Some Questions To Ask BEFORE You Buy

It’s that time of year again…annual maintenance fees and special assessments are being mailed out and many timeshare owners are getting a very nasty surprise in the form of huge increases and huge unexpected assessments.

If you own at a Diamond, Wyndham and/or older resort, you know what I mean.  I’ve been hearing from owners who plead for help with a $3,000 assessment that was levied or increases in annual fees well over 30% year over year.

First, let’s cover a few questions that all potential owners need to ask before buying any timeshare:

1)    What are all the annual fees and what do they cover?

2)   What is the “cap” on how much the fees can be increased year over year?

3)   What is the five (5) year history on these fees?

4)   When was the last time a special assessment was levied?

5)   How much was that special assessment?

6)   How much of the resort is sold out?

7)   Is there a stipulation that in the event of a fund shortage, the developer is required to make up the difference?

8)   What is the current delinquency rate at this resort?

This is NOT a comprehensive list, but a good place to start.  (I’ll be providing a full list of the necessary questions in my forthcoming book, “Timeshare By The Numbers-A Guide For Consumers” due out later this year.

Now, for those of you who already own and are faced with a huge bill, here are some things you need to do…the sooner the better:

1)     Connect with other owners through timeshare forums and through publications such as TimeSharing Today to see what their thoughts are, if other owners have discovered something and to just share information

2)   Contact the resort directly and be certain that you are receiving a copy of the full annual budget, then familiarize yourself with it

3)   If you are unable to pay the entire amount due, contact the resort directly as soon as possible to work out a payment plan---they would rather hear from you than not hear from you

Another way of tackling these fees is to rent out your timeshare and use the proceeds to pay or at least partially pay for the fees.  It bears repeating that you should only be renting your HOME property, not exchanging it and then attempting to rent that.  Both RCI and II “frown” on that and there are a ton of cases where the owners’ exchange rights were suspended.

Maintenance fees and sometimes special assessments are part of timeshare ownership.  It’s important to remember that these are part of the “vacation experience”…whether you own timeshare or rent a hotel, you’re paying one way or another.

Timeshare, Travel and Isolation

I recently attended the Ataway Conference here in Orlando and was excited to hear from travel professionals about the issues they are facing today as well as learning from the best.

As is the case with every non-timeshare conference I attend, timeshare was NOT well represented.  To me, this non-attendence is one of the reasons that timeshare is considered the "red-headed stepchild" of the travel industry (although being a red-head myself I'm not sure if I should take offense of myself!).  Timeshare has much to learn from the travel industry, as I've written about in the past---and the travel industry has much to learn from the timeshare industry.

Tom O'Neill from United Mileage Plus' Program gave a very interesting overview of loyalty programs; United specifically, but really all of the airline loyalty programs.  From the harried note taking that was going on at my table, I could see that my fellow attendees "got" the gist of what Tom was saying and noting how they could improve their loyalty programs.

Then there was me.  Or rather I should say there was timeshare in it's isolation.

I think one of the major reasons timeshare is in the state it is...and by that I mean less than 7% of the population owns it...is that the industry clings to its guns that they're different.  Different in the way it's portrayed, different in the way it's marketed, different in the stubbornness that people like to believe that it isn't a sought after product and different in the way we treat our clients.

Airline loyalty programs are far from perfect, but they're ahead of what timeshare has.  Airline loyalty programs not only reward their clients, but they let their clients earn rewards by partnering with OTHER companies.  Other travel related companies to start with.

Once timeshare starts realizing that they are in the vacation and travel business just like everyone else in the market, I think we'll see a great improvment in numbers.

Secondary Market Timeshare Valuation

Yes indeed, there is a great need for a viable timeshare valuation strategy.  Why?  Consider these REAL ads:

1)  The Jockey Club 1 Bedroom Week 52  $1,000
2)  The Jockey Club 1 Bedroom Week 52  $100,000 (2 listings at this price)
3)  Summer Bay 3 Bedroom House Floating Time $2 (Yes, $2)

The truly insane thing is that these listings all come from the same site!

Mind-boggling, isn't it?

The Need For More Timeshare Consumer Awareness

While it is true that the average timeshare owner did NOT purchase a timeshare with the intent to get involved in meetings, read blogs, participate in forums or at the extreme, become involved with Class Action lawsuits, it has become obvious that timeshare owners DO need to become more aware of what is going on in timeshare as it has a direct impact on their ability to enjoy their timeshare.

Having gotten my start in front-line timeshare sales some 12 years ago, I can say with some degree of certainty that many of the issues facing both timeshare owners and resorts today could have been avoided if one word “transparency”, was more universally implemented.

I strongly believe that timeshare is a wonderful product and that more people should own it.  It’s a terrific way to vacation.  Having said that, there are some changes that need to be implemented in order to make it “better” for both consumers and resorts.  Unlike some both in and on the fringes of the industry, I believe that it can and should be a win/win situation; consumers don’t have to lose if resorts win and vice versa.

It starts with transparency, fiscal responsibility and consumer education/awareness.  Timeshare Insights was formed in 2006 because I believe strongly that “an educated and involved consumer is the timeshare industry’s best friend.”  If a timeshare resort or organization does NOT want their owners and prospective owners to be more informed, then I think there’s something wrong.  It sounds basic and a bit cliché, but organizations with nothing to hide don’t hide anything.

This consumer awareness can and should in my opinion start at the resort level.  Resorts should welcome questions, allow for sufficient time for a consumer to make a purchasing decision and by following up with that consumer whether or not they choose to purchase.  Resorts should be happy to have their owners get involved with timeshare owner groups and read books and blogs about timeshare.  Imagine how many problems that owners and resorts are facing in 2012 could have been avoided this more of this awareness and interaction had taken place in 2000!