Affordable Travel Guide to Timeshares

Partial Ownership if You Vacation on a Schedule

Timeshares

Like most forms of accommodations, there are pros and cons to the concept of timeshare resorts and facilities. The idea was generated in the early 1960s in the United Kingdom, and was designed for sharing between four (possibly connected) families. In the first year, one of the four would have the timeshare for, for example, the summer season, and the next year for the fall, and so on, but savvy developers in the U.S.A. soon flipped that idea to see a timeshare jointly owned by not four families, but 50 complete strangers. Once it became a business and not just a compatible arrangement, the price skyrocketed.

Timeshares are not unlike housing exchanges (see that category on this website), but the differ in many other ways. There is an exchange involved in that you may be able to swap your timeshare in Mexico for someone else’s unit in Italy, but otherwise the system s based on sameness, not flexibility. Timeshares are normally regarded as resort-based condominiums, and as such they tend to be located in typical vacation spots around the world. Among the most popular locations are:

  • Mexico
  • Japan
  • India
  • Thailand
  • Europe

Many are located at beaches, but not all, and because a number of people who purchase timeshares do that from paper, and not in person, there is some risk.

How Do Timeshares Work?

A person buying a timeshare unit typically is involved in what is known as a “fractional ownership” deal. The purchase is regarded as a real property transaction, and the owner is liable for property taxes (these are commonly paid for through the condominium maintenance fees). Another 49 to 51 people also buy into the same unit. Each buyer gets the use the unit for one week per year. This works well if, for example, you always take the first week of July for your holidays, and if you get in early enough that that week at the timeshare belongs to you. This is known as the owner’s “allotted period”, and in the early days of timeshares, it was seen as grossly unfair; the first people to purchase the time share unit got the best choice for their week.

Because of that, many timeshares now offer one of three options:

  1. Fixed week. You get the timeshare condo for the same week every year (which works for some people).
  2. Floating Week. You get to bid for which week you want each year. Also a bit unfair.
  3. Rotating or Flex week. You get the unit for week 26 one year, week 27 the next year, and so on.

What if You Can’t Get that Week Away?

There are plenty of options for people who have firmly booked week 32, for example, as their official “usage time”, and find they are unable to stay. Timeshare owners have the following options if they don’t have the time to share:

  • rent it to a third party
  • gift it to friends or family
  • forfeit the week
  • offer to swap your week for another timeshare week owner at the same facility

Timeshares can also be exchanged between countries. If your timeshare is in Mexico and you want to vacation in Japan, you may apply to exchange your timeshare through the company that manages the resort. Sometimes it works, but sometimes it doesn’t; it’s based upon availability. It’s almost always preferable to rent out your timeshare if you can’t use it yourself, and that’s what we’ll offer in our timeshare articles and posts here on Affordable Travel.

Timeshare condominiums are widely regarded as being over-priced for purchasers. Let’s say that a normal fully furnished and equipped condo might cost $200,000, and you divide that by 50 owners, which equals $4,000, but you still have to pay perhaps $10,000, it seems like gouging on the part of the developer (and a few of them have been thusly charged). Plus, they are very hard to sell, unless you have the prime fixed week for that location, and the location is coveted.

Is a timeshare the right form of vacation accommodations for you? It might be if you opt to rent or lease rather than own, and those options are now available. They are full condominium units that can sleep from two to six people, so they may be less costly for a family of six than would be paid for a hotel room or rooms.

Always involve a real estate lawyer when you purchase a property, even a timeshare. Go to the location before you buy if at all possible; try not to buy from floor plans and site pictures. Our best advice? Don’t buy a timeshare unless you are set on your location and date for a week-long annual holiday; there are plenty of them available for rent!

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