Timeshare resales: Plenty of sellers remain in the market
(Third in a series)
The speaker at the other end of the line wasn’t frantic or desperate. She was simply a person wanting closure, and a need to move on.
“Can you tell me of a charity I can donate this timeshare to,” the caller said. “I simply can’t make the annual payments anymore. I have already considered what I paid for it as lost money, but I just want to get out from under the payments.”
Other callers to “Real Estate Today” on Sunday mornings shared the same message: They had tried the conventional ways of selling their timeshare – newspaper advertising, Internet exposure, church bulletins – but many had no takers.
In fact, I had my own story to tell. I spent hundreds of dollars marketing a timeshare 20 years ago and considered myself extremely fortunate to get back most of my investment.
I have counted my lucky stars since. Such luck is virtually unheard of nowadays.
The bottom line is what was true 20 years ago remains true today: there is a huge glut of resale timeshares available in this country, many of which can be purchased for pennies on the dollar, according to Trevor Hein of Lynnwood-based The Timeshare Exit Team.
“You are better off staying at a hotel than buying a timeshare,” Hein said. “If you paid $15,000 for the initial purchase and if you add the $900 maintenance fee paid over a 15 year period, there is a total investment of $28,500. You have just pre-paid a company for your vacations over your lifetime at an average per night rate of $271. For that rate, I will stay at the Fairmont in Maui and book it when I want to go. Best of all, you have spent no capital to have the right to stay at the Fairmont so that money will be sitting in your bank account collecting interest.”
But let’s face it: timeshares also make sense for a lot of people in this country. Typical owners are couples, well-educated, middle aged with upper-middle income. The timeshare association reported that 55.7 percent have at least a bachelor’s degree, 67.5 percent are 45 years of age or older and 69.5 percent have annual incomes over $50,000.
The pitch, which often comes with a free or reduced rate to a terrific resort, is difficult to turn down. The sales agents do an impressive job of driving home the idea that the average family cannot afford a second home and that vacation time is limited. Why purchase and maintain your own getaway, they say, if you only can get away a few weeks of the year?
Some people swear timeshares are the only way to travel with a family and that the international “bank” of resorts not only offers flexibility but also destinations they normally would not consider. Well, I assume most of those owners can plan far in advance, or travel at a moment’s notice. I know that the schedules of two working spouses and four active kids in different schools do not lend themselves to timesharing.
Twenty years ago we bought a timeshare with dreams of kicking back in a variety of Northwest resorts, seeing America with the kids from a conveniently located, already-paid-for base condo. We would save Christmas money one year, we vowed, and fly to a sunny beachfront location in St. Somewhere.
It didn’t happen. Youth basketball tournaments, family reunions, budget restraints and school – coupled with the fact that we are very picky about accommodations – led to a three-year timeshare shutout.
We did attempt to book a few resorts, but we could never connect with the place and week we wanted. Most of the time, it was our inability to be flexible with the week and the size of the unit available. Other times our desired destinations were booked (like Whistler at spring break) or the unit available was nowhere near the location we wanted.
Although I never believed the timeshare would appreciate in value, I did look at the $11,000 purchase price as a sort of prepaid leisure and a guard against rising hotel costs. The $334 annual fee was semi-acceptable at the beginning but seemed extravagant for an owner who did not use the service.
The frustration of not using the timeshare was one thing, but the anxiety about not being able to sell it gnawed away at our future budget and vacation plans for more than a year. I could not justify spending more money on travel until at least some of the timeshare cash was returned. That turned out to be a long and anxious time.
Next week: Actually selling a timeshare is difficult and time-consuming.
Tom Kelly’s new novel “Cold Crossover” is now available in print at bookstores everywhere and in both print and Ebook form from a variety of digital outlets. Follow real estate agent and former basketball coach Ernie Creekmore as investigates the disappearance of his star player on a late-night boat. Check out the national reviews and put “Cold Crossover” on your list.