General Questions About Buying a Timeshare
Q: What is a timeshare?
A: Timesharing or vacation ownership is a term that describes a method of use
and ownership of a particular property. It normally allows you to use the
property for a certain period of time each year. You pay an initial investment
for the timeshare and then you will pay a maintenance fee each year for the
upkeep of the timeshare.
Q: What are maintenance fees?
A: Maintenance fees are the cost to operate the resort. This fee is divided up
amongst all resort owners. A portion of the maintenance fee is to build up
reserves to pay for the non-recurring costs like furniture and appliances. A
reserve is also typically set up to pay for other capital costs incurred because
of physical deterioration. When a developer is still selling in a resort the
fees may be subsidized and are subject to increase after the homeowner
association takes over the association. Some states regulate how much is kept in
reserve for future spending.
Q: How much are maintenance fees?
A: Maintenance fees will vary from $300-$1000. They will vary from resort to
resort depending on location, size of unit, amount of amenities etc. There are
occasionally special assessments charged to handle a specific problem at a
resort that has not been funded.
Q: What is a point system?
A: The point system allows you to break up your vacationing into 3-4 day
vacations. The point system allows you to make better use of your week by
vacationing in off season. Every resort that has points has a different program
and you should check with your resale specialist about the differences in the
point systems. RCI Points are different than the points described above.
Q: What is the difference in a leased property and a deeded property?
A: A leased property is a right to use and will expire in a certain
number of years. Those years can be from 20 to 99. It is important to verify
that you can transfer your property if it is a right to use property. A deeded
property means that you have a deed for the rest of your life and your heirs
will inherit the property.
Q: What is an exchange?
A: An exchange is the depositing of your week with an exchange and then the
requesting of a week to use in place of the week you are depositing. The
exchange company does not have to find someone to use your week before they will
give you an exchange. Once you deposit the week you are done with it. It is very
important to deposit your week early to have more power with your week. Each
exchange company has slightly different rules for exchanging. There is a fee
involved in exchanging your week.
Q: Why are prices so low on the timeshare resale market?
A: There are a couple of reasons for this. When your purchase from the
developer you are paying the marketing fees for the developer. These are
generally around 50% of the sales price. When the unit goes on the resale market
the client has hopefully enjoyed the benefit of the timeshare for a few years so
he benefits by use but not financially. When you buy a resale you will benefit
from the use but you will also benefit financially. Prices are based on supply
and demand. When you have a large resort with several thousand owners there will
generally be a number of timeshares on the market. That will keep the prices
lower.
Q: What sizes of accommodation are available?
A: Timeshare accommodations are quite varied - sized as small as a hotel room
and as large as a 4 bedroom unit.
Q: Does my Timeshare give me access to anything more than just my unit?
A: There are many benefits when you buy timeshare. A daily schedule of
on-site sporting, recreational, and social activities are normally available for
both adults and children. Many resorts offer swimming pools, tennis courts, golf
courses, horseback riding, skiing, and numerous other amenities and often all
on-site. Most timeshare resorts are staffed with well-trained hospitality
professionals whose sole duty is to make your vacation as fun and stress-free as
possible.