Why Timeshares are an Objectively Worse Investment Than Just Purchasing a Condo
Many people dream of having their own vacation/investment property, but very few actually take the steps necessary to turn that dream into a reality. Even worse, some are roped into the idea that a timeshare is a smart investment; in reality, for those who desire a vacation and/or investment property of their own, the smarter decision is to purchase a condo outright rather than fall into the timeshare pit. By having a better understanding of the many benefits of outright ownership over timeshare investing, it’s possible to make the right decision.
Avoid Timeshare Maintenance Fees
For starters, consider the fact that timeshares almost always come with annual “maintenance fees,” and timeshare investors are responsible for paying these fees regardless of whether they used the timeshare during that year or not. Furthermore, these fees can be increased at just about any time and without much in the way of an explanation. By owning an investment or vacation property outright, investors never need to worry about these frivolous fees and can better spend their money elsewhere.
Sell For a Profit Later On
Selling one’s portion of a timeshare can be very challenging, and actually making a profit off the sale of a timeshare can be even moreso. Furthermore, when a timeshare is sold at a loss, the IRS doesn’t even allow sellers to claim the sale as a capital loss, which can be yet another punch in the gut. By owning a property outright, it’s much easier to sell down the road and to do so at a profit. And of course, on the chance that a profit isn’t made, at least sellers are able to claim capital losses on their taxes to lessen the blow.
Use it Whenever You Want
Timeshares often require a great deal of planning and logistical hurdles when it comes to scheduling dates to actually use the property, which partially defeats the entire purpose of the investment. By owning a property outright, there is never any need to “schedule” time in the property or get approval from anyone else. And of course, during periods when the property isn’t going to be in use, investors can easily rent it out to offset the costs or even make a profit on the property.
Make Changes To It
Renovating and upgrading a timeshare can be challenging, if not impossible. That’s because doing so usually requires written approval from all the members of the timeshare, as well as agreement of everyone to pitch in on the shared investment. This can be a huge headache. With a condo that’s owned outright, the only approval needed for upgrades or renovations will typically come from the HOA or similar association. This makes it much easier to make any desired changes and to reap the benefits of those upgrades in added resale value.
For those considering a timeshare as a means of finally securing that vacation and/or investment property, it would be wise to instead consider purchasing an investment condo outright. In both the short- and long-term, this tends to be the more sound investment decision for investors and vacationers alike. Consider Cancelling a Timeshare, Learn How to Cancel a Timeshare.
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