Jason Hull, CFP, Hull Financial Planning: In this article, Jason Hull presents to us two interesting reasons for why we might consider buying a timeshare, with appropriate and strong rebuttals as to why we should not.

1. You’ve been told often that it would be so wonderful to vacation at the same property during the same time frame every year. The advantages are so obvious, such as continuity for the kids and the savings that you’ll reap by owning and controlling your own timeshare property. And you think that maybe it’s not such a bad idea.

a. A quick view of timeshare resale entries on a internet-based reseller website, or on auction site ebay, serves notice that contrary to popular belief this type of real estate does not appreciate nor does it seem to retain much value at all.

b. Check out your property online to ascertain what it would cost to book a similar room on the open market. You’ll find that your timeshare has cost you just as much or even more than what you might pay for that room, once the mortgage payment, yearly maintenance fees, RCI fees and special assessments are factored into your timeshare cost.

c. Yes, you say, but I can use RCI to book other properties with my points. More often than not, the other properties offered to you are not at the same level as your home timeshare property. Plus there is a booking fee, that is if you are able to find availability for what you want.

d. I can rent my timeshare and make some money, you say. Sounds like a good idea, but the marketplace is fraught with deceptive resellers who will take your money and disappear. You’ll find that it becomes a very difficult venture to rent your timeshare. Research reseller websites to see how much timeshares are being rented for and you will discover the sad truth.

2. You’ve also been told that a timeshare purchase is a great investment that will provide you with a wonderful estate to bequeath to your children.

a. One particular fact to note up front is that you will unlikely be able to get a tax break on real estate depreciation. This is because, for your timeshare property to be considered as a rental property, all of the owners of that property (potentially 52 of them) would have to rent it out. The total accumulation of rental time will not likely meet the threshold for the property to be considered as a rental property. Therefore, any losses you garner are lost for good.

b. It is extremely difficult to rent out your timeshare enough to recover the costs of your yearly maintenance fees, let alone the monthly mortgage costs if you have an outstanding loan. Recall 1.d above – a quick check of the internet will show you many examples of undervalued timeshare properties for rent.

c. Now recall 1.a above – timeshares just do not hold their value. A study of timeshare reseller listings or of ebay auction listings will show you that timeshares are to be avoided as investments, because they do not hold their value. Witness the many people trying to sell their timeshares on ebay for $1.00. They obviously have learned the value of their timeshares and are basically trying to dump them to be rid of the maintenance fees. In simpler terms, they are stuck with their timeshares.

So, to address the bottom line, consider your options carefully before you purchase a timeshare. You certainly can experience a cheaper, but comparable, vacation by booking from the open market. And, as for an investment, don’t waste your time or money. There are other real estate investment vehicles out there for you to invest in, say for example a true rental property.

If you find yourself locked into a timeshare property that you would like to divest yourself from, consider the viable option of timeshare cancellation. The attorneys of the Aaronson Law Firm stand ready and able to help you to cancel your timeshare contract, all the way to litigation if necessary. It’s all that they do. Call them today for your free consultation – it’s not too late…