Saturday, October 22, 2005
Internet Offers Timeshare Resale Market
Ron Baker, a Lafayette, CA real estate investor, purchased a 1,650 square-foot, two-bedroom, two-bath condo timeshare from Marriott Desert Springs Resorts in Palm Desert, CA for $15,000, plus annual maintenance and property tax costs.
For the past 10 years, the agreement has entitled him to use the condo once a year, but he can choose to rent his week away and net about $1,500 after costs.
The rental income potential should make the timeshare attractive on the resale market, unfortunately the industry's resale market is largely disorganized and, as a result, not very profitable.
Baker, a former limited partnership company owner, believes he can change that.
"The biggest objections to timeshares is that owners can't sell them. Right now, you could buy my unit in the secondary market for $15,000, when they are selling phase two for a smaller unit with less amenities for $22,900," said Baker.
Once purchased purely for the enjoyment of their owners and considered a white elephant of a real estate investment, timeshares could soon become a more viable asset with an organized resale market.
Unlike a house, the nation's 2 million timeshares, which cost an average $10,000, don't generally appreciate because vacation club chits or a condo with values that shift seasonally are not easily appraised.
Contracts written before the mid-1990s and before major brands entered the industry, are often so restrictive it's cost prohibitive for owners to list, show, or sell timeshares. Brokers want large commissions and upfront fees to list the time share, or simply refuse to deal in them.
The $3 billion-a-year industry trade group American Resort Development Association (ARDA) offers resale guidelines for developers, but they include hefty disclosure requirements for fees, commissions, advertising methods and data tracking, include the average number of weeks a resale unit is on the market and the number of sales each year.
Still, nearly 300,000 households bought time shares in 1998, and Baker and others have begun to see the value in the cheaper resale timeshares.
Baker's TimeshareNet joins Timesharing Today, All Timeshare, CondoWeb and TriWest Timeshare, among other sites helping timeshare resellers list their timeshare and avoid costly fees -- much as discount real estate agents use the Net for home sellers.
Among the nation's 1,600 time share resorts, some developers, including Marriott, have also begun to offer resales at some of their properties.
For the past 10 years, the agreement has entitled him to use the condo once a year, but he can choose to rent his week away and net about $1,500 after costs.
The rental income potential should make the timeshare attractive on the resale market, unfortunately the industry's resale market is largely disorganized and, as a result, not very profitable.
Baker, a former limited partnership company owner, believes he can change that.
"The biggest objections to timeshares is that owners can't sell them. Right now, you could buy my unit in the secondary market for $15,000, when they are selling phase two for a smaller unit with less amenities for $22,900," said Baker.
Once purchased purely for the enjoyment of their owners and considered a white elephant of a real estate investment, timeshares could soon become a more viable asset with an organized resale market.
Unlike a house, the nation's 2 million timeshares, which cost an average $10,000, don't generally appreciate because vacation club chits or a condo with values that shift seasonally are not easily appraised.
Contracts written before the mid-1990s and before major brands entered the industry, are often so restrictive it's cost prohibitive for owners to list, show, or sell timeshares. Brokers want large commissions and upfront fees to list the time share, or simply refuse to deal in them.
The $3 billion-a-year industry trade group American Resort Development Association (ARDA) offers resale guidelines for developers, but they include hefty disclosure requirements for fees, commissions, advertising methods and data tracking, include the average number of weeks a resale unit is on the market and the number of sales each year.
Still, nearly 300,000 households bought time shares in 1998, and Baker and others have begun to see the value in the cheaper resale timeshares.
Baker's TimeshareNet joins Timesharing Today, All Timeshare, CondoWeb and TriWest Timeshare, among other sites helping timeshare resellers list their timeshare and avoid costly fees -- much as discount real estate agents use the Net for home sellers.
Among the nation's 1,600 time share resorts, some developers, including Marriott, have also begun to offer resales at some of their properties.
# posted by John @ 6:31 AM 
