If you enjoy an annual trek to the mountains or beach, and enjoy the simplicity of staying at the same place, a timeshare purchase might be a good option for you. If you like a little more variety in your vacation, but hate the hassle of trip planning, a vacation club membership might fit your needs.
However, both these options come with a lot of stipulations and fine print, and both have had their fair share of controversy. So let’s give both of them a hard look to see if either is right for you.
Timeshare. When you purchase a timeshare, you buy a shared right to real property that allows a one- to two-week stay in the same unit annually for a set number of years. Typically, a timeshare unit is a room in a resort hotel, or an apartment or condominium. A principal amount is paid upon purchase, then maintenance and membership fees are paid annually. Timeshares can be sold as either deeded, which is a real estate transaction, or undeeded, which acts more like a lease arrangement. Besides staying in the same place each year, you may choose to stay the same week. For variety, some timeshare owners swap with other owners.
Vacation Clubs. To accomplish some of the same objectives, vacation clubs allow members to plan and prepay their annual getaways. Vacation clubs, however, provide more variety and flexibility with a system of points that members buy and redeem within a network of resorts. Yearly maintenance fees also apply. Several hotel and resort networks offer vacation clubs, including Disney, Westin and Marriott.
Are they worth it? Whether timeshares and vacation clubs are a good investment depends on your real estate investment goals, vacation priorities and lifestyle. In vacation hot spots where timeshares are sold, the market is often flooded with them, with more being added every year. This saturation drives down value. Vacation clubs are not a purchase of property, so again it’s not an investment in something tangible.
So you must look for value in other ways. Over ten to twenty years, the cost of a timeshare may save money on your vacations as compared with booking a different trip year after year. But do you want to vacation at the same place and time each year? A better option might be to search online for timeshare owners willing to lease out their places.There is a good market for these rentals and that way, you aren’t committing to a purchase of your own.
Vacation clubs offer more flexibility than timeshares, but that doesn’t mean there are no restrictions. You buy in at different point levels and more money invested means more points with more liberal benefits. Buy in at a lower level and you have less attractive choices.