Has timeshare had its day?
Once a passport to luxury vacations, many experts now dismiss timeshare as outdated, outmoded and unable to compete with the modern travel industry.
Compared to regular hotel stays, vacationing through timeshare is undeniably more expensive. "On an annual basis the timeshare costs are around the same as regular vacations, provided members vacation in their home resort," explains Suzanne Stojanovic, spokesperson for American Consumer Claims (ACC). "The management fees approximate to what non-members pay for the same vacation through Expedia etc. Where timeshare members rack up extra expense is by paying the initial joining fees (usually well over $12,000 per week or equivalent in points), plus various extra costs, like exchange company membership, exchange fees, banking their week etc. These costs don't apply to non-members who just book a week when and where they want, and pay the rental for what they use."
Timeshares have evolved a lot since their inception in the 1960s. Ostensibly, you can now exchange for a cruise, a canal boat or even an RV. Even with the effort timeshare has made to improve, it can never match the freedom of choice a regular vacationer has, and here’s why:
RCI (the main timeshare exchange company) has 4300 exchange possibilities.
The non-member can choose from around 700,000 hotels in the world, and that's before you consider apartments, villas etc, plus practically endless alternatives like RV hire, camping, and cruises. They can even rent units in most of those 4300 RCI properties without owning a timeshare themselves.
Many of the exchange options through RCI come with so many conditions and regimental timeframes that owners prefer to book externally anyway. However much extra choice RCI claims to add, the timeshare owner is still paying to self-limit to the RCI brochure instead of the whole rest of the travel sector.
The considerable initial timeshare joining fee entitles the proud new owner to a certain amount of vacations per year (subject to conditions). Most timeshare contracts are written in “perpetuity” which effectively means “forever”.
The flip side of that deal is that the owner is also committing to paying fees for those vacations for the full duration of the membership whether they use it or not.
This became a serious point of contention for many owners during the pandemic. People were sold on the premise that becoming members would force them to take the vacations they deserve. However timeshare contracts don't actually guarantee a vacation. Instead they explain the fee as 'management'. The vacation is incidental. In 2020 for example when nobody could take a vacation, virtually all timeshare owners still had to pay their annual fees in full.
Many timeshare owners believed that they would one-day hand the membership down to their kids, but kids are saying 'no thanks' to that commitment. They don't want any part of owning a timeshare.
Exclusivity, but not exclusive
Probably the biggest bugbear for people caught in the timeshare system is that they believed they were paying a lot of money for access to luxury resorts not available to the general public. "People didn't mind paying a lot of money to have something special," notes Stojanovic. "The trouble is that most companies made the decision to rent out their unused inventory through regular booking sites like Expedia. The resorts are no longer exclusive to their paid up members.
"While this helps the resorts financially, it infuriates members who have paid through the nose for an exclusive membership. They have in effect paid for nothing."
"A lot of timeshare owners are desperate to get out of their memberships," says Stojanovic. "Nowadays the rest of the travel industry is looking a lot more appealing than their membership, and they want to be able to enjoy what non members have access to, instead of their limited system."
It is not easy to escape from a timeshare commitment. The contracts are designed to keep members from leaving, because the resorts need the annual fees. It usually takes expert assistance to help someone relinquish a timeshare ownership. A Google search of how to escape yields pages of results, most of whom are criminals looking to charge fees but then disappear without providing the service.
For advice on your specific timeshare situation, get in touch with our team.
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