Timeshares have existed in some form or another since the 1960s, gaining in popularity during the 1980s and 1990s as an alternative to the typical package holiday deal that was on offer by travel companies.
This popularity is still ongoing, with around 600,000 Brits owning their own timeshare and around $10 billion of timeshares sold each year in the US.
However, in recent years, timeshare companies have come under a lot of fire for exploiting consumers, with the industry as a whole inundated by scams. As a result, of these 600,000 British owners, around 250,000 would now like to sell these timeshares on.
So with all the rumours and myths surrounding timeshares, we’ve found five truths that show how this dream holiday may not be all that it seems.
It costs a lot more than you think
One of the hard-hitting truths facing consumers is that timeshares are not the amazing deal they seem to be at first glance.
While the upfront fee may be cheaper than purchasing a whole property, it’s still a large setback, with some people paying up to £15,000.
On top of this, annual maintenance fees of between £500 and £1000 are added, which can really rack up the costs of owning a timeshare. These fees have to be paid regardless of whether you’re using the property, meaning you may end up paying through the nose for something you’re not actually benefitting from.
While purchasing a timeshare through resale, rather than from a company, is cheaper, it’s still more likely to be cheaper to rent a timeshare from owners rather than own one yourself.
This post by the Huffington Post has more information.
It’s difficult to sell on
Many salespeople will tell potential customers that they can easily sell their timeshares on should they want to stop their ownership. However, the truth of the matter is that it’s much more difficult to sell a timeshare than agents will tell you.
With a market saturated with sellers due to the negative reputation of timeshares, there are around 400 sellers to every one buyer, meaning your chances of shifting your timeshare are greatly reduced.
This article by This Is Money shows the extent of the selling crisis, with some people struggling to sell their timeshare for as little as 99p.
It’s not as flexible as you might think
Timeshare sellers will also try to convince many potential buyers that timeshares are much more flexible than their earlier manifestations, with the rise in points schemes and exchange companies, which give you the option to change your week or resort if you would like to.
However, this is not always the case, with many owners struggling to swap their holiday. The degree of flexibility depends on whether you sign up for a timeshare within a larger company that has lots of resorts on offer, and also on the whims of other owners in that company. You are only able to swap your resort or week if there are other timeshare owners who are willing to swap with you.
Similarly, the points system usually operates on a first-come-first-served basis, meaning you aren’t guaranteed to get your first choice of holiday unless you book months in advance.
Contracts are extremely difficult to leave
Many owners are pressured into buying a timeshare by hard-selling salespeople that offer freebies coupled with covert manipulation, meaning consumers are often unable to read the contract in depth before signing it.
However, timeshare contracts are usually extremely restrictive and, despite what the salespeople say, extremely difficult to leave. In most cases, unless you are financially unable to pay the fees, you will be unable to leave the contract and instead are required to find a buyer for the timeshare.
There have even been cases of timeshares passing onto children in the event of the owners passing away, with children still required to pay the fees.
It won’t increase in value
The hard truth of timeshares is that they will not increase in value and that they should not be considered a financial investment, despite what the agents may tell you. With such a saturated market, a decrease in interest in timeshares and the rise of cheaper alternatives, it’s unlikely that your timeshare would make a profit, or even break-even, should you wish to sell it in future.
While it may be an emotional investment where you can make some long-lasting memories, it won’t be good for your pocket in the long-term.
This infographic by the Timeshare Consumer Association, a leading independent adviser on timeshares, has more pitfalls to watch out for when considering timeshares.