic for timeshare scammers and can easily be avoided. Do your research when looking for a timeshare company. Make sure their agents are licensed real estate agents and that the company appears on the Better Business Bureau website.