Timeshares 101: What Is a Timeshare and How Does It Work?

timeshare legal advice

Everyone has heard the term ‘timeshare.’ It’s not a new concept, it has been around for decades. It caught the eye of entrepreneurs and investors when they saw they could sell the same room 52 times per year while maintaining a constancy over the price.

Since those early days in the 1970s, the basic concept has developed and been sold all over the world with application to many different types of accommodation. So what is a timeshare? You likely have a basic idea that it involves sharing a holiday property but there is much more to it than that.

In this article, you will read about the different types of timeshare and how they work. You will also see some of the benefits and also some of the limitations. Timeshares are a popular concept and really suit some people, so read on and find out if you’re one of them.

What is a Timeshare – Semantics

The basic concept of a timeshare is that a group of people purchase the right to use a property exclusively and share the time using that property according to the size of their payment.

So in its simplest form, a timeshare is exactly what it says it is. You’re buying time in a property but instead of paying when you check in or check out, you’re buying it in advance. Why would you want to do that?

Well, as you will see, there are some advantages to doing this because depending on the type of timeshare you own you may actually have a share not only in the time but also in the value of the property.

Same Concept – Different Variation

There are several different time allocation models. You can purchase a fixed week or weeks. That makes it difficult to change but it can be a real advantage to someone whose holiday time is always fixed like a school or university educator.

Besides the fixed week system, there is a floating week option. Here you can choose from a range of weeks within a defined period. This is obviously more flexible but the downside is that it may not be available during the peak periods.

Also if you want a particular week, you may need to book it way in advance to guarantee its availability. An update on the back timeshare model is the points system. Here you purchase points that represent your timeshare holding. You then spend these points accessing a range of properties at different times according to your convenience.

This has some natural advantages that come with flexibility but also disadvantages as the points will vary according to the options you consider. Besides the way time is shared or allocated, you need to think about the aspect of ownership.

Sharing the Property Deeds

This means you own a percentage of the property itself. Your entitlement to the value of the property is directly related to how much time in the property per year you have purchased.

For simplicity, if you purchased 6 months of timeshares in this type of property, you would own 50 percent of its value. This type of ownership can be seen as an investment and can be either sold or passed on to relatives through your will etc.

Sharing the Property Lease

Just like owning a lease on a house, you will know that it entitles you to exclusive use of the property during a defined period of time. However, you will never really own the underlying property and land itself. So this type of acquisition will not increase your overall wealth but it does offer some advantages as they are usually cheaper than the option described above.

Before you make any decisions about purchasing a timeshare it is wise to seek some timeshare legal advice. Make sure you clearly understand what you will ‘own.’

Advantages of a Timeshare

The timeshare market is worth over 10 billion dollars. What does that astounding figure tell you? Well, at the very least, it’s easy to see that this type of shared ownership model is extremely popular.

That’s because there are many advantages to owning a timeshare. When you compare the size and quality of a property in a timeshare compared to the equivalent in cost in a hotel, then you will get more for your money in a timeshare. Bigger rooms, additional facilities, and amenities can come with a timeshare option than a standard vacation choice at equivalent costs.

If you’re the type of person that appreciates routine and enjoys going back to the place you love, then a timeshare is perfect for you. The adage ‘if it’s not broken, don’t fix it’ comes to mind. Why spoil a good thing, when you can purchase guaranteed time at the location you love?

The idea of going to stay in a home from home is very appealing to me many people. At the end of the day, you know what you’re getting and you will never be disappointed.

Are Timeshares Inflexible?

It’s true that there’s a degree of inflexibility with timeshares. Of course, that will vary depending on which model of ownership you purchase. However, keep in mind that a timeshare is not designed to be a last-minute breakaway.

A timeshare is a well thought out and planned vacation property. Purchasing the right timeshare that fits with your annual routine and lifestyle is all part of the careful planning and consideration that goes into your timeshare choice. If flexibility is at the top of your list, then a timeshare may not be the best choice for you.

Are You Ready for a Timeshare?

In this article, you have read about what is a timeshare. We have also taken you through some of the different ownership models and how the timeshare works. Perhaps you’re already getting the feel for whether this will work for you or not.

The timeshare market is competitive and can be pressured. So don’t get hijacked into a purchase you were not completely sure of. Keep doing your research and most of all understand clearly first, what will fit with your ongoing lifestyle.

Don’t stop reading here, you can read many more articles on our site that give fantastic financial advice and tips that fit with your lifestyle.

About the Author: Mike

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