Is Timeshare An Investment Property?
Wednesday, September 3, 2008
You don’t have to do much reading, talking, or thinking about buying timeshare before the question inevitably comes up, “Is timeshare an investment property?”
According to the Merriam Webster’s Collegiate Dictionary, the word ‘investment’ in its true sense refers strictly to matters of money. And it is a very rare thing for a timeshare to increase in value above the price you paid to purchase it – especially if you purchase it as new property.
Yet, in everyday use, we often speak of investing our time, our talents, or our emotions, into something that does not yield a financial return, but does benefit us in other ways. And in this regard, timeshares and timeshare resales definitely can be beneficial and rewarding in our lives.
What Drives Up the Cost of New Timeshares
If you have ever been to a developer’s traditional timeshare sales presentation, or have talked to others who have, then you already know how that game is played. You agree to listen to what the timeshare sales representative or representatives have to say; perhaps you tour a timeshare property and you see a video presentation about the timeshare resort. In return for your time, you are rewarded with a perk. Depending upon how long the timeshare presentation is and/or the size of the timeshare sales company with which you are dealing, your ‘reward’ can be anything from a free lunch to several days comped (or discounted) at a timeshare resort.
Imagine what a new pair of shoes would cost if every time someone went in the store and tried on a pair, that person received a gift. Think about how pricey a new home would be if every interested home buyer or looker was given free tickets to Disney just for stopping by to tour the house.
The business model used in the sale of new timeshare is certainly unique, and apparently works, because timeshare sales have increased consistently, year-in-year out. But clearly, the cost of all the free gifts that are given to the people who never buy timeshare is built into the sales price of new timeshare, and is borne by those people who do buy timeshare. It is very hard for timeshare property to appreciate when it carries with it such high front-end marketing costs.
But Buying Timeshare Can Still Be the Smartest Move You Ever Made
Okay, so you probably won’t ‘make’ money on the purchase of a timeshare you buy from a developer. But that doesn’t mean you can’t truly benefit from buying timeshare. Timeshare locks-in the cost of your vacation accommodations for as long as you own your timeshare, whether that is years, decades, or a lifetime. Certainly, in that way, buying timeshare is a valid hedge against vacation inflation.
Absolutely nothing makes vacation planning easier than owning timeshare. In today’s busy world, where husband and wife are both dealing with the demands of jobs and family, it is often the case that no one has time to hunt out a vacation deal or shop for the right hotel accommodations. Owning timeshare eliminates this problem entirely. Mark the days on your calendar, book a flight or gas up the car, and start your vacation. Timeshare ownership eliminates vacation planning hassle, and lets you and your family relax and enjoy … which is what a vacation should be all about.
I guess the bottom line is that some investments, don’t come wrapped in dollar signs, and timeshare is one of them. But don’t shortchange the idea of owning timeshare by overlooking all the value they can bring to your quality of life. Click on the video below to hear some additional thoughts about the benefits and realities of owning timeshare.
By the way, if you are ever attending a timeshare sales presentation, and someone tries to tell you what a good investment timeshares are, you should exit, immediately. That’s a major red flag that you are dealing with someone who will tell you anything (even a lie) in order to sell timeshare.
