Fractional Guide – Luxury Timeshares
25. Jan, 2010 
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WHAT IT IS
Timeshare is a vacation ownership concept that allows people to own a fraction of a product – whether it is a house, condo, boat, or plane – and use it during a period of time. The time used by the owner can either be contractually fixed to the same time period over and over; or it can be flexible, allowing the owner to use the time based on a reservation system. Residence, condo or hotel space is typically bought in 1-3 week increments.
Luxury Timeshares (also referred to as fractionals) are often associated with branded hotel developers such as Disney, Marriott, Hilton Grand Vacations and Ramada. Each of these brands are also typically affiliated with one of the two major exchange networks, RCI (Wyndham) or Interval International (Nasdaq: IILG).
A useful guide to Vacation Ownership, provided by ARDA is available for download here.
WHAT IT ISN’T
Timeshare is not a Private Residence Club, though timeshare is a distant cousin. Timeshares in general, do not provide dedicated concierge services, ski and golf butlers, pre-arrival grocery shopping, limo transfers from the airport. Timeshare is not a destination club, as destination clubs are more expensive, in elite destinations, and provide more personalized services.
HOW MUCH IS IT?
The average price range of a timeshare interval sold was between $14,000 and $19,000. Prices vary from resort to resort and the unit price or points is based on product type, location, unit size, amenities and supply.
INCLUDES
More spacious floor plans and home-like amenities, compared with traditional hotel accommodations;
. Flexibility and space, from studio units to spacious three bedroom villas;
. Fully equipped kitchen with dining area;
. Washer and dryer, stereo, televisions, DVD players/VCRs.
THE PLAYERS
Exchange Networks
1. Resort Condominiums International (RCI)
- Over 3M “vacation owners”
- More than 3,700 resorts
- 101 countries
- Offers week-for-week and points-based timeshare opportunities.
Luxury Division: The Registry Collection
2. Interval International – Operating segment of Interval Leisure Group (Nasdaq: IILG)
- 1.9M vacation-owning members
- 2,400 resorts in 75 countries.
Luxury Division: Preferred Residences
TOP DESTINATIONS
Las Vegas | Orlando | Miami | Palm Springs/Coachella Valley
San Diego | Lake Tahoe | Maui | Hawaii | Hilton Head
QUESTIONS TO ASK
1. What is the history of the resort timeshare components and the resort’s maintenance fees? What is the yearly escalation rate?
2. What are the reservation policies?
3. How do I go about insuring that I will have the best possible chance of locking in a desired week?
4. What is the earliest date that I can make my reservations? (This information will be important when it comes to using the property. If you buy a floating week, you will be competing with other owners for the week that you desire.)
5. What extra benefits will I receive when I purchase a timeshare?
6. Is there bonus time?
7. Can I trade with other resorts without joining an exchange company?
8. Does my timeshare give me access to anything other than just my unit?
9. What is the difference between “deeded,” “leased” and “licensed” timeshare?
10. How difficult is it to sell my timeshare and how is it done?
THE FINAL WORD
- Research timeshare options and contact companies with packages that fit your needs.
- Be sure the company you are considering is reputable. Check with the Better Business Bureau in the city where the company is based, ask for references from other timeshare owners, attend the timeshare sales presentation with a list of questions; make sure all of them are answered to your satisfaction. Consider carefully what the company is offering. Ask if there’s an after-purchase grace period so you can cancel if you change your mind.
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