(800) 647-4130

Timeshares Still Not An Investment? Simply Not True.

Published

An interesting article appeared in my RSS feed recently; making the claim that, according to "legal experts," timeshares are still not an investment. Having spoken to thousands of owners about their timeshares, I have to take issue with this perspective. Timeshare itself can be hard for even experts to quantify, and the view that it is simply "not" an investment is not only an oversimplification; it can pose a danger to timeshare owners' interests. At the core of this issue there are actually two separate arguments:

  1. In the past, timeshare developers have come under fire for allowing/ignoring sales reps who "pitch" investment potential to consumers. The idea being that buying timeshare is akin to buying whole ownership real estate, and that the owner should expect the timeshare's value to rise dramatically over the years. Fortunately today, this practice has been largely eliminated (at least in the U.S), and developers now make clear that timeshare is an investment in vacations, not a financial one.
  2. The secondary argument is more subtle: Timeshare itself is not an investment, should not be considered real estate, and costs of ownership will soar unchecked in perpetuity. Sadly, this argument seems to be gaining ground with myriad disenchanted owners, who find selling at a fair price can be difficult in the current market. There exists a real danger that, if enough owners believe timeshare is not an investment and act accordingly, this idea could become a self-fulfilling prophecy; leaving timeshare in the "ash heap of history." (Along with over $100 Billion of Americans' hard-earned dollars.)

Just what constitutes an investment anyway? According to the Merriam-Webster Dictionary, an investment is

"the outlay of money usually for income or profit: capital outlay; also: the sum invested or the property purchased."

Even the developers agree that timeshare should not be bought "for profit," but timeshare does involve a "capital outlay" and is a "property purchased." Thus, I think it safe to conclude objectively that timeshare is, by definition, an investment. As such, it carries with it both rights and responsibilities: You have a right to use your timeshare during the designated time period, and you have a responsibility to pay for the maintenance of your timeshare property. Beyond these basic concepts, you have a right to expect to recoup a "fair value" for your timeshare when you decide to sell, and you have the responsibility to ensure your resort is properly managed - including closely monitoring increases in your maintenance fees.

Ironically, the thing timeshare owners must do to protect their investment, is the very thing denying timeshare is an investment discourages: Take Ownership of Your Timeshare.

Like it or not, if you own timeshare, you have invested in real property. It will not go away; you will pay property taxes, you will pay maintenance fees, you will pay to insure your property, and you should attend HOA/POA meetings, you should take an active interest in the operations at your resort. Protect your timeshare investment as you would any other - and be leery of headlines that begin with "Legal Experts..."

Submit your comments and feedback!Sell your timeshare with us!Buy a timeshare!

80c06ab93718dca46724477def9fee7d85fe3e5a

80c06ab93718dca46724477def9fee7d85fe3e5a