Timeshare rentals have a bit of a stigma to them.
You and I have both heard the same spiel from dissatisfied customers — ‘oh, I got a paid vacation, but I had to sit in a tiny room and put up with a dull timeshare presentation! I even ended up renting some space and now it’s costing me an arm and a leg!’ There’s even a South Park episode mocking this phenomenon, the one where all the boys and their parents end up in Aspen.
Now, don’t get me wrong, there are definitely timeshare scammers out there. After all, the annual income of a sales rep in this industry is anywhere between $70,000 and $171,000. That’s a lot of money to earn from renting vacation properties!
But the question remains: are all timeshares bad? Can you actually rent a vacation property without being ripped off?
I think most of the fears that people have with this concept is that they don’t really understand how it works.
I don’t blame you.
That is why I’ve decided to provide you with a comprehensive, and easy-to-understand guide to timeshare rentals.
And I promise it won’t involve forcing you to listen to a painful presentation… unless you like that sort of thing.
What is a Timeshare?
Imagine buying a vacation house or an apartment. You have to pay taxes for it, as well as monthly expenses and proper maintenance. You and I both know that it’s hard to even own a home in 2020, let alone a vacation pad. Even a small apartment requires a lot of hard work and sacrifice.
So, what if instead of paying for it all year round, you paid for just a few weeks? That right there is the essential concept of a timeshare. You’re not really buying the physical property; you’re buying the right to the time you’ll spend there while the title remains with the property owner. It's a similar concept to renting.
To differentiate, “fractional ownership” refers to buying real estate, with each buyer being on the title, and given a specified portion of ownership. A subtle, but important difference.
Timeshares, while not really property purchases, still ‘behave’ like property ownership. For example, you can do a lot more than just use the property yourself. You can rent it to others, sell it, give it away, or bequeath it to a friend or a family member. It belongs to someone else for the majority of the year, but during those few weeks, it is yours to do as you please.
Types of Timeshare Contracts
Generally speaking, there are two types of contracts: shared deeded and shared leased contracts. They mainly differ in who owns the deed to the space you’re using.
Shared Deeded Contracts
When the owner leases their space to others, each individual renter gets a deed to that space. For instance, if the owner of the property decides to lease the space every single week throughout the year, they would need 52 deeds for 52 different space owners. And yes, each and every single one of those 52 will get their own deed.
A shared deed contract does not expire. You get to use the property as long as you please. And since you have a deed for it, you can sell it, gift it to someone, or will it. However, you don’t get to change or upgrade anything in the space itself, since you don’t own the actual real estate. Only the owner can do that.
Shared Leased Contracts
The basic difference between a shared leased and a shared deed contract is the fact that you don’t get the deed with shared leased ones. In fact, the deed stays with the owner and you’re only leasing the vacation spot for a specific period of time.
It’s important to note that, unlike deeded contracts, leased ones can expire after a set period of time. For example, if your contract stipulates 10 years, then you will have that spot for exactly 10 years. You can, however, lose that spot earlier than that if the owner themselves no longer possesses the property or dies before the end of the contract.
Types of Timeshare Ownership
Fixed week timeshares are exactly what their names suggest they are. You get one (or more) fixed weeks every single year.
Of course, the downside of this arrangement is that you can’t really use your space beyond that time slot, and that can be a drag if your vacation rotates each year. On the other hand, it’s the perfect arrangement for specific types of holidays. For instance, you won’t need a cabin in the snowy mountain during the summer, so a few weeks in January will do.
Unlike fixed week, this option allows you to pick your vacation time. Normally, you would have an arrangement with the owner in terms of available weeks each year (eg. ‘the space won’t be available between July 12th and September 29th’). In addition, you would have to call beforehand in order to see if your preferred time slot isn’t taken by someone else who uses that same timeshare space. In this situation, planning ahead pays off.
Modern point systems tend to provide a little extra to the clients. Let’s say that you buy a timeshare slot somewhere, and it’s worth a certain number of points. When you’re on vacation, you can use those points to access certain resorts that use the same system. However, that access might come with additional fees, and not all vacation spots share the same point value. The upside with this arrangement is flexibility – you can use your points in different locations at different times of the year.
Is a Timeshare Rental Right for You?
You don’t have to own a timeshare to benefit from it. You can rent one from another owner. For one reason or another, they may not be able to take advantage of their allocated time in their property, so it is rented for others to enjoy.
Timeshare rentals are better than a typical hotel room because of features like:
- Home-like atmosphere
- Separate bedrooms
- More space for families and larger groups
- No need to book multiple hotel rooms (saving money)
- Resort-style facilities (such as tennis courts and swimming pools)
- In-house shops
- Full kitchen facilities (including a large refrigerator)
- Laundry facilities
Renting a timeshare is a risk-free way of testing out the timeshare lifestyle without jumping in with both feet. If you’re not completely sold on the location or property, then a short-term rental will let you try it out for a little more peace of mind.
A timeshare rental might be an exclusive resort, condo, or villa in a world-renowned property brand such as Marriott, Wyndham, or The Ritz-Carlton. Take a look at these timeshare rentals for a dash of inspiration.
What to Consider When Buying a Timeshare?
Checking the Buyer/Broker
Generally speaking, there are two ways you can buy a timeshare. The first includes talking to a middleman, i.e. a broker. The upside behind this arrangement is that everything is professional. A proper broker will have a list of clients and a history of working in the field. However, they may require extra expenses, and you will need to do some in-depth research into their business in case they might be scamming you.
Individual property owners, on the other hand, don’t have the necessary paperwork that brokers do, and scamming is just as prevalent in this scenario. But the major upside with talking directly to the owner is that you get to see what kind of person owns the property you plan on renting. If you’re lucky, they will be someone who takes care of the property meticulously, so the place will be spotless when you come to spend some time there.
If you don’t know where to start, I recommend checking out SellMyTimeshareNow.com. They have a huge list of genuine timeshares for sale and rent by private owners, with all the information you could want – prices, photos, property descriptions, week availability, maintenance fees, and more. You can either book a timeshare online, negotiate directly with the owner, or have one of the company’s affiliated brokers handle the transaction for you.
Checking the Property
Despite timeshares being... well, rentals, you still need to do some scoping. Make sure to check everything you can about the property. Discuss it with your broker or the owner and ask as many questions as possible. Is electricity running properly? Are there any leaks? What about structural damage? What about the surrounding area, is it safe? Try to approach the purchase rigorously, as if you were actually buying the property.
Deciding on the Time Slot
Once you have everything in order, you need to decide on the time slot for your purchase. Do you plan on vacationing there every year at the same time? If so, you’ll want to look into fixed week contracts. Now, if you prefer some flexibility with your vacations, a floating week will be more up your alley. Whichever option you choose, make sure to ask the owner what time of year the property will be off-limits. After all, the owner might need to do some renovations or upgrades, or maybe they just want to use the property for themselves.
Deciding on the Contract
Finally, when you have everything ironed out, you’ll need to pick the type of contract that works for you. Just like time slots, these contracts will depend on how you want to spend your vacations. If you have your eyes set on that specific place, like a beach property or an apartment in a big city’s shopping district, you might want a shared deeded contract since they don’t expire. On the other hand, if you prefer flexibility, a regular leased contract will be more suited for you. If you need somewhere to start, check out these apartments for rent in Colorado Springs.
Just because you own a timeshare, doesn’t mean you’re completely locked in. There are 2 ways to exchange your timeshare with other owners – internal (through your vacation club) or external (through an exchange company). With an internal exchange, you can be sure you’re getting the same kind of quality accommodation you’ve come to expect. The downside is there are fewer properties available. External exchange companies open more doors, and you can swap your timeshare with thousands of resorts all over the world. Typically, this freedom comes at a price… an annual membership fee to be precise.
What About Selling a Timeshare?
Perhaps your personal situation changes, or you need some extra cash. Selling your timeshare is just like selling any other major asset – a car, ride-on lawnmower, or pogo stick (that seemed like such a good idea at the time).
Advertising the property, negotiating with a buyer and handling the paperwork takes time, not to mention expertise. So, it’s best to enlist the help of a reputable broker like SellMyTimeshareNow.com. They’ve been in business since 2003 (a long time in Internet years), and have established a network of buyers in 217 countries.
The first question you’ll probably ask is ‘what is my timeshare worth?’. SMTN’s easy online calculator will help with an instant valuation. Pricing factors include ownership type, usage frequency (eg. annual), usage type (eg. floating week), property size, location and more.
Once the broker advertises the property, they’ll field any enquiries and only present serious offers to you. When you’re happy with the price, give them the green light, and they’ll take care of everything else. You simply sign the paperwork and accept the cash.
The Bottom Line
Timeshare rentals are a safe way to ease into the timeshare market. There’s no big commitment, just book one online like an ordinary hotel room. If you enjoy the experience, then perhaps you’ll consider taking the plunge and buying a timeshare.
Timeshares can be a great fit if you have a favorite spot you want to visit over and over again and enjoy the predictability. Or if you prefer flexibility and are willing to learn a little more, then taking advantage of point systems will open travel doors that you didn’t expect.
And once you understand how timeshare rentals and exchanges work, reaping all of their benefits becomes easy.
Now that wasn’t so painful, was it?