Are Timeshares Good or Bad Investments? Whether you’re a current timeshare owner or not, many wonder whether investing in a timeshare will be a good or bad investment for your future. We’re here to tell you what you need to know about the value of a timeshare, both when you initially buy and for when you’re looking to sell or exit.
Timeshare companies use all sorts of incentivizing methods to attract customers to buy one of their timeshares. Many will approach vacationers with various sales pitches to convince them how timeshare ownership is an investment opportunity. From a financial standpoint, it is not, which is why we encourage you to to learn more about what a timeshare will really do for you.
Options for purchase
A timeshare is not an investment, and will not accrue wealth over time like a normal property purchase. Although this is true, for some customers who have interest in visiting the same location every year, a timeshare may make sense for you. Because so many people look to exit their timeshare obligations every year, it could make sense to look at a secondary market if this is something you’re still considering. If you look on Ebay, there are numerous timeshares that current timeshare owners are willing to give away for free or $1 so they no longer have to bear the burden of maintenance fees.
If you’re still interested in a timeshare but don’t want to use your timeshare every year, there can be options. The most traditional timeshare companies will often require owners to use the property during the same week every year unless there are renting options. Others will offer an every other year program or have more flexibility about when and for how long you can use your timeshare.
If there’s interest in alternate locations so you don’t have to go to the same spot every year, some timeshare companies will offer trades for other destinations. Although this may seem like an attractive option, there will be less control over the timeframe you get to travel and additional fees to cover the switch.
How much do timeshares cost?
Timeshare costs can be sneaky because you not only pay for the price of the actual unit, but you also have to pay the costs of the associated fees. When directly going through the timeshare company, they also have the liberty to dictate your interest rate and payment plans. Secondary options will often give you a better picture of what you should be paying if purchasing a timeshare is right for you. On top of a loan that you may have to pay off, there will always be maintenance and taxes that you won’t originally account for. Annual maintenance fees will vary depending on the unit, but you can always expect to pay upward of $1000 annually.
Timeshares are not investment properties and should be an option that is carefully considered. If you don’t feel that you’re able to keep up their financial burden nor stick with that location in the long term, you probably should consider other options. If you already own a timeshare and want to get rid of your burden, we suggest looking to resell or consider using a timeshare exit company who will work with you to legally exit your contract.