“Ending a timeshare isn’t easy because many companies are unwilling to let owners out. The demand for these contracts on the resale market is weak. Some timeshares are going for $1 on Ebay.”
Timeshare buyers may believe that their timeshare will appreciate in value over time, but this is often not the case. A New York Times article notes that “As a general rule, timeshares depreciate; they are rarely resold for as much as was originally paid to the developer or the resort.” The Federal Trade Commission advises consumers that “Because so many timeshares and vacation interval plans are available, the resale value of yours is apt to be a good deal lower than what you paid.”
Since timeshares tend to depreciate in value, timeshare owners are often frustrated in their efforts to resell them. But that’s not the only problem owners face.
Sellers: Beware of Scammers
According to the Baltimore Business Journal, “Desperate timeshare owners also face potential scammers who get ahold of timeshare lists and try to profit off them. Scammers promising a cancellation or resale often tell owners to stop paying their maintenance fees. After providing payment, owners never hear from the scammers again. Instead, they are left still owning their timeshares as well as now having damaged credit.”
The Attorney General of Arkansas recently provided the following tips to those looking to resell their timeshares:
- Beware of timeshare resellers who contact you unsolicited with a promise to resell your timeshare.
- If they say they have willing buyers, it is probably a lie.
- Never pay a substantial advance fee for resale assistance. A reputable seller will charge a commission paid only upon sale, like a normal real estate transaction. An advance fee may be called a “marketing fee,” a “listing fee,” an “internet advertising fee” or other related fee.
- Get an independent appraisal from a licensed appraiser before agreeing on any resale assistance contract.
- Deal only with licensed agents.
Reading the Fine Print – Further Limitations
In some cases, the company has a right to buy back your timeshare before you can sell it to anyone else. If that is the case, you should consider how that might affect the sales process. There might be other limitations on unit sales and on the sale of points.
For instance, at the Ocean Resort Villas, a Vistana property, the rules are as follows: “If you receive an offer to buy (the “Offer to Buy”) your Vacation Ownership Interest and if you want to accept it, you must first notify the Developer before accepting the offer and must provide a complete copy of the Offer to Buy. The Developer will then have the right and an option to buy your Vacation Ownerhsip Interest at the same price and on the same terms contained in the Offer to Buy. If the Developer decides to buy it, then the Developer will send you written notice of that decision within ten (10) business days after the Developer receives your notice of the Offer to Buy.
“If the Developer does not send notice of its decision to buy the Vacation Ownership Interest within the ten (10) business day period, then you may sell your Vacation Ownership Interest to the person who submitted the Offer to Buy. If the Offer to Buy is changed in any way (for example, a reduction in the price, a change in the Buyer or an assignment of the Buyer’s rights to someone else), or if the sale does not close within ninety days, then the Offer to Buy will be considered a new Offer to Buy and you must re-submit it to the Developer and the requirements of this section will apply again.”[i]
The timeshare sellers’ problems, described above, mean that it’s often a buyer’s market for those looking for used timeshares. Before you buy a new timeshare, compare the price to the resale prices of timeshares at the same resort. Here are some resale prices listed on Redweek.com for units at the Sheraton Vistana Orlando as of December 6, 2016:
|Price||Annual Maintenance Fees||Week (Season)||Use||Type||Unit view||Bedrms||Baths||Sleeps|
[i] Disclosure Statement on Ocean Resort Villas, revised 5/13/16. Pg. 17, Section 7.2.C