In this article, we will examine how inflation will affect Timeshare Maintenance fees and why 2022 will test the markets and set the record for the highest price increases in maintenance fee bills.
What could be the cause of high Timeshare Maintenance Fees?
Let me answer you quickly in one word – Inflation.
The most frightening bill for timeshare owners generally happens to be in late November each year. Timeshare Maintenance Fees are similar to paying taxes, but if you want to own a timeshare then it’s part of your expense. However, this year’s maintenance fee bills have risen to a whole new level, unlike any other year.
What are Timeshare Maintenance fees?
Timeshare maintenance fees are the fees paid annually to the Timeshare developer, which includes the property taxes, insurance costs, and club dues to properly manage and upgrade the maintenance of a timeshare property ( also known as upkeep). It seems as years pass by, the cost of living, insurance payments, and rental payments have dramatically increased due to the rise in inflation. Besides, maintenance fees are usually paid annually, but there are some Timeshare companies that charge owners monthly payments. It may also include additional fees like “program fees” which cover the cost of operating the property.
How much do Maintenance fees go up?
As a Timeshare owner, you have no idea when maintenance fees are going to continue to rise. There is no fixed number for how much maintenance fees will cost you upfront. It depends on variables like property location, unit type and how long you have owned the property, and pool maintenance.
According to the American Resort Development Association (ARDA), the average annual cost of maintenance fees for a Timeshare in 2019 was $1,000 and has increased by 2% inflation every year since then.
On the other hand, according to a 2017 report by Trulia, the average maintenance fee paid to Homeowner’s Association ( HOA) which included apartments, was $3,972 per year. Moreover, ARDA has not mentioned that timeshare owners pay a hefty premium over what market norms are.
Let’s examine it carefully and find out what it means.
According to ARDA’s own report, Timeshare property owners obtained seven nights of usage for $1,000. That means their average cost per night in fees was around $142.85. This is the average for different property unit types and destinations. Whereas a property owner (condominium, single-family home, etc.) paid $3,972 for the year (or 365 days of usage). The average cost per night to own a property outright is around $10.88.
In our evaluation of Timeshare maintenance fee inflation year over year, the actual increase is closer to 4% (not the 2% ARDA reported). This is especially true for larger timeshare companies (nicer resorts, bigger management fees, and premium locations are all factors that drive up costs). However, the largest timeshare company in the world offers a Multi-Site Vacation Ownership Interest (VOI) Plan that in theory should have beat inflation by blending costs, but even this plan hasn’t outperformed the inflation rate in the US.
Why do Timeshare owners pay a premium?
Most timeshare owners are forced to pay exorbitant prices because Timeshare developers have easily misled them with high-pressure sales tactics. There are zero rules and regulations in place that can force disclosure of homeowner association fees ( HOA) at a national level. Timeshare owners don’t have enough information to analyze and make decisions based on historical data.
The largest timeshare companies in the world have deceived owners into owning a Timeshare property because it’s a hedge against inflation. But historical stats have proved it’s not the case. Besides, some of the timeshare developers do not take any obligation in keeping the property maintained. They are purely driven by profits as owners are locked up in paying the maintenance fees for a lifetime.
Why there will be a major increase in Maintenance Fees in 2022?
There are several factors that could lead to disaster – Inflation at record-time highs, static timeshare sales, and the company CEO and Finance Team who manage the timeshare properties will always have a conflict of interest which could likely lead to the highest increases in timeshare maintenance fees in 2022.
Moreover, Timeshare owners will start withdrawing from their timeshares due to the financial burdens placed on them by Timeshare developers. The financial pressure will make it more difficult for dissatisfied Timeshare owners to move out of their contracts. Timeshare developers will come in and make their life harder to pull out of their contracts. So now we must look for an exit solution.
How can I get rid of Timeshare Maintenance fees?
If you miss paying your annual maintenance fee, this can have several consequences such as having a bad credit score, and not getting car loans in the future. To get out of a timeshare legally, consider these options:
- Use the rescission period.
- Stop your timeshare payments (but expect the consequences).
- Avoid timeshare scams.
- Stop your timeshare payments (but expect the consequences).
- Avoid timeshare scams.
If this is something, you wouldn’t like to do by yourself. Fortunately, there are Timeshare Cancellation Companies that have given timeshare owners a way out to avoid engaging in unfair and deceptive contracts.
How does Timeshare Cancellation Work?
There are many factors that influence the Timeshare cancellation process. There is no general rule of thumb to get out of Timeshare contracts. Many times the circumstances of Timeshare owners and developers are different. Every Timeshare developer has a different set of processes and procedures. The factors that affect the successful termination of timeshare contracts are basically how long you have owned the Timeshare; how repeatedly you have utilized the Timeshare, changes in personal health, and financial or other hardships.
Now owners have a good chance to end their contracts with timeshare companies. However, before you decide to get out of your Timeshare contract, it’s important to get the right advice in place and get all your exit options reviewed by a licensed firm.
If you are seeking a licensed firm, with full credit and risk management services then Legal Timeshare Help is the source you have been waiting for. We offer free consultations and fast quotes. When working with licensed firms, we have many payment plan options supplied by United Consumer Financial Services. A nationally accredited finance company has partnered with our organization, making us second to none.