February 07, 2008

Want to lose 90% quick on a real estate deal? Great, just buy a timeshare, and try to resell it. And if you can't, you gotta keep paying more

I wonder how many of the 1.3 million ramen eating six percenters will now try to find work unethically selling timeshares to suckers.

My guess - a lot.

It's amazing how many sheeple get played by timeshare salesmen on commission - my guess is that even a few of you have. Promises of models by the pool, glamorous lifestyles, buy-now-or-be-priced-out-forever, and incredible appreciation. Sound familar?

Well, here's a great article on the Big Timeshare Con. People are now trying to get rid of these debt-traps as fast as they can, only to find out they have ZERO OR EVEN NEGATIVE VALUE. There are no buyers stupid enough to pay even ONE PENNY.


I'm not sure who I feel sorrier for - the fools who bought the timeshares, or the con artists who earn their living screwing fools into buying timeshares. It's sad to see what people do to other people to make a buck. How do they sleep at night? What do they tell their kids?

Timeshare owners see assets turn into liabilities

Buyers on the timeshare resale market are scarce, and experts say sellers are lucky to get 10 percent of the original price. It could be even less: timeshares are routinely offered for sale on auction site eBay starting at 1 cent.

The problem for many buyers like Uhler is they believe timeshare is a slice of real estate, which they hope will increase in value. High-pressure, glitzy sales pitches can add to the confusion.

"We can't sell it even if we find an idiot to buy it," said the substitute school teacher from Northwood, Middlesex, who bought the weeks for a total of about $5,000 seven years ago. "We realize that we've lost our investment."


Max said...

Amazing, I didn't know they were that worthless. How could it be?

Anonymous said...

Same suckers bought timeshares bought subprime I bet

Anonymous said...

I purchased a timeshare a few years ago knowing that it was not an investment, I like to travel. My wife and I trade it in and use it for overseas vacations at some pretty spectacular places. I looked at it as a enforced savings plan, that I eventually (10 years) no longer have to pay for, but still get to use. Averages about $135 - 145 a month after you factor in the yearly maintenance fee and exchange fee.

It was really pathetic when we went to the pitch, it was like an Amway Meeting. Strung out sales people getting families who obviously could not afford to spend the extra money all amped up on this "investment" They originally wanted us to pay 3 times as much for 15 years, we kept walking out and they all of sudden pulled out "defaulted" plans we could take over for the pittance we pay.

I even got a legitimate Nevada Deed for like 1/52 owner ship of one suite in a resort complex. Ha. Anybody who purchases for the "investment" is a sucker.

Frank@Scottsdale-Sucks.com said...

I know someone who bought into the Marriott timeshares and they like it because they can use their two weeks at any of the 50+ properties, and their friends also have the same deal so they can plan vacations together.

BUT ... they bought it knowing it was NOT an investment, but simply an expense, basically a pre-paid hotel suite for two weeks per year.

Having said that, I don't see much of a point in getting one since you can just reserve hotel rooms when you need them.

keith said...

For the people who bought timeshares NOT as an investment, why pay full price when they could have had the EXACT same thing for 90% less?

Do they go to the grocery store and insist on paying $50 for a gallon of milk?

Buzz Saw said...

Promises of models by the pool...

That's a joke, right? I was on Marco Island in December, all I saw was a bunch of beached whales and a ton of empty condos. We rented a huge (double) hotel suite, got a sweet rate too being off season. Florida condos are NOT glamorous. If you want to be treated like royalty go rent a room for a week or two, leave the maintenance, insurance, tax, and cleanup to them.

Mark in San Diego said...

I ran the numbers on a timeshare presentation in Las Vegas a few years ago. . .buy one at the Hilton for 20K - $1500 a year for upkeep. . .hmmmm. . .I stay at the Stratosphere next door for $49 a night. . .let's see - 10 nights at year at $49 ($79 on weekends) is about $490 0r $790. . .not even as much as the upkeep for one week at the Hilton Grande Resort. . .plus the crowd at the Stratosphere is younger and more fun. . .and free crap when I check in. . .what's not to like . . .can you believe at the Hilton sales pitch they said, "you better buy now, because you can't always get a room in Vegas". . . .right. . . .like you can't get a place in the sand at Venice Beach in January!!

Anonymous said...

I pay $290/yr in maintenence fees for a week in a 2bd/2br condo in Hawaii each year. They rent the same units for about $1000/wk. To rent two nice hotel rooms would cost even more. Me and my friends go surfing and scuba diving there each year, so it ended up saving us lots of money after a few years. We also have more fun having BBQ's and grilling on the patio by the beach, something we can't do at a hotel. I knew I would never be able to sell them for a profit, just use them for my vacations. As for investments, bad idea.

Eric Ogunbase said...

"But Keith! Don't you know that real estate ALWAYS goes up? Timeshares are real estate and we know that real estate ALWAYS goes...wait...nevermind."

Russ DoGG said...

Stupid sister bought not one but two of these dumb thinkgs. I tried and tried but couldn't get her to look at the numbers on her investment. REFUSED to look at a piece of paper.

Its not that she didn't want to argue that it was a really good investment. She kept arguing just that. But refused to even consider a series of cash flows and the computation of the rental income from the unit for the years she won't use it.

Major avoidance behavior. When they are told that their investment is really a money-looser, and that she would have been netter keeping her "purchasemoney" in hte bank earning interest, they like refuse to believe it.

It's like LA LA LALA LALA LALA I CANT HEAR YIU.. Im better off buying this because otherwise Id be throwing money away on rent.

Will not allow me or her father anyone to rationally evaluate the expenses of keeping this thing, and what it can really sell for. Positively does not want to hear that the units can be rented for just about what the annual maintenance fees cost.

She Will clam up and say that I used the wrong number for the purchase price. (It was the number she told me). Then she won't give me her new purchase price- just so that the numbers can't be run (in excel spreadsheet). Then she says it's a good investment because she isn't throwing money away on rent, and bc she (thinks she can) sell it.

She doesn't realize that these units sell for like 0.10 on the dollar, if they can be sold at all. It does rent out- prime HAWAII location. While you could cover the maintenance fees + a few hundred bucks if you rent the place out, it won't work. That is because the management company insists on like 35% cut of the rental income just for posting the unit for rent.

The prepaid vacation idea is no good for her bc she can't afford to go! Had to borrow money from her elderly parents when an ordinary water heater needed replacement. IIf you have the means, however, it can be good prepaid vacation. But you have to stay vigilant against the sleazy broker and management companies. Never give them a large purchase deposit bc then they have you and can start raising the managenment fees.
I sent her the reuters clip to try and stir the pot up bit.

Pets or Meat? said...

"Do they go to the grocery store and insist on paying $50 for a gallon of milk?

February 07, 2008 5:21 AM"

Probably if they could get 2 loans until payday like wimpy did in Popeye for his hamburgers..

Shakespeare WAS Right...

Step right up. The line begins here, the cows are not making any more milk and if you don't buy now you will not have milk in the future...

happy homeowner in the stix said...

Hmmm. Now I'm interested if I can pick one up for a penny! ;)

Seriously....what will they do if I don't pay the annual fee after I use it one time? Foreclose on me?

happy homeowner in the stix said...

On second thought....who the hell wants a timeshare foreclosure on their credit history? Or worse yet, having to admit to my family that I own one of these abominations, even for a penny?

Maybe I'll just email the sellers on eBay and tell 'em I'll give them $100 for their week as a rental (or $200 if it's somewhere desirable). I might get a taker or two.

Big Cheese said...

Even if the timeshare is free the annual fees make it only an equal trade off vs booking a hotel room for the same period.

But you are stuck using the same timeshare or the same chain (in the case of Marriott) while paying maintenance fees every year. If choice and flexibility matter to you and you don't like flushing money in the toilet then it's a net loser, even if someone gives you the timeshare along with the damn boat anchor of annual fees for life.

-Big Cheese

bay400 said...

I have never understood why people buy timeshares. Even if they were a good value, which they are not, why lock yourself in to that? For the same money, you can go where you want and when you want.

Pretty stupid "investment"

Anonymous said...

Got to wondering,

Is there a magazine called SHEEPLE?

If not there should be, and it would have plenty of advertisers, like 'Want to sell your time share (for 50 bucks)'?

Beignet said...

What about Condo-tels in Orlando and Vegas? Is this the same as a timeshare?

I've seen websites on condo-tels in Orlando, these look like really really nice resorts.



Dirty TimeShare Bomb said...

Got to tell you about my only Time Share experience. In the Fall of 2006 we were invited for 3 Days / 2 Nights stay in the Massennutten Va. resort area by my Sister who had purchased a Time Share there previously. The catch was a mandatory "2 Hr" tour of the grounds and having to endure the sales pitch. The good news is that we stayed free , got a $200 preloaded Visa , free water park passes & Golf. Bad news is the "2 Hr" sales pitch lasted 4 Hrs and the arm twisting was like none I have ever sat through before. It was like you say "NO" and they didn't even hear it. The price started at $20K and the final offer was at $1K (Today only because we looked like a nice family). My wife said she would never endure that again even for a $2000 Visa card & free stay. Now for the sad part...I looked around the room and there were families with small kids , ragged shoes & tattered clothes you know needed to just take the verbal beat-down and walk away with the free stuff but they were signing the dotted line. Those folks actually paid for my trip but they needed the cash much more than I. This is the world in which we live...the greedy will munch on those least able to afford it.

BTW...My Sister has expressed great regret that she fell for the sales pitch...almost as much as she regrets trying to sell Amway and getting the "Amway Credit Card".

john r said...

My wife and I bought a timeshare on Maui a number of years ago. Our thinking was that each year we would not want to go to Maui, but would trade our week for a timeshare in many desirable places in the world for a nice vacation. Our kids could also do so. What a wonderful concept. However, whenever we would try and exchange our week we could never book where we wanted to go. For even a chance of doing that you might have to try and book years in advance. Who can do that?
We sold the place, and lost money considering purchase price, dues, maintenance fees, etc. A Lesson Learned!

Anonymous said...


My best friend bought into Monarch about 6yrs ago.

Thought it was the thing to do during his divorce, for his new girlfriend and he to have someplace to go.

Jump ahead a few years, tried to sell and couldn't!

Found one of these timeshare brokers, it took about 2 yrs total to sell.

Buy in about $12 to $15 thousand plus your dues (monthly or quarterly not sure) over six years.

Sold for $3 thousand!

The best part of the story is part of the sales pitch was a guaranteed room whenever, wherever!

He called once to get a room for himself and his 2 kids, nothing available.......sorry!

Too bad, so sad!


Anonymous said...

"I was on Marco Island in December, all I saw was a bunch of beached whales and a ton of empty condos."


This buds for YOU !

Anonymous said...

Are they deducting the rip-off property taxes from that 10% profit figure, especially if you bought that cancer in Florida?

Anonymous said...

I purchased a timeshare a few years ago knowing that it was not an investment, I like to travel.

Good news! You, sir, are the lucky winner of the Finance Donkey Hat trophy at HP.

We arrived at this tough decision, among serious contenders like DOPES!, for instance, after reviewing your unfounded reasoning of "not caring about investment strategy when buying expensive assets".

Congrats and don't forget to vacuum your beds often to get rid of all those pesky dust mites that feed on dead skin of strangers who sleep over at your precious timeshare!

Anonymous said...

like you can't get a place in the sand at Venice Beach in January!!

True, and who goes to the beach on Venice anyway. The small stretch, on the Marina del Rey side next to the pier, is much better.

DinOR said...

O.K, kind of late on this one but I wanted to see what some of the responses would be?

OBVIOUSLY none of you are Oregonians! I stood outside the entire SuperBowl Sunday under the awning of the in-laws garage tending to a fire-pit and 3 coolers of beer!

Everyone kept asking if I wanted to come inside? What? And let a "little" hailstorm spoil it!

Seriously people, I haven't been outside (other than in and out of the car) for more than 10 minutes at a time since late September! I only have February, March, April, May and a good chunk of June to go!

I would LOVE to be able to "get away" for the ENTIRE winter (but business and 2 daughters make that all but impossible) My "plan" was to buy up chunks of timeshares off ebay (or wherever) for a penny and live w/ the damn maint. fee! Even if I have to move down the hall every week. I just want to have "some" assurance that I'll have a shot at a "regular" summer?

Meaning no rain in Sept/Oct and again from May/June. BUYING a full time SFH *won't work. Trust me. Nor will a hotel room. You people don't seem to want to recognize that while you can always get a room in Vegas/Palm Springs there are times when you WILL pay through the teeth!

Just my 2 cents. Oh and I'm open to comments. :)

DinOR said...

I was just hoping we could all be a little more open minded about this topic over all? Most of our experiences and interface w/ timeshares has been from a "pre-bubble perspective".

If (and I DO... believe) homes continue to plummet in value, where's the logic in even CONSIDERING buying at any point in the immediate future... if EVER!

Especially in "distance markets" like Bend, OR, HI or any other place that has sunshine for more than 87 days a year? I think we've established that a lot of the resort/retirement areas will be hit and hit hard so why bother even looking at a SFH?

Previously you could make the case that ANYone that bought a TS during the bubble was OD'd on kool-aid, now... I think it's The Ultimate Bear Statement! But.. but..bu homes have lost HALF their value here in ____ and you'd be getting such a deal!

Yeah, I know but they will NEVER appreciate from this (or any other point going forward) so why have the year-round PITI, PLUS maint. PLUS vandalism threat etc?

Anonymous said...

Timeshares are the original real estate rip off. Besides the inital purchase price you pay an annual maintenance fee, then the week you stay there, you pay cleaning/use fees for that week. When you add up that annual maintenance fee and the fees for the week you stayed there you could have stayed at a nice hotel/resort for a week just on that.

Anonymous said...

So many negatives, how about a positive. Owning pure "points" through wyndham worldmark made it possible for my family and I to see the world on about 1/4 the net cost. You see, 90% of bad timeshares gives the other 10% a badname. Just like lawyers. You just need a really good one. Pure points (credits) the only method that makes sense. people who complain they can't trade or sell it probably didn't buy pure points, or a valuable location. People who bought Maui 20 yrs ago love their timeshares!

WINGS said...

I love this phenomenon.

This is great.

Ha ha ha!

You people got so scammed. You people are just delightfully stupid.

I adore you for your simpleton ways.

I offer you fifty cents for your timeshare.

I've also got a bridge I want to timeshare out to you while we're at it.


Anonymous said...

I went to a timeshare presentation last year. The ONLY reason I went was the fact that they promised to give you 2 complimentary tickets to Disneyland with one nights stay accommodations at a local hotel.

The price of Disneyland admission is somewhere in the neighborhood of $65 dollars or so per person. WOW! I thought! That's a $130 dollars plus one night in a hotel. Whatever I have to listen to, it'll be worth the tickets.


The first guy was "your best friend" character. He looked like a frat buddy you had in college. After the presentation, he sat me down at a table and talked about the numbers and how great an investment it was to buy.

I didnt go for it. So he said he'd get his boss before he'd let me go. Sit tight. Can I get you a coffee?

No thanks

Boss comes back. A real cerebral looking guy, with glasses, gelled hair and all. "He runs numbers for me, tells me this is my only chance, my only shot at life, my one big opportunity that I'm letting go buy. YOU MUST BUY.

Time rolling by, rolling by.

NO, I cant, I've got to get my wife.

Well, call your wife!

NO, she must be here in person.

Why didnt you bring her. I dont know why?

Then MR. Cerebral leaves and tells me to wait. The Disneyland tickets are coming but I have to wait just a little longer.

I wait, call my wife, she tells me "Dont buy!" But I want the tickets. "Just leave!" she says
"They wont let me!"

Time rolls by, maybe another 10-15minutes.

All of a sudden, his boss, an African American, who looked like he played pro ball some years back sits down next to me and shows some other brochures with beautiful women- all over the place- the ratio of men to women had to be 5 to 1.


I cant, my wife!

Arent you a man.

At this point, all three of them, the frat buddy, the cerebral guy, and Mr. NFL all surround me, hound me for the better part of an extra hour. The look on their faces.



keith said...

Anyone considering the "timeshare life" here's my recommendation:

1) If you buy from the developer, you'll lose 90% when you walk out the door. So buy on ebay instead.

2) Don't buy a timeshare, simply rent condos or villas from vrbo.com, cyberrentals.com, craigslist.com, holidaylettings.com and more. And when an owner wants X, offer 1/2 of X and you'll get it.