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Is a Timeshare a good investment?

Is a Timeshare a good investment?


  • Total voters
    41

stmartinfan

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Our timeshare was not expensive, and the maintenance fees are less than we'd generally pay to rent in the location, so after nearly 20 years of owning we've pretty much recouped what we paid. What we can't quantify are the priceless memories we've created for our family.
 

TravelTime

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Is a new car a good investment ?
Yes - if you don't want to take the bus anymore.

TImeshare units can give you you more space and better vacations than small hotel rooms.
A hotel room is often 450 sq feet / a 2 bedroom timeshare could be 1200+ with a full kitchen.
[ When you are not on vacation do you live in 450 square feet? - with a spouse & 2 kids ?]

Timeshares and cars depreciate drastically the day after you buy one retail.

Good Timeshares can be bought resale- for very little $
Cars require upkeep = maintainence dollars.
TImeshares require yearly maintence fees.

Effective TIMESHARE USAGE generally requires advanced planning - if you want prime weeks - prime locations .
Myrtle Beach in January isn't difficult - July 4th Week requires advanced planning.

The unhappy timeshare owners are often those who think they simply bought a bigger hotel room and do no advanced planning.

TUG - Timeshare Users Group - is a great place to get information and share information to help have better vacations through timeshare usage.
I agree with everything you have said except I think saying the average hotel room is 450 sf is quite generous. I suspect 300-350 sf may be closer to it.
 

TravelTime

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I debated how to answer this question. It depends what “investment” means. I ended up saying Yes because a timeshare is a good investment in vacations over the long term. More space, living room and bedrooms, balcony usually, washer/dryer usually. The maintenance fees are usually lower than renting especially at places like Hawaii. It is NOT a good financial investment like a home. If investment means an asset that appreciates over time, then the answer is a clear No.
 

CPNY

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It’s a two part question. I think the consensus is timeshares purchased through the developer are not an investment at all and in fact are a financial loss. If you Purchase the right one for a good price on the resale market you could make out pretty well.

Overall, from a financial investment stand point, no, TS’ are not a good financial investment at all and I’d say roughly 99% of owners know this. Unfortunately, 99% of first time buyers don’t find this out until they join places like TUG or learn the hard way after years of ownership without using what they own.

The second part to this question is, are TS’ a good lifestyle investment? Here I would say yes. Those who are knowledgeable and know how to get the most out of their ownerships are generally happy with their TS ownerships. Based off of what I learned on TUG, I replaced one high annual fee unit and purchased 4 in its place. I get 4-5 times the amount of vacations in the same destination for a few hundred dollars more in annual fees than I was paying for one ownership. It has gotten to the point that I have many co workers and friends asking me if they should buy a timeshare or asking me to teach them how they can get into and navigate timeshare ownership.
 

The Colorado Kid

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It’s a two part question. I think the consensus is timeshares purchased through the developer are not an investment at all and in fact are a financial loss. If you Purchase the right one for a good price on the resale market you could make out pretty well.

Overall, from a financial investment stand point, no, TS’ are not a good financial investment at all and I’d say roughly 99% of owners know this. Unfortunately, 99% of first time buyers don’t find this out until they join places like TUG or learn the hard way after years of ownership without using what they own.

The second part to this question is, are TS’ a good lifestyle investment? Here I would say yes. Those who are knowledgeable and know how to get the most out of their ownerships are generally happy with their TS ownerships. Based off of what I learned on TUG, I replaced one high annual fee unit and purchased 4 in its place. I get 4-5 times the amount of vacations in the same destination for a few hundred dollars more in annual fees than I was paying for one ownership. It has gotten to the point that I have many co workers and friends asking me if they should buy a timeshare or asking me to teach them how they can get into and navigate timeshare ownership.
@CPNY Agree totally! Curious if the friends and coworkers interest grew naturally from them hearing about your travels?
 

CPNY

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Last edited:

TUGBrian

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I certainly agree with different definitions for the term "investment"

however we all know how most folks interpret that question as written.
 

T_R_Oglodyte

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I'm writing an article for my website and will include a link to this thread.

JasmineReedTheAuthor.weebly.com
With brief skimming through the thread --

As others have noted, you need to be clear about what you mean by "investment", differentiating between strictly financial issues versus quality of life issues. Having children, for example, is almost never a good financial investment. You would be better off saving/investing the money that is spent on children to use for your old age. But life isn't always about dollars and cents., and any notion of "investment" needs to be based on how well it moves you toward where you want to be in life, which means that not all investments will pencil out economically, such as having a family.

Similarly, on a strictly financial analysis, taking a vacation is almost never a good financial decision. Financially, you would be better off simply finding some other financial positive activity to do during that vacation time, so that you can collect salary as well as making money on the side, while saving the money spent on travel, accommodations, etc.
 

Ralph Sir Edward

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I'd like to approach the investment standpoint from another aspect.

Second vacation home.

You might make money buy a vacation home, i.e. sell it at more than you paid for it. You might be able to rent it out during a year for more than the upkeep. But no matter how you look at it you are investing a lot of money, often on margin (mortgage), and are taking the risk of irregular return on the money at risk, with a negative cashflow base (you have to pay taxes, upkeep, and mortgage (if applicable), whether or not you can rent it out or not. You can then use a few weeks for personal use.

On the other hand - timeshare.

You won't (except in extremely unusual circumstances) make any money selling it. The money you use to buy it is write-off money (or should be treated as such). you also have a negative cashflow, as well (maintenance fees). But you have no more capital at risk than the initial purchase. In addition, you have no worries about upkeep, taxes, or utilities, it is all rolled into the MF. Furthermore, in expensive places, like Hawaii, you may find that the MFs don't exceed the upkeep costs of an equivalent vacation condo until you reach 2 months or more of timeshare intervals.

So, on an ongoing basis, as a vacation property, used occasionally, timeshares may be cheaper. (Of course, it depends on the timeshare and the condo. There are better deals and worse deals. YMMV)

Shrug. How do you view "investments"?
 

artringwald

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How much would you be willing to spend to rent a spacious, 2 bedroom, fully equipped, oceanfront condo in Hawaii? Does $300/night sound like a good deal? It costs less than that for a timeshare if you only count the maintenance fees, and people are almost giving away their timeshare weeks. But it's not a financial investment. It's a lifetime commitment to taking vacations. Timeshares are difficult to get rid of. If you or your friends and relatives can keep using it until you pass on, at least nobody is required to accept it as an inheritance. It's silly to call it an investment.
 

VegasBella

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Generally, no timeshares are not good investments. BUT if you know what you're doing and find the inefficiencies then you can make money off virtually anything and timeshares are no different that way.

My most expensive timeshare I own was purchased for $5000. It's easily worth at least $22,000. I could find and flip these if I wanted but that's a level of hassle in which I'm not interested. I wouldn't enjoy it. But there are some who do.

For me, the value of timeshares are in the experiences they provide. They are family vacations, couples retreat, solo time, blue ocean views, hikes, city explorations, new adventures, familiar celebrations...
 

VegasBella

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To add... like others have said a timeshare is a luxury purchase like a boat or RV. This is true. But I feel it's more like a country club membership or a fancy gym membership. You buy for access, for a right to use, for certain privileges, for safety, maybe for status. Only you can determine the value of those things. Its definitely NOT a financial investment even if the salespeople and the tax man says it is. But it can be an investment in your lifestyle, your family, your happiness, etc.
 

BigTimeOwner

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Is a new car a good investment ?
Yes - if you don't want to take the bus anymore.

TImeshare units can give you you more space and better vacations than small hotel rooms.
A hotel room is often 450 sq feet / a 2 bedroom timeshare could be 1200+ with a full kitchen.
[ When you are not on vacation do you live in 450 square feet? - with a spouse & 2 kids ?]

Timeshares and cars depreciate drastically the day after you buy one retail.

Good Timeshares can be bought resale- for very little $
Cars require upkeep = maintainence dollars.
TImeshares require yearly maintence fees.

Effective TIMESHARE USAGE generally requires advanced planning - if you want prime weeks - prime locations .
Myrtle Beach in January isn't difficult - July 4th Week requires advanced planning.

The unhappy timeshare owners are often those who think they simply bought a bigger hotel room and do no advanced planning.

TUG - Timeshare Users Group - is a great place to get information and share information to help have better vacations through timeshare usage.
I agree, we own 2 Marriott units, one is a 3 bed lock off in Florida and the other is in Williamsburg 2 bed lock off. We trade all the time with planning. I just booked 3 weeks at KoOlina yesterday, took some planning but its 3 weeks back to back. Love the Marriott properties and their staffs. We purchased from 3rd parties.
 

sunrig

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Investment is normally for gain in dollars in return i.e stocks, housing, etc.
Timeshares are only in my opinion, like motorhomes, travel trailers, new cars. We have owned our timeshare for 20 years, bargain now. $110. a day for a 900 square foot condo in Palm Springs for 7 weeks a year.
I read recently in a magazine, Why would you buy something you can't sell. Inflation is your return on the purchase.
We paid $.06 a share, currently $.33 a share, and another increase due in 2022 for new purchasers.
Some folks have had success with repurchase time shares.
Do your math!!
 

easyrider

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Timeshares can be an investment that generates income dependent on how hard a person is willing to work. Many people have rental businesses based on timeshare ownership. Like any business maybe 16% are making moderate income while 4% are making substantial income.

For most timeshare owners, a timeshares has an intrinsic value that is often in the form of great vacation memories so it really isn't an investment. It's a measurable cost, imo.

Bill
 

djohn06

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I guess that is DVC.. You have to take into account the initial investment. How much is DVC point today? $200 from DVC? If so that means that the upfront cost for 210 points is $42K. At a savings of $2100 that is a payback of 20 years. Not a great investment. You could take 42K and at 8% a year earn $3,360 a year and add back the $1,600 in maintenance for a total of $4960. you can get the room for $3744 and pocket $1,200. or re-invest and continue to grow the investment.

I think you need to take the initial cost into play.
I think you should also use realistic numbers.

You can still buy DVC resale for $125 today. I think most on TUGG are in the resale market, not direct.

Last year I paid $105 for my 100 point AKL contract. I am renting it out and made $1,400 after maint fees are paid. I can sell it today for $140.

I like investments where I can beat the S&P 500. I realize this isn’t the game everyone is playing, but just like the stock market not everyone is buying and holding for 20 years.
 
Last edited:

djohn06

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Quarterhouse New Orleans
Laguna Surf
Marriott Monarch
Also there are resale resorts that people pay $0, but are exchanging into top resorts in places like Maui paying maint and exchange fees of $1300. That same Hawaii room can cost 7k to 8k a week on the beach.

Then, take the difference and invest that in the market.
 

TUGBrian

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Brain, Did the OP/author write their article Sunday?
not sure, have not seen it nor have been contacted with any link.
 

JustAddVodka

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I voted no, and wanted to add that it's not that I don't think the timeshares I have as good value. Just not good investments. They're expenses. They will become more expensive over time. They will not appreciate in value.
 
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