Many of the enquiries we receive are, more often than not, because timeshare owners simply wish to exit their timeshare. Some may have purchased the timeshare recently, whereas others have been taking their holidays annually for many years, often perfectly happily. Now, however, they’ve decided that their ownership is no longer a priority and it is time to say good bye. This may be for financial reasons, a change of personal circumstancesor dissatisfaction with the resort or service they are receiving or something else entirely.
Most have usually contacted their resort about cancelling their ownership, only to be told that they are contractually obliged to continue, regardless of their reasons for wishing to leave. The majority of resorts are keeping timeshare owners bound into onerous, long terms contracts with undesirable and unquantifiable levels of liability, which clearly is an issue of fairness or rather lack of.
One of the most common themes from enquirers is the length of the contract particularly when you consider the increasing age of long-term timeshare owners. Arecent survey suggested the median age of owners is 51.With this in mind many owners wish to plan their future and don’t want to pass on debts and liabilities upon their demise, a pertinent issue that has been quite well publicised.
All of this is obviously unacceptable, a matter of ethics and morality as much as a legal problem. So why are the timeshare companies and resorts making it so very difficult for their customersto give back a timeshare and move on especially when you consider many of whom are older and often vulnerable individuals?
The Problem
At the crux of the problem is that fact that timeshare has become progressively harder and harder to sell in recent years. This is partly down to the profusion of bad press that the timeshare industry has generated, in many cases not without good reason. It’s also a matter of affordability and of tighter legal constraints on timeshare companies.
Timeshare companies rely on the annual maintenance fees gathered from their existing client base in order to earn enough to keep the resort running and make a profit;primarily because it is now harder than ever to bring in new sales with the associated profit they procure.Also with many existing owners passing away or using legal avenues to get out of their timeshare stranglehold, the timeshare companies have fewer overall owners to contribute to the maintenance fee ‘honey pot’.
Consider the maths…
A timeshare resort with 100 apartments equating to 50 timeshare weeks for sale (2 weeks are always retained by the resort), will generate 5,000 sales in total. Once all these apartments are sold, in order for the company to survive and grow, it must necessarily either build more timeshare resorts or find a way to generate new sales from the apartments it already has at the one resort. Of course, building a new resort is much more costly than the ideal scenario of reselling the products you have essentially already sold.
Having earned several thousand pounds from the initial sale of the timeshare contract, and confident that the unit can be sold again for the same price (or perhaps more), they were happy for the existing owner (who has already paid that large sum and subsequent annual maintenance fees) to simply give it back for nothing.
What Changed?
Over time, timeshare companies found themselves unable to resell those relinquished units. They were in a position that found them with to too many empty units. With no maintenance fees coming in, the resort would be left responsible for its own unsold stock. They desperately needed income from maintenance fees to stay afloat and for the upkeep of the resort.
No longer confident in their ability to sell timeshare units, the only avenue open to them was to find any way they could to hold onto those vital existing owners and, overwhelmingly, the solution they landed on was to simply refuse to let those owners give back their timeshare weeks.
Even though the timeshare resorts know it’s not good PR to refuse to let their members out of their ownership, they simply could not afford to let them go. Desperate times, they figure, call for desperate measures. It becomes an issue of self-preservation, and one that damages their customers, their own reputation and the industry as a whole.
Fairness and Balance
Clearly, it has become all too apparent that it’s not all plain sailing for the timeshare companies either. Nonetheless, this doesn’t excuse them from their duty of care to their members. There are still many owners who are perfectly happy with their timeshares to this day, and were the system to function as it should, we’re certain many more would be happy too.
One of the key aspects of good business is to move with the times. There is no disputing that the market has changed, for a number of reasons. Innovation is the only way that a business in any industry can hope to survive the changing nature of the marketplace and the evolving demands of consumers. Unfortunately, by and large, the timeshare industry is failing to keep up, which is something that causes us much concern.
Going Forward
Going forward it’s our hope that timeshare companies will see the actions being taken and the way that laws are changing in favour of owners as a wake-up call. We see these changes as a ripe opportunity to offer better service and a product that works for the next generation of potential timeshare owners.
We do have a modicum sympathy for the plight of these timeshare companies, though we remain convinced that in most cases the problems they are facing are sadly self-induced and self-perpetuating. At the end of the day, ownership of timeshare is just another product in the holiday marketplace and like any other product, as an owner you should have the right to dispose of it. If your TV is out of date it costs nothing to dispose of and buy a new one, so should be the case with timeshare.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk