By the 1990’s, most major hoteliers had entered, or considered entering, the world of timeshare. These included Wyndham, Disney, Hilton, Hyatt, Ritz Carlton, and, of course, the first to act, Marriott.
Thanks to a combination of their influence, legislation, as well as ARDA (the timeshare industry professional association) marketing and sales techniques began to improve. So did the timeshare image. Vacation clubs were born. By this time, timeshare sales in the U.S. exceeded $1 billion annually.
By 2000, timeshare sales had multiplied to $4 billion annually. However, the 21st century also brought trouble to the timeshare industry, namely, the resale market. Wikipedia says: “…the biggest complaint of all is the fact that timeshare re-selling by the private owner is almost impossible to do. An owner looking to sell literally cannot give their timeshare away…”
In 2002, recently licensed real estate attorney Jim Tarpey founded Resort Closings. It was one of the first companies to exclusively handle timeshare transfers on the resale market.
Back then, timeshare resale values were relatively stable. Still, most owners overestimated the true resale price of their properties. They didn’t consider the power of marketing— resorts provide incentives such as show tickets and free stays to attract customers, and these prospective buyers get to tour the property, these strategies aren’t available on the resale market and lead to the higher sales prices received at the resorts.
Timeshare owners also equated timeshares with other real estate—as appreciable assets. Owners reasoned that if they paid $20,000 in 1980; their property should now be worth at least $30,000 twenty years later. Unscrupulous listing companies and predatory resale companies took advantage of this flawed optimism. Even back in the 2000s timeshares sold for less on the resale market as compared to direct sales at the resort.
While the resale market spluttered, new sales in the U.S. continued to increase at a phenomenal rate. In 2005, they hit $8.6 billion annually. In 2007, they peaked at $10.6 billion. Then came the economic crash of 2008. Like most other luxury businesses, timeshare sales got hit especially hard, plummeting to below $6 billion.
Bad press related to the increasingly dysfunctional resale market stunted recovery. In 2009, new sales barely improved to $6.3 billion. But by 2013, they had slowly climbed to $7.6 billion.
In 2013, the owners of Resort Closings decided to create an avenue to share their knowledge of the timeshare industry and help owners safely navigate the resale market. To do this, they founded Timeshare Specialists.
“We believe the only way to restore health to the industry is to create educated consumers,” says founder Brent Maggio. “Timeshare Specialists is the culmination of everything we learned about timeshares over our 12-year history in Resort Closings.”
The company has a support line that offers free advice. They created the nation’s first Scam Hotline, where owners can report the timeshare scams they encounter on the resale market. Additionally, Timeshare Specialists offers a Guaranteed Transfer Program, which provides owners a hands-off solution to ending their timeshare ownership.
Today, there are 9.1 million timeshare owner households in the U.S., with 83 percent owner satisfaction.
So, what can we expect to see in the future of the timeshare industry? ARDA, the timeshare industry’s professional association, wrote an article called “Industry Expert Snapshot,” designed to answer that very question. The article says “Research and expert forecasting offer this consensus: challenges exist, we are well-positioned for the future as Baby Boomers hit retirement age. Demographics are on our side.”
One difficulty the report specifically mentions is the resale market. “…challenges include creating a more efficient and viable resale market, as well as limiting the market opportunity for predatory resale companies through better owner communication and action,” the report says.
“Resorts are still selling well, and their product is in demand,” says Maggio. “But there’s a huge gap between resort sales and current owners faced with marketing their own properties. If we can get that fixed, the industry will not only survive but thrive as never before. We’re doing everything we can to get it there and help owners in the meantime.”
In the ever-evolving landscape of timeshares, understanding the past, the history of timeshares helps navigate the future.
For free advice on either acquiring or divesting a timeshare, call Timeshare Specialists at 800-969-6565. Stay up to date on the timeshare industry and resale trends by following our Facebook Page.
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.
In the first installment of our three-post series on the History of Timeshares, we discuss how and where the concept of timesharing was developed.
John Kushman is the President of Timeshare Specialists, Inc. and Co-Owner of Resort Closings, Inc. He has overseen the sale of tens of thousands of Timeshares on the resale market and founded the Timeshare Scam Hotline in 2018 to protect consumers from con-artist.
