For many families around the world, the trend in vacations is leaning towards ownership of a vacation property more than ever. Families are cementing a sense of ownership over their vacations in two ways; through the purchase of vacation properties of through the use of timeshares.
Both methods of property ownership offer some big benefits to families on vacation:
Eliminate the need for planning: It is a truism that vacations can be even more stressful than work. With the trend for dual income households bigger than ever and still rising, families are finding that planning a vacation is just one more hassle that they must endure in their busy lives. Through owning a piece of property or a timeshare, families know where they are going to vacation each year and what types of activities they can do there.
Cut down on costs. Believe it or not, owning property can actually mean that you save money on vacation. If you have ever been on vacation in a busy area with a family, you know that going out to eat every night and paying for recreational facilities can really add up. Timeshares at popular resorts and ownership of vacation properties means that a lot of the cost is taken out of the food bill in particular, as you can get meals just as you would at home.
Familiarity. Some people may find that they do not look forward to trying something new every year. This may be especially true of families with older children and teenagers. Having a fixed vacation spot each year not only means that families will be returning to the same area, it also means that people who have property or timeshares in the area and who vacation at the same time as you will also be there. This can give everyone a chance to build up some long term relationships that are renewed each year.
About Vacation Properties
The type of vacation property a person invests in will depend on the lifestyle that the owner enjoys, as well as income. Some people want to get away from everybody else during their vacation; the ideal vacation property is a cabin out in the woods, maybe on a quiet lake, away from other people and all noise. It is a time just to relax and unwind from the hassles of the year.
Other people may find that they need a busy surrounding environment to truly unwind, They thrive on activities and on the presence of others. For this type of person, vacation property around popular resort areas might be the key. There will always be a lot to do and a lot of people to do it with. In addition, vacation properties at popular locations have the potential to be rented out in order to finance some or all of the costs.
Whatever property is right for you, you should remember that these properties still come at a cost. Unlike first home purchases, vacation properties do not receive a tax exemption on the purchase. Taking out a mortgage to cover the costs of vacation properties will also mean a lot more interest paid in the long run. Finally, remember that the sale of a vacation property does not receive an exemption when it comes to capital gains tax, so if you are considering selling a second home, count on a large part of the sale going to the government.
About Timeshares
Timeshares are a relatively recent development that have grown popular as they allow people who might not normally be able to afford second pieces of property on their own to take advantage of the property owned by others.
In a very real sense, timeshares do allow holders the chance to have some real property. Anyone who purchases a timeshare, however, should remember that although title and benefits can be passed on to others, just as any other real property can, the ultimate holder in the interest is the developer of the resort or campground. Timeshare holders have only a tiny stake in the overall operation. One week ownership of a fifty room condominium development translates only to a 1/2600 stake. Your impact on policies and developments will be proportional.
In addition, those interested in timeshares should make sure that they understand the difference between deeded and right to use timeshares:
Deeded timeshares are those that are real property, sold as partial ownership (1/52 for a week long stay, or see the above formula for the real stakes). These timeshares can be used entirely at the discretion of the holders, and often result in a lot of the same issues as any other real property.
Right to Use shares are set only for a limited amount of time, and when the time expires ownership is retained by the timeshare company.
A significant development in the timeshare world has been the rise of the timeshare trading company. These companies are actually separate from the actual developing company. They offer timeshare holders the chance to sell their week of ownership or their entire share outside the company so that it is not limited to other holders. Of course, the companies themselves often allow their holders to do this, but timeshare trading companies claim that they can help holders to turn a profit.
The technicalities of timeshares mean that it can be easy to fall prey to a scam or find yourself in a less than desirable legal position. Timeshares are often purchased in a high pressure sales pitch environment, so it is not always easy to determine exactly what you are getting into. While the benefits of owning a timeshare can be immediately obvious, most of the detriments are not. Unfortunately, potential investors are not usually given the opportunity to reflect on the pros and cons of the purchase. Remember when considering a timeshare to approach it just as you would any other property investment; take the time to weigh the options. If you are not given the time needed, walk away.