It happens to everyone. You're enjoying a wonderful time on vacation and curiosity — or the promise of a free gift — leads you to attend a timeshare sales presentation.
Trust me when I say, timeshare salesmen are great at their job and they'll have you wondering, 'should I buy a timeshare' five minutes into their pitch. That's why the industry has just come of out its ninth consecutive year of growth.
Truth is, there's no reason why you shouldn't buy a timeshare as long as you follow these guidelines.
1. What Is Timeshare?
Timeshare is a simple concept where you share ownership of a desirable holiday unit with 51 other people and take turns using it.
Most often you'll purchase a fixed week which you're entitled to use at the same time every year. Usually, the purchase price of this week works out far cheaper than renting the same week year after year.
Timeshare is forever, so you'll still have to pay for your week's vacation whether you use it or not. This doesn't suit everyone, but there are alternatives which we'll look at in a moment.
2. Buyer Beware
It's an unpleasant topic, but like all commission-based employees, timeshare salesmen come in good and bad varieties. Some of them will tell you anything to swindle cash out of you.
There are thousands of horror stories about these unscrupulous people, and your best defense against them is to stay informed. Remember, the concept of a timeshare isn't bad, but it's not as affordable as these smooth operators would have you think.
Ask plenty of questions during your presentation, especially with regard to how much you'll be paying over the years. Insist on facts, not approximations.
It's true that a timeshare week will save you thousands in your lifetime, but unless you can afford to holiday every year, that's irrelevant.
3. Study the Fine Print
Most states insist the buyer gets a generous cooling-off period once they've signed a timeshare contract. Go through the cancellation clause of your contract and check how long you've got to change your mind.
Then sit down and think about it carefully. Owning a timeshare is like owning a second home. Initial timeshare prices don't include the cost of maintaining your apartment over the years.
You'll have to pay a monthly cost to keep the resort running smoothly as well as the cost of regular upgrades. Unlike a holiday home, you'll share these costs with 51 other owners which is one of the major benefits of timeshare ownership.
Remember, these costs are bound to increase over the years, so bear this mind before you sign on the dotted line. If you're in any doubt as to the affordability of owning a timeshare, cancel the contract.
4. There are Good and Bad Timeshares
You wouldn't buy a house in a low-demand area that's in a steady decline, would you? In the same light, don't buy a timeshare in a place where nobody wants to go, or where the future looks a little grim.
To make the most of your purchase you need to know how to get a timeshare to work for you. One of the ways to do this is to rent it out to other vacationers. Make sure you buy in a place where you and your guests will want to go for years to come.
Avoid buying a timeshare off-plan. Like many real estate developments. some timeshare resorts never get past blueprint stage or fail to deliver on promised amenities.
If you've got your heart set on owning a timeshare, leave the sales presentation, go home and do some research first. There are thousands of timeshare resorts to choose from, rather look for your ideal one than succumb to the first sales pitch you hear.
5. Know Your Exchange Options
As much as you're in love with your current vacation destination right now, how are you going to feel about it in 20 years' time? People's circumstances change and when you're older without children in tow, you may want to holiday somewhere different.
Investigate the option to join an exchange club, so that you can see more of the world as your interests change. Most timeshares offer the option to swop your week out for a similar one both locally and abroad.
In most cases, you can even save up your weeks to enjoy less frequent, longer stays at sought-after destinations.
6. Timeshare Isn't an Investment
There are thousands of timeshare weeks available for sale at any given time, and new developments crop up all the time. Thus, timeshare has a very poor resale value.
They're also notoriously difficult to sell, even at rock bottom prices. The best option for an unwanted timeshare is to trade it in with a points organization.
These clubs assign a number of points to you which you can use at other locations. This is a more flexible option than exchanging your timeshare on a week-for-week basis.
There are still costs involved, but it's easier to recoup these with rentals when you have more variety to offer.
7. Know the Law Before You Buy a Timeshare
Familiarise yourself with any iniquities regarding the law where the timeshare's based. For example, Hawaii has a unique legal system based on both Western law and local customary law, read on here.
No matter where you're based, property always falls under the law of its own locality, and timeshare is no exception. So, don't assume you know your rights.
Get More Vacations
Timeshare and points-based vacation clubs can yield exceptionally good value for money if you know how to use them correctly. Yet they aren't suited for everyone.
If you prefer to travel at the drop of a hat and explore off-the-beaten-track destinations, you probably shouldn't buy a timeshare. Rather, head on over the travel section of my blog for some inspiration.