The timeshare industry, as you might guess from its name, is an industry that provides vacationers with a time-shared interest in a resort property. Unlike owning a true second home, which requires ongoing maintenance, a timeshare involves a one-time purchase and a lifetime commitment to pay annual maintenance fees and special assessments.
The market is a highly lucrative one. Several recent studies have found that the total value of the industry is around $17.3 billion per year. The American Resort Development Association (ARDA) estimates that the industry provides more than $540 million in tax revenue for Florida, the most popular destination for timeshares, and supports 161,000 full-time jobs.
According to the ARDA, the average cost of a timeshare is $24,140. Owners also pay annual maintenance fees, which can be high. In addition, they are responsible for paying the property taxes of their deeded resort.
Despite all the costs, many owners report being satisfied with their investment. Moreover, the industry supports 540,000 jobs worldwide.
Timeshares are a great way to save money on future holidays. However, they are not always the right choice for everyone.
Consumers should consider timeshares only if they are able to afford the cost and understand how to maximize their investment. They should carefully compare prices between timeshares in the same destination and between different properties within a resort.
A large portion of timeshare owners are Baby Boomers, who enjoy frequent and longer vacations. They have an affluent lifestyle and are typically repeat purchasers.
They also enjoy larger condo-style accommodations with kitchens and separate bedrooms. This product is especially appealing to leisure travelers who seek more space and convenience than is available at the smaller hotel rooms.
The sales process for vacation ownership is a complex one, with consumers frequently swayed by slick marketing and tall promises. They are often impulsive purchases that can be emotional, so it is important for consumers to conduct due diligence before making a decision about buying a timeshare.
There is an industry-wide lack of transparency that is a problem for many people. Most states do not have any laws that require timeshare companies to disclose the cost of timeshares.
This lack of disclosure is a serious issue because it can put consumers at risk. If a timeshare company is selling timeshares at higher rates than they are worth, it could be in violation of the law. This is particularly true in the case of developers who rely on the sale of timeshares as their primary source of income.
Another concern is that many timeshare contracts are non-cancelable and perpetual, meaning that the consumer can’t get out of their contract unless they have paid all of the accumulated expenses. This makes it difficult to sell a timeshare, as the buyer can’t easily recoup their initial investment.
In addition, there are other disadvantages to timeshares, such as the lack of liquidity. If a timeshare is sold, it may not bring the same price that it would have in the first place, because resales tend to depreciate rapidly.