Timeshares Worth it?

[thegimp03]

My parents own a few Marriott timeshares in Hawaii. FYI, this is the best place to buy a timeshare, because it's the most popular place and the easiest to trade out of and go somewhere else for a week. Timeshares are definitely not investments because Marriott will screw you when you want to sell it back to them, then resell it to someone else at a higher price.

My parents look at the timeshares as a prepaid vacation. Yes, there is a yearly maintenance fee, but that's part of the deal to keep the property in shape so that when you keep going there for 30 years it's not falling down. In a place like Hawaii where room rates in good hotels can be $300+ a night, a week vacation can easily cost a couple thousand dollars and are likely to keep increasing. The timeshare is a way to hedge against that increasing room rate. People will retire and will not have as much disposable income on hand to blow in Hawaii for a week, the timeshare comes in handy because the only thing costing people to go will be plane tickets and food. That's the way my parents look at it.

From my point of view, there are positives and negatives. If you're looking at buying one as an investment, that's not a good idea. If you want one as an alternative to a house or condo (which would probably require a whole lot more upkeep than the yearly maintenance fee a timeshare has, not to mention property taxes and utilities), then they're not a bad idea.

 

[dullard]

Think of it in terms of investments. Suppose you have $12,950 right now to use. You could either (1) buy this timeshare or (2) invest it. Which is the better use of your money?

In case (1), you still need to pay $435/year, but you MIGHT save $1200/year on a vacation (a typical Marriot suite price for a week). Best case scenario: you gain $1200-$435 = $765 a year. Worst case scenario: you can't use it for one of many reasons and you lose $435. Since people tend to use their time share only about half the time, the EXPECTED gain is $300/year. When it is all said and done, you can sell the time share for scraps (maybe a few thousand dollars).

In case (2), it all depends on the interest rate. Lets suppose you put that $12,950 into your house mortgage at 5% interest. Then each and every year you'll gain $12,950*5% = $647 no matter what. When it is all said and done (by selling the house), you'll get your full $12,950 back.

So do you want (1) your $12,950 to earn an expected $300 and at the end be worth half of what it started? Or do you want (2) your $12,950 to earn an expected $647 and at the end be worth $12,950? The math is pretty simple.

But what if you invested in the stock market and got the expected 10% return? Now the investment gains you $1295/year which is basically enough to buy the Marriot vacation outright without any annual upkeep.

Pretty soon, you see that the full-priced timeshare is a scam. Everyone I know with a timeshare hates it. And it always eventually becomes a useless vacation that costs you hundreds of dollars a year and you can't use (ie if you are old/sick, lose a job and can't vacation, want to go where there isn't a Marriot and where you can't trade your timeshare). Then you ditch it for pennies on the dollar to the next sucker.

Like someone said above, if you really want to get this timeshare headache (instead of just bargaining for better room rates which is far easier), then your only good move is to buy it from the last timeshare sucker.

 

[runzwithsizorz]

We have acquired 7 over the coarse of 20 years or so, and it works for us. We are retired, and with careful planning/booking we can stay at the finest resorts for up to 8 weeks a year anywhere in the world. You can also trade for cruises, and houseboats. In most cases you will be staying at your destination for at least a week, so it's nice to have a FULL kitchen,washer/dryer,jacuzzi, bbq, etc. We have given, or rented weeks to family,and friends, or even donated them for charity auctions. You can also choose to rent them, as an example, we got one heck of a price for our 2 bedroom suite in Palm Springs booked for the Bob Hope classic.That being said, for 90% of the populous I would highly recommend AGAINST making a purchase now. If you do, never, ever pay developer prices EVER! My advise is to check out the many sites that you can rent, or buy securely, Tug, and Redweek are 2 of the best. You could even PM me and tell me where you want to go, and when. A word of warning, once you get your wife out of the cramped, $100, to $200 a night rooms with only a small coffee maker, and mini fridge, and into a 700sq.ft. one bedroom suite she may never want to go back.

 

[RaistlinZ]

Friends don't let friends buy timeshares. Timeshare salesmen rank right behind telemarketers, IMO.

 

[RaistlinZ]

dp

 

[boomerang]

We've got one on Maui. We wish we didn't own it at this point but I would not say we regret the purchase. If you use the time and want to go to other places, they are not a bad way to go. The key is using the time. You'll pay a fortune for a comparable hotel suite in the same area. If you like to vacation and stay at nice places, they are worth considering IMO.

As was said, do not buy from the resort proper. Do not buy through a salesperson. Buy on the open market at a price that is comparatively, pennies on the dollar. Beware of maintenance fees. They don't stay static.

There are ads by private owners here that you should look at. http://tug2.net/ Click on 'Marketplace'. Not all ads there are private so be aware of that. Not all the pricing is reasonable so do your homework.

We're not traveling like we used to. We've been successfully in renting our unit out to cover the maintenance fees using Craigslist. I'd be willing to sell our 2BR 2BA unit dirt cheap.

In closing where you own is key. It's easy to trade Florida, Hawaii and some others. Nebraska doesn't trade very well.

Timeshares are not an investment. If you can't use the time don't make the purchase.

Cal166, PM me if you want. I'll answer your questions as best I can. We've owned ours for 16 years.

 

[alkemyst]

My parents timeshares are local, One's a Marriott top level or whatever...the other part of a smaller swap circle. Both are places we all like to get away to for a week or so. They usually take a separate 'large' vacation at another time.

They are definitely not investments...more akin to a boat or motorcycle. Fun to take out, but you will never get your money out of them. The deal is we keep them in the family and don't ever sell them off.