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Determining resale market value (by Mike N.):

patrickd79 wrote:

What I was getting at is that I currently rent a house in the same area. I am trying to determine if buying a timeshare there makes financial sense versus just renting. If the cost of the rentals would exceed the purchase + maintenance fees after a given point it may make sense to just buy. I am wondering if there is a realistic timeframe in which that break even point should occur.

Ken’s response laid it out pretty well. Timeshare maintenance fees are all over the map. They can range from a few hundred dollars to over $1000, but my uneducated guess is that MFs average around $600-$800/year which is probably less than renting a house for a week. However, if you're renting during the off-season, you could probably rent a house for less than the cost of MFs (I’ve seen summertime house rentals in Florida for under $600/week). In addition, there can be unexpected special assessments that can be thousands of dollars. Personnally, if I’m renting a house for less than $1000/week I’d probably stay with the rental and avoid the potential headaches of a TS.

Now to the purchase price... Unless you are buying a resale such as Marriott, that has a Right of First Refusal Clause, you can buy a TS for literally pennies. Even if you spend a few thousand dollars and amortize that over 20 years, it only adds a $100 or so per week to the overall “cost”. Marriotts, Disneys, etc, are going to have a higher initial price tag.

Finally, if you buy a TS and the time comes where you no longer able to use it (or the fees get too high), it may be difficult to sell or rent; you still have to pay the fees. If you’re renting a home and for any reason you are no longer happy with the place, you can just walk away; there are no financial obligations.

So here’s a few questions... Where are you currently renting? Are you renting in a community that provides a lot of perks (golf, tennis, etc)? Are you renting in a high demand area and peak season where rents are HIGH? How big is the house (2 BR, larger)? How much are you paying for rent? If the current house owner decides to stop renting, how difficult would it be to rent a different house?

Take Ken’s advice and search the TS listings for the area in which you are interested (be advised that the MFs listed might not always be accurate).

Hope this helps a bit more