When timeshare owners decide to sell, they frequently discover they have a distorted perception of the value of their property. Even though, most timeshare sale documents include statements such as “the value of a timeshare is in the use” that point is seldom driven home at the new sales table.
High marketing cost is one of the underlying problems associated with both timeshare resales and new sales. It is estimated that the marketing costs alone are over 40% of the new sales price paid by the consumer. The big brands like Hyatt, Hilton, Wyndham and even Marriott can almost never market a timeshare product for less. When individual timeshare owners and the general public are made aware of this reality it often creates a negative perception. This is one of the reasons that most developers have elected not to become involved with resales in the past. Today, with the rising cost of development, the ever increasing new sales price, and the rapidly growing second market, more and more developers are dealing in timeshare resales. Usually their involvement is in right of first refusal buy backs and not a resale program for their owners.
Few timeshare sellers are aware the marketing costs are so high until they try to resell their units. The developer’s 40-50% marketing costs on a $20,000 new timeshare sale often exceed the resale price. The cost of sale is obviously not going to be any less for an individual. According to the American Resort Development Association (ARDA) most timeshares sell for between 25% to 50% percent below developer pricing. When an owner decides to sell there are a few basic things to keep in mind. They are selling a luxury item not a necessity like their home — even though the timeshare may be deeded real estate.
Due to the high marketing costs, expect to pay an advertising fee in advance. Deal only with licensed real estate Brokers that will earn a commission at closing. Be aware if there is no commission to be earned then there is no motivation to sell your property. Remember, price the property below developer pricing because you are now competing with the developer for the family that wants to enjoy years of wonderful vacations as you hopefully have.
Just remember, your timeshare will not sell itself. If you do nothing you’ll get nothing in return. While it may be uncharted territory for almost everyone when it comes to selling your timeshare.