# Tell me why a timeshare is a bad deal **URL:** \ **Category:** Factual Questions\ **Created:** [April 30, 2009, 5:09pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862 "2009-04-30T17:09:04Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 5:09pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/1 "2009-04-30T17:09:04Z")
I’m asking about actual ownership benefits (or lack thereof), not the sales pitch. Mom has been in poor health pretty much since I was born. Nothing immediately life-threatening, but she knows her days are numbered when compared to the life expectancy of her peers. Multiple times (usually around the time she goes on vacation) I have been reminded about how we would go on a family vacation every year, how that was possible thanks to the “investment” they made, and now that I have my own kids, I should look into getting my own / morbidly tell her how I can’t wait to inherit hers. She’s ga-ga over her timeshare experience. I know that she bought it for about $5,000 about 25 years ago. It’s worth about $15,000 on the resale market, today. It’s about 5 minutes from Disney World. I’ve tried to run the numbers, but every reasonable way I look at it, it still seems like a fair, if not good, deal. Assuming 5% interest, her investment could’ve been worth $16k today. That’s only a paper loss of $1000… over 25 years. If you assume better rates of return, the situation gets much worse. If you assume that she paid interest on the initial purchase, it gets worse still. **I just need some good points/information that I can use to defend my timeshare-phobia.** As it stands now, it sounds like her maintenance fees are way less for a 3 bedroom (maybe it’s a 4bd?) condo that sleeps eight than it would be for me to rent adjoining rooms at the Holiday Inn for a week. That’s hard to refute. **So what’s the straight dope on timesharing? Should I avoid it? Should I just sell it if and when it’s left to me?** ---
**Author:** ![cruel\_butterfly](https://avatars.discourse-cdn.com/v4/letter/c/5daacb/32.png) [@cruel\_butterfly](https://boards.straightdope.com/u/cruel_butterfly)\ **Post date:** [April 30, 2009, 5:23pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/2 "2009-04-30T17:23:20Z")
[This](http://www.daveramsey.com/etc/cms/truth_about_timeshares_9562.htmlc) is a good explanation. ---
**Author:** ![Freudian\_Slit](https://avatars.discourse-cdn.com/v4/letter/f/5daacb/32.png) [@Freudian\_Slit](https://boards.straightdope.com/u/Freudian_Slit)\ **Post date:** [April 30, 2009, 5:30pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/3 "2009-04-30T17:30:24Z")
I never get why people don’t just get a hotel room instead. Is it supposed to be so you can say, “I have a little place in Aspen/Mexico/Fiji”? ---
**Author:** ![Ol\_Gaffer](https://avatars.discourse-cdn.com/v4/letter/o/8e8cbc/32.png) [@Ol\_Gaffer](https://boards.straightdope.com/u/Ol_Gaffer)\ **Post date:** [April 30, 2009, 5:36pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/4 "2009-04-30T17:36:30Z")
Why aren’t you factoring in 25 years of “maintenance costs” into the true cost of ownership? ---
**Author:** ![Kinthalis](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kinthalis/32/16084_2.png) [@Kinthalis](https://boards.straightdope.com/u/Kinthalis)\ **Post date:** [April 30, 2009, 5:41pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/5 "2009-04-30T17:41:16Z")
And that market value is bs. Try and sell it. Go ahead, and good luck. If you get anything near what she ORIGINALLY paid for it it’ll be a miracle. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [April 30, 2009, 5:42pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/6 "2009-04-30T17:42:59Z")
If you have a Timeshare in a place you will go often ,it is fine. I have one in Key West and have used it for 17 years. I like Key West and if I rented a place for 17 years ,I would have spent more. It is on the ocean . It supplies all the cookware ,bedding, towels etc. that you would use. It is upkept very well. Timeshares are able to be traded. You do not have to go to the same place ,if you want to change. I did not buy it to sell it. I am sure I could get a lot more than I paid. It is not a real estate investment. In many locations ,you will not get more than you paid. But if you used it, traded it or offered it to friends or family, it all works out quite well. ---
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 5:43pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/7 "2009-04-30T17:43:10Z")
> [@Ol\_Gaffer](#): > > Why aren’t you factoring in 25 years of “maintenance costs” into the true cost of ownership? Because the maintenance is less than the cost of a hotel. I don’t recall the number she gave me, but I think it was around $700-800 this year. That may have included RCI membership & exchange fees. Oh, and I don’t know what it was historically. All I see is that she pays $800 a year and gets a week virtually anywhere. That same $800 would get me 4 nights of 2 rooms at a very budget-friendly hotel. ---
**Author:** ![Hirka\_T\_Bawa](https://avatars.discourse-cdn.com/v4/letter/h/db5fbb/32.png) [@Hirka\_T\_Bawa](https://boards.straightdope.com/u/Hirka_T_Bawa)\ **Post date:** [April 30, 2009, 5:43pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/8 "2009-04-30T17:43:15Z")
I own a timeshare in Florida also, about 5 minutes from Disney, along Hwy 192. Now I didn’t buy it, my parents did, and when they passed I inherited it. My experience as an owner, it is worth it if you use it all (or at least most) of the time, however I don’t think it would be worth paying for. The maintenance costs are a little cheaper then a hotel room for that long, but if you add in the cost to actually buy it in the first place, it would take way too long to make it worth while. Also, timeshares aren’t an investment. Don’t look at the price on the “resell” market, there are a lot of people who would give you their timeshares for free just to get out from under the maintenance fees. If you REALLY want a timeshare, look for one of those people who will give you one free or really cheap. Look on someplace like Ebay under timeshares to see what the real price is. ---
**Author:** ![Duke](https://avatars.discourse-cdn.com/v4/letter/d/e8c25b/32.png) [@Duke](https://boards.straightdope.com/u/Duke)\ **Post date:** [April 30, 2009, 5:45pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/9 "2009-04-30T17:45:16Z")
> [@cruel\_butterfly](#): > > [This](http://www.daveramsey.com/etc/cms/truth_about_timeshares_9562.htmlc) is a good explanation. I agree with most of what he says, but… > [@](#): > > The average cost of a timeshare in the U.S. is $13,000. If you put that money in a mutual fund averaging 12% over 10 years, you would have almost $43,000. Pretty good. Will Dave please give us the name of that “12% profit” mutual fund? 😃 ---
**Author:** ![beowulff](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/beowulff/32/542_2.png) [@beowulff](https://boards.straightdope.com/u/beowulff)\ **Post date:** [April 30, 2009, 5:46pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/10 "2009-04-30T17:46:50Z")
Timeshare can be great - if you use them. I own one, and I have never stayed in it. I use it to “bank” points to use at other places around the world. For my honeymoon, we were able to stay at the fantastic Excelsior Florence by using the points I had saved. We would never have been able to afford it otherwise. You need to 'work" the system - there are incredible places available, but you have to plan way in advance. If you are a spontaneous traveler, timeshares aren’t for you. If you are willing to plan ahead, (I won’t, but my wife will), you can get some good deals. ---
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 5:47pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/11 "2009-04-30T17:47:47Z")
> [@Kinthalis](#): > > And that market value is bs. > > Try and sell it. Go ahead, and good luck. If you get anything near what she ORIGINALLY paid for it it’ll be a miracle. I’m not sure about that. While that might be true of 90% of them, this one (Sheraton Vistana, 3+ bedroom) seem to be listed on resale sites for about that much. But ok, let’s assume the market value is $500 (yes, five hundred) and that she’s going to leave it to someone else. Why should I not buy one for $500 on the resale market? ---
**Author:** ![GrandWino](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/grandwino/32/67_2.png) [@GrandWino](https://boards.straightdope.com/u/GrandWino)\ **Post date:** [April 30, 2009, 5:49pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/12 "2009-04-30T17:49:22Z")
Here is Dave’s answer on that average. [Here’s a link.](http://www.daveramsey.com/etc/newsletters/company/042409.cfm?ectid=cnl0905.1_05) > [@](#): > > Q: Dave, I have been through Financial Peace University and found some of the rates of return (10–13%) you suggest for “growth mutual funds” to be unattainable in today’s marketplace. Have you revised your suggested rates of return, and where could I find those rates? —Melissa on Facebook > > A: Those rates are what the stock market has averaged over the past 70 years. Some years it has averaged more and some less. The market may gain 15% one year, then 10% the next, then 3%, then 20%. The gain has varied year to year, but it has averaged 12%. Sometimes it may lose money, but the average is still 12%. > > Even in these down times, I would still project the same overall growth, based on the past. Remember, the market eventually recovered after the Great Depression, a president resigning, an energy crisis and cowards flying planes into buildings. We’ll survive this as well. ---
**Author:** ![Labrador\_Deceiver](https://avatars.discourse-cdn.com/v4/letter/l/7c8e57/32.png) [@Labrador\_Deceiver](https://boards.straightdope.com/u/Labrador_Deceiver)\ **Post date:** [April 30, 2009, 5:50pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/13 "2009-04-30T17:50:00Z")
> [@Duke](#): > > I agree with most of what he says, but… > > Will Dave please give us the name of that “12% profit” mutual fund? 😃 Dave only talks about long term investing. There are plenty of mutual funds or index funds that have averaged that kind of return over 10+ years. ---
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 5:55pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/14 "2009-04-30T17:55:33Z")
On-topic, please 😃 I clearly see that a new timeshare is a bad deal. I didn’t even need to run numbers. It’s obvious on the sales pitch alone. But why are inherited properties or low-priced resales a bad deal? ---
**Author:** ![Duke](https://avatars.discourse-cdn.com/v4/letter/d/e8c25b/32.png) [@Duke](https://boards.straightdope.com/u/Duke)\ **Post date:** [April 30, 2009, 5:59pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/15 "2009-04-30T17:59:18Z")
> [@JerseyFrank](#): > > On-topic, please 😃 Sorry, **JerseyFrank**. ---
**Author:** ![Ol\_Gaffer](https://avatars.discourse-cdn.com/v4/letter/o/8e8cbc/32.png) [@Ol\_Gaffer](https://boards.straightdope.com/u/Ol_Gaffer)\ **Post date:** [April 30, 2009, 6:02pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/16 "2009-04-30T18:02:34Z")
> [@JerseyFrank](#): > > Because the maintenance is less than the cost of a hotel. I don’t recall the number she gave me, but I think it was around $700-800 this year. That may have included RCI membership & exchange fees. Oh, and I don’t know what it was historically. > > All I see is that she pays $800 a year and gets a week virtually anywhere. That same $800 would get me 4 nights of 2 rooms at a very budget-friendly hotel. Well, in the OP you were comparing the “value” of the timeshare against having invested $5000 with a 5% return 25 years ago. I was just pointing out that not including the yearly maintenance fees doesn’t make for a fair comparison. ---
**Author:** ![Bearflag70](https://avatars.discourse-cdn.com/v4/letter/b/8e7dd6/32.png) [@Bearflag70](https://boards.straightdope.com/u/Bearflag70)\ **Post date:** [April 30, 2009, 6:08pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/17 "2009-04-30T18:08:47Z")
By raffle, I won the right to use a timeshare in the Caribbean for a week. WOO HOO! 🆒 However, I had about three week’s notice to get there and I didn’t win the travel costs. So, my wife and I won a prize that would cost us $2,000 and a week off work (I’m self employed). No thanks. :mad: ---
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 6:17pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/18 "2009-04-30T18:17:47Z")
> [@Ol\_Gaffer](#): > > Well, in the OP you were comparing the “value” of the timeshare against having invested $5000 with a 5% return 25 years ago. I was just pointing out that not including the yearly maintenance fees doesn’t make for a fair comparison. It does if you can assume that you’d pay an equal amount of maintenance each year that you would spend on vacation lodging. A timeshare salesman would argue that you spend less on maintenance than lodging (and get so much more! :rolleyes:). I don’t know if that’s a fair assumption, but I think it is. The big assumption, IMO, is that I’ll go on vacation every year. I always have. I expect to in the future. But I really don’t like that I’m on the hook to pay for it if I don’t. My argument has been that there must be a way to simply rent equivalent accommodations. Since the resale value depreciates (or even appreciates, but at a slower rate than a modest investment), the value of your initial investment is close to nothing. Take your $5000, put it in a stable investment, and then rent the property from the suckers who bought it in the first place. The longer I use this strategy, the less my vacations cost me each year. ---
**Author:** ![Labrador\_Deceiver](https://avatars.discourse-cdn.com/v4/letter/l/7c8e57/32.png) [@Labrador\_Deceiver](https://boards.straightdope.com/u/Labrador_Deceiver)\ **Post date:** [April 30, 2009, 6:43pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/19 "2009-04-30T18:43:33Z")
> [@JerseyFrank](#): > > On-topic, please 😃 > > I clearly see that a new timeshare is a bad deal. I didn’t even need to run numbers. It’s obvious on the sales pitch alone. But why are inherited properties or low-priced resales a bad deal? If you’re looking at the property as an investment, it’s only natural that people are going to compare it to other investments. I’m not sure how that’s off topic. ---
**Author:** ![JerseyFrank](https://avatars.discourse-cdn.com/v4/letter/j/bcef8e/32.png) [@JerseyFrank](https://boards.straightdope.com/u/JerseyFrank)\ **Post date:** [April 30, 2009, 6:52pm UTC](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862/20 "2009-04-30T18:52:10Z")
> [@Labrador\_Deceiver](#): > > If you’re looking at the property as an investment, it’s only natural that people are going to compare it to other investments. I’m not sure how that’s off topic. **On-topic** : Reasons for/against owning a resale, new, or hand-me-down timeshare. **Kinda-On-topic** : Is a 12% average annual return a reasonable expectation for a mutual fund over a 25-year time frame? **Off-Topic** : Which mutual fund will do this / have done this? I know that an index fund will return the market average and discounting the current recession, the average annual return on any given 10 year period should be between 8 and 16%. Knowing that is helpful for determining the future value of my investment relative to another investment, but pointing out specifically which mutual funds will give average or better-than-average returns is something I do not wish to discuss. [Next page](https://boards.straightdope.com/t/tell-me-why-a-timeshare-is-a-bad-deal/494862.md?page=2)