Your vacation resort can ill afford

In addition to more square footage in a timeshare, you usually get bedrooms that are separated from living areas, along with a kitchen and ensuite washer and dryer. While many timeshare owners do enjoy their property like the annual family vacation to Disney , there are many others who have said they were pressured into a purchase by salespeople during the initial tour, and are now trapped in an expensive ongoing obligation. Here are some of the risks of purchasing and owning a timeshare.

Like walking into a car dealership, timeshare sales agents are going to show you their best and typically highest price offer first, and then push hard for a sale. If you decide to proceed, ask for the fine print first and cross-check that with what you would typically spend on an annual vacation—not what the salesperson claims vacationers spend.

In reality, many people do finance the purchase, and the market offers opportunities to pay less than the full price for a resort vacation. You can also quickly look up vacation package costs on any of the main travel booking sites to get an idea of what you would pay for a desired location without purchasing a timeshare as a comparison. If you finance a timeshare, your options may include financing through the timeshare company, getting a personal loan with no usage restrictions, using a credit card or the proceeds of a home equity loan.

Timeshares do not retain their value, let alone increase in value. If you want to sell your timeshare on the secondary market, you will be competing with people who are practically giving their timeshares away. According to the Association of Vacation Owners, an independent advocacy group for timeshare owners, there are millions of timeshares available on the secondary market. What about renting out your timeshare? You should not expect to be able to rent out your timeshare for a profit.

If your contract allows it, you may be able to rent out your timeshare to recoup some of your expenses, but it can be a lot of work. Not all timeshares are points-based.

There are also fixed-week and floating-week timeshares. But point systems are popular these days and have an important drawback. Further, the easy ability for people to buy timeshares on the secondary market for much less than what the developer sells them for can depress the value. Another possibility is that the points required to use your timeshare during your preferred dates could change from year to year. For example, the developer may reevaluate point requirements annually to shift demand away from high-vacation periods and increase incentives for low-demand periods.

Higher assessments can lead to a downward spiral of owners not being able to afford their dues, and then the resort quality declining. Purchasing a timeshare is a long-term commitment, often lasting decades. Sometimes, you can give your timeshare back to the resort—a process that leading developers explain through their Coalition for Responsible Exit.

However, the process can be difficult and time-consuming. Timeshare owners have had varying results when trying to return their timeshare to one of these developers. However, you can accomplish any of these things without a long-term vacation contract, especially with the widespread availability of extended stay properties on travel websites like Expedia, Priceline, Airbnb and VRBO.

Deciding on a timeshare also depends on how much time you can take off to use your annual membership. So before you tour a timeshare, do your research—a lot of it.

The Timeshare Crusader, Timeshare Users Group, Redweek and even Facebook groups whose users all own timeshare from the same developer, are consumer-friendly sources worth consulting. Amy Fontinelle is a leading personal finance expert with nearly 15 years of experience.

She has won several national and state awards for uncovering employee discrimination at a government agency, and how the financial crisis impacted Florida banking and immigration. Select Region. Coconut Lagoon. Diya's Inn Marari. Backwater Brook Resort. Coco Bay Resort. View more hotels in Muhamma. Reviews 1, Write a review. Filter reviews. Traveller rating. Excellent Very good Average Poor Terrible Traveller type. Time of year.

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Review tags are currently only available for English language reviews. Selected filters. Updating list Date of stay: August Trip type: Travelled with friends. Thank smravindra LiLy W. Reviewed 21 October Nothing special. Date of stay: October Thank LiLy W. Reviewed 18 October Had an amazing stay. Trip type: Travelled with family. Thank basuj. These are often referred to as "vacation clubs. Some plans let you "bank" unused points. Cost varies by:.

Timeshare properties can often feature larger and more luxurious accommodations than standard hotels and are generally located in desirable places. When you are standing in a beautiful condominium overlooking the perfect beach and sparkling blue water, it is easy to succumb to the sales pitch. Remember, timeshare salespeople are in the business of selling.

But just because they tell you that you are getting a great deal, it doesn't mean that you really are. Before you buy, take some time to research the property and talk to other timeshare owners. Don't make your decision in haste, and never let the salespeople rush you. Points-based systems come with no guarantees. Just because the salesperson tells you it's easy to trade your week for another week or your property for another property, doesn't mean it really will be easy.

If you own a week in Hawaii, would you be willing to trade it for a trip to the blistering hot Las Vegas desert in August? If you wouldn't, chances are no one else will either. It's also important to remember that everybody wants to travel to the same places and in the same weeks that you do.

The desirability factor aside, trading often results in an additional fee. In addition to the monthly loan payment, which comes with a high-interest rate when financed through the timeshare company, the annual maintenance fee will also set you back a few hundred dollars a year.

Also, if the property needs a new roof or a new sewage line, a "one-time" assessment will be levied. Some properties also charge miscellaneous fees, such as a publication fee if you want to view other properties that may be available for trade, and additional fees if they help you sell your property. While a lifetime of vacations sounds great, will the management company that sold you the timeshare be around three decades from now?

If you are considering a timeshare in a foreign country, you must also understand the laws and know what the result will be if the timeshare management company closes. Another major consideration is your health. That condo on the ski slopes may look great today, but five years from now when you are caring for a baby or are suffering from a herniated disk, your days on the slopes may be over, but the bills for the timeshare will continue.

Consider that your desire to hop on a plane may wane as fuel costs rise and airport security becomes more onerous. A timeshare is not an investment. Investments are designed to appreciate in value, generate income, or do both. A timeshare is unlikely to do either, despite what the salesperson says. The huge volume of used timeshares on the market, the appeal of buying new versus used, and the marketing muscle of the firms selling new timeshares all work against the idea that you will make a profit reselling your used timeshare.

Thus, selling for a profit is an uphill battle considering you need to convince someone to pay more for a used unit and factor in all the fees you paid over the years.

The very nature of the sales process should be a hint about the reality of the issue. Have you ever heard of a mutual fund , municipal bond , or any other investment that offered you a free weekend in Miami just for giving the product a try? A timeshare is not an investment, it's a vacation. It's also an illiquid asset that is likely to lose value over time.

Ultimately, timeshares are like swimming pools, if you buy one, do so because you love the idea of owning it, not because you expect to make a profit. If you do take the plunge, remember that you are buying a repeatable vacation. If you have found a vacation destination that you absolutely love and want to return to every year and have decided that a timeshare is a perfect way to achieve your goal, go ahead and buy one.