Have you ever gone to a timeshare presentation only to be greeted by high pressure salesmen and overwhelming sales techniques? Did you end up buying one or possibly taking your free gift and leaving vowing never ever to go to such a presentation again. You’re not alone. Thousands of people attend timeshare presentations all over the world each year. And business is booming.
Timeshares are a great way to take a vacation. A set period of time (usually a week) is marked off at the resort of your choice. Some programs have a fixed week others have a “floating” schedule. The purchase price gives you ownership of that time period and selected unit. Let’s say you purchased a one week/year property. You own 1/52nd of the unit (one week) and you are responsible for property taxes and maintenance on the unit. Let’s say the purchase price of the unit is $10,000 and the maintenance fee is $500/year. The property taxes will probably be 2% of the purchase price ($200) and the transaction will require a escrow fee (usually $700).
The initial cost to you for that week’s vacation in paradise will be $11,400 divided by how ever long you keep the unit. Let’s pro-rate it over a 20 year period. The total cost will be the $10,000 purchase price plus $10,000 in maintenance fees, plus $4000 in property taxes, plus the original $700 escrow fee or $24,700 or $1235/year. This is how much a week will cost you in paradise. The cost will be higher if you finance the purchase price.
Let’s take the same unit and show what it would cost to purchase the unit as a resale. Timeshares depreciate rapidly and are NOT a good investment over time. This same unit will probably resell for $3000 at the end of the 20 year period. If we do the same math the resale unit will work out to $865/year pro-rated over the 20 year period. This is a much more reasonable price for a week’s vacation. And you can purchase a resale without the hype and pressure of the usual timeshare presentation.
Timeshare resale’s can be an incredible bargain. We picked up a one bedroom unit on the beach in Ventura, California for $1500 at a timeshare auction. The unit has just been refurbished and everything is like new. The yearly maintenance fee is just over $500 and we couldn’t be happier. We have seen units reselling as low as $500. The secret is to find buyers who need to sell them to get out of paying the maintenance fee.
The great thing about owning a timeshare is that you can exchange them for other timeshares all over the world. Exchange companies such as RCI and Platinum charge a small fee for the transaction and sometimes have a membership fee. This is a great way to get a bargain vacation at a different place every year.
Here are some popular links that will show you the great value that can be found in timeshare resales and the popular exchanges that let you vacation a different place each year. You’ll be amazed at the great bargains that can be found at a Timeshare auction.