Owning a piece of real estate to call “home” a few days a year is, often times, a decision many regret. Although a bright side to buying a timeshare exists, it’s always best to weigh in all the facts before making an impulsive decision.
A timeshare is rarely a purchase people consider and plan on buying. And yet, so many sign the contracts only to realize they should have thought about it twice.
Buying a tenant owned propriety comes with many pros and cons. Although owning a place few days a year isn’t all that bad, some arguments carry more weight than others. Keep reading to learn more about what everyone ought to know before buying a timeshare.
Timeshares are great for vacationing, but they are not an investment
The biggest selling point that determine most people to sign a contract is the idea of having a safe place to enjoy and call their own. If you usually go on vacation the same period year after year, having a pre-set destination you always enjoy visiting sounds like a dream come true!
So what’s the problem with owning a timeshare then?
A timeshare should never be considered a real estate investment. Although you’re literally buying part of a property, consider that timeshares are very hard to sell.
The chances of selling a timeshare at a loss are ridiculously high. Buying a timeshare out of the blue might seem like a good idea, but chances are you’ll soon face the reality of a flop. Don’t sign any contracts unless you’re financially ready to take big a loss.
A timeshare is cheaper than a home, but it still implies big costs
Buying into a tenant owned condo is cheaper than buying a small property by the beach. You won’t have to fork out 6 figures, which is another big selling point that concern shared properties.
The downside though, is high costs are involved either way.
Although cheaper than a house, not everyone can afford to buy a timeshare with cash. And getting a mortgage to pay for a shared property is definitely not a good investment.
In addition, maintenance costs, property taxes, yearly fees and utilities have to be paid for by someone. If you decide to buy into a timeshare, that includes you. And although you only use the property 1-2 weeks a year, these costs all add up all year round.
You may rent your timeshare, but selling it is difficult
When realizing a timeshare is more of a burden than an ‘investment’, the first thing owners do is try to get rid of it.
Although you can attempt to ‘rent out your week’, you should know not every contract allows you to. Often times, people are pressured into signing a timeshare contract and fail to read the fine print before signing the dotted line.
Selling a timeshare is also close to impossible. Unless you have the stomach to take a huge loss, it’s probably best to stay away from buying such a property at all.
When that happens – and chances are high that it will – you should also consider the impossibility of deducting your loss on your tax return. Although a great idea in theory, timeshares are never to be considered an investment.
You may sit through a presentation for the freebie, but could end up buying a timeshare by the end
The promise of an interesting freebie is a well designed strategy to sell a timeshare even to the most reluctant person in the room.
Selling is an art. And timeshare salespeople are highly skilled into encouraging you to sign the dotted line.
Although there are ways to get out of a timeshare, few are aware of their legal rights and get stuck with a property they didn’t want in the first place.
Having guaranteed accommodation is a plus, but renting a room at a resort may save you money
Last but not least, it’s only fair to say that having a guaranteed roof over your head while on vacation is indeed a dream come true. If you’ve fallen in love with a place and would love to visit it year after year, clearly having a place to stay constitutes and advantage.
The alternative, however, may actually be cheaper!
Buying a timeshare seems like a great way to save money on accommodation, but the total costs and added extra fees could actually mean you’re losing money when you draw the line.
With so many accommodation options nowadays, you might be saving money if you rent a room at a bed & breakfast or even a whole apartment via AirBnb and the likes.
Although buying a timeshare isn’t always the worst idea in the world, it’s important to weigh in the pros and cons before signing a buyer’s contract.
The drive to buy on the spot is high, but don’t let anyone pressure you when it comes to buying a property. Consider the downsides before making a decision and sleep on it if you want to avoid trouble.
Have you ever bought a timeshare and regretted it? Or do you think tenant owned properties are a good idea?