Why Buy a Timeshare?

I don't know why anybody would buy a timeshare! They are too readily available from all of the gullible people that bought them and are now renting them out to recoup their annual maintenance fees that just keep escalating year after year. Even if you get the timeshare for free, the maintenance fees are not much less than what you can find a rental for. About 9 years ago, my family was wanting to stay at the Pueblo Bonito Rose in Cabo San Lucas. The resort was sold out, and I wasn't able to book a room at the resort. The friends of ours that had invited us, suggested that I look online for owners that were renting their week out. My friend had spent about $2700 for the week for their room through the resort, so imagine how tickled I was when I found a 28 year contract being sold online for only $4500! Just 2 visits and the purchase would be be worth it, I thought. So instead of renting, I bought the timeshare. Well first of all, it took me 2 years to figure out that I needed to book an entire year in advance other wise oddly enough, there was never any availability! Next, my annual maintenance fees are over $700 per year. I can find online, day in and day out, people renting their Pueblo weeks for about $1,000 per week. Unless I want to repeat my vacation to the same resort year after year (which I don't), I have to pay an additional fee to EXCHANGE my week. Which it took me at least a year to figure out the ins and outs of EXCHANGING. Not to mention, I also pay to maintain an RCI exchange membership. The headaches and longterm obligations of a timeshare is not worth the headaches. Trust me, there are endless options to just renting. Don't fall to the temptation of purchasing a timeshare.

I agree with the above post .... why buy a timeshare and be saddled with maintenance fees and possible special assessments when there are thousands of timeshares for rent.

timeshare is not for everyone and obviously you did not know what you were getting into if it took you years to figure it out. I would never suggest someone buy first, figure out how it works later.

We know exactly how ours works and studied the market beforehand to get a great deal. We have had many great vacations in fabulous locations at rates much lower than public can get.

just because you couldn't make it work for you does not mean that it can't work for others.

While cheap rentals are plentiful this year, I do not believe that will continue when the economy turns around and unemployment plummets. Owning allows me to go where I want, when I want, without having to have someone else make it available for me to rent or exchange into.

Everyone needs to do what's right for them, and timeshare fits us extremely well. ymmv

I would agree with you that what works for some may not work for others. I would also agree with you that I was unschooled on timeshares when I first got into mine. However, nearly 9 years as an owner, I now can speak from experience as an owner and as one who has rented. Over the years, I have rented no fewer than10 different timeshare condos at some very desired destinations. During that time, our nation (and world) has experienced one of the best economies and worst in recent history. However the timeshare market from a renters aspect has stayed virtually unchanged. Ive paid $1400 for the same type of room and resort year after year (including this year), for the past 8 or 9 years. So why would you expect that to change since it was just a couple of years ago that we experiencing a strong economy?

Not to mention, by renting, I have the ability to select from far more resorts than what my exchangecompany limits me to. For me, and many others I suspect,its much easier and less expensive to rent than to maintain and ownership and exchange membership.

After 9 years, your deed should be paid for. If you can rent that week out for $1400 and only pay $700 in maintenance fees, I'm having a hard time seeing the cons of ownership.

Buying from the company may sound like a bad idea, but buying resale, then renting... sounds like a good deal to me.

Timeshare is really best utilized by people that want to stay where they bought year after year. I own in a network and I pay my fee and use my points at any of their locations. that's it. no more out of pocket.

no caring about rack rate, special events, possibly hotel taxes/local hospitality fees, reviews, any of it. I book, I go. or put it in someon elses name for them to go. I don't have to worry about getting scammed, sending money to someone I don't know.

no searching the internet for hours, communicating with tons of people over weeks of comparing reviews and locations and on and on ... it just takes too long. If I want to be on the beach in wherever, I don't have to worry about resort quality, I know what to expect.

I guess I bought convenience of making trip plans short notice and well in advance. instant access to a ton of resorts with discounts on much much more. Best part, I always know how many points something will cost, as far in advance as I want. taxes, inflation, it's hard to say, it's all a crapshoot. that I don't have to care about.

this works for me, forces me to vacation. I've lost a ton of friends and family over the years and all I've ever wanted to do was see the world. My job did not provide that, so, I bought into a way to do it, and we are. Motel 6 pricing. Consistently. It's partially my stress relief, partially family reunion, friends gathering, blah blah.

My ownership gets me into more things, too, at significant discount on non-timeshare experiences, from camping to yachting. Being an owner can have advantages in paying well below rack rate in many areas if I do have to have a hotel. Dublin, for example. Rack rate would have been over 300 euro but using my points I paid more like 190e for 3 nights. DUBLIN. no tax, no surprise at check out.

That's why I own. Pick up and GO. We have no kids so are not on the "see the family every year at ____" deal.

And I'm not so sure that you are correct about the rental market. I have not studied it in-depth but have rented out my ownerships. You're right, I haven't changed my asking price. I found the sweet spot and hang there. Going higher decreases contacts, going lower increases "flight traffic" (buzz-by casual inquiry, move on).

Plus, it is all heavily dependent on place and season, resort quality, yada yada. Try to go to Boston on 4th of July. Bike week, sporting events/training camps, conventions, beach season, mountains ... Vegas. demand has also risen in some areas, not in others as the recession took its toll. A lot of seasonal markets really have a low offseason rate naturally.

Supply of rentals is way up, absolutely, but I don't think that prices have remained stable everywhere for very long. If there is analysis like that, I'd be very interested in seeing it. I am not being sarcastic!

also, not trying to convert anyone, just trying to provide perspective on the financials from ownership.

Do you have any suggestions regarding the benefits of buying directly from the companies? I've been noticing the Marriotts point system; I attended 2 of the meeting at the Marriott Grande Chateau in Las Vagas; they were a bit pushy (yet polite). Does the premium cost pay off in the long term if you can rent your timeshare for more than the maintenence fees and still accrue points over the years for infrequent BIG trips?

It is not worth it because you can buy the points between you and your spouse and it would be cheaper than paying the extra thousands you would have paid for it by buying with the developer. It used to be worth it when they gave you many more points when you bought from Marriott. However now, they have devalued the points and you don't get as many.

We bought ours to use, not trade. We were also under no illusions regarding appreciation etc.

We viewed it like buying a car or boat, bought "used", an expense but one to enjoy.

The market rate for rentals is at least double the maint. fees and it's a fine place to visit.

So for us, so far, it works.

Paul, Charles,

I'm new to this forum, but regarding the rental fees...it looks like the rates are quite variable. Some appear to be under the average maintenence fee in a typical 2BR suite. based on me glancing the rental adds for Marriott's Grande Vista in Orlando, it looks like a renters market here presently.

If the Marriott points have been undervalued and it's not worth it to buy from the developer, and the rental rates are as variable as I've noted, then I see no advantage in buying from either owner or developer at this resort currently. Please comment...

Everything is relative. It all depends on why you wish to buy a timeshare in the first place. Yes, maintenace fees are higher than rentals currently and the MR points have been devalued. However, if you are visiting Grande Vista because you love Orlando and its activities and attractions. You see yourself coming there regularly because Grande Vista is a very nice resort. Tht is why you buy.

As an owner you get to determine when you want to go there and not banking on someone maybe having it available when you want to be there. Also, you can determine if you want the one bedroom or just the studio or maybe you may want two weeks instead of one. (I say this because Grande Vista has lock-offs).

You really need to know what is best for you and your family and what your plans are. Personally, I would look and see what kind of changes Marriott implements before I would make any purchase. Think that would be prudent to wait and see so that you cansee fi you want to even participate in their new system.

"you want to even participate in their new system. "

I've received nothing about the "new" system from Marriott so can't comment on that. Our T/S is at the Maui Kaanapali Marriott (not the new buildings) and certainly the one time we've traded it we got exactly what we wanted even a much larger unit so maybe there's truth in "Maui Power" !

Never buy a timeshare--new or resale. The maintenance fees are not worth it. We own Marriott Ko Olina and it has been a disaster. $1600 a year in fees--$200+ a night for our 7 nights. If you paid $30K for the TS, add another $1K per week ($143/night), assuming a 30 year ownership period. Now you're at $343/night and they have use of your $30K upfront. If you have the $30K cash up front and serious discipline, put it in a fixed income security. Also, contribute what your maintenance fees would be into this investment. If you earn 1% per year (after taxes) over 30 years, that $30K and annual fees would be worth $96,301.26

At the end of 30 years, the TS would cost $126,301 (assuming you paid all cash). A loan would cost even more. If you went to a 5 star property and paid $500/night (including tax, so about $450+taxes) for a 7 night stay over 30 years, the cost would be $105,000. And you get complete flexibility of where/when you stay. If you will down your property, the recipients must be in a position to afford the fees as well. There's some time value of money to factor into the pay as you model, but it still would be less than $126K. Further, by renting from us, you can considerably save, as rentals go for a lot less than $500/night.

The ROI is negative. Renting the unit is useless, as offers are less than the maintenance fees. With thousands of desperate owners willing to rent their units for a loss, you're better off exploiting us poor owners.

I looked into Donate For a Cause and as others have stated, it's not like dropping off old clothes at the Goodwill on December 31st. They have to want your unit and if they accept it, it will be a distress sale and you might get 5-10% of what you paid for it they said. So a $30K unit might be a $3K tax credit--if you're lucky. They know the vast majority of donors can't afford their maintenance fees and want out.

Wow, how very depressing! Consider this. Give up your $5.00 per day Starbucks habit (or whatever your vice is) and save the $5 and once a year invest the $1,825 at 5% and in 30 years you will have $122,028 or even more if you consider the leap years during the 30 year period.

Actually, most who buy timeshares do not do so as an investment but for the vacations. The memories I have over the years vacationing with my children and now grandchildren are priceless and I know from observing the practice of others that I would not have had these vacations had I been required to find a suitable rental each year. To each his own. As for me, I prefer the priceless memories.

Bruce, you suggest the donation of a timeshare orginally costing $30,000 to a charity might yield you a $3,000 tax credit. I think you are confusing credits and deductions. A credit reduces your tax by an amount equal to 100% of the credit whereas a charitable deduction of $3,000 assuming a tax bracket of 35% reduces your tax bill by only $1,050.

Wow, Carvana, you took my post way too seriously. My facetious point was to show that with a tiny 1% return after taxes, you're better off with a pay as you go approach. I thought Madoff was locked up, as I'm not aware of a fixed 5% rate of return after taxes.

We did not buy our TS as an investment either. We were sucked into the ROI pitch, as we did not want to spend $500/night. It turns out we're spending that anyway and have a very inflexible vacation vehicle. We also liked the "forced" vacation concept, where a TS makes you go somewhere every year versus procrastinating and end up driving somewhere local or staying home. But it was not worth it for us. Our memories are just fine taking vacations that don't siphon our bank account.

No idea why you had to go into a deep tax analysis and to call me confused. Again, my point was a $30K purchase price turns into $3K. And yes, at tax time, you'll only see 1/3 of that $3K as a reduction in your tax liability.

The point of this forum is to say pro or con on buying a TS. You obviously didn't like my response and went on the attack. Don't reply back, as I know where you stand.

Timeshares can be a waste of money and are not even easy to get out of. It can be impossible to even give it away, which is scary for many people. I certainly am concerned about willing this to my kids, as who knows if the TS will end up being a nightmare for them.

Bruce,

You did not include that you could take 2 weeks in Hawaii instead of one. I have a two bedroom lockout. I have stayed in Hawaii for two weeks with my maintenance fees. That breaks it down to $110/day in that the maintenance fees are actually $1550 for the year right now. Our if you don't need both sides, you could do what some smart people do and rent out one side and stay in the other. That is another tip. Or you could rent one side and use the other side for a different local. In any event, knowing how to use your timeshare is key. If you are going by today's market, yes you will see more rentals that are cheaper, but heck the stock market has gone down too. The rates on stocks aren't what they used to be. We will see how things are when the economy recovers. In the meantime I would suggest that you explore ways to get the most out of what you have. I love Ko Olina and I go pretty much every year. It is a great place to visit all of the time.