How to Sell a Timeshare Property
Many owners of timeshares have passed their honeymoon infatuation period and begun to see the marriage was not made in heaven. Perhaps they would like to divorce themselves from the ongoing mortgage, taxes, and maintenance fee. The fixed-week unit was convenient when purchased, but doesn't fit their current lifestyle. Maybe their family grew or matured, or the destination just did not live up to the promised experience they thought they were purchasing.
Whatever reason, if you've decided to sell your timeshare property, you no doubt want top dollar and a quick closing. For most sellers, those two events do not go hand-in-hand. Owners who purchased a new timeshare typically recover very little of the original sales price when they decide to sell the portion of the unit they own.
Realistic Timeshare Pricing
A sale can be even more difficult to achieve if your unit is a studio, or the usage dates you own are in an offseason. The same is true for units in resorts that have not been properly maintained. Don't be too dismayed because even larger timeshare units with in-season or flexible weeks typically sell for only 30% to 55% of their original purchase price.
One upside is if your timeshare is part of a chain, where credits can be used for airline tickets or other accommodations. If this is the case, you may be able to recover a higher percentage of the unit's original price.
If you're in a real hurry to sell, keep the price low. Buyers are usually shown a list of timeshares grouped by the resort. If other, similar units are priced lower, you can guess which ones they'll pursue. You're the only one who can decide if holding out for a higher price outweighs the burden of paying ongoing maintenance fees and other expenses.
Understanding What You Own
Make sure you understand exactly what you are selling before you begin to market the timeshare. Timeshare properties can be sold as both a deeded ownership of the property and as a Right To Use (RTU) for a specified number of years.
Fractional portions of deeded properties were sold by the week as real property. The owner became responsible for a portion of taxes and maintenance costs. The deeds will vary by the laws regulating such items in your state.
RTU agreements decrease dramatically in value as they near the expiration date. Sometimes an RTU structure was used as a resort was being developed and built and was more of membership in the resort than owning. If the resort property changed hands you may have lost most of your rights over your unit.
Sometimes timeshares will be called a vacation ownership property. The contract may refer to your property as a vacation license which is valid for a specific number of years. Usually, the minimum length of stay purchased was one week. Weeks could be fixed, floating, or flex—meaning all owners have a chance at getting the best week. Some timeshare companies, like Disney Vacation Club, issued points to the owners each year. Accumulated points could be redeemed for better weeks.
Listing With a Real Estate Agency
Before you begin to list, locate all the documents you have that pertain to the timeshare. These will include mortgage information, tax records, and maintenance details. A knowledgeable seller tackles a transaction in a confident manner. Be prepared to answer any (reasonable) question a potential buyer may have.
You'll find many online and offline real estate agencies that will list your timeshare. Some charge an upfront fee, then a commission at the time of sale. Others work strictly on commission. Fees and commissions vary and are typically higher than those charged for a traditional real estate transaction.
Interview several agencies before signing an agreement. Check each company's complaint records with the Better Business Bureau, and with their State Attorney General's office. Find out if the company is a member of the American Resort Development Association (ARDA), a trade organization that expects its members to abide by a set of ethical guidelines when selling timeshares.
Become familiar with the timeshare laws for the state involved. Upfront fees are illegal in some states, but agencies work around the laws by giving them other names. Check with state real estate commissions to verify that the company and its salespeople are licensed to practice real estate in the states they operate in.
Ask each office to tell you, in writing, exactly how they plan to market your timeshare.
Resort developers sometimes offer resale programs. Salespeople working onsite do have easy access to buyers who are interested in that specific resort or chain, but their main focus may be selling new units. Before you sign a contract, compare their fees and marketing practices with those of other agencies. Developers offer programs to finance new timeshares, but it's difficult to finance a resale. The majority of sales are cash transactions. Talk with an attorney before agreeing to offer owner financing for the property.
The timeshare resale market has attracted numerous scam artists. Be wary of anyone who promises you a quick sale. No one can guarantee that.
Other Options You Can Take
Include your timeshare listing on an auction service such as eBay. Browse current and past auctions before you list your property. Note sales prices and which descriptions sound most appealing. Incorporate the best marketing ideas into your ad.
Timeshare owner clubs offer several member services, including classified ads. This type of classified reaches the right target audience for your timeshare. If you have a fixed unit and time, find out who owns the timeshare for weeks just before and just after you. They might be interested in increasing their time.
Finally, if all else fails you may want to try a one-time exchange. A one-time exchange isn't the answer if you wish to sell a timeshare, but it might be the perfect solution if you simply want to change dates or locations.
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