Timeshare Rentals 101: Buying vs Renting

The Case for Renting

No upfront purchase cost

A vacationer who decides to rent a one-time stay does not have to worry about an upfront investment cost. Owners typically pay a purchase cost that consists of a price and closing costs such as transfer, recording, mailing, escrow, taxes, and other fees. Vacationers, however, do not have to worry about this upfront investment for a rental property.

No annual maintenance fee commitment

In addition to paying an upfront purchase cost, owners also commit to an annual maintenance fee assessment. This fee is a legal commitment and must be covered each year regardless of whether the owner is able to use their timeshare. For a vacationer renting a property once, the burden of annual maintenance fees is not a concern.

No risk of special assessments

An added cost of ownership is special assessments. Often, resorts collect additional special assessment fees above and beyond the annual maintenance fee amount. These could be meant to cover unforeseen renovations that are not covered in the regular operating budget, for example, in the case of natural disasters such as flooding or fires. This is yet another cost that a vacationer who rents a property does not have to worry about.

Flexibility to change destinations

Vacationers who choose to rent properties one time have more flexibility to plan when and where they would like to go. When owning a property, utilization options are limited to the home resort or other resorts the owner can exchange. However, a vacationer who rents the property can browse all inventory and take a different vacation every year to a new destination. Ownerships are better suited for travelers who prefer to return to the exact location each year.

Bargain deals, especially last minute

Often, vacationers can benefit from last-minute bargain deals from owners who cannot use their timeshare or have yet to rent it. In these situations, it is not uncommon to find a vacation rental where the cost of the stay is less than the owner’s maintenance fee.

The Case for Buying

Enhanced choice of dates and units

Dates, views, unit sizes, and often unit locations are accessible to book in advance as an owner.  Owners can usually book a year in advance of travel. Rather than depending on what is available to rent from others, an owner can secure preferred dates in advance, often saving by buying airfare.

Reduced long-term use cost

Although an owner must pay a purchase price and closing costs upfront to purchase a timeshare, as well as an annual maintenance fee assessment for the use of the ownership, in some situations, this may be less costly in the long term.   When renting a timeshare is much higher than the annual maintenance fee, the cost savings accrue to the owner’s benefit year after year.  After several usage years, the owner’s upfront purchase cost is covered.  This can often be the case for a high-season holiday week.  In this case, the owner can save thousands each year by paying the annual assessment instead of renting at a higher price, coupled with the ability to book more affordable airfare in advance, as they know the exact dates of their stay a year ahead of the trip time.

Access to other discount inventory

Owners have unique perks by often being able to exchange their timeshare through their home resort network for another resort. They can also join large exchange companies such as Interval International or Resorts Condominium International (RCI), where they can not only exchange their timeshare but also have access to deeply discounted getaways.