Timeshare Resales
2009/01/29 Originally published in the Vernon Morning Star.
Recently, I had a call from one of my readers. She was wondering how to go about selling the vacation timeshare she had purchased several years ago.
A timeshare interest is defined as a person's interest in a timeshare plan. A timeshare plan is a plan in which the persons participating each have a right of recurring use for a certain number of years, of all or part of the land/property/condo/hotel room.
A timeshare plan does not require that the persons acquire an ownership interest in the land/property/condo/hotel room. We see them most often applied to resort properties in holiday destinations throughout the world. There are many different types and systems of timeshares and ownerships. The buyer pays a certain price at the outset plus an annual fee of roughly $300 - $700 per share per week depending on size of unit, location and quality of the resort, etc. etc. There are probably annual fees both higher and lower than this. I'm just using figures I have seen myself in various timeshare offerings I've read about.
Most timeshares I have seen cost at least $5,000 per week at the outset, in addition to the annual fees. I have also seen them priced at $40,000-$50,000 and more. It's my observation that timeshare resales are sold for less than the original prices paid, although I suppose that may not always be the case. Timeshares are commonly in exchanges so that the owner can "trade" their resort time for that time in a resort elsewhere in the world. I understand that the better the location of your timeshare property, the more easily it trades for other destinations.
Timeshares are not to be confused with fractional ownerships and perhaps I'll explain that in a future column.
But, to get back to my reader's question of how does she sell it. Canadian Realtors don't normally do this for three reasons. Firstly, there is usually no interest in the land so we're not licensed to do this. Secondly, we have little or no training in this field. Thirdly, we may have to charge a fee of perhaps a third or a half of the value of the share just to have a budget to promote and advertise.
I think most timeshare owners go to the most reputable timeshare resale companies they can find. They also go back to the company where they originally bought it as that can be a source of buyers. For example, existing timeshare owners may want to pick up additional weeks so they can vacation longer. Or perhaps happy vacationers at the resort want to buy a timeshare so they know they can get that same time next year. Another method to find buyers is the vacation section of your local newspaper. Would-be holiday'ers read those ads when they are thinking of booking their next vacations and may consider the option of a timeshare purchase.
To seek out reputable timeshare resale companies may be a daunting task. If you find a company you think you may like to deal with, do check with the Better Business Bureau or the equivalent in that country before proceeding.
Always seek a good lawyer to assist you in asking the right questions and to read over anything you may be asked to sign.
By the way, I have no substantial expertise in this subject. I only know the little I have learned in talking to timeshare salespeople a few times while on my holidays, and to friends and clients.
It does occur to me that this might be a better time to purchase a timeshare, if you are so inclined. Because of the U.S. recession it's likely there are some lower prices being offered.
Thank you to my reader for suggesting this topic.
Jane Field works with RE/MAX Vernon. Jane has over 30 years experience in the Real Estate business. To suggest topics for future articles or to ask Jane questions, email her or call 503-3755.
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