A simple question with probably dozens of answers but taking a focus on just one area, the area that seems to raise most complaints from TCA enquires, availability. In the good old days of the fixed week product timeshare owners knew exactly what they were getting. A guaranteed holiday at a guaranteed time in a guaranteed location at a guaranteed resort, then points came along and it all changed.
Many commentators will say that the introduction of floating weeks followed by points was the beginning of the rot setting in, for the most part TCA would agree, however this isn’t the full story. Again, referring back to the fixed week product, in theory, the maximum numbers of timeshare owners for a single apartment at a resort could be 52. Once all apartments on a resort are sold out on this basis, then no more profit from new customers. Great for timeshare owners, not so great from a developer point of view.
Points based timeshare removed this problem for developers because as points are not tied to any single property, given this, then as many points can be created and sold as more buyers are found, happy days. Gone is the mathematical maximum of 52 owners per apartment, now hundreds or even thousands can purchase points. In most cases the only remnant of the old fixed week contract that remains is that points are still attached to a home resort. That said, there is still no guarantee as to timeframe or availability at the home resort. Gone are just 52 potential owners, now there may be hundreds vying for the same week(s).
Earlier we said that we would agree that points based timeshare was the primary cause of the problem, but there is one other massive setback in the struggle for availability, that being exterior non owner bookings. Before we investigate further, a quick look at what damage has been done financially to owners by the switch to points.
From asset to liability in one easy move
Sorry to sound like we are living in the past, this is not because of nostalgia it’s because the timeshare industry has literally removed any asset value from timeshare ownership with the transition to points based contracts, we will demonstrate this with a true example later.
If you are into holidays every year and someone offered you a guaranteed holiday each year for the rest of your life for a relatively modest purchase price, you might agree that this would have a value. Because of the intrinsic guarantees, the product may well have a residual value which you could sell at some stage, if required. This still in part is true, but sales values of fixed week products, those that still exist that is, have fallen because of the strain place on them by ever increasing maintenance fees. Fixed weeks aside, let’s take a look at the example we promised to show earlier.
This is an example taken from a resale company website featuring Wyndham Kingsgate Resort in Williamsburg, Virginia. 126,000 points for sale at just $1, the kicker as to why this hasn’t sold could be the current year maintenance fee of $1,176. Basically, although the bargain basement price of $1 seems fantastic, every year there is the contractual liability to pay the maintenance fee, which we know only ever goes up. So a good question would be, does $1,176 for a one week holiday at this resort represent good value for money, assuming there is availability?
Because we are talking points here, there is no guarantee that there will be any availability any time you wish to holiday, even at your home resort, the dreaded “no availability” rears its ugly head. But as we said earlier, it isn’t just points that cause availability issues, read on.
Exterior bookings
For many years now TCA have watched the major unique selling point of timeshare, being exclusivity, slowly but surely disappear. Nowadays it’s virtually impossible to find a timeshare resort that cannot be booked online by non members. If you add the mathematical problems created by points to exterior bookings now being offered, you rapidly start to see why availability issues have become a really significant problem.
The sales listing above shows Wyndham Kingsgate Resort, so can you book in to this resort as a non owner? Of course you can. We looked at booking.com and chose a week in April, no real reason other than a random date to check availability. Bingo, we can book that week:
From this we can see that one week in a one bedroom apartment will set us back $786, this compares to the timeshare owner who has to pay $1,176. So even at the bargain basement price of $1, if this timeshare were purchased then your one week holiday could cost $390 more than booking online. The important point to take from this is if you book online you are guaranteed to have a holiday at the time, destination and resort of your choice, being vindictive, this is at the expense of timeshare owners.
TCA comment
Availability and rising maintenance fees are the main protagonists concerning timeshare ownership, for sure there are a myriad of other problems but it’s these two that create the largest number of complaints. Why does the timeshare industry not do something about it? They don’t because they don’t have to.
You signed a long term contract that is nigh on impossible to get out of, you signed a contractual agreement to pay annual maintenance fees, you signed a contract with no stated or implicit guarantees that you can utilise the so called “benefits” that were sold to you. Given this, the timeshare developer has put you between a rock and a hard place with seemingly no way to improve your lot, or escape.
Florida is the timeshare capital of the world and is home to over 350 timeshare resorts. From this it could be concluded that if you carry out a timeshare survey, then there will be plenty of candidates. A University of Central Florida (UCF) study found that 85 percent of timeshare owners regret their purchase, no doubt the content of this article will figure highly as some of the reasons for such dissent.
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