By now, most people have at least heard of timeshares. But not everyone knows what they are, and fewer still know how they work. If you have questions about timeshares, we have answers! In short, a timeshare, or “vacation ownership,” is a type of vacation lifestyle product conferring shared ownership of a resort unit in the form of a fixed amount of annually allotted time. If you have a favorite vacation spot you visit yearly, then a timeshare could be for you. Don’t travel annually, or don’t want to commit to the same destination year after year? With modern advances like points-based ownership and timeshare exchange platforms, you can keep your options open. So, what is a timeshare? We’ll guide you through everything you need to know, including how timeshare works, types of ownership, the benefits of timeshare, and more!
- History of Timeshare
- What is a Timeshare?
- Types of Timeshares and How They Work
- Types of Timeshare Contracts
- Timeshare Ownership Subtypes
- Is Owning a Timeshare Worth It?
- Benefits of Vacation Ownership
- What is Vacation Exchange?
- How Much Do Timeshares Cost?
- How to Buy a Timeshare
- Can You Finance a Timeshare?
- How to Sell a Timeshare
- How to Avoid Timeshare Scams
- Timeshare Broker Associates: A Name You Can Trust
History of Timeshare
The term “timeshare” was coined in the UK in 1962, but the concept dates back to the ‘40s. After WWII, when Europe reopened for intracontinental travel, the practice of “holiday home sharing” was established. This practice saw groups of four (usually related) European families buying vacation cottages jointly and splitting the usage rights by season. However, as few families could afford to spend the whole season on vacation, these cottages often sat vacant for long periods of time.
Seeing this opportunity, British businesses established what could be considered the first modern timeshare in the ’50s, dividing a resort room into 1/50th ownership, closing for two weeks of maintenance, and charging maintenance fees. But it would take another decade for this business model to really catch on.
What is a Timeshare?
A timeshare is a vacation property (usually a villa or condo-style suite) whose usage rights are divided into fixed increments of time and shared between multiple owners. Usually, vacation ownership is split 52 ways, giving each timeshare owner the right to a full week of usage.
While timeshares traditionally conferred the same week at the same resort every year, today, most timeshares are owned by large brands like Wyndham and Disney, which have moved over to a points-based, travel club-style ownership system, giving members more flexibility in where and when they travel.
Types of Timeshares and How They Work
There are several types of timeshare agreements and several subtypes of ownership. Knowing exactly what kind of timeshare you’re buying is important, not only for your ownership but for any prospect of selling it in the future. Get familiar with the types and subtypes of timeshares below. And if you decide to buy, be sure to read your contract!
Types of Timeshare Contracts
Timeshare agreements are divided into three main types: deeded, right to use, and leasehold. Let’s break them down!
Deeded Week Timeshares
Typically, signees of a deeded timeshare contract own a specific week or fixed week, during which they may enjoy usage rights each year. A deeded timeshare’s contract confers the same rights of ownership as any real estate deed. Signees own the timeshare in perpetuity and may sell, rent, bequeath, or gift the property. However, unlike traditional deeded real estate, deeded timeshares are not investments and will not appreciate in value.
Right to Use (RTU) Timeshares
With a right to use (RTU) contract, signees don’t technically own the timeshare. Instead, this lease-based contract accords “owners” usage rights that expire after an agreed amount of time, typically 30 to 99 years. After that, ownership of the leased timeshare goes back to the resort, or the lease is terminated. Right-to-use contracts are most commonly found in international travel destinations. This is because travelers are not legally allowed to own real estate in countries where they are not citizens.
Leasehold Timeshares
A leasehold timeshare agreement is similar to a right to use timeshare in that ownership expires after a set amount of time. However, unlike a RTU contract, every timeshare contract at a given resort has the same expiration year. This is because, with leasehold timeshares, the resort or brand “leases” the land from a developer. Disney Vacation Club is a prime example. As a leasehold timeshare, DVC builds its resorts on land it leases from Disney Vacation Development.
Timeshare Ownership Subtypes
Timeshares are further broken down into different types of ownership. Read on to learn about timeshare ownership subtypes.
Fixed Week Timeshares
Timeshares first came into popularity in the U.S. in the 1970s, offering owners a one-week increment of time at the same resort, and usually the same unit, every year. In this “fixed week” ownership type, the week number also never changes. Different resorts have different calendar systems, but typically the first week of January is designated week one, and the last week of December week 52, with check-in dates usually falling on a Friday, Saturday, or Sunday.
Until relatively recently, fixed week timeshares have been the standard timeshare ownership subtype. Fixed week timeshares are ideal if you have a favorite vacation destination you return to every year, letting you secure your favorite week without having to make reservations ahead of time.
Floating Week Timeshares
Looking for a more flexible type of timeshare ownership? With a floating week timeshare, each year, the owner has the same number of days of use, but the dates may vary according to a first-come, first-serve basis. In some cases, floating weeks have seasonal restrictions. For example, an owner with a summer floating week can book any week that falls within the summer season. Depending on location and demand, certain seasons may have a higher value than others.
Points-Based Timeshares
Today, points-based timeshares are by far the most popular type, and most timeshare companies have moved over to a points-based ownership system. Points-based timeshares offer the most flexibility of any type of ownership.
In the most basic sense, timeshare points operate as vacation currency. Each year, owners receive an allotment of points they can redeem for a timeshare vacation. But here’s where things get tricky. In some cases, owners buy a specific amount of points they can use at any of their brand’s resorts. These are called pure-points memberships. In other cases, resorts allow owners to convert their fixed week timeshare into points for greater flexibility. In this type of timeshare, the amount of points owners receive depends on the popularity of their “home resort,” season, unit size, and other factors. If owners wish to travel outside their home resort, they can bank or borrow points as needed to stay at their preferred destination.
Annual vs. Biannual vs. Triannual Timeshares
Timeshares also break down into annual, biannual, and triannual ownership. As the names imply, annual ownership confers usage rights every year, while biannual and triannual timeshares may be used every second or third year, respectively. Biannual and triannual timeshares have the advantage of being cheaper than annual timeshares and can be ideal for owners who don’t vacation on a yearly basis.
Is Owning a Timeshare Worth It?
Depending on your needs, owning a timeshare can be a more luxurious, convenient, flexible, and cost-effective way to vacation. Timeshares usually offer residential-style accommodations, resort amenities, long-term savings, and, nowadays, points-based flexibility that lets you broaden your travel horizons.
However, timeshare ownership isn’t for everyone. Keep in mind that a timeshare is an investment in your quality of life, not a monetary investment property. It most likely won’t appreciate over time. Thus, timeshares are great if you use them, but they may not be the best option for those who don’t travel regularly.
Benefits of Vacation Ownership
From luxury accommodations and amenities to long-term savings to points-based flexibility, vacation ownership comes with many benefits.
Residential-Style Accommodations
Unlike a hotel room, a timeshare will typically be a large, residential-style unit like a villa or condo suite. With a timeshare, you can enjoy more legroom, home-like comforts such as kitchens, living and dining areas, private bedrooms, as well as occasional extras like patios or balconies, in-unit spa tubs, and state-of-the-art entertainment centers.
Resort Amenities
Most timeshare accommodations are located within vacation resorts. More often than not, these resorts will feature a range of luxury amenities designed to enhance the fun and convenience of your stay. Common amenities at resort properties include swimming pools, hot tubs, sports courts, as well as practical perks like Wi-Fi and business centers. However, some resorts take it to another level with amenities like water parks, marinas, on-site restaurants, and movie theaters.
Long-Term Savings
Timeshares can cost a pretty penny upfront, but they can save you tens or even hundreds of thousands of dollars over the course of a lifetime. This is because, while hotel room rates will naturally inflate over time, a timeshare is a one-time purchase, letting you lock in tomorrow’s vacations at today’s prices. Not sure if you’ll be able to vacation every year? You can rent out your week or points to cover maintenance fees while you’re not using your timeshare!
Timeshare Flexibility
If timeshares ever fell short of hotels in any regard, it was in the flexibility department. With a fixed week timeshare, owners had to be willing to commit to the same week and location every year. While this still works for many vacationers, today, timeshares have upped their flexibility game with points-based systems that allow owners to redeem their points at any resort in their brand’s network. Moreover, most brands have partnered with exchange platforms like RCI and II, which offer even greater flexibility by letting members trade for other brands on the platform.
What is Vacation Exchange?
Today, most timeshare companies are affiliated with either RCI (formerly known as Resort Condominiums International) or Interval International (II). Some are affiliated with both. Known as vacation exchange platforms, these third-party companies convert your ownership into a new points system, allowing members to trade to stay at even more resorts. Thus, instead of only being able to exchange your points for resorts under your brand name, exchange platforms let you trade outside your brand, giving you access to thousands of RCI- or II-affiliated hotels and resorts worldwide. Members can even redeem their points on unique vacation experiences like cruises and excursions, passes to theme parks and events, travel fares such as plane tickets, car rentals, and much more!
How Much Do Timeshares Cost?
According to the American Resort Development Association, the average timeshare costs about $24,170 in 2023. The initial cost depends on a variety of factors. These can include things like resort and destination popularity, season, week, unit size, and more. The cost over time will depend on how much you’re paying in yearly maintenance fees and how much you’re paying in interest should you choose to finance.
The biggest factor influencing the cost of a timeshare transaction, however, is whether you buy directly from a developer or on the resale market.
Direct Purchase
A direct timeshare purchase involves buying directly from the developer and is usually made at the resort. Direct purchases are what most people think of when they hear timeshare. Prospective timeshare buyers are typically offered a free or deeply discounted stay at the resort, during which they will be assigned a sales representative and given an initial presentation, a tour of the property and accommodations, and finally, a sales pitch.
Resale Purchase
Direct purchase isn’t the only way to buy a timeshare, however. When owners want to exit their ownership, their timeshares often end up on the resale or secondary market. Timeshares for sale on the secondary market can be thousands less than timeshares purchased directly from the developer. And while the name may suggest a second-rate product, brands work hard to keep their timeshares pristine. Thus, a timeshare resale offers the same standards of luxury enjoyed by the original owner.
Timeshare Maintenance Fees
The initial cost isn’t the only expense to keep in mind when buying a timeshare. Like any piece of property, a timeshare property needs to be maintained over time. Thus, whether you buy direct from the timeshare developer or on the resale market, you’ll need to pay annual maintenance fees in order to use the property. Timeshare maintenance fees cost an average of $1,260 in 2023. However, as with the initial cost of the timeshare, your maintenance fees will be influenced by things like the number of points, resort popularity, unit size, and other factors.
How to Buy a Timeshare
Do you want to become one of the thousands of timeshare owners who enjoy the next-level amenities, accommodations, destinations, and savings that only vacation ownership can provide? Before you sign on the dotted line, it’s essential to do your research. Lucky for you, if you’ve made it this far, you’re already ahead of the curve.
You should now be able to answer the question, “What is a timeshare?”. Ready to become a timeshare-buying expert, too? Read on to learn more about the purchase process. Or, check out What Timeshare Buyers Want to Know for everything you need to know about buying vacation ownership.
When you do decide to buy a timeshare, your next decision will be whether to buy retail or resale. Whichever you choose, getting started is relatively easy. If you want to buy directly from the developer, simply plan a vacation at or near your resort of choice. You’ll be able to find and book a tour ahead of time.
If, on the other hand, you decide to buy a timeshare resale, you can use our timeshare directory to browse the timeshare resale market from wherever you are. Filter your search by brand, resort, location, and more to find exactly what you’re looking for. Have questions? Call us at (407) 917-8432 and let our experienced brokers clear things up!
Can You Finance a Timeshare?
Can’t afford to pay for your timeshare out of pocket? You don’t have to! Whether you’re buying a timeshare directly from the developer or on the secondary market, financing options are available to help ease your financial burden.
Planning to buy a timeshare on the resale market? Timeshare Broker Associates can help you find financing. With our partners at Vacation Club Loans, you can get a great loan on almost any timeshare, including from top brands like DVC, Wyndham, and Hilton Grand Vacations. You shouldn’t have to wait to start living the timeshare vacation lifestyle you deserve. With Vacation Club Loans, you can enjoy low interest rates, no prepayment penalty, and fast online approval, and start living your timeshare dreams today!
Buy With Timeshare Broker Associates
As with any type of real estate, you don’t technically need a broker to buy a timeshare. However, just like when purchasing a residential, commercial, or traditional vacation property, when purchasing a timeshare, it’s best to bring in a professional.
As your go-to timeshare resale outlet, Timeshare Broker Associates is your source for the best timeshare brands, resorts, and destinations on the market. And as a fully licensed real estate brokerage, we have the knowledge, resources, and range of services to help you every step of the way through the purchase process, from finding financing to finding the perfect timeshare to making a market-smart offer and closing with confidence.
Best Timeshare Brands
Every timeshare company has its own benefits and systems. So before you buy a timeshare, it’s important that you familiarize yourself with the various brands. Here are some of the top timeshare brands you’ll find with Timeshare Broker Associates:
- Wyndham
- Disney Vacation Club
- Hilton Grand Vacations
- Hyatt Vacation Club
- Marriott Vacation Club
- Bluegreen Vacations
- Holiday Inn Club
- Diamond Resorts
- Exploria
- Breckenridge Grand Vacations
- Welk Resorts
Best Timeshare Resorts
A timeshare resort is more than just a place to stay. With fun-filled amenities like pools, sports courts, planned activities, and more, these properties are like attractions in and of themselves. When you buy a timeshare, you’ll have the option to choose your “home resort” and enjoy priority booking every year.
Top Timeshare Destinations
When most people think of timeshares, they likely think of exotic beach destinations like Hawaii and Cancun. While they wouldn’t be wrong, today, you can find timeshares almost anywhere. Whether you’re looking for the bright lights of big cities like New York and San Francisco, winter wonderlands like Aspen and Breckenridge, or colorful desert destinations like Sedona and Santa Fe, Timeshare Broker Associates has your ticket to the top timeshare destinations in the U.S. and beyond.
Still trying to decide where to buy a timeshare? Here are the top five timeshare destinations by distribution, according to ARDA’s AIF State of the Industry Report. Use the links to browse timeshare resales in these top destinations!
- Florida – 29%
- California – 9%
- South Carolina – 6%
- Hawaii – 11%
- Nevada – 9%
How to Sell a Timeshare
Timeshare owners sometimes experience lifestyle changes that make it hard to keep up with their maintenance fees or annual vacation traditions. Unfortunately, timeshares don’t typically appreciate over time, meaning that for these owners, the best recourse is usually to sell. Fortunately, there are safe ways to exit your timeshare.
Are you already a timeshare owner? Has a lifestyle change caused you not to be able to afford or regularly use your timeshare? If you want to exit your timeshare, your first step is to contact your resort or developer. Most reputable timeshare companies, such as Wyndham, Holiday Inn Club Vacations, and Hilton Grand Vacations Club, are members of the American Resort Development Association (ARDA), which enforces strict guidelines to protect the interests of timeshare owners. As ARDA members, these timeshare companies offer several options to help timeshare owners exit their timeshare, including buyback programs and references to reputable resale outlets like ours.
How to Avoid Timeshare Scams
Of course, any industry will have its share of bad actors, and the timeshare industry is no different. While you’ll find plenty of viable exit solutions out there, any “timeshare exit team” or “timeshare exit company” advocating against timeshares, advising you to stop paying your annual maintenance fees, or asking for large upfront fees is usually a scam. Never stop paying your ongoing fees or dues; this can negatively impact your credit score. And never pay any exit or resale company upfront unless they charge a nominal advertising fee.
That said, the easiest way to tell a timeshare scam from a legitimate timeshare company is to make sure ARDA accredits them.
Sell With Timeshare Broker Associates
If you want to list your timeshare on the resale market, Timeshare Broker Associates can help. As a fully licensed real estate brokerage specializing in timeshare resales, we have the marketing know-how to get your timeshare seen and the real estate credentials to help you seal the deal. When you list your timeshare for sale with Timeshare Broker Associates, you’ll get a full-page ad highlighting all your timeshare’s most salable qualities. But we don’t stop there. While some resale companies take a list-it-and-leave-it approach, at Timeshare Broker Associates, we use state-of-the-art SEO and a large, dedicated client base to actively target interested buyers around the world.
Once you accept an offer, your Timeshare Broker Associates agent can recommend a licensed title company to help you with the closing process. The title company will handle every step of your closing, from escrow to document preparation to coordinating signings, distributing funds, and transferring ownership. Meanwhile, your Timeshare Broker Associates agent will be standing by to answer your questions or connect you to the title company if you want to ask them directly.
Timeshare Broker Associates: A Name You Can Trust
At Timeshare Broker Associates, we bring brokerage credibility to the world of timeshare resales. As a leading resale service, we can help with all your timeshare needs, whether you’re looking to buy or sell a timeshare. And as a licensed brokerage, we can help give you peace of mind. Get in touch with us today!
