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Is timeshare a thing of the past?

Jan 22, 2021 | Blog

Once a passport to luxury holidays, many experts now dismiss timeshare as outdated, outmoded and unable to compete with the modern travel industry.

Expensive

Compared to regular hotel stays, holidaying through timeshare is undeniably more expensive.  “On an annual basis the timeshare costs are around the same as regular holidays, provided members holiday in their home resort,” explains Robert Salmon, industry specialist at European Consumer Claims (ECC).  “The maintenance fees approximate to what non-members pay for the same holiday through Expedia etc.  Where timeshare members rack up the expense is by paying the initial joining fees(usually well over £12,000 per week or equivalent in points), plus the various extra fees, like exchange company membership, exchange fees, banking their week etc.  These fees don’t apply to non-members who just book a week when and where they want, and pay the rental for what they use.”

Restrictive

Timeshares have evolved a lot since their inception in the 1960s.  Officially you can now exchange for a cruise, a canal boat or even an RV.  “Even with the effort timeshare has made to improve, it can never offer the freedom of choice a regular holidaymaker has,” says Robert Salmon. RCI (the main timeshare exchange company) has 4300 exchange possibilities.  

“However the non-member can choose from around 700,000 hotels in the world, and that’s before you consider apartments, villas etc, plus practically endless alternatives like RV hire, camping, and cruises.  

“Many of the exchange options through RCI come with so many conditions and regimental timeframes that owners prefer to book externally anyway.  However much extra choice RCI claims to add, the timeshare owner is still paying to self-limit to the RCI brochure instead of the whole rest of the travel sector.”

Commitment

The considerable initial timeshare joining fee entitles the proud new owner to X amount of holidays per year (subject to conditions) for an agreed amount of years – sometimes in perpetuity.  

The flip side of that deal is that the owner is also committing to paying fees for those holidays for the full duration of the membership whether they use it or not.  “This has become a serious point of contention for many owners during the pandemic,” explains Jack Dawson, a contracts expert with ECC.  “They were sold on the premise that becoming members would force them to take the holidays they deserve.  However timeshare contracts don’t actually guarantee a holiday.  Instead they explain the fee as ‘maintenance’.  The holiday is incidental.  In 2020 for example when nobody could take a holiday, virtually all timeshare owners still had to pay their annual fees in full.

“Many timeshare owners believed that they would one day hand the membership down to their kids, but kids are saying ‘no thanks’ to that commitment. They don’t want any part of owning a timeshare.”

Exclusivity, but not exclusive.

Probably the biggest bugbear for people caught in the timeshare system is that they believed they were paying a lot of money for access to luxury resorts not available to the general public.  “People didn’t mind paying a lot of money to have something special,” says ECC timeshare specialist Jayne Niven.  “The trouble is that nowadays nobody new is buying timeshare, and that leaves a huge hole in resort revenue streams.  

“Pretty much every company has made the decision to rent out their unused inventory through regular booking sites like Expedia.  The resorts are no longer exclusive to their paid up members.

“While this helps the resorts financially, it infuriates members who have paid through the nose for an exclusive membership.  They have in effect paid for nothing.”

Exodus 

“Timeshare owners are desperate to get out of their memberships,” says Andrew Cooper, the CEO of ECC.  “Nowadays the rest of the travel industry is looking a lot more appealing than their membership, and they want to be able to enjoy what non members have access to, instead of their limited system.”

The English claims firm head warns that it is not easy to escape from a timeshare commitment:  “The contracts are designed to keep members from leaving, because the resorts need the annual fees.  It usually takes expert assistance to help someone relinquish a timeshare ownership.  If you google how to escape, nearly every firm offering to help are sadly criminals looking to charge fees but then disappear and not provide the service.  Before giving money to anyone, we advise members to check out the firm they are thinking of retaining via the Timeshare Trust site, or contact one of the many independent timeshare consumer associations for free advice.”

For some timeshare owners, getting rid of their timeshare may yield a financial windfall too.  “People who bought in Spain from 1999 onwards have often been signed up with illegal contracts,” says Cooper.  “There were new regulations brought to protect consumers from high pressure sales.  Most resorts ignored these regulations and as a result many timeshare owners who bought in Spain from 1999 onwards can claim not only their money back, but sometimes thousands of pounds on top.  

“Anyone retaining a firm to help them escape their memberships should also check to see if they qualify for this compensation as well.”

Article first published on NewsDesk 20 Jan 2021.

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