If you are considering buying a timeshare, you might be wondering if now is a good time to do so. There are several factors to take into account when making this decision. The timeshare development industry has been growing steadily since the 2008 recession, according to annual studies conducted by the American Resort Development Association, with larger, healthier companies consolidating and expanding their inventories. This modest growth trend is likely to continue in 2017, unless an unexpected economic crisis or political event changes things. Rapid growth of the market, however, is hindered by factors such as low resale value, stringent government regulations, and uncertainty of the future.
According to Timesharing Today, there are several transitions in progress that will affect current and prospective timeshare owners. Maintenance fees, for example, are expected to increase between 2-5% on average this year as HOA boards attempt to offset increasing delinquencies with the need to renovate older units and onsite amenities at legacy resorts. The secondary market will likely continue to struggle as many original timeshare owners begin to age out of their timeshare travel and resale inventory outnumbers demand. While timeshares were a popular vacation option for baby boomers and the generation before them, it seems as though millennials are not as enthralled with the idea. Younger generations are tending to prefer short, spontaneous vacations as opposed to week-long stays at one resort, and are especially cautious of lifelong purchase contracts. It remains unclear how the millennial generation will react to and impact the timeshare industry as they age.
Another wild card factor for the future of the timeshare industry is the trajectory of President Trump’s time in office. During his campaign, the Republican Party adopted a platform that included a promise to dismantle the Consumer Financial Protection Bureau (CFPB), which investigates complaints about financial credit and loan programs that may defraud consumers. It is currently investigating numerous industries and at least one timeshare company, Westgate Resorts, for their practice of financing owners’ timeshare purchases. Again, Trump’s regulatory reform policies remain unclear.
So, while there are some uncertainties that lie ahead regarding the industry as a whole, it still may be a good time to purchase. You can be confident that at this moment in time, the timeshare industry is growing steadily and relatively healthy. Be sure, however, to ask yourself these questions and do your research before moving forward. Make sure you are ready for the large time and financial commitment that comes with timeshare ownership. And also be aware that once you own a timeshare, it can be very difficult to get rid of, as the struggling resale market suggests.