Contrary to what you may have heard, there is a thriving secondary timeshare market today. People are always in need of a vacation and always in search of a good deal. Here are five things you need to look out for to make this process as successful as possible.
1) Price your timeshare right. Despite what you may have been told by the timeshare salesperson or want to believe, the vast majority of timeshares do NOT hold their resale value, much less appreciate. There are exceptions of course. If you purchased a timeshare on Sanibel Island 15 years ago for $5,000, I have no doubt that you could double or triple that today. But most consumers looking to sell don’t own on Sanibel Island.
General rule of thumb is to find out what similar timeshares are going for today from the developer and start out at 50% to 65% less than that. I know this is not what you want to hear, but it is the truth.
You also want to check what other people are listing similar timeshares for on the secondary market.
2) Understand what you have to sell. I’m continually astonished by just how little some timeshare owners know about their timeshare. You have to know if you own points (how many), or weeks (fixed or floating), every year or every other year and if the resort is affiliated with either RCI or Interval International.
Is the resort part of a smaller, internal exchange system? If so, what are the benefits of this internal system? What are the annual maintenance fees and do they include real estate taxes? Is the property deeded, or a right to use? All of these things are vitally important to marketing the timeshare. Interestingly enough, once some people do a little digging and find out what they own, they decide to keep it because they realize that they haven’t been making the best use of it!
3) Call the resort that you own at to see if they would buy it back. This doesn’t happen nearly as much as I think it should. I believe that all timeshare resorts should be helping their owner base out and at the very least offer owners a way out. However, some forward thinking resorts are doing just that and it is certainly worth a phone call to the Owner Services Department to find out.
Some resorts also have a “Right of First Refusal”, so it makes sense to find out what they will accept and what they won’t.
4) Understand and evaluate the fees involved. This is where it can start to get really tricky for frustrated timeshare owners. In most cases in the United States, timeshare falls under real estate law and in many states such as Florida; it is illegal to charge upfront fees for real estate.
However…nothing is free. You need to decide if the $22.95 advertising fee that your local paper will charge for a 3 line listing is going to get the “eyeballs” you really need to sell your timeshare. On the other hand, if a large online listing service charges you $500 but has 40,000 verifiable hits per day, that $500 may be a better deal that paying $22.95 every week for a year until someone eventually calls.
There are some real estate agents and brokers who handle timeshare. They will not charge anything up front, but you will have to pay them a commission, sometimes as much as 15%, upon sale. You should ask if they have experience in selling timeshare, as timeshare is vastly different from general real estate.
5) NEVER do business with someone who contacts you first. I left this tip for last as it is the most important thing I can leave you with. Unfortunately, there is a never-ending stream of unscrupulous (as best) and illegal (at worst) companies out there waiting to prey on you. They will fill your head with all sorts of mis-information, claim to have a buyer for your timeshare and all you have to do is send them a few hundred or thousands for closing costs. DON’T DO IT. No matter how good it sounds.
If you had a car that you were no longer using and you received a call from someone that you had never heard of/never contacted that said that they had a buyer for your car and all you needed to do was send them $3,500, would you fall for it? Of course not. So don’t do it with a timeshare.