Occasionally,
families find themselves comparing the purchase
of a vacation home to investing the same money in timeshare ownership.
Though individual home ownership is very different from timeshare,
an analysis of the popularity of timeshare will help you fully
appreciate the advantages of whole ownership.
Vacationers
for years have proven that they want more than a handful of receipts
to show for their time away from home. The American Resort Development
Association (A.R.D.A.) states on their website that over 5,000,000
families from 150 countries, including 3,000,000 from the United
States, own timeshare. Why? They want better accommodations and
most prefer to own their accommodations. In the 1999 Report, State
of the Vacation Ownership Industry, A.R.D.A. said, "The vacation
ownership industry is enjoying high approval ratings from its
owners and achieving levels of satisfaction unequaled in the hospitality
industry".
Although
hundreds of thousands of timeshare buyers, including myself, enjoy
their purchase
for what it offers, many bought for what they were led to believe
it offers, but in most cases does not…investment
appreciation. Although some individuals who have sold their timeshare
experienced a profit, most have not, and many have taken a loss.
The lack of a viable resale market for timeshare can be primarily
attributed to the under education of the buying
public on the various programs available. Simply put, it can be
confusing. Many prospective buyers do not feel confident in purchasing
unless they are talking to a developers representative.
Let's
pretend, for just a moment, that there is a huge resale market
for timeshare. Imagine also that the appreciation per year is
equal to that of a single-family vacation home. Would investing
your capital in a few weeks of timeshare give you the option of
moving to Orlando when you retire? Would timeshare give you the
option to reside year round in a tax
favorable state that offers much, much more than just The Mouse?
That's a nice option as your body gets older, the snowdrifts get
higher, and the winters get colder. Just sell your timeshare when
you retire, right? Use that money as part of your down payment.
But will the homes be as affordable in the future as they are
now? The way that prices are escalating they will certainly be
much more expensive. Does it make more sense to invest
in a vacation home now so that Disney vacationers can share some
of the mortgage
and expenses? Let's think this through even further. Even if you
can profit on your timeshare, you will still need to use it after
retirement…so why sell it? When you do retire in Florida,
you will more than likely feel like the rest of us who want to
spend a couple of weeks somewhere else. You may occasionally want
to enjoy cooler weather, or take advantage of the inexpensive
travel to the Bahamas, Caribbean islands, South America, and Mexico.
Once you have acclimated to the comfort of timeshare accommodations,
will you want to return to the expense of renting a small hotel
room or suite?
Now
you're getting the real timeshare picture! Even though it may
be real
estate, timeshare is an entirely different product for an
entirely different use. Well, you say, timeshare is a less expensive
purchase.
Certainly a person would have to be wealthy to afford an expensive
second home that is rarely used. Not necessarily so! If you could
purchase your own Disney area vacation home with a minimal deposit
and have all the expenses, mortgage
payments, taxes,
insurance,
and upkeep paid by someone else, could you afford one? Could you
afford not to take advantage of that opportunity? No mortgage
payments, no taxes,
no interest, no upkeep costs, nada, none. So, what's the catch?
You will need a down payment of at least 20%, which depends on
several factors. You're thinking that is too much…can't handle
that amount? U.S. residents can make less of a deposit, but you
may have a few hundred dollars to pay monthly. Would you contribute
a few hundred dollars monthly to own a vacation/retirement home
in Orlando, if other vacationers paid for most of your payments
and expenses?
The
tremendous opportunity afforded us by simply riding the multi-million
dollar advertising coattails of the amusement park giants will
become increasingly clear as we progress through the following
considerations for purchasing
an Orlando vacation home.
