 What is Holiday Club Ownership?
Holiday Club Ownership – or "Timeshare" as many still refer to it as - is the term used to describe the process which allows buyers to purchase an increment of time, typically one week, in a condominium, villa or apartment type of furnished vacation accommodation.
Holiday Club owners receive either a fixed week or a floating time reservation arrangement that may vary by developer, unit type and season. This reservation is an investment in lifestyle, in future holidays, in family time together.
It is not an investment in real estate--it's an investment in your future vacations!
Whilst still a small segment of the growing tourism sector, Holiday Club Ownership is a fast growing - and once again popular - sector.
It is estimated that 3% of Americans own a Holiday Club membership and that number is rising every year. In the United Kingdom, there are more than 1 million Holiday Club members. Worldwide, it is estimated that 5,400 “timeshare” resorts exist in nearly 100 countries.
The industry has changed dramatically from its early days when there were many unscrupulous individuals and companies involved. Today, many Holiday Clubs are affiliated with major hotel companies such as Marriot, Wyndham, Disney, Ritz-Carlton, and Four Seasons.
You can still buy the most basic type of timeshare option--a one-week interval at a deeded property in a single location--but dozens of variations on that theme are available. They include non-deeded ownership, points-based programs and fractional ownership. In some cases, you can purchase a Holiday Club membership for a short period of time - e.g. 3 yerars - at a very low cost.
Holiday Club ownership no longer applies solely to the classic one-week-per-year, condo-in-Spain format which dominated the old "timeshare" industry a generation ago. There are now many permutations of ownership that differ widely in what they offer.
Holiday Ownership programs also operate under many different names including "holiday club", "residence club," and "vacation club." They may all operate under different rules, but fundamantally the same prnciples apply.
The CORE principle which applies to all these definitions: You are buying the right to stay in a condo (or house) in a vacation destination for a certain amount of time.
When compared to the cost of renting similar accommodation, Holiday Club ownership can pay for itself after about 15 years for a FULL membership - even less if purchasing a 'trial" (e.g. 3 years) membership which some resorts now offer.
The big difference to renting is that many participating Resorts allow you to you to swap a week in your "home" property for a week somewhere else through exchange companies such as RCI and Intervals International. As a result, your vacation does not need to be a in a fixed location each year. Bearing in mind that there are 5,400 timeshare resorts and many are involved with these exchange clubs, buyers can have a big choice of vacation alternatives.
Here’s some basics you should be aware of when considering a Holiday Club Ownership option:
DEFINITION OF TERMS
Most of the commonly used industry terms can be found at:
http://www.vacationbetter.org/timeshare-terminology
Here’s some of the more important ones:
Deeded vs. Non-deeded
A "deeded" resort is one where you own the title to a small part of the property, the same as you do with your primary home. Non-deeded, or "right-to-use" resorts give you the right to use the property for a specified amount of time, the way a lease on an apartment does. There is little difference between these two types of property in terms of the type of holiday experience you'll have, only in the ease and rights you have when transferring or selling it. Deeded property can be sold or bequeathed to a family member, just like conventional property.
Fixed vs. floating weeks
In a fixed-week system, owners are guaranteed to be able to stay in the same unit for the same week every year. Floating week systems allow owners the right to use their unit for one week during a pre-specified season. A reservation must be made well in advance to reserve the week.
Points
Some companies have programs that allow you to buy points which are redeemable for accommodation, instead of buying a specific property. You will generally still have to pick a "base" property, but you are not locked into staying there--it just acts a proxy for trading purposes.
Points can be used for accommodation in any number of locations, or can be bought or sold to other Holiday Club Owners. They have the advantage of letting you stay somewhere in increments of less than a week. Some companies even let you redeem points for dining, cruises, car rental or other vacation amenities.
Like traditional ownership programs, points programs will cost you a hefty chunk of money up front, plus monthly or yearly maintenance fees. You can generally pick from amongst different "plans" which vary in the number of points you're allotted per year, according to price. Points-based programs can either be deeded or non-deeded.
Fees
There are fees which come with every form of Holiday Club ownership and these vary from resort to resort. They include maintenance fees, homeowners' fees, rental fees, trading fees and property taxes (depending on location). Always check the fine print of agreements for any “hidden” fees which may apply. It's really no different to owning a property outright in your own name.
Forget the Sins of the Past ...
Though the Holiday Club Ownership industry still brings up negative thoughts with many because of the sins of the past, buyers are in a much better position nowadays to get good value for money.
Nearly every state and country has passed consumer-protection laws pertaining to the sale and ownership of apartments and units on a "timeshare" basis to ensure that customers get what they pay for.
In nearly all cases, a "cooling off" period of three to seven days post-sale, during which time you are legally permitted to back out of any contract you enter.
Unlike in the turbulent "timesahre" sector of the 1970's which was dominated by "fast-buck" developers, todays Holiday Club Ownership industry is dominated by solid brands such as Disney, Marriot, Absolute, Royal and other reputable developers of quality properties.
Resorts are aware of their obligations and endeavour where possible to work with buyers to create a WIN:WIN position for both parties. |
