The Timeshare industry has remained strong in today’s world economy. With a market size of US$ 29190 million by 2028, this segment is projected to witness robust growth. This market is expected to reach new heights due to the increasing demand for travel. Also, millennials and generation X are anticipated to contribute a significant share of the tourism sector in the next several years.
A timeshare is a vacation property that is leased by one or more parties for a certain period. Owners receive a 1/52nd interest in the unit. Usually, the owner has the right to use the property for a certain week every year.
A number of resorts worldwide offer timeshares. These properties include a fully equipped kitchen, living room, laundry room, and other accommodations. Timeshares are popular for travelers who prefer a more predictable vacation. But this kind of vacation real estate has faced many problems over the years. For example, timeshares degrade over time due to inadequate maintenance and user traffic. Moreover, owners must make ongoing maintenance payments. And the upfront costs are high.
Many hoteliers have transformed the image of the timeshare. They have changed their marketing techniques to better serve their customers. In addition, they introduced more diversified Vacation Ownership products that appealed to the savvy traveler. However, the timeshare industry still faces many challenges and needs to make substantive changes.
One major challenge for the Timeshare industry is the competition with online travel services such as AirBnB. Another issue is the lack of liquidity. It is important for the industry to compete with the availability of low-cost, online vacations. There is also a need for an exit route for timeshare owners.
Timeshares are typically sold as a right to use contract, which lasts for 30 to 99 years. The ownership of the property is based on a points system. Depending on the type of property and resort location, points are awarded to the owner. As a result, there is a wide disparity in resorts.
The market for timeshares in the United States reached a new high of $10 billion in 2006. In 2007, the ARDA International Foundation published a study that estimated sales volume in the United States to be $ 10 billion. Today, North America remains the largest market for timeshares. Europe and Asia-Pacific hold the second and third positions.
Although the industry has experienced a number of problems over the years, there are reasons to believe that the industry is on the rise. Millennials, for instance, are expected to be the biggest travel market in the coming years. Meanwhile, a new economic recovery may bring about considerable demand for Timeshare products.
According to an ITB World Travel Trends report, millennials will be the leading travel trend in the next several years. Their emergence has contributed to the maturity of the industry.
Despite the challenges, the timeshare industry has a bright future. Fortunately, the industry is well regulated. Developers and exchange companies help users to find timeshares at other resorts. At the same time, governing bodies have helped to enforce stricter rules.