Why You Shouldn’t Purchase a Timeshare

by Jessica Sommerfield · 16 comments

Timeshares are vacation properties that several people share partial ownership of — usually over a time span of about 25 years. They’re typically located in exotic locations that are popular tourist destinations.

Starting in Europe in the 1960s, the concept of timeshares spread quickly to the United States. They became a huge trend with seasonal vacationers who liked the idea of “owning” property in an exotic area for a fraction of the price.

Today, timeshares are generally sold through high-pressure sales presentations that present them as a more financially responsible way to vacation.

In case you’re thinking about purchasing a timeshare, here are some things you should know before you sign.

4 Reasons You Shouldn’t Purchase a Timeshare

1. In addition to purchase price, timeshare ownership requires costly maintenance and other hidden fees.

During a timeshare presentation, the salesperson will show you comparison pricing between taking a traditional vacation versus owning a timeshare. Without taking into account yearly fees (which can usually be added without warning, per the purchase agreement), the numbers may seem to favor timeshare ownership.

But, just because you only use the property for a few weeks a year doesn’t mean you’re not jointly responsibly for the property’s maintenance, including any renovations, repairs, utilities and other hidden fees associated with property ownership. Timeshares are usually located in areas with high costs of living, so maintenance fees may run higher than average.

2. Transferring your timeshare to different properties isn’t always easy or cost-effective.

One selling point for timeshares is that if you get bored with vacationing in one spot every year, you can transfer your timeshare within the resort company’s network of other locations. This may seem appealing at first, but transferring to other locations isn’t as easy as it sounds.

You may have limited choices based on the times of year you want to vacation and the terms of your contract. It also may be difficult to find openings at your desired location, and, at the very least, it will be a greater hassle and expense than you’re prepared for.

3. Timeshares aren’t wise investments.

A good investment is one you can get more out of than you put in. The property values of timeshares decrease rapidly, and you’re seldom able to sell a timeshare for a profit. Contrary to the selling point that a timeshare will “pay for itself,” you can end up spending more in the long run than you would have by taking traditional vacations.

4. Timeshares are difficult, if not impossible, to sell.

The timeshare property market is highly saturated. Since they’re not in demand, timeshares are difficult to sell — unless you’re willing to take a loss. Enough people have had bad experiences with timeshare purchases that they’re not interested in ever purchasing one again.

While unable to sell, you’re still responsible for paying maintenance fees. Timeshare companies themselves are rarely willing to buy back your timeshare, since they’ll be losing income. If you’re stuck with a timeshare, your best option is to try to rent it out to cover your costs until you’re able to sell.

While appealing at first glance, timeshares aren’t a wise financial or lifestyle choice for most people. You’ll be better off carefully saving for and planning a vacation you can pay for outright. So, the next time you’re sucked into a timeshare presentation, remember these points and keep yourself from getting tied into a potential money pit.

What’s your experience with timeshares been like? Positive or negative?

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{ read the comments below or add one }

  • 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 will find that you can buy a timeshare for far less money than what the first owner purchased it for.

  • Buying a timeshare under the impression you will save money on the long run on travel expenses such as airfare or cruises equals to being a victim of timeshare fraud. Timeshares will barely provide you a small discount on accommodations and that’s it. Timeshares will not provide you, in most cases, any discounts on your vacation expenses.

  • It is very important to take into consideration that time shares should never be considered as an investment, but only as a purchase. An investment means the possibility of financial growth and resale, and no one is likely with time shares.

  • Timeshare industry is known for being very susceptible to scams. Year after year, thousands of people around the world feel they were scammed by a timeshare developer. The reason why fractional ownership is successful, it’s because shared properties have become a tremendously profitable way for resorts to sell real estate- mostly suites in important touristic destinations. On the other hand, despite the success, timeshares have gained a bad reputation.

  • The timeshare industry keeps getting a bad reputation, and yet there are many people who still pay thousands of dollars for them. In fact, time shares are one of the top sellers in the hotel industry; however, that doesn’t make them a good purchase.

  • Melanie Brown says:

    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 will find that you can buy a timeshare for far less money than what the first owner purchased it for.

  • Timeshare fraud has been around since the timeshare idea was created, but they increase during poor economy. When times are difficult, timeshare owners are stuck with properties they can´t travel to or even afford. Desperate to recoup some money to pay for bills, they can easily become victims to scams artists pretending to be their timeshare salvation who will take upfront fees -as much as five number figures in some cases- but fail to fulfill their promise.

  • tivener says:

    Put it on ebay with no reserve and start it at $.01 Someone might just take it off your hands…..

  • dojo says:

    I wouldn’t like the idea to be ‘restricted’ to a vacation spot only. If I’d get a timeshare, we’d vacation there only, so that we don’t feel like we have wasted our money. We like to travel a lot and also see different places. Even 1 month abroad cannot be that expensive, if you know how to find an affordable location and plan accordingly.

  • daisy says:

    Do you have any suggestions on how to dispose a timeshare? I’ve tried selling it even below my purchase price but there are no takers.
    Appreciate your help. Thanks.

  • Jay says:

    No one in their right mind buys a timeshare as an investment.

    I bought into the timeshare at Disney as a way to force me to take vacation…The points are use it or lose it. There is sufficient flexibility in the points system to allow for a varied vacation experience across the years. Over time I will save money compared to what i would have spent at those resorts if i had paid cash( An artificial and unfair comparison, BTW). I spent 20 years coming up with excuses why NEXT year was a better year to take that BIG vacation. I violated the fundamental rule: Pay Yourself FIRST!

    NOW, We plan our vacation several years in advance in order to take advantage of all that time share have to offer.

    The Investment is in yourself and your family…..and I am Liking the ROI!

  • I really like the idea of a timeshare, but it never seems to work out how you expect. I purchased one that i assumed i would use quite a bit, but me and my family rarely if ever use it. It is absolutely a waste of money for me. But i did learn a good lesson out of it.

  • lee says:

    We have a property share, not the same thing as a timeshare at all. Google ”property share” for details of the companies out there.
    We have been more than happy with our choice and have had some fantastic holidays in different parts of the world. We have consistently saved money on tour operators prices and stayed in better quality accommodation.

    We look forward to more frequent holidays in the future now that we are not restricted to school holidays. It is based on a points system and more points are needed during school holidays and less points at other times, less points used each time means more holidays. Also you only pay a charge (called a user charge) if you actually book a property, no holidays = no charges.
    Definitely a winner for us.

  • Unfortunately, many timeshare companies are not serious, there are some serious including the 3 major known timeshare companies and they are Sheraton, Hilton and Marriott. It’s cheaper and nicer to book new holidays today and various parts of the world without timeshare.

  • Timeshares are generally poor investments but can be useful for vacations if you play the game properly.

  • Michelle says:

    I would never buy one. They don’t seem like a good investment at all.

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