Building on Sidney's comments:
Time shares... also known as "interval ownership" could possibly be better
known as a penalty against the mathematically challenged.
It can all be dressed up nicely with all kinds of sales pressure, red
herrings, etc., but the basic message when you cut through the smoke is the
same: you "own" a condominium-type property for about two weeks per year,
usually in some distant place. You get charged an exorbitant price for this
"ownership."
The mathematics to consider here: take the value of a similar property
(condominium, town-home, etc.) nearby the "time share" property that is
available for sale. Consider the total cost of owning said property.
Consider that when you own this property, you own it for 52 weeks of the
year. Consider now the alternative: "time share..."
Time share properties are "owned" usually only for a period of two weeks
per year. The other 50 weeks per year, you do *not* own the property....
someone else owns it. Maybe 25 others own "shares" of this same property,
all at two-week intervals. (Presumably, no one owns the same two-week
interval as someone else...)
Now comes the math... let's say that your time share property has an honest
value of $100,000 if it was to be sold on the market to one buyer... the
whole property, to one buyer, free and clear. The time share sales crew
will try to sell this to you for an effective price of anywhere from
$20,000 to $50,000. Initially, $20,000 may sound like a bargain for a
$100,000 property... and thousands of people fall for this. But, consider
that you are only buying *two-weeks* of ownership per year... that is
1/26th of a whole ownership. (52 weeks in a year divided by 2 weeks
ownership equals 26 possible owners for each time share property) (Keep in
mind that 25 others will fall for the same scheme...)
Rightfully, your "ownership" interest ought to only be worth 1/26 of the
entire $100,000 price, which figures out to roughly $3,850.
The time share company makes out better than winning the lottery: 26
people all pay $20,000 (or more) each (plus exorbitant interest rate
charges and other "junk fees") for this one property (that has a market
value of $100,000). In effect, the company makes over a half-million on
each unit sold (26 people pay $20,000 each... equals $520,000... for a
property worth only $100,000... then add in all the "junk fees," management
fees, and financing costs, etc.) (Not a bad deal for the company...)
The smoke and mirrors approach makes this whole scenario sound like a "good
deal," especially when you consider that you can "trade" your time share
for another one in Paris... or London... or (fill in the blank). Once you
"own" your two week slot in your time share, you can barter it with others
who have fallen for similar deals elsewhere. (Kind of a lonely hearts
club...) Many, many other tricks and gimmicks can be employed by the
timeshare company to obscure the fact that you've just overpaid for this
property by a huge factor... perhaps a factor of five (on the very, very
optimistic side) to a more realistic factor of ten, twenty, or thirty.
(Whatever they can get out of you...)
Each timeshare deal will be different, of course, but the basic math
remains: you pay way, way, way too much for way, way, way too little. All
the rest of it is just smoke and slick salesmanship at best... and complete
dishonesty at worst.
No wonder the timeshare companies can afford mass mailings, telemarketers
(by the hundreds), and cheap television sets (for sitting through the sales
pitch). It's all a numbers game... and all the numbers are in their favor.
You can *never* win at this game... never!
Best of luck in your quest... maybe investing your money in yearly
vacations would be a better placement of your funds?
Garrett
At 05:53 PM 5/4/00 -0700, you wrote:
>At 12:31 AM 5/5/00 +0000, you wrote:
>>I would like to check a Spanish co. trying to sell me timeshare and
>>wondered if there is a website somewhere I could check it up ? I have a
>>vat no. for this co. and want to know if they are a viable co.
>>
>>Joanne
>
>Regardless of VAT no., virtually all Timeshare deals are
>inherently "dodgy" - proving to be at best disappointing
>and all too often even dishonest.
>- Sidney.
