Weighing Up The Pros And Cons Of Timeshares

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There are advantages and disadvantages to everything in life and they vary from person to person. You will need to consider whether buying a timeshare suits your personal lifestyle and finances. Will you be investing your hard-earned nest egg or only a small part of your overall worth? Whatever your situation, however, any intelligent investor will certainly scrutinize the pros and cons of the investment carefully.

Looking at the advantages first - To start with, timeshares are clearly far more economical than buying a piece of real estate for a lifetime if, realistically, you are only going to end up using the property once a year. If you spent $200,000 on a property compared to investing a much lower amount, say $10,000 plus $500 annual maintenance fees, in a timeshare property over 30 years the maths would look like this:

$10,000 (initial purchase) + 30 years x $500 (fees) = $25,000 for 30 years

The total saving would be $175,000 compared to a real estate property! Quite a sum! How much of a good investment is it to put that much money into a property used so little?

Now let’s also compare this with staying in a hotel for 30 years. We’ll use a modest $1,200 per year as our base cost:

$1,200 hotel costs per annum x 30 year lifetime = $36,000 (still $11,000 more than the $25,000 timeshare costs over 30 years!)

Not only do you save money but you still have all the home comforts of staying in your own place rather than a hotel suite. Typically, today’s timeshare condos have two or three bedrooms, a couple of bathrooms, a kitchen, a dining room and its own laundry room…and last but certainly not least - an indoor or outdoor pool! Add all this to everything the resort has to offer and you have the perfect combination of home comforts and full facilities.

If you have a timeshare the hassle of dealing with general upkeep of the condo is all dealt with by the developer. Gone is the constant worry of the maintenance needed on a piece of real estate property.

Also, if you or your partner are bad at scheduling vacation time, with a timeshare you will definitely make a point of taking at least one vacation a year! What could be more relaxing than planning a trip to your own timeshare condo?

Most timeshare developers are linked to other timeshare companies which greatly facilitates timeshare exchange - yet another reason why people are so keen to buy timeshares.

If we talk a little about the disadvantages of timeshare, unfortunately it’s a sector that has seen its share of fraudsters of late and been plagued with scammers. Stories abound of people being hit with unethical, pressurized selling techniques after having innocently attended free seminars about timeshare. Steer clear of these scams. Do read all paperwork carefully before signing it and pay attention to the fine print! Do your research and find out who the timeshare company is before you buy.

If you pay a large deposit you may be losing interest on any moneys you’ve borrowed, plus you will also be paying the maintenance costs.

Probably the biggest disadvantage is the lack of appreciation. Timeshares don’t tend to appreciate in value and can even depreciate over time. They are also more difficult to resell than real estate property.

One final point is that the lack of flexibility of timeshares may not suit everybody as you are necessarily tied to using it each year at a specific time. Although some companies offer flexibility you are always competing with many other timeshare owners who may be planning to take their holiday at the same time.

For more advice about Timeshare please visit Timeshare Advice or the Vacation & Travel Resource Worldly Wise

Tags: investment, investment property, timeshare, timeshare pros and cons, timeshare resell, timeshares

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