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Free Market Solutions for Timeshare Resale, Part III

Published

This is the third installment in a 3 part series where we’ll examine the current push for regulation of the timeshare resale industry.

Timeshare as a Use Product?

As the timeshare resale market grows, problems will arise that neither an individual owner, nor a resale company, will be able to resolve. These include: maintenance issues at the resort, customer service provided by the resort developer, floating week functionality, and exercising 'first right of refusal' clauses to keep fire-sale priced timeshares off the resale market.

Over the years the American Resort Development Association (ARDA) has made enormous contributions to the quality and success of the timeshare industry. Recently, ARDA President Howard Nusbaum has stated that timeshare should be considered as a 'use product.'

While in many ways timeshare is similar to a use product, like a car, but unlike a car it is also real estate. Most timeshare ownerships are deeded either a week/unit at a specific resort, or a percentage of the building (common with points.) Timeshare is regulated by real estate law. Timeshare salespeople must have real estate licenses. Resort developers must file Condominium Documents, including Home Owner's Association (HOA) documents, with the local government prior to beginning construction, and membership in the resort's HOA is typically conveyed to the owner at time of sale.

Often owners I speak with are completely unaware that there is a HOA at their resort, and few, if any, have read their HOA documents. When owners keep their timeshare at arm's length, by considering it a use product, they isolate themselves from other owners at their resort. Rather than working together to solve problems, these owners often vent frustrations on the internet, negatively affecting resale values.

If you own timeshare, I urge you toget involved with your HOA now! By addressing issues privately, with other owners at your resort, you'll ensure strong resale values in the future. By accepting personal responsibility for the real estate you own, you'll have a voice.

The Demise of the Timeshare Resale Company

Often, it's pointed out to me that, if owners take my advice, I'll be out of a job as there'll be no need for timeshare resale companies. - In fact, resorts with highly effective HOA's are usually able to handle resale themselves, without involving a resale company. As someone who truly loves the timeshare product, I'll be overjoyed when that day comes!

However, as long as owners struggle to make sense of what they bought, as long as owners need assistance in marketing their properties, and as long as the timeshare resale market struggles for its market share, I along with other dedicated professionals will be there to help.

Informed Owners offer Best Regulation

By becoming informed on matters affecting resale values, timeshare owners will be able to make the right decisions concerning their properties. Informed owners offer the best industry regulation available, without limiting resale potential through increased Government interference.

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