How to Choose a Timeshare
- 3.1 Fixed Week Timeshares
- 3.2 Floating Week Timeshares
- 3.3 Right-to-Use Timeshares
- 3.4 Points-Based Timeshares
- 4.1 Evaluate How You Take Vacations
- 4.2 Decide on Your Timeshare Location
- 4.3 Accommodation Quality Level
- 4.4 Visit Your Potential Timeshare Before You Commit
- 4.5 Decide On Your Budget
- 4.6 Make Long-Term Plans
If you’re considering how to spend your vacation money wisely, you’ve probably heard of timeshares as a cost-effective vacation home option.
Buying a timeshare may be a fantastic way to save money on trips for a lifetime. However, think twice before signing on the dotted line. You must use it once you have purchased it to get any value from it.
But what is a timeshare? Is buying a timeshare indeed a good financial investment? Let’s take a look at how to choose a timeshare.
What Is a Timeshare?
A timeshare is a residential real estate scheme for a holiday destination or resort. Just as the word “share” implies, several owners split the property’s cost. In exchange, a timeshare provider will grant each owner the right to occupy the property for a set amount of time.
The usual length of time that resorts sell to one owner is a week each year. However, some alternatives allow owners to purchase bigger or less yearly time blocks.
How Do Timeshares Work?
Deeded and non-deeded are the two forms of timeshare contracts.
You acquire a part of ownership under deeded arrangements, much like when you buy a house. You can resell your timeshare, rent it, or pass it down to your family. Deeded timeshares account for a large majority of all timeshare transactions.
Contracts for non-deeded timeshares are comparable to leases. You purchase the right to use the property for a set period. But, you do not own the property outright. After your term, ownership reverts to the original owner.
Types of Timeshare
There are four main types of timeshares that you should be aware of before searching for one.
Here, we’ll summarize each type. Then we’ll get onto how to choose the right one for your needs.
Fixed Week Timeshares
A fixed week timeshare allows you to utilize the property every year for the same week. They tend to be deeded transactions.
Because you can’t change your week, this arrangement is excellent if you prefer predictability. You may either rent out or trade your time block with other owners. Customers are seeking greater flexibility; thus, fixed-week contracts are becoming less frequent.
Floating Week Timeshares
A floating week timeshare allows you to own one week every year, but you may choose when you want to use it. You have the option of booking your week at any moment or within a specific timeframe. These tend to be deeded transactions as well.
You have greater freedom with the floating week option than with the fixed week. However, you’ll face stiff competition for desirable time slots.
These are the same as non-deeded timeshares. You don’t own the property, but you get to use it within a set period that you agree with the owner.
The way you work out your vacation time with this system is to deal with the owner. Not all owners will offer the same terms, mind.
Many people opt for a points-based timeshare system because of all the advantages it offers. They are incredibly flexible and deliver a variety of wants in a timeshare for most people.
With this system, you buy a specific amount of points each year to exchange for timeshare reservations. A hotel points-based timeshare, for example, allows you to stay at any of the hotel’s participating sites throughout the world. Vacation clubs are another name for timeshare schemes – for example, a Disney timeshare is points-based.
How to Choose a Timeshare
Now we’ll provide you with a foolproof checklist to run through on how to choose a timeshare. Follow these steps, and you should be well on your way to years of memorable moments away from home.
Plus, we’ll also give you tips on how to choose a timeshare abroad. This is because timeshare rules differ from region to region. Now let’s get to it!
Evaluate How You Take Vacations
Answer these questions to begin the purchasing process:
- Is your family more likely to travel for a week at a time or in three- or four-day increments?
- Do you take a vacation each year?
- How often do you think you’ll go back to the same spot?
After you’ve assessed your requirements, you may consider where you want to buy. If your family enjoys shorter trips, points-based ownership may be a better option than a fixed week. A biannual even or odd-year timeshare might be more cost-effective than annual ownership if you only travel every two years.
Decide on Your Timeshare Location
When you buy a timeshare in a place that you plan to visit at least once every few vacations, you’ll get the greatest deal. And if you think this type of setup will suit you, then points-based clubs are the way forward.
Traditional floating and fixed week timeshares must be swapped through a third-party program. So if you are going to opt for one of these timeshare systems, you’d better make sure that you are willing to enjoy the vacation spot year after. This is because you might not always be able to swap your timeshare.
Accommodation Quality Level
Most timeshare accommodations exceed those of a regular hotel. Yet to make things easier for you to decide, timeshares have their own grading system that indicates their degree of facilities and luxury.
There are grand houses right through to small apartments by the beach available as timeshares. Plus, as we mentioned, you can opt into a points-based system with hotels worldwide even! Hilton resale listings is a great place to start looking, if this is what you’re into and like the sound of a Hilton timeshare.
Whatever the case, make sure you give yourself realistic expectations for what you can afford. And, make sure that you’ll be happy with your accommodation’s level of quality for years to come.
Visit Your Potential Timeshare Before You Commit
Visit the resort you want to buy on a timeshare tour presentation if you haven’t previously done so. Examine the grounds and amenities and speak with the resort’s personnel. Also, take note of the condition of whatever type of property you’re looking at. And check the neighboring real estate.
You should not regard a timeshare as an investment property. Yet, the resort’s general condition will influence future resale value.
Decide On Your Budget
For timeshare property, there are no precise evaluations available. In the end, the price of a timeshare is determined by what a willing buyer is prepared to pay and what a willing seller is willing to accept.
If you’ve seen the resort before, you may have a good sense of how much apartments are selling for and may adjust your offer to fit. If you haven’t done so before, or if the resort no longer sells timeshares, you should base your bid on the value of the timeshare’s utilization.
Make Long-Term Plans
In the long term, timeshares save money, but only if you use them frequently. Make your holiday plans as far ahead as possible. Some solid advice is that you reserve a year in advance. Keep in mind that you’ll be battling for the same spot with other timeshare owners. Act early since all other timeshare owners will soon snatch up all the best time slots.
Advice on Purchasing a Timeshare Abroad
Outside of the United States, most timeshare companies offer a right-to-use or non-deeded timeshare contract. Furthermore, timeshare vacations purchased in foreign nations are not protected by US law. If you’re thinking about buying something in another nation, research the country’s consumer protection laws and how they implement them.
Timeshares are known for being difficult to sell. The timeshare market is rife with owners who are willing to sell their units at a steep discount. Developers will occasionally purchase back timeshares, but you will be responsible for maintenance costs until the developer finds a new buyer.
If you successfully sell your timeshare, it will almost certainly be for a considerably lower price than you bought. The IRS won’t let you claim the sale as a capital loss since they don’t consider it an investment.
Timeshare Tip Before You Buy
Owners of timeshares who cannot use their allotted week tend to search for renters to cut their losses. There are plenty of timeshare communities out there that offer such services. So if you can find a week renting in a location you might want to buy into, it’s the perfect way to check it out first.
When you rent, you may try out the resort’s facilities without committing to anything. If you decide to buy, you’ll have the opportunity to investigate the drawbacks and benefits.
Choose Your Timeshare Wisely
All of the advice we have given you so far should put you on a solid footing to find the right timeshare for you. Take your time, research, and plan.
Thanks for your time, and good luck! Also, please check out our blog for more helpful advice and tips.