Is a Timeshare a Financial Investment?
Is a Timeshare a Financial Investment?
Have you been scammed into buying a timeshare as an investment property because of rental weeks or marketing programs that you were offered during a fraudulent sales pitch?
Many timeshare scam organizations make promises that they will refer you to a company that will:
- rent weeks at your timeshare to cover the purchase price and maintenance fees or to make tens of thousands of dollars in profit
- sell a timeshare you already own in order to help you to purchase a new timeshare
- sell your timeshare for a profit
Timeshares are not financial investment properties! Often the promises of renting or selling your property are made verbally, and are not included in the contract that you sign when you purchase the timeshare. The salespeople persistently guarantee that your weeks can be rented or sold, but state that they are not able to include this in their contract as it will be a partner company that is responsible for listing the properties. Sometimes they will even show you a fax from their partner rental agency in the US stating that you are guaranteed listings and that rental suites at your property are in high demand by vacationers.
All of these false promises of an excellent return on investment entice vacationers to purchase timeshares. The resorts do not advise you that the companies they are referring you to will charge you an upfront fee to list your property.
Our clients have complained to us about companies such as Luxury Resort Management, Resort Rentals International, Dreams RSI or Regal Resales and Rentals, to whom they have paid several hundreds of dollars to list their properties on their websites. These types of companies promise to rent or sell timeshare properties for far more than the actual value. For example, they may offer to list your property for $2,800 per week when the actual amount that it may rent for is less than $500. These unrealistic prices and assurance of rentals or sales lure clients into paying the upfront fee for their services. They often promise to send you the contract and draft listing before even processing the fee on your credit card. However, the administration fee is processed right away, and clients do not receive the draft listing for several weeks.
The rental agent contract usually states that their company will represent your property on their website. When the clients go to the rental agency’s website, there are no actual listings of timeshare units. Sometimes there is a generic listing of the property, but no details about the price or description of the unit. Potential renters or buyers have no information by which to even become interested in purchasing your weeks in your timeshare. The websites only have online forms for people to contact the agency if they wish to sell or rent their timeshare, not to rent their clients timeshares.
Six months or a year later, the clients properties have not sold or been rented, and they have never been contacted by the property management or realty company, or any of their representatives. The property management companies have already received their fee, so there is no incentive for them to follow through on their false promises. These companies are not in the business of renting or selling properties. Their profits are solely made by the listing fees that vulnerable timeshare owners pay to them. In short, not only have the timeshare purchasers been scammed by the resort, but also by the rental agencies who make deceitful guarantees that they will rent or sell their properties.
Property managers and realtors in North America normally do not charge upfront fees to represent you in a rental or sale. Listing on their website is part of their normal service, and is an expense incurred by the agency in order to do business. Payment is made on a commission basis once they are successful in renting or selling your property.
Avoid being scammed again by dishonest sales practices! When thinking of purchasing, renting, or canceling a timeshare, make sure that you do not pay any money upfront for administrative fees. You work hard for your money, and it is important that these companies dont try to take that from you. Honest organizations will work hard to render their services so that they get paid accordingly.
Is timeshare a financial investment?
