My Buy Essay

It worked well, and the idea spread throughout the world.1

There are two main types of timesharing plans: deeded and non-deeded. With the deeded type, you buy an ownership interest in a piece of real estate. In the non-deeded plan, you buy a lease, license, or club membership that lets you use the property for a specific amount of time each year for a stated number of years. With both types, the cost of the unit is proportionate to the season and the length of time you want to buy.2

Before You Buy

As with any major purchase, you need to understand what you are getting before you sign any papers or pay any fees. The general information should be accompanied by careful analysis and perhaps even professional advice that concerns all aspects of a particular timeshare purchase.

Before purchasing a timeshare consider the following points.3

* A major reason people buy timeshares is for the convenience of having prearranged vacation facilities. Therefore it would be wise to determine whether you will be able to use the timeshare facility regularly. When evaluating a timeshare with units in several locations, consider whether sufficient units are available at the sites you prefer at the time you want to use them.

* Question any investment claims made by the seller. The future value of a timeshare depends on many factors. Resale of timeshares is almost impossible.4 So, if you are considering buying a timeshare, do it, realizing that you will probably not be able to resell it; and, even if you are able to sell, you probably won’t be able to sell it for anything close to your original purchase price. Closing costs, broker commissions, and financing charges also must be considered as part of the investment costs.

* The total cost of a timeshare includes mortgage payments and expenses, such as travel costs and annual maintenance fees. The annual maintenance fees usually rise to equal or exceed inflation and could add hundreds of dollars to the purchase price. To help evaluate the purchase, compare the total timeshare costs with rental costs for similar accommodations and amenities for the same time in the same location.

* Do not act on impulse or under pressure. Review all documents or have someone familiar with timesharing review them before you make a purchase. Do not be pressured into making a purchase without having a couple of days to think about it. Find out if the contract provides a cooling-off period during which you can cancel the contract and get a refund.

* Be sure everything the salesperson promised orally is written in the contract.

* Remember that exchange programs, which offer the opportunity to arrange trades with other resort units in different locations, cannot be guaranteed. When you trade your timeshare unit for another, expect one of approximately the same value.

* Many timeshare sellers offer gifts to potential buyers who will listen to a timeshare sales presentation. Consider the value of these gifts or prizes. Most are of little value.5 It would be to your advantage to attend a sales presentation only if you are interested in the program.

* Your timeshare will be a good place to vacation only if it is run properly. Therefore you should consider researching with local real estate agents, Better Business Bureau, and consumer protection offices, the track record of the seller, developer, and management company before you make your purchase.

* If you are considering buying a timeshare on property where the facilities have not been completed, get a written commitment from the sellers that the facilities will be finished as promised, and require that a certain amount of your money be held in escrow.6

* Find out what your rights are if the builder or management company has financial problems or in some way defaults. Make sure that your contract has both non-disturbance and nonperformance clauses. A non-disturbance clause ensures that you will continue to have use of your timeshare unit in the event of default and subsequent third party claims against the developer or management firm. A nonperformance clause allows you to keep all your ownership rights even if a third party is required to buy out your contract.

* If you have any questions or complaints regarding timeshares or a timeshare that you have purchased, contact the Real Estate Commission of the state in which the timeshare property is located, as well as the Correspondence Branch, Federal Trade Commission, Washington, DC 20580.

How Timeshare Resale Scams Operate

If you already own a timeshare, be cautious about people who offer to help you resell the timeshare for a fee. Because many of these types are rip-offs, be careful to deal only with legitimate sales companies. Companies that use questionable resale practices operate like many other telemarketing scams. You might be contacted by a telephone salesperson or through a postcard, asking you to call a particular telephone number about selling your timeshare. The salespeople are likely to tell you that the market for resale of timeshares is “hot” and that their company has a high success rate in reselling these units. They may even claim that they have extensive lists of sales agents and potential buyers for timeshares and for an advance fee of hundreds of dollars these salespeople promise to sell your timeshare for a price equal to or greater than the amount you originally paid.7

The market for resale is actually extremely poor, because there is no secondary market for timeshares.8 Currently American consumers own 1.5 million timeshares. Approximately 870,000 of these are presently available for resale, with 845,000 for sale far below the original purchase price. In truth, over the past 20 years, only 3 percent of owners who have wanted to sell their timeshares have been successful, and the vast majority of those have had to sell below their original purchase price. So, it is highly unlikely that a company can sell the timeshare at all, let alone for the original purchase price.

There are some precautions to consider if you decide that you want to resell your timeshare and are approached by a resale company. (1) Do not agree to anything over the telephone. (2) Ask the salesperson to send you written materials to study. (3) Ask for company references of customers who have used their services. (4) Ask where the company is located and in what states it does business. (5) Ask if the company’s salespeople are licensed to sell real estate by the state where your timeshare is located, and check with the state licensing board to verify the information. (6) Be cautious of any company charging an advance “listing” fee for its service.9

Conclusion

Timesharing is not an investment product and is not intended as a way of making money. It is, though, a financial commitment to your leisure enjoyment. So, how much is leisure and preplanned vacation time worth to you? This is the question that must be asked before you decide to buy a timeshare. If it is not worth thousands of dollars in initial investment, plus hundreds more in maintenance fees, then you should probably stay away from timeshare promotions. But if, on the other hand, you enjoy preplanned vacations and realize that timeshare is not a money making investment, then it may be a good choice for you.

Look! You are going to steal any timeshare you buy on the resale market anyway. The resale market is just starting to come into it’s own. Prices fall in a market vacuum and there has been a market vacuum in resales since the timeshare industry started twenty-five years ago. Now, people such as us are starting to make a serious business of resales. This means that the least expensive weeks are going to get sold first. Like harvesting apples, you shake the tree and pick up the apples. The next time you have to shake the tree harder. The long-term prognosis is that resale timeshares will increase in price. I believe that anyone buying a resale in today’s market just isn’t going to get hurt unless they are entirely unknowledgeable about current market value or they are not looking for good product. At these prices, buy the best! It’s affordable.

So how do you find out what you should pay for a given property? This publication is certainly a good start, but not everyone advertising has a realistic idea of what their property is worth. The Internet also lists weeks for sale, but it is still young, therefore imperfect. The resort itself should yield some information and is always worth a call. Although it sounds self-serving, the best bet is to call a Real Estate Broker if one is involved with that property. Normally, people in general real estate are simply not yet knowledgeable about timeshares. Seek out a broker specializing in what you want. They are going to want to make a deal and will tell you what you will actually be able to purchase at the lowest price. They will also give you accurate detailed information about the resort itself. Further, a good broker will counsel you about your needs and try to direct you to the product, which will actually end up best serving you. They are not emotionally tied to any specific week or project. They know that if they do a good job for you, you will refer others to them and return for more yourself.

The most important criteria is to buy into the project you like the best. If you are buying just to exchange, this is still important. If you think you can buy a cheap February week in Hog’s Breath, Idaho and exchange it for the Whaler at Maui over Christmas, think again. It might happen once every 50 or 60 years, but generally you are not going to get great exchanges using an unexciting week to trade. It seems almost redundant to say, “Buy Quality!” but it needs to be said here… particularly at these prices. You can buy quality resort timeshares today for 20% to 30% of replacement value! Why would you not go for the best? Another thing just coming into the business is resale financing. We offer 80% four year loans to our customers so immediate cash requirements should not be a big problem. All we require is good credit and a good resort with the timeshare being purchased at a realistic resale price.

After you have selected your week and have obtained a good price, there are still a few things you should do for your own protection:

Get a policy of title insurance unless you know the history of the timeshare week. Sometimes people get a “great deal” only to find that there is a tax lien of several times the entire value attached to the week. In others, the original loan was never satisfied. The Seller might have paid it, but they never received a reconveyance. The great Savings and Loan debacle was famous for this. By the time the loan was paid, the S&L was no longer around and there was no one to sign the reconveyance. Some resale brokers do not bother with this. Our advice is that if they do not, don’t bother with them. In some cases, the title policy is so expensive relative to the price, it just doesn’t make sense to buy it. If that is the case, you should still research the title to make sure there are no visible defects.

Go through an escrow. Unless you are buying from someone you know, (and not often even then) you will be better off having the neutral third party holding the funds and deed until it is time to make the swap. In the east, attorneys perform this function.

The Seller is required by law to disclose anything wrong with the property, but how many know that? Further, what guarantee do you have that the Seller even knows that something might be wrong? Your best bet to protect yourself is still the Broker. Get references. Check with the usual agencies including the Real Estate Department to make sure that the Broker has a license. The resort itself might be able to refer someone who has had no problems. Title companies are also a good reference.

Have you picked up a trend here? Notice that as the industry matures, resales will start to look more like resales in the regular housing market. A fledgling resale marketing system will mature, develop good standards and the boomers will leave. As that continues, price of resales will start to stabilize at higher levels.

The timeshare product is incredible. It really enhances people’s lives and saves them a fortune on truly splendid vacations. As more understand this, more will purchase. The truly smart ones will purchase a resale through a licensed Broker just as you would a house. They will have many years of enjoyment and eventually probably get their investment (or at least most of it) back.

With timeshare the use and costs of running the resort are shared among the owners. While the majority of Timeshare resorts are condominium vacation resorts, developers have applied the timeshare model to houseboats, yachts, campgrounds and motor homes.

History of Timeshare

The notion of a timeshare was originally created in Europe in the 1960s. A ski resort developer in the French Alps innovatively marketed his resort by encouraging guests to “stop renting a room” and instead “buy the hotel”. The developer was successful in increasing occupancy and the idea spread worldwide.

Timeshare Methods of Use

Timeshare owners may elect to:

* Use their usage time

* Rent out their owned usage

* Give it as a gift

* Exchange internally within the same resort or resort group

* Exchange externally into thousands of other timeshare resorts

Timeshare owners can elect to stay at their resort during the prescribed period, which varies depending on the nature of their ownership. They can rent out their week or give it as a gift to friends and family.

Timeshare offers owners the possibility to exchange their week, either independently or through several exchange agencies, to stay at one of the thousands of other resorts worldwide. The two largest exchange agencies are Resort Condominiums International (RCI) & Interval International [II] and there are several independent exchange agencies. RCI and II both have resort affiliate programs and members can only exchange to affiliate resorts. It is rare to find a dual affiliate resort, it is more common for a resort to be affiliated with only one of the larger exchange agencies. RCI is the largest with over 3,800 resorts split between its weeks and points programs. II has more then 2000 resorts. It is important when considering timeshare ownership to consider which locations and resorts you may want to travel to before making your purchase, because the timeshare resort you purchase at will determine which of the major exchange companies you can exchange through. Both RCI and II charge membership fees and exchange fees. They also bar members from renting weeks they have exchanged for.

Timeshare owners may also arrange a direct exchange, this requires locating a timeshare owner with the location and weeks both mutually desire. This form of exchange is rare but since it can save in exchange fees it is often sought after.

Color Time

Color time refers to the travel season for any given resort. For RCI, the designations are:

* Red: high demand season

* White: intermediate season

* Blue: low demand season

For II, the designations are:

* Red: high demand season

* Yellow: intermediate season

* Green: low demand season

Types of Ownership

* Fixed, Floating and Rotating Weeks

Ownership is often sold as weeks, the use of these weeks can be fixed, floating or rotating weeks.

* Fixed Week Ownership

The most basic timeshare unit is a fixed week; the resort will have a calendar enumerating the weeks roughly starting with the first calendar week of the year. As an owner you may own a deed to use a unit for a single specified week. For example week 26 normally includes the Fourth of July Holiday. If you owned Week 26 at a resort you could use your week every year.

* Floating

Sometimes a timeshare is sold as floating weeks. The ownership will be specific on how many weeks you own and from which weeks you may select for your stay. An example of this, a timeshare may be a floating summer week where the owner may request any week during the summer season generally weeks 22 through 36. In this example there would be competition for prime holidays such as the weeks of Memorial Day, Fourth of July and Labor Day. The weeks when schools may still be in session would not be so high in demand. Some floating contracts exclude major holidays so they may be sold as fixed weeks.

* Rotating

Some timeshare is sold as rotating weeks. In an attempt to give all owners a chance for the best weeks the weeks are rotated forward or backward through the calendar so one year the owner may have use of week 25, then week 26 the next year and then week 27 the year after that. This method does give each owner a fair opportunity for prime weeks but it is not flexible.

* Deeded vs. Right to Use

A major difference in types of timeshare ownership is that between deeded and right to use contracts. With deeded contracts the use of the timeshare resort is usually divided into weeklong increments and these are sold as fractional ownership and are real property. As with any other piece of real estate you may use your week, rent your week, give it away, or leave it to your heirs.

With right to use, the timeshare purchaser has the right to use the property in accordance with the contract but at some point the contract ends and all rights revert to the property owner. In other words, the right to use contract grants the right to use the resort for a specific number of years. In many countries there are severe limits on foreign property ownership so this is a common method for developing timeshare resorts in countries such as Mexico. Disney Vacation Club is also sold as a right to use.

* Vacation Clubs

Vacation clubs are organizations that may own timeshare units in multiple resorts in different locations. They are sold both as deeded or right to use and club members may reserve vacation time at any of the owned resort units based on availability.

* Points Programs

Resort based points programs are also sold as deeded and as right to use. Points programs annually give the owner an amount of points equal to the level of ownership. The timeshare owner in a points program can then use these points to make travel arrangements within the resort group. Many points programs are affiliated with large resort groups offering a large selection of options for destination. Many resort point programs provide flexibility from the traditional week stay. Resort point program members may request from the entire available inventory of the resort group.

Exchange company point programs are not a method of ownership nor are specifically associated with one resort or resort group. With the exchange company points programs the members may be limited to exchanging for weeks deposited by other members.

A points program member may often request fractional weeks as well as full or multiple weeks stays. The number of points required to stay at the resort will vary based on a points chart. The points chart will allow for factors such as:

* The popularity of the resort;

* The size of the accommodations;

* The number of nights;

* The popularity of the season;

* and the specific nights requested.

There is flexibility as well as complexity in point programs.

Important Note on Ownership

* With any of the above mentioned ownership methods, a timeshare owner is legally and contractually tied to that ownership.

* A timeshare owner has rights, responsibilities and legal obligations. Once the timeshare contract is made it is not easily ended.

* These contracts and obligations belong to the timeshare owner until the timeshare is sold or ownership is transferred through some other means.

Rescission Period

In many developer contracts (and often required by government statutes and/or regulations) there may exist a Rescission period. The Rescission period outlines how many days after a timeshare purchase, from a developer, that a buyer has an opportunity to change their mind and cancel the purchase. The Rescission period is usually only a few days long and the buyer must follow the cancellation procedure exactly or risk the request to rescind being ignored.

Types and Sizes of Timeshare Units

Timeshare properties tend to be apartment-style units ranging in size from studio units (with room for two) to three and four-bedroom units. These larger units can comfortably house large families. Timeshare units normally include fully equipped kitchens with a dining area, dishwasher, televisions, VCRs and more. It is not uncommon to have washers and dryers either in the unit or easily accessible on the resort. Kitchens are equipped to the size of the unit, so that a unit that sleeps four should have at least four glasses, plates, forks, knives, spoons, and bowls so that all four guests can sit and eat at once.

Timeshare units are usually listed by how many the unit will sleep and how many the unit will sleep privately.

* Sleeps 2/2 would normally be a one bedroom or studio

* Sleeps 6/4 would normally be a two bedroom with a sleeper sofa

Sleep privately refers to the number of guests who will not have to walk through another guests sleeping area to use a restroom. Timeshare resorts tend to be strict on the number of guests per unit. Unit size can effect demand at a given resort where a two-bedroom unit may be in higher demand than a one-bedroom unit at the same resort. The same does not hold true comparing resorts in different locations. A one bedroom with a great location may still be in higher demand than a resort with less demand. An example of this may be a one bedroom at a great beach resort compared to a two bedroom unit at a resort located inland from the same beach.

The concept of vacation timeshare has also been extended to luxury items such as planes and luxury cars.

Scope of Timeshare Industry

Today’s timeshare industry includes over 5000 resorts worldwide, for a total of 11 million timeshare “intervals” that have been individually sold to nearly 7 million families around the world. There are timeshare resorts around the world. Global timeshare sales total over $9 billion annually. ARDA, American Resorts Development Association, reported that in the USA, as of January 1, 2005, there were 1668 timeshare resorts serving 3.87 million US households. Ownership has increased in the USA 16.2 percent in 2004 and 13.8 percent in 2003.

There exists a resale industry for the resale of timeshare intervals. Many of these can be found searching the Internet as well as an active market in the online auction sites such as that on eBay.

Pros and Cons of Timeshares

The timeshare industry has been widely criticized and even sometimes likened to a travel scam. Unlike the customary renting arrangement, where the customer decides every year on the quality and price of accommodations, timeshare requires to make a major payment up front. There exist doubts as to whether timeshare buyers ever recover the money spent, but the vast majority of timeshare owners have no desire to exit the system and find the quality of their holiday accommodation makes their financial outlay a logical expenditure.

There are also some complaints that owners have to return to the same resort every year, but there exist several companies - the best known being Resort Condominiums International (RCI) & Interval International - that enable timeshare owners to exchange their weeks into literally thousands of resorts around the world. There are a growing number of independent timeshare exchange organizations available to timeshare owners.

Other complaints include issues surrounding the yearly maintenance fee. Some critics talk of ever escalating fees that mean owners cannot afford to keep their weeks due to financial pressure.

One of the major benefits of the product is the fact that vacation timeshare is real property. Resort developers purchase land in a location and develop a timeshare resort. They are actually selling consumers deeded weeks of real property at a specific location, meaning customers can do what they wish with the weeks they own. This flexibility includes the opportunity to rent out weeks that are not used or indeed to lend them to friends or family.

Like any other product, timeshare exchange is subject to the law of supply. This should make the exchange mechanism a fair and meritocratic system. For example if a timeshare owner deposits a studio apartment in low season that owner is unlikely to be able to exchange into a villa during a country’s high season. In practice the major exchange companies have proprietary exchange formulas that add complexity to the system. The study of and issues revolving around exchanging are beyond the scope of this article and should be researched before making any timeshare purchase.

As he walked into our little land office in Placerville, California (about sixty miles west of South Lake Tahoe), he said, “I’ve got the keys to the bank” and proceeded to tell me about this new concept called timesharing. I responded with “Forget it, Jack. It won’t work.” Jack was persistent, persuasive and before long we were the developers of one of the first timeshare projects in the country (RCI #0078). And so I began what would become a lifetime journey.

Fast forward to several years later after Jack’s retirement. Along came Larry who became another close friend and sales associate. During this time the two of us were selling it. I would tell Larry that this was no scam and really had substance. His response was, “Yeah, yeah, sure”, but he kept going until it was done.

Now it was time for the first general Owner’s Association meeting. I coerced Larry into attending. After the very upbeat meeting, one of the Owners’ wives approached us. Larry kind of slunk over behind me thinking I would absorb most of the blows. She took my hands and with tears in her eyes said, “Thank you, thank you so much! You have really improved our lives!” One of the funniest things I have ever seen was the look on Larry’s face. His jaw had dropped and he was absolutely stunned. It would be a few more years before he would completely accept that this concept was so sound, but he eventually became an active owner of several timeshares himself.

As we were selling that property in the early 1970s I would tell people, “You better buy one of these now, because if you don’t, you will be paying a hundred dollars a night for a hotel room.” They would say, “Nah, that will never happen.” Today it is hard to find a Holiday Inn room for under a hundred dollars a night.

Guess what the rack rate of the Mark Hopkins hotel in San Francisco (Top of the Mark) was in 1942. It was $5 single and $7 double. For servicemen it was $3 single and $5 double. By 1974 it was $45 single and $55 double. Now it is $210 to $270 single or double depending on the location. Projecting this ahead another fifty years and you will be paying $9,058 a night for a hotel room there! And I can just hear most people saying, “Nah, that will never happen.”

The reason for owning a timeshare is the same as the reason for owning your own home. It will cost you much less in the long run and you will end up with something of value. Just think of the value to your children who stand to benefit the most from your foresight. It is a shame that more of them don’t realize how important this is and only focus on the upkeep. The smart ones will be enjoying vacations that are way beyond their means for the rest of their lives.

After thirty years, my take is this: You will save about half of what you are currently spending on vacation lodging. But the real kicker is that you will be staying in facilities that are more luxurious than anything you would even consider. How many of you will spend $350 to $500 a night for a place to sleep? Not me! Ever! But I do enjoy that level of vacationing through my timeshare ownership.

So much for the financial side. Now how about the real value? What do you remember the most about your childhood? Isn’t it the family holidays? The times you spent together and felt so close to your family? An observant doctor once said, “I never saw anybody who, on his or her death bed said “I wish I had spent more time at the office.” In today’s crazy world no one has time for even the most basic activities. The family is under the greatest stress ever. The sad fact is that in the time of the greatest need most families don’t even get that so important vacation together.

One of my greatest satisfactions in life is selling a timeshare to a family that really needs it! They can be in a family business and prone to never taking a vacation. Or they can simply be stressed from having to pay for meals and lodging for themselves and three or four children and blowing the family budget for the next three years. That situation with the woman who thanked me so much at the first Homeowner’s meeting has repeated itself many times. Whatever the situation, I know that I have improved their lives in terms of real value. Whether I end up rich or poor, I will always be rich for the good I have done for people in terms of helping them to achieve the real values of life.

The security of other Timeshare owners at your resort.

Many resorts to choose from with the exchange program world wide .

Lock in your timeshare vacation accommodations.

For example: If you purchase a timeshare today at $5,500.00, use it 10 years and sell it at the same price you paid for it originally…you end up with equity.

In contrast: if you rented a hotel room you would have useless receipts. As with most deeded resorts you can rent it , sell it , lend it , exchange it or present it as a gift of precious memories for that special event in your life… honeymoons, anniversaries, family reunions.

Time share makes sense.

Time share vacations are diverse…. from a log cabin next toski.jpg (15090 bytes) a trout stream to an exotic tropical paradise in the South Pacific to the exciting ski slopes of The Rockies, you can be assured that your accommodations are first class .

You don’t have to be a millionaire to enjoy luxury vacations. You also get many benefits when you are a timeshare owner, travel agents ,discount air fares ,bonus weeks you can even gift these to your business associates and loved ones for that vacation of a lifetime .

Are you interested in Vacation Resort Ownership?

Here is some basic information you will need to know before you buy a timeshare :

When you buy from an owner there is a TITLE company that will guarantee clear title for you. When you buy from an owner you pay far less than you would if you bought from a DEVELOPER or a BROKER .WHY? you are eliminating the middleman when you buy directly from a timeshare owner.

Types of Time-share Ownership:

Deeded: You will have a recorded “Deed” with this type of ownership. Your period of ownership is forever.

Right-to-Use: This type of ownership is for a set amount of time. After the agreed time of ownership expires, ownership converts back to the Grantor. During your ownership, you can convey your ownership to another party.

Membership: This is not an ownership, it is a “Membership”. You pay a large sum of money to buy into the membership plus there are annual membership fees. Be very cautious of this type of Time share. Usually the language in the membership agreement states: if you miss one of the annual payments, your membership will terminate. Some of these memberships can be transferred, some can not.

NOTE: Some Resorts also offer bi-annual ownership. (check your paperwork)

Periods of Time-share Ownership:

Usually your time share period (check-in date) is numbered from 1-52. Week “1″ starting in the first week of the year. Week “52″ being the last week of the year.

“Floating/ Flex” periods. Which can be divided into Seasons (Blue Floating/Flex) (White Floating/Flex) (Red Floating/Flex). If your ownership is for a Floating/Flex period, you can check-in on different dates according to your ownership.

Blue Season (Good): Also known as “off season”. This would be the time of year which the Resort and location is of the least demand. If you own a “Blue Floating/Flex” period, you will only be allowed to check in during these “off season” dates. If you are planning to buy a “off season” week, plan on getting it for a cheap price.

White Season (Better): Also known as “mid season”. This would be the time of year which is between “Off Season” and “Peak Season”. The time of year right before the “Peak Season” starts and right after the “Peak Season” is over. If you own a “White Floating/Flex” period, you are allowed to check-in during the “mid season” and the “off season” dates. If you are planning to buy a “mid season” week, plan on getting it for a reasonable price.

Red Season (Best): Also known as “high/peak season”. This is the time of the year everyone wants to be at the resort (highest demand). If you own a “Red Floating/Flex” period, you can check-in any time of the year. If you are planning to buy a “peak season” week, plan on paying a pretty penny for it.

NOTE: Interval International (an exchange company for timeshare) rates Blue as Green, White as Yellow and Red as Red.

Size of Time-share Ownership:

Studio: A small unit, usually similar to a hotel room. Sleeps two, sometimes four.

One Bedroom: Similar to a small apartment: a living room area, kitchen area, with a private bedroom. Usually sleeps four (two in the bedroom and two on a pull-out sleeper sofa in the living room area).

Two Bedroom: Usually sleeps six (two in one bedroom, two in the other bedroom and two on a pull-out sleeper sofa in the living room area). Some two bedroom units can sleep eight, if it has a loft.

Lock-Out: These units vary in size, usually divided into two separate apartments. Each with its own living room and kitchen areas. If you own a Lock-Out unit, you can use one and exchange or rent the other. These units can be big enough to sleep eight to twelve people.

Obviously a Deeded two bedroom unit during “Peak Season” would cost a lot more than a Studio unit during “Off Season”. Of course, there are other factors to the value of a timeshare unit, but this is the basic frame work of timeshare value.

Costs of Time-share Ownership:

Purchase Price: The amount of money paid for ownership plus any “transfer fees” (can range from $50 to $500).

Maintenance Fees: The amount of money paid annually for maintenance of your unit. This amount can range anywhere from $100 to $700.

Property Tax: The amount of tax to be paid by you for your time share unit. This amount is usually reasonable, ranging from $10 to $100.

Special Assessment: This the amount of money the Resort can require you to pay on a un-regular basis. Usually for a re-modeling project, check your timeshare documents for the max amount they can charge you and how often they can charge you. This amount can range from $20 to $400, you may want to check the Resort history record for past amounts and times.

Time-share Resale:

Why not buy a time share directly from the owner? Buying a time share directly from an owner can save you thousands of dollars….No Commissions, No hidden charges ever!

When that subject was introduced, the entire auditorium started yelling, “Yeah, why can’t we ever get bonus time?” At that point one gentleman stood up and said, “I don’t know what you’re talking about. I’ve been there on bonus time fourteen times in the last six months.” I became concerned that we might have a riot and all the other unhappy Owners would injure him. Now, how come the experiences were so different?

First, you must remember what Bonus Time really is (that is besides a sales feature). Originally, not all the time was sold in specific resorts. Anywhere from 48 weeks to 51 weeks of the 52 available were sold. The rest were designated “Maintenance Weeks”. They were the time when the resort would be refurbished. It was later found that most of this kind of maintenance could be accomplished “on the fly” and 52 weeks were actually sold. Theoretically, if everyone showed up for their reservations and the maintenance weeks were actually fully used, there would be no bonus time…none! Unfortunately, some original salespeople said, “You can have bonus time whenever you want in addition to your reserved week.” Again, theoretically possible, but not really practical.

So Bonus Time is actually the unused maintenance time plus the time that certain Owners either don’t make a reservation, don’t show up at all, are unable to use their time because of failure to pay their maintenance dues or leave early. That’s it and it is spotty. It does, however exist. Most resorts will end up with a vacancy factor of between 5% and 15% of their usable time. So where does it go? Those who know how to use it do. Here’s how you go about it.

When are people most likely to not show up? In the off season and even more so midweek in the off season. Thus the most likely time you will be able to get Bonus Time in Southern California will be November through February at the beach and July through September in Palm Springs. This doesn’t necessarily mean that these are not good times. Some November days at the beach are among the best you will find, warm days and beautiful sunsets. Early mornings and late evenings in Palm Springs are uncrowded and delightful. If you aim for midweek off-season you will probably be pleasantly surprised at how many times you actually get Bonus Time.

Next is when should you ask for Bonus Time? About 3:00 PM on the check in day is when the husband will turn around, look in the back seat of the car and ask, “What are those funny looking spots on the kid’s faces?” The call canceling the reservation will be made by about 4:00 PM. If your call comes in at 4:15 PM, you have a good chance at snaring that spot which was suddenly left vacant. And that is the secret that the gentleman used at the beginning of this article. He would simply call at the last minute and if there were space he would come. If not, he wouldn’t. Another good time is after noon of the day after check in day. That is when the front desk will tally up the no-shows, call them and verify that they in fact are not coming. Suddenly, their reservation becomes a bonus time potential.

Every resort will have it’s own idiosyncrasies. To be successful with Bonus Time, it is up to you to figure them out. Another tip is that it always is a good idea to be on good terms with the front desk personnel. If they like you they may sometimes be able to help you. You will most certainly get the nod over the grouch who is always demeaning and criticizing them.

So the tricks to achieve Bonus Time are: 1) Use your head to figure out when your odds are best; 2) Be on good terms with the people who can help you; and 3) Call at the right time. I tell people that it is hardly worth the price of the phone call to try to get Bonus Time at the height of the high season on a weekend but those who exhibit flexibility and will roll with the system end up with more than their share. Every project is different but you can figure them out. With this knowledge you should have good luck with your Bonus Time. But, as I have always said, “I would rather be lucky than smart.”

At TimeshareValues.com we recently communicated with a buyer based in the Midwest. We are in the San Francisco Bay area. We talked a lot at 9pm our time &ndash while he was still in his office. At his time, the clock was moving toward midnight.

He bought a timeshare because he feels he doesn’t have enough time to plan his vacation, but he knows he still has to take time off each year. He works long hours, but he hoped a timeshare purchase would achieve some balance between his work and personal lives.

This is an extreme case &ndash but it got us thinking about the reason for buying a timeshare. Most people want to achieve a balance between the Two E’s: Emotion and Economics.

We believe a successful timeshare purchase provides a balance between these two E’s.Here’s how:

The First E: Emotions

Certain people and places always stick with you. Great times, food, scenery, friends. Many of us have great memories of places we want to go back to every year. We hope to recapture feelings we first experienced at these places.

Such a place is Cozumel, Mexico. It provides not only a wonderful timeshare vacation for people, but it was also the honeymoon for a couple we know. The couple’s entire trip was amazing, from the great food (the newlyweds actually found a wonderful Italian seafood restaurant there), great diving (the groom remembers his bride’s eyes when she saw her first barracuda), and friendly people.

It probably will not come as a surprise that we keep our eyes open for Cozumel property.

Emotions help us focus on what really matters in life.

The Second E: Economics

When you say this ‘E Word’, people think of accountants with green eyeshades. But that’s far from the truth.

“Economics” in a timeshare purchase is a simple matter of looking at the yearly cost of a vacation. Economic factors to consider include:

• What is the best value for my vacation investment?

• What places offer me the best ”bang for my buck”?

• What can I afford each year &ndash and not have to worry about paying the credit card bill after the trip?

These may be boring questions, but the emotional value of this economic approach is anything but boring. Answers to these “money issues” can offer you great peace of mind.

Let’s look at a couple scenarios where the economics and emotions are out of balance.

More Emotion than Economics

Does that sound familiar? Have you ever noticed a great commercial in which the product is secondary to the emotions you feel? All you have to do is purchase the product and you will feel the emotions in the commercial.

Have you ever noticed travel web sites never show an unhappy flyer or a seasick cruise passenger? You don’t want negative emotions anywhere near the product being sold.

Remember this as you look at timeshare auctions. Like all companies marketing travel products, TimeshareValues want to show our timeshares in the best positive light. However, that’s very easy, since we believe so much in the product and how it improves the quality of a vacation.

Making a buying decision based more on emotion than economics has been the American “Way of Marketing” for decades. But the Internet is helping to change this, since you can find a wealth of invaluable information before you make a purchase. You can do extensive research before a making purchase, checking out the Timeshare Users Group (.tug2.net), viewing other timeshare auctions and classified sites, and even calling a the resort.

When a buyer makes a purchase based on emotion, he or she will usually pay more for a product than necessary. A few dollars isn’t’t a big deal, but injecting a little economics can be very helpful. We love people who ask enthusiastic questions. They get more information, which lends excitement and fun to the bidding process.

More Economics than Emotion

In his book ”Don’t Worry, Make Money,” Richard Carlson has taken a time-worn phrase and re-engineered it. He has a chapter titled:

“Consider the Possibility that if it Sounds too Good to Be True &ndash It Might NOT Be”

Read that again slowly. Carlson states that cynicism, doubt and suspicion cause people to miss out on excellent opportunities. We see this every day.

We get e-mails that say:

* “Why so cheap &ndash what is wrong with this property?”

* “What haven’t you told me in your auction?”

* “This is a rental &ndash right?”

These people are interested, but they’re also very wary. Some are wary to the point where they don’t participate. Their decision is based on economics and some negative emotions.

These wary people dismiss the prospect of a good deal, because they’ve heard about the prices others have paid. But if they were to ask us, we would tell them 500,000 timeshare owners want to sell their properties, and that creates a huge buyers market.

Our company buys properties at a low price and sells them for more than we paid for them. Of course, we make a profit, but we let the market tell us how much the profit will be. People who are more driven by dollars than emotion struggle with this. But this approach has worked for us more than 300 times, so there must be something it!

There is an added business benefit to our approach: Our timeshare products don’t sit around &ndash they always sell. This means we return our capital faster to purchase more timeshare properties. People who value economics like to hear that. It’s key to our business model.

Finding Your Balance

Rarely is a decision based on equal parts emotion and economics. These factors come in different strengths for different people.

We propose an exercise that is effective for everyone. If you are inclined towards one E Factor or the other, work on the weak side before you place a bid. When you find the right balance, your Emotional Side will be happy, and your Economical Side will let you sleep at night.

Our auction web site provides detailed articles help your Economical Side plan better, and pictures and personal stories will give your Emotional side a lift by showing you those places you just HAVE to visit!

Get your life in balance today!

Have you ever bought an inexpensive car only to find that upkeep and dissatisfaction made it more expensive than if you had just bought a better one in the first place? The same is true in timeshares. The “satisfaction quotient” of a timeshare will actually be determined by your buying the right one in the first place. This is true whether buying a developer’s timeshare or a resale. The only difference is that you will buy the resale for one third to one half the price. Consider the following attributes when purchasing:

The Location. Is it in a demand area? Can you walk to shops, restaurants and other off-site amenities? Does it have major attractions close by? The property on the beach is better than the property a block back. Some resorts feature solitude and a “get away” location with great views of the wilderness. What will suit your lifestyle and desires?

The Design. Was the project a motel conversion or purpose built? Some motel conversions are excellent. Others result in turning a substandard motel into a substandard timeshare. Is the property a mix of Studio, One and Two Bedroom units? Is it attractive and well laid out or just a box? The more attractive the physical layout of the property and the unit floorplans, the better.

The Management. First and foremost: Are the units clean? Look for dust, non-working windows, squeaking doors, seedy landscaping, etc. The better maintained the property, the higher the value. Does the appearance please you?

The Fiscal Stability. This is harder to find because it is not visible. Ask for a copy of the Owner’s Association budget or financial statements. If this is out of your area of expertise, ask the Owners around the pool. Have there been a lot of special assessments? If there is a professional Property Manager (a CPM or RRP), ask them. Is the project “living beyond its means”? Look for the reserve study. When will the property need a new roof and will the money be in the bank to pay for it? Another non-technical way is to review the last few minutes of the Board of Directors meetings.

The Unit Size. As a general rule, the people who buy the larger units are the happiest. The ability to bring friends and family along on a vacation is not to be overlooked. Two bedroom units offer this possibility. In other cases you may not want this possibility to exist so a smaller unit will be the best selection. Think it over not only for the present, but also for the future. Young singles have bought studio units. They don’t work so well after the marriage and the third child.

The Season. Buy the high season if that is what you wish to consistently use. If the summertime is high season and you are a schoolteacher who can only vacation then, you should go ahead, bite the bullet and buy that season, even though it may be at a premium price. If you have school age children the same applies. Sometimes, the reverse is true. For example, we have many Owners of Southern California beachfront resorts who live in the east and Midwest and have specifically purchased the “off season” because it gets them out of the cold. It works perfectly for them.

The Price. This is last on purpose. You are looking at buying a lifetime possession. If you get the wrong one, the dissatisfaction will be present long after you have forgotten what you paid for it. At current resale prices, I don’t think there is any way to lose. Resale timeshares are like antique furniture. They will either hold their value or increase with time. Look at resales as though they will not really cost you money, they will save it. The worst that will happen is that you will have a lifetime of incredible vacations and at the end you will sell it and get all or most of your money back. The longer you own, the better it will be because alternate accommodations (hotels) will only cost more in time due to inflation. The best units in the best season in the best projects have held their value best. Currently, resale prices are generally half of the original developer sale price. In some cases it may be less and in some more. To assure yourself of not paying more than you have to, shop around. Call a title company in the area to find out what the resales in a specific resort are going for. Ask a resale Broker to show you some comparatives. In other words go about it as you would buying a house. Obviously it is not as major a purchase, but time spent getting the right product is absolutely worth it. Remember that you will own it for years. Another trap to avoid is that of buying a cheap timeshare for exchange. Make no mistake. Low quality exchanges for low quality with only rare exceptions.

Key Point - Since we are offering 80% financing for the purchase of timeshare resales, you can now afford to buy the best property; the one you really want. You will be much happier in the long run if you do. All this may be summed up by one phrase:

Buy Quality!!

The “hard” sales techniques, unexplainable price drops, and low-quality resorts are generally disappearing. That means many vacationers now view timesharing as a viable and economical option for future vacations. But they need to know much more to make an intelligent purchase.

With the entrance of companies like Disney, Marriott, and Hilton into the field, the timeshare market is exploding. In the past two years, almost 500,000 households have purchased a total of more than 700,000 week-long units at timeshare resorts. That means there are more than 2 million owners at more than 2,000 resorts worldwide. Contrary to popular belief, a recent study by leisure survey experts Ragatz Associates showed that more than 80% of these owners are happy with their purchase.

“It is clear that timesharing is gaining in popularity, not only here in the U.S., but also across Europe, Mexico, and in South America,” says Tom Franks, president of the American Resort Development Association, the timeshare industry body, based in Washington, D.C.

THE BASICS

In timesharing, consumers typically buy one or more weeks at a specific resort and can return to that resort every year or “trade” it for a week at another resort with an exchange company. Prices currently average about $9,000, with annual maintenance fees of around $300.

Vacation timesharing generally takes one of two forms: “Fee” timesharing gives the purchaser permanent rights–in the form of a deed–to the property. About 85% of timeshare resorts sell under fee-ownership agreements. “Right-to-use” timesharing grants the purchaser the rights to the use of the property for an established period of time, such as 30 years. Under this type of timesharing, the purchaser does not receive a deed.

Rather than return to their home resort every year, many owners opt to exchange their week for a week at one of thousands of other timeshare properties worldwide. For a fee (usually less than $100), companies like Resorts Condominiums International (317/876-1692) or Interval International (305/666-1861) perform these exchange services for member resorts and owners.

Many owners say this exchange privilege was a key reason for buying and have had much success with the exchanges. The keys to successful exchangers are: buying at a popular resort (this increases exchange power); “depositing” the week with an exchange company as early as possible (this gives the exchange company more time to find a user for the week being exchanged); and being flexible on the desired destination, resort, and dates of travel.

SOME SPECIFICS

The Orlando, Florida area serves as an ideal example of what’s available. It’s a huge market for vacationers from throughout the world in search of a piece of that Orlando “magic.” There are dozens of options available and the area is a great place to own one or more weeks, if you know where to go.

Well-established possibilities include: Island One (407/859-8900); Marriott (813/688-7700); Orange Lake (407/239-1082); and Vistana (407/239-3008). At these and other resorts, you’ll find a full host of amenities, often including kitchens, decks, pools, restaurants, golf courses, tennis courts, and much more. These timeshare resorts are more like fully-equipped apartments or suites, rather than standard hotel rooms.

Walt Disney World recently opened their first timeshare resort, the Disney Vacation Club (407/939-3100). As would be expected, they have developed some unique features for their timeshare concept.

Disney tackled two of the major issues in the timeshare industry today: flexibility and aggressive sales techniques. Along with many other timeshare properties, Disney has moved to improve these two areas and the early reviews give them high marks.

By purchasing a real estate interest in Disney Vacation Club Resort, guests automatically become members of Disney Vacation Club and are entitled to a variety of exclusive benefits and privileges. Members also receive an annual allotment of vacation points, which may be used on vacations at the resort or at more than 100 worldwide resorts currently offered through a “Member Getaways” program with RCI.

“The flexibility of choosing among several different vacation experiences is what sets the Disney Vacation Club apart from many similar plans,” says General Manager Mark Pacala. “The vacation point system allows members to select the type of vacation best suited to their needs, particularly as those needs change from year to year.”

Disney has also attacked the overly-aggressive sales techniques that used to plague the industry. They don’t provide any incentives or awards for prospects attending the sales presentation and their sales force mostly receives a fixed salary, rather than high commissions for high volume.

For a one-time purchase price, guests may purchase a real estate interest in the resort, which expires after 50 years. Prices currently run from $11,730 to around $16,000.

The points system, which is becoming much more popular in the timeshare industry, is much easier to understand than it first appears. Let’s say that with your Disney Vacation Club ownership interest you have 270 points to use each year. You could reserve a two-bedroom home for a week’s stay in June or enjoy a five-day family reunion in July in a three-bedroom Grand Villa. Other options would be to reserve a two-bedroom home for a nine-day stay in September or an incredible stay of several weeks in a studio unit.

Disney’s timeshare operation is typical of the exciting future for the industry and astute timeshare buyers. There are timesharing options throughout the U.S., with huge multi-site options like Hilton Grand Vacations (813/482-7766); Fairfield Communities (800/251-8736); and the Lawrence Welk Resort Group (619/485-5556); as well as small and intimate single-resort operations. You’ll find apartment-like accommodations in a resort-like atmosphere.

WORLDWIDE OPTIONS

Timesharing is not limited to the U.S. at all. This worldwide industry is very popular in Mexico, South America, Europe, and several other parts of the world.

More than 100,000 weeks were sold in Mexico last year at more than 100 different resorts. Prices tend to be lower than the average $9,000 purchase price in the U.S.

Potential buyers should consider Cancun and Cozumel; Puerto Vallarta; Acapulco; Ixtapa; and Manzanillo, a regional resort area for Mexico City, which is favored by Mexicans and generally features even lower prices (less than $5,000). To get started in Mexico, contact reputable multi-resort operator COSTAMEX at 305/267-7855.

South America is a relatively new hot-spot for timesharing, but the industry there is growing quickly. The Argentinian coast and mountains (skiing during the U.S. summer) are currently the most popular spots for development. Visitors to Argentina should explore the options in Buenas Aires, Mar del Plata, Miramar, and the Cerro Catedral ski area. The Uruguay coast resort area of Punta del Este is also becoming a timeshare hub.

Timesharing actually started in Europe, before blossoming in the U.S. There are hundreds of options throughout Western Europe, the Mediterranean, and Scandinavia. As can be expected, resorts are most prevalent along the coasts and in the Alps.

Southern Spain is probably the leader in sunny European timesharing. Dozens of timeshare resorts dot the Costa del Sol area. It’s easy to comparison shop along the coast, but definitely check out several of Club Riviera’s options (011-34-52-831252). Other timeshare hotspots include the Canary Islands, Portugal, the French Riviera, Greece, and Turkey.

The Alps appeal to many timeshare buyers and for good reason. A timeshare unit can save lots of money on ski trips or a summer vacations in the mountains. There are several options in the French Alps, Switzerland, and Germany’s Bavaria, but Austria seems to have the best overall bets. Timesharing Ferienclub Jausern in Sallbach-Hinterglemm (011-43-65-41-503) is typical of Austria’s club-like mountain resorts.

BUYERS BEWARE

Timesharing isn’t for everyone. It’s not a true real estate “investment” and the resale market is tight. Simply put, plan to buy it, keep it, and enjoy it.

The industry body ARDA (see below) has many excellent publications about timeshare purchase. Their office is a great starting point for interested buyers.

It actually makes great sense for the kids. In previous articles we have told the story of the Mark Hopkins hotel in San Francisco. For those who missed it, the 1942 nightly rack rate was $5.00 single and $7.00 double. By 1974 it was $45.00 and $55.00. Last year it was $210 to $270 single or double depending on location. Carrying that price increase forward another 50 years will set the price at $9,058.00 per night!! Can’t happen, you say? It did happen and there is absolutely no reason it won’t happen again. Now what will the kids think of you when they are saving this kind of money down the road? They will think their parents were just about the brightest people in the whole world and they will think that every time they vacation. What a great legacy!!

Why, then don’t they want it now? Even for free? Well, you think back. Several years ago did you wake up one morning, look at each other and say, “This is sure a great day to go out and buy a timeshare?” We all know that didn’t happen. No, you went out not to buy, but just to pick up your free car, Hawaiian vacation or other “free” gift. After you had left the sales presentation, you said, “What happened?” Not only had you paid for your own “free” gift, but you had also paid for those of the other nine people who didn’t buy. You probably didn’t give a lot of logical thought to this purchase as you were intentionally swept away by the slick emotional sales method employed.

So now you offer it to the kids and they decline. Why is that? It is almost always the cost of upkeep that the kids focus upon. The dues of from $350 to $500 and taxes of from $30 to $90 knock them out. They can’t envision spending that much on a vacation. The fact is that they will probably spend a lot more than that even now for a product that isn’t one tenth as good. But the reality is that they have not been sold the product. How many parents will become salespeople to their kids to show and sell them on the advantages of the product before it is offered?

Part of it is timing. If the kids are too young or really financially struggling, it is not a good time to offer the gift. Wait until they don’t have those kind of pressures. Also, have you used the timeshare as a family? If not, how could they know how good it is? On the other hand, if they have used it with you as kids and really enjoyed it, and if they now have kids of their own and are struggling with the ever-increasing cost of vacations, their reception will be much different. Timing is everything.

Don’t neglect the selling of the benefits. Before offering it to them, open the RCI or Interval International catalog and show them all the neat places they can go. If you have already taken them to some of these, it will just be that much easier. Don’t overlook the fact that you should really be able to offer one to each of your offspring. Fortunately, resales offer the opportunity to pick up these additional timeshares at a fraction of what you originally spent. And what a gift it is!! They talk about the gift that keeps on giving. This is one that will provide your children with a lifetime of pleasure. And their children after that.

You might also clip out this article for your kids for the time when they will pass it along to their children.

One final caution. Don’t just add their names to the Deed! In disposing of resale timeshares one of our worst problems has been straightening out improperly deeded property. In some cases it has resulted in the property being unsaleable. In one case a mother just added her four kids names to the deed without any thought to their spouses some of whom were ex-spouses by the time we got into the picture. A nationwide manhunt insued to find the ex-spouses and talk them into signing a quit claim deed. Don’t forget that most timeshares are in fact real property and follow those rules. You are almost always better off obtaining the services of a professional.

The lifetime value of timeshares is just starting to be realized now. It will still take a few more years before it is completely obvious to everyone. When it does, the value of resales will increase dramatically.