Home ยป Breaking Down Timeshare Costs: Is Ownership Worth It?

Breaking Down Timeshare Costs: Is Ownership Worth It?

by Ethan More

Timeshare companies like Marriott Vacation Club and Wyndham promote the benefits of owning a timeshare, highlighting the quality family time, cherished memories, and exciting vacation destinations as a valuable investment. However, many individuals who own timeshares find themselves compromising their financial stability. This is because a timeshare is not a lucrative investment that generates income, but rather a property that entails various additional fees which owners may only realize after the purchase.

It’s crucial to acknowledge that the responsibility of owning a timeshare extends beyond the annual payments. Prospective buyers must also factor in numerous supplementary expenses to enjoy their vacation spot for a limited period each year. Therefore, it’s essential to comprehend all the extra costs associated with timeshare ownership before committing to a purchase.

Breaking Down the Timeshare Cost

Frequently, timeshare companies use gift cards and vouchers for free hotel stays as a means of targeting frequent vacationers, with the stipulation that they attend timeshare presentations. During these presentations, attendees are enticed with complimentary breakfasts and mesmerizing visuals of picturesque timeshare destinations, leading them to believe that this lavish lifestyle is within their financial reach.

Unfortunately, the truth about timeshare ownership becomes apparent soon after signing the contract, as buyers begin to comprehend the actual cost. In the ensuing analysis, we delve into the multiple expenses linked to owning a timeshare property that prospective buyers should take into account before making a purchase.

Upfront Costs


Acquiring a timeshare necessitates an initial cost, which constitutes the complete value of the property. Similar to real estate, each timeshare has a purchase price that typically ranges from $10,000 to over $100,000, depending on the location, size, and developer. Since most buyers cannot pay for the property in full, they typically have to finance it.

One option is to establish a payment plan with the timeshare provider, allowing buyers to pay off the property over several years. Alternatively, some buyers choose to obtain a personal loan to fund their purchase, which can result in lower monthly payments and potentially lower interest rates. However, if a buyer’s credit score and finances do not qualify for either of these options, they can opt for a home equity loan, which employs their primary home as collateral. This choice is not recommended since it endangers both properties if the buyer fails to make payments.

It’s important to note that the upfront cost of a timeshare does not constitute the entire ownership cost. Timeshare companies usually charge exorbitant interest rates, ranging from 14% to 20%. For instance, if someone buys a $30,000 timeshare with a 10% down payment of $3,000 and pays a 20% interest rate over ten years, the total amount paid will surpass $55,000, excluding maintenance fees. While personal or home equity loans may be more cost-effective, the interest rates can still result in thousands of dollars in additional expenses.

Maintenance Fees

All timeshare resorts charge annual maintenance fees to cover the cost of salaries and property upkeep. These fees are utilized for renovating common areas, such as pools, lounges, and tennis courts, as well as for upgrades within the units, such as new air conditioning units or bathroom tiles. Maintenance is critical to ensuring that your timeshare unit remains comfortable and contemporary for future use.

However, the issue with maintenance fees is that they tend to increase each year, much like rent on an apartment. In some instances, maintenance fees may even increase more rapidly than inflation. Additionally, not all of the money collected from maintenance fees goes towards maintaining the property, as a portion is frequently designated as “management fees” for the timeshare company.

Most timeshare owners neglect to read their contract to determine if there is a limit to how much fees can increase annually. While some agreements restrict fee increases to 10-15%, this can still represent a substantial amount. For example, if someone purchases a timeshare with a yearly maintenance fee of $1,000, they should anticipate fees to rise by at least 5% per year. Within a decade, this could result in a 50% increase, implying that they will be paying $1,500 annually.

Special Assessments


Apart from initial and maintenance fees, timeshare companies may also levy special assessment fees to cover unforeseen expenses arising from natural disasters such as hurricanes, blizzards, or earthquakes. These charges can be difficult to avoid as many timeshare properties are located in areas prone to such events. While these fees are not necessarily fraudulent, they can be an unanticipated expense that is often not fully disclosed during the initial purchase of the timeshare.
Emotional Distress

While timeshare ownership can provide access to luxury vacation spots, the associated costs and limitations can result in significant stress and negative emotions for owners. The challenges of coordinating family vacations within a limited timeshare week and dealing with unempathetic timeshare companies can be overwhelming. As a result, potential timeshare buyers should carefully consider if the investment is worth the emotional and financial burden.

Avoid an Unprecedented Timeshare Cost

It is important to note that selling a timeshare can also come with its own set of challenges. The resale market for timeshares is often oversaturated, which can make it difficult to sell your property, especially for the original purchase price. Additionally, some timeshare contracts may have clauses that limit or prohibit the resale of the property. Therefore, it is essential to thoroughly review your timeshare agreement before purchasing to ensure that you understand all of the terms and conditions. If you are still interested in selling your timeshare, there are companies that specialize in timeshare resales that can help you navigate the process. However, it is important to be cautious when working with these companies and thoroughly research their reputation and track record before signing any agreements or paying any fees. In summary, owning a timeshare can come with many hidden costs and challenges that may not make it a wise investment. However, if you are already a timeshare owner struggling with the financial burden, there are options available, such as selling or seeking assistance from advocacy groups like Centerstone Group.

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