Timeshare

Consumer demand for greater flexibility brings more timeshare options to the table. Here, we look at fractional ownership as well as the relatively new concept of urban timeshares.

 Throughout its history, the concept of timeshare has undergone a number of radical changes. These changes were implemented as a response to the needs of timeshare owners, and all of these changes indicate a constant striving for flexibility on the part of the resort as well as the consumer.

Timeshare has evolved in what can be described as a basically linear pattern. First came floating weeks, which allowed timeshare owners the flexibility to schedule a vacation week when it was most convenient. Then, points-based systems of ownership were created. Points systems allowed owners to break up their week into smaller portions of time, while at the same time changing the way timeshare exchange values at certain resorts were calculated.

The quest for flexibility continues today, spurred on by competing resort companies responding to consumer demand.

A number of high-end timeshares have been developed in urban areas in recent years. Urban timeshares are offered in destinations like San Francisco, London, Boston, and most recently, Hong Kong. While major resort chains are the most noticeable players in this market, several independently-owned and operated resorts have done well for themselves. Most notably, New York’s Manhattan Club is one of the most well-known urban timeshares on the planet. Urban timeshares are known to have high exchange value, because the demand is high and the supply is low. Exceptions to this rule may exist if the city is a high-demand resort destination, but even Las Vegas timeshares (generally) have strong exchange power and are in high demand.

Around 1994, the concept of fractional ownership was developed. With fractional ownership, a timeshare owner has the option to buy a fraction of a year, usually ranging anywhere from 21 days to 4 months. Business travelers like fractional ownership because the time can usually be used in increments of several days at a time. The owner is not locked into using the timeshare at a particular week. The costs associated with fractional ownership are much higher than ordinary timeshare expenses, but a major selling point of fractionals is their outstanding amenities, most of which are comparable to 5-star hotels or luxurious private residences. Exchange, though possible, is limited due to the relatively small number of fractionals available on the market today. A timeshare owner is better off buying a fractional interest in a private residence club in an area that he/she is going to want to return to on a consistent basis.

Fractional properties in urban areas are the next phase in the evolution of timeshare. The timeshare industry has been receptive to these offerings, and industry publications have given fractional-ownership private residence clubs high marks for service and amenities.

Though the hefty price tag means that fractionals are out of reach for most individuals and families, we can expect fractionals to become more popular and affordable in the future. One thing to bear in mind is that the purchase of a fractional interest requires as much preparation and due diligence as does any other real estate purchase. Even if you are dealing with a respected hotel brand, do your homework before you agree to buy.

Four Seasons, Marriott, Ritz-Carlton, and Disney are the most high-profile companies offering fractional ownership of vacation property. More information may be found by visiting these companies online.

Unethical timeshare sales practices often include a spurious guarantee that a timeshare will sell within a specific time period.

Recently I received an email from a timeshare owner asking me for advice. It seems this gentleman bought a timeshare several years ago, but became unable to use it every year because of family obligations. He approached an online timeshare resale company to see if they could help him sell his timeshare. Shortly thereafter, he got a call from a sales rep, who assured him that the *** company could sell his timeshare by Labor Day. Pleased by this news, he immediately enlisted the services of the *** company.

It’s the day after Labor Day, and he hasn’t gotten a single offer on his property yet. This timeshare owner now contemplates seeking legal advice to help extricate him from this debacle.

I am not an attorney, so I won’t discuss the finer points of the contract in question. What I will say is that no-one can predict when a timeshare resale will sell. Any company making this prediction is using antiquated, deceptive tactics.

It is surprising to note that a number of successful and high-profile timeshare resale companies still promise an attractive timeline to a prospective advertiser. This is an old leftover ploy from the early days of the timeshare resort industry, when fraud was rampant. What is even more surprising is that people believe these wild claims. When it comes to determining how long it will take for a timeshare to sell, a phony timeline is about as helpful as a newspaper horoscope. Always remember, even if you choose the best timeshare resale company in the world, there’s still no way for anyone to know when your property will sell.

Here’s the bottom line: don’t believe the hype! A fast timeshare sale depends on two things: pricing and promotion. A seller has to be sure that his or her timeshare is priced lower than other similar properties. However, this by itself does not guarantee exposure on an effective scale. It is important to choose a timeshare resale company capable of promoting a property before the greatest possible number of potential buyers.

In the wake of the biggest disaster in recent memory, the timeshare industry confronts challenges, but also affords timeshare resale opportunities.

Four days after hurricane Katrina hit Louisiana, the situation along the Gulf Coast of the United States is particularly dire. The city of New Orleans may never recover fully from this disaster. The long-term economic implications are still being calculated, and widespread repercussions are already being felt. Most shocking of all is the loss of human life on such a massive scale, and the horrifying ordeals faced by those still trying to survive in this city. Anyone reading this is encouraged to help relief efforts by any means necessary.

In lodging and hospitality industry news, Marriott International Inc. was arguably the first hotel company to respond to this tragedy. Marriott had temporarily shut down about 20 hotels in Louisiana and Alabama. In interviews, spokesman John Wolf described no severe structural damages to Marriott properties in affected areas.

Other hotel chains have yet to provide information about damages. We all remember the terrifying stories and photos of the Hyatt Regency in New Orleans, which was slammed by both high winds and flying debris.

Most feel that Katrina has been the latest installment in what is clearly an abnormally destructive hurricane season. Clearly, many people are having second thoughts about owning property in an area vulnerable to hurricanes, even if these areas are prime resort destinations, like Central Florida.

Normally, after an area has been hit hard by a hurricane, it undergoes a period of redevelopment. Timeshare resort developments are no different: the affected area can undergo dramatic renovations and upgrades in the weeks and months following a hurricane. Consequently, with upgraded amenites, remodeled resorts are able to sell new timeshares for higher prices, and charge higher fees on existing ones.

Immediately after a major hurricane strikes a high-demand resort area, the timeshare resale market typically sees a dramatic influx of timeshares for sale. If these units are located in a resort damaged by a large storm, the timeshares in question cannot be assumed to be structurally sound. Timeshare owners often advertise storm-damaged properties for as little as $50.00/week. Sometimes owners can be less than forthcoming about the condition that their properties are in, so due diligence is a must when purchasing a timeshare resale under these circumstances.

Buying timeshare resales at a storm-damaged resort facility is largely contingent upon whether or not the resort plans on redeveloping the property. The idea is to buy a unit at a minimal cost while demand is still low, obtaining it before timeshare sale prices rise. Please keep in mind that some resorts are still rebuilding after the 2004 hurricane season, which caused widespread damages all over Florida.

What many people don’t realize is that hidden costs can materialize out of thin air. Rising property taxes are a likely consequence of a natural disaster. The maintenance fees at the new resort will be higher than they were previously, and the resort company may even assess special fees to cover hurricane damages. Typically, a special hurricane assessment can cost owners $800.00 – $1200.00. Still, if a timeshare cost $50.00 initially, the average timeshare owner can absorb the rising costs and still save thousands of dollars off the original price asked by the resort for the unit in question, just by buying a timeshare resale at minimal cost.

In this manner, many timeshare buyers try to take advantage of the opportunities on the resale market. If you plan on buying damaged property at bargain prices, make sure you know exactly what you are getting into before you sign a contract!

The situation in New Orleans is extremely grim in the aftermath of hurricane Katrina.

New Orleans is undergoing a total evacuation due to widespread flooding from Lake Pontchartrain caused by hurricane Katrina. I tried to contact several resorts in the area, but with no success. Though reports are conflicting, I’m going to summarize what I know so far about conditions in this city and the other areas affected by Katrina.

Yesterday, New Orleans Mayor Ray Nagin issued a statement saying that because of rising floodwaters, the entire city would have to be evacuated. The rising water is carrying sewage, human bodies and industrial waste, and it is feared that these contaminants will pose health risks to any who stay behind.

Today, people taking shelter from Katrina in the New Orleans Superdome have been relocated to the Astrodome in Houston, Texas.

Yesterday the death toll was reportedly 55 in New Orleans, 80 in Mississippi. Estimates vary widely, but the number of people dead or missing is likely to increase in the next few days. Rescuers in New Orleans are primarily focused on helping survivors rather than counting the dead.

Reports say that the flooding has been stabilized, and that the French Quarter remains dry. Because the French Quarter lies at a slightly higher elevation than the rest of the city, it may escape with only minor flooding. However looting is widespread throughout the city. At this time there have been reports of at least one shooting. There is no electricity, no fresh water, and minimal phone service. Contaminated floodwaters pose a severe hygiene risk, and cannot be pumped out of the city until the levves have been repaired. Because of this, only rescue personnel are allowed to enter the city at this time.

Mayor Nagin also advises that it may take as long as 12-16 weeks before people can enter New Orleans again.

For local news coverage of the situation in New Orleans, go to http://www.nola.com/.