A timeshare can put you on the beach--year after year.
Timeshares are vacation properties in which the timeshare owner is entitled to use the property for a specific length of time each year. Developers or resorts sell new timeshares. The resale of a timeshare occurs when the original, or a subsequent, owner decides to sell.
Deciding to Buy
Resale timeshares are in places where people want to spend vacations year after year. These places, often a beach or a ski resort, provide the vacation experience that makes the investment in a timeshare worthwhile. Sometimes people have vacationed in an area, or they visit a location they might want to vacation in the future. Touring the available timeshares and talking to people about how much they like them is recommended. Another good way to learn about a particular resort, and also about the timeshare lifestyle, is to rent a timeshare. People who rent have a chance to learn about the locality, the amenities, the people, and the quality of maintenance--all important considerations---before deciding to buy.
Why Buy a Resale Timeshare?
The resale buyer only has to pay the market value of the property. This can be as much as 65 percent below the original price. Timeshare developers incur significant marketing costs. The promotions, freebies, sales pitches, and sales commissions necessary to persuade people to buy the timeshares all are included in the developers' prices. Even with the large discounts available from the the original prices, resale timeshares are best thought of as places for vacation enjoyment and not investments for financial gain.
The Purchase
The price of a resale timeshare depends on location, size, age of the unit, resort amenities, peak or off-peak time of year, and the demand for timeshares at the time. As with other real estate, the purchase price is just part of the total cost of the transaction. Buying a resale timeshare involves closing costs, title transfer costs, deed preparation costs and others. It is best to have a respected and experienced timeshare closing company handle the closing.
Rights and Responsibilities
If a timeshare is a deeded property, the rights to it are the same as for any real estate. It can be used by the owner, given to his or her children, rented or sold. The deed must be recorded with the county clerk to protect the rights of ownership. Other types of "ownership" have different conditions. One of these is "right to use." This is, in effect, a time-limited lease and rights of the owner may also be limited. A fundamental consideration in a lease is the number of years remaining on it.
The purchase of a resale timeshare will include membership in an owners' association. This may require participation in the decisions. The owners' association may determine maintenance fees, or it may be the developer. In either case, the owner is responsible for paying the fees. Maintenance fees not only pay for upkeep, but also for insurance, repairs, utilities and property taxes.
Selling a Timeshare
The seller's side of the resale transaction must be considered to ensure both parties are treated fairly. It is best for both sides if the transaction is handled by a licensed real estate broker. It is possible that the buyer and seller never meet, so a reliable intermediary is essential, even if a 10 to 25 percent commission is involved. The seller should include in the listing for the property all significant information about type of sale, condition of the unit, current maintenance fees, whether ownership includes participation in an exchange plan, and any amenities that are part of ownership. The buyer should carefully examine the listing and the sales agreement to ensure all relevant points are covered and clearly set out.
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