This is a difficult subject, firstly each developer works in different ways and also initial and ongoing costs vary. Where we can obtain accurate information as to initial costs and ongoing costs then we can fairly accurately calculate the true costs. A number of developers are extremely transparent regards costs. Disney Vacation Club, who have looked at in the past are one such developer, Marriott Vacation Club are also very transparent and it’s the use of Marriott figures we will draw on to attempt to answer the question of the true cost of timeshare.
What are the costs?
Nowadays it’s fair to say that most timeshare developers have moved away from fixed and floating week style contracts, in favour of points based products. Those developers with a transparent approach will explain the price per point. It then follows that the initial cost will be directly attributable to the number of points purchased, and the developer minimum purchase requirement.
Whilst the price per point will be static across all resorts, the buying power of each point will differ in relation to both quality of resort, destination and time of use. High season in a summer resort will require more points than low season, nothing radical there, that’s the same as the holiday market as a whole, not just timeshare. As a Europe dweller, no one will be surprised that to holiday in say Spain will be a lot cheaper than the Caribbean or other such exotic locations, points buying power will reflect this also.
The other major cost of timeshare ownership is that of the annual maintenance fee. As long as timeshare is owned, there is a contractual liability to pay this fee. Maintenance fees also have a tendency to rise each year, with many developers making increases way above the presiding rate of inflation.
Finally, although rarely used, “special assessment fees” may also be charged. These fees are charged where necessary resort expenditure has to be made which is outside the normal remit of the annual maintenance fee. An example of this fee may be seen here and relates to an unexpected tax bill incurred by the developer.
Taking a look at Marriott Vacation Club
Marriott Vacation Club offers members points based timeshares. This means each year, owners purchase a number of points they can then use to book their timeshare holiday. The Marriott points’ value is determined by Marriott itself, as is the cost. According to their website, a Vacation Club Points package starts at $25,000 for approximately 1,500 Vacation Club Points.
Using simple maths ($25,000/1,500) it may be established that each point costs around $16.66. Many consumers we speak to have as their home resort the rather lovely Marriot Marbella Beach Resort complex in Southern Spain. We mentioned the buying power of points earlier, using the 2024/25 points chart; let’s look at how many points are required to holiday in Marbella this year:
(Editors note: 2025 figures used above, 2024 figures are similar, serves to demonstrate a point)
Straight away we notice that the entry level purchase of 1,500 points will not allow for a complete one week holiday, even in a one bedroom apartment. As southern Spain is recognised as a summer destination, to holiday in the peak month of August, the requirement is 3,750 points. Given this, an entry level 1,500 point owner would need to upgrade by buying another 2,250 points at a whopping cost of $37,485! Meaning a total expenditure in a one week holiday high season in Spain will cost $62,485. But as we established above, the cost doesn’t stop there. The annual maintenance fee needs to be paid.
Once again, Marriot are totally transparent and publish the cost per point charge:
From this we can see that the fee for 2024 is slightly over 78 cents per point. The eagle eyed will have spotted that the 2023 fee was 68 cents per point so the rise in maintenance fee over the year is 15%, way above the rate of inflation. So for our one week holiday high season in Spain, the 2024 maintenance fee is $2,953, just a shade short of $3,000, but it doesn’t stop there. You will notice a charge of $196.87 per Beneficial Interest, what’s that? We hear you ask, to be honest, we didn’t know either, so here’s the explanation:
So if our understanding is correct we can arrive at this additional charge by dividing the points owned (3,750) by 250 which gives us a figure of 15. Simply taking the above quoted $197.87 per Beneficial Interest and multiplying it by 15 we arrive at $2,968.05, added to the maintenance fee of $2,953 means the total maintenance fee bill for 2024 would be $5,921.05!
TCA comment
In no way is this article a reflection or criticism regards Marriott, quite the reverse. Marriot freely publish all the facts used to produce this story, which is a lot more than can be said for many other developers. By doing so, Marriott allow would be purchasers to get a really clear understanding of not only their initial expense, but also ongoing costs.
Add to this the fact that Marriott do have a buy back policy for some of their top end more in demand resorts and that’s a good thing; however we don’t think their Spanish resorts figure amongst them.
The article is designed to make readers aware that it’s not just the extraordinary high cost of getting into timeshare; it’s the extremely expensive cost to upkeep the ownership. Factor in the normally long term nature of timeshare ownership and with buying in costs at entry level exceeding $20,000, if finance is required then this is yet another cost to be added to the already mounting numbers.
Boiling the whole thing down, timeshare is just a means to a holiday but a very expensive and fairly restrictive way of going about it. Even if our story relates to a long term 25 year contract, it still means that the base cost is $2,500 per week over the term. This figure will not increase so when the reps said “you are pre paying for your holidays in advance”, they weren’t lying. In 20 plus years, with inflation, $2,500 for a week’s holiday will be cheap, but given this year alone, $5,921.05 has to added to the $2,500, what will that cost go up to as the years roll by.
We have seen that the increase 2023 to 2024 has been 15%, even if we halve that and using the TCA maintenance fee calculator, by year 20, the 2024 fee will have risen to $22,912.40 meaning that adding all the previous increased maintenance fees together, the total paid out on maintenance fees alone will be $259,725.71.
Financially it’s extremely inadvisable to take a short term view when considering timeshare purchase. Looking at the bigger picture is the only way to ascertain whether buying into timeshare is both desirable and more importantly affordable and of course offers value for money.
Whilst on the subject of costs surrounding timeshare, our next article will focus a little more in depth of other areas you need to be aware of when considering buying 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