The Timeshare Truths
You’re thinking about escaping town for a few days and you suddenly get an offer for a “free” vacation. The only catch is that you have to spend some time listening to a 90 minute presentation about timeshares. These timeshare presentations can quickly turn into high-pressure sales pitches, so you’re better off knowing what a timeshare is and whether one is right for you before heading off to one of these meetings. Here’s some information to help you decide.
What is a Timeshare?
When the rich and famous want to afford a vacation home, they simply go out and purchase one. When ordinary people want a vacation home, it may not be that easy. That’s where the timeshare concept comes into play. With a timeshare, you’re purchasing a “share” of a vacation home. By purchasing a certain week out of the year, you don’t have to spend hundreds of thousands of dollars on your vacation home, just a fraction of that. But are there any drawbacks?
A Timeshare is Not an Investment
First things first, while real estate is normally an investment, timeshare purchases are generally not. In fact, if you purchase a timeshare and ever go to sell it, you probably won’t be able to sell it for what you purchased it for, you’re going to have to take a loss. That being said, if you’re looking to purchase a timeshare for investment purposes, look to put your money elsewhere.
There Are Annual Expenses
In addition to the purchase price, there are other annual expenses that are involved when dealing with a timeshare. This annual fee covers the cost of maintenance and administration of the timeshare. It can range from a couple hundred dollars to over a thousand dollars, so unless you’re really going to use your timeshare each year and the cost of a hotel would exceed your annual fees, you might want to pass on the timeshare opportunity.
When It’s a Good Idea
That being said, if you travel often and hotels are pricey in the areas you like to stay, a timeshare may be a good idea. The timeshare industry has changed over the years so if you were interested in a timeshare once but the climate of the industry turned you off, you might want to revisit your timeshare options.