Like touch-tone telephones, zip codes and soda can pull tabs, it’s hard to remember a time when timeshares didn’t exist. However, timeshares are actually a fairly new concept that revolutionized the vacation ownership industry.
Let’s delve into the fascinating history of timeshares.
The first timeshare was built in 1963 (as were the other three inventions). It was a 13-room ski resort in the Swiss Alps. But not until the 1970s did the idea really catch hold in the U.S. And if truth be told, it started a bit by accident.
The robust economy of post-World War II America stimulated the massive construction of vacation homes and condominiums at popular national tourist destinations.
As the economy slowed in the 1970s and a real estate recession set in, banks had to deal with overbuilt condominium projects. Rather than sell one condo to one person, savvy businesspeople decided to make them more affordable to cash conscious Americans. They broke the condos into one week units and sold each condo 52 times to 52 different owners.
Yahtzee! The U.S. timeshare business was born.
The infant industry was unregulated at the time and had real growing pains. For instance, there were widespread marketing abuses that emphasized sales, not vacation experience. These unethical practices marred the industry’s reputation with both consumers and reputable developers. Still, the timeshare model grew like gangbusters. The number of resorts increased in the 1970s from 45 to 350, and the number of timeshare owners rose from 10,000 to 200,000.
Innovation was one reason for the massive growth. In 1974, RCI, the world’s first exchange company, opened for business. Two years later, Interval International, the other mega exchange company, began. Today, these two exchange companies give owners access to more than 7,000 resorts, according to Wikipedia.
In the early 1980s, developers began constructing purpose-built timeshares. Before that, all U.S. timeshares were condo conversions. These properties often met or exceeded the standards of four-star hotels in terms of quality, space, and service. The first of the purpose-built timeshares was on Hilton Head Island in SC. It was so well thought out and so attractive that in 1984, Marriott Corporation bought it, thus becoming the first hospitality brand to enter the vacation ownership industry.
In the early 1980s, developers also introduced the floating-time concept. This freed owners from getting locked into a specific week and unit. Soon after came the points system, adding even more flexibility for owners with wanderlust. This system allowed owners to redeem points for resort locations, amenities and other travel services.
At the same time, regulators established rescission, disclosure, and escrow requirements, safeguarding consumers from unsavory developers. And the timeshare industry itself developed a code of conduct called The Model Timeshare Act.
By the end of the 80s, the timeshare industry had matured into a formidable market, there were more than one million timeshare owners. The number of resorts had increased by 400 percent and sales by 500 percent.
Today, the timeshare industry continues to thrive, offering unparalleled vacation experiences to millions of owners globally. You can read more about how timeshares work here.
Discover more about the intriguing journey of timeshares in our next post, The Rise and Fall of the Timeshare Resale Market.
Owning a timeshare can be a rewarding experience, providing you with unparalleled vacation opportunities and cherished memories with loved ones. Before agreeing to a tempting timeshare offer, you need to understand the long-term financial commitment involved.
As the popularity of timeshares grows exponentially, problems begin to emerge on the resale market.
