Closure of Resorts
The declining popularity of timeshare in Europe means that an increasing number of timeshare resorts are being closed and sold for re-development. Developers, having exhausted the profit potential from timeshare, are now looking to make a further profit from the re-development of the site.
How can you recognise a resort targeted for closure?
This is a difficult scenario to contemplate. The resort closure plan will have been carefully orchestrated by the developer over a number of years, probably in collusion with the trustee and Exchange Company. If any or all of the following is evident at your resort then the resort is possibly heading for closure.
- Standards at the resort declining year on year with no effort by the developer to rectify the problem.
- The exchange Company threaten to withdraw exchange facilities.
- The annual fees (management, levy, etc.) have increased by more than 10% each year over the last few years.
- There has been a very active campaign to persuade owners to join another club in exchange for membership of their timeshare.
What can you do about it?
This is a risk with acquiring timeshare. An individual owner has little or no hope on his own in respect to influencing the resort. Even acting as a group, the group will face difficulties when a resort/developer has in laid plans for closure supported by Trustees.
If you want to make contact with other owners at your resort firstly check whether the resort has a website.
What are my choices when the closure eventually happens?
In all but a few cases, this is a tactical battle as when there are only a few timeshare owners remaining at the resort, the developer will need to extinguish the rights those timeshare owners have. Holding out could prove financially beneficial as it would hold up the development and/or redevelopment. In this set of circumstances, consumer advice is critical so as to exact the best deal for the consumer.
In addition, if a consumer has paid (in part or whole) by credit card (or has borrowed to finance the original purchase), the consumer may have the right to claim back ALL paid under the Consumer Credit Act 1974.
Last modified: June 20, 2018