Did you know that the annual accounts of one popular, unnamed resort, with 576 units, showed over $20 million in annual dues paid by its timeshare “owners” and one-off visitors? There are always more owners visiting each resort than there are available properties to visit.
Considering purchasing or already have a timeshare? It is beneficial to examine the full financial responsibility tied to your new vacation resort.
Maintenance Fee Responsibility
Timeshare maintenance fees are an annual commitment paid to the Homeowners Association that manages the respective timeshare resort. These fees often include property taxes, insurance costs, club dues, and funds for managing the resort and maintaining good working conditions. Some timeshare companies will charge their owners monthly payments and may even include additional charges, such as “program fees,” which can be used to cover the cost of operating the reservation system.
Small Print of Fee Increases
According to the American Resort Development Association (ARDA), the average maintenance fees for a timeshare in 2022 were nearly $1,200. The IRS report stated that the fee associated with timeshare maintenance increased 4.6% between 2021 and 2022, not the 2% reported by the American Resort Development Association.
Packed on Premiums
Most developers maintain control of HOAs and vote to self-manage properties. There is usually a 10-15% fee for management of the HOA, so the thought that your timeshare company doesn’t profit from maintenance fees is usually false.
ARDA reports that timeshare owners receive seven nights of usage, which equates to a value of $1,225 based on the average rental price of $175 per night. In reality, a property owner pays $4,150 per year, which is approximately $592.86 per night.
Does It Ever End?
The simple answer is no. There are no national rules, regulations, or laws in place to require the disclosure of HOA fees. Therefore, prospective buyers need more data to analyze and are easily misled by high-pressure sales tactics. To make matters worse, a trend shows major timeshare developers (publicly traded companies) supplement sluggish sales with increased HOA revenues. The job of any CEO is to maximize profits for their shareholders; they have no fiduciary responsibility to the timeshare owner.
Your Way Out is Timeshare Legal
As the leading timeshare exit company, Timeshare Legal offers a way out! We have helped thousands of clients cancel millions of dollars in timeshare debt. We understand the financial burden that timeshare companies leave their owners to carry; Timeshare Legal offers no-money-upfront options for qualified candidates. With hundreds of 5-star reviews, there’s a reason we’re the leading timeshare cancellation company.
