Timeshare ownership is expensive. Annual maintenance fees, special assessments, membership fees, and other costs are a persistent drain on an owner’s finances. It makes sense, then, that many timeshare owners consider the option of renting out a timeshare. If they’re not using it, why not let renters use it and cover some of the bills in the process?
While renting out a timeshare successfully is possible, it’s also more difficult than it sounds. Apart from the work of attracting renters to your unit, there’s the challenge of doing it correctly. Timeshare developers generally don’t like the practice and will act to curb it.
This article will take a look at the process of renting out a timeshare, from legal and contractual issues to listing your unit for rental. We’ll also look at whether renting out a timeshare is a viable alternative to exiting a timeshare — in other words, whether you’d be better off just getting out of your contract entirely.
Before you start down this road, you should know that timeshare developers often discourage or even outright forbid the practice of owners renting out their timeshares. As with any action you might take, the first step is to look at your timeshare contract or public offering statement and see what it says about the possibility of a rental.
Many timeshare developers include vacation rental restrictions. In some cases, these will outright ban renting out a timeshare; in others, they will require you to get your timeshare company’s approval first. In those cases, you will likely have to pay a rental fee to be able to use your timeshare in this way.
Keep in mind that many timeshare developers have their own rental programs to lease their spare inventory to vacationers. Not only does this provide timeshare companies with another revenue stream; it also gives them potential new timeshare owners. For this reason, timeshare companies do not like for owners to rent out their own units. It’s competition for the developer’s business.
That means, in crowded tourist destinations, you are competing with not only hotel rooms and Airbnb but also your own timeshare resort. The problem only gets worse during crowded holiday periods. A timeshare owner in Las Vegas or New York has very little chance of succeeding in that environment. Owners in Orlando with one of thousands of timeshare units near Disney or on a beach stuffed with hotels in Hawaii may have even less chance.
While it is possible that you might be able to rent your unit secretly, the consequences of breaching your contract might be severe. Some timeshare developers have taken the extreme step of suspending members’ accounts based on the mere suspicion of unapproved rentals. You could lose all the money you made on the rental and have to pay a penalty to the resort as well.
One of the more extreme examples of retaliation by a timeshare company is Holiday Inn Vacation Club, which has suspended owner accounts indefinitely for unauthorized rental activity. While that might sound tempting, keep in mind that Holiday Inn Vacation Club also required suspended owners to make all loan and fee payments while being unable to use their timeshare.
Assuming that you are legally able to rent out your timeshare, there are steps you can take that will make you more likely to succeed. We will look at some of those ideas below.
First, you likely don’t want to go through the rental process completely on your own. We’ve already seen the first major reason why: You can get yourself in hot water with your timeshare company very quickly if you don’t know what you’re doing.
Second, eBay and Craiglist are flooded with listings for timeshare rentals. For example, a vacationer planning a stay in Las Vegas can search Craiglist and find about 100 different options throughout the city, from older properties like Polo Towers to more renovated properties like the Hilton Grand Vacation Elara. Whether these properties are comparable, or even what they seem to be, is up for debate, and your listing will just be lost in the mix.
Also keep in mind that sites like eBay or Craigslist don’t have great reputations when it comes to products like timeshare rentals, so if you use sites like them, you can probably expect less of a response than you might get otherwise. You may also be cheated by scammers.
You can also use specialized platforms for timeshare rentals, like KOALA or RedWeek Timeshare Rentals. These sites are designed in a way to maximize engagement in that they look like a listing you might see on Expedia or Travelocity, with numerous photos and details about the location and nearby attractions.
Keep in mind that the use of KOALA, RedWeek, and similar sites is not free. They take a large percentage of your rental revenue for their services. Considering that your profit margins from a rental are going to be slim anyway, using these sites might mean that you don’t actually make any money at all.
With all of that said, another option for listing a timeshare rental is to use a licensed Realtor who specializes in timeshare rentals. These professionals can help you list your timeshare property on the Multiple Listing Service (MLS) used by real estate agents.
No matter what method you choose for listing your timeshare, there are ways to help your listing stand out.
For example, take a look at this listing for a Wyndham timeshare in Las Vegas and compare it to the Las Vegas ads from Craigslist above. This listing not only includes detailed information about the property and its location, but it also has links to reviews, professional-level photography, and a complete listing of amenities at the property. If you are trying to get a listing noticed, these kinds of details matter.
Keep in mind that, if you are using photos to advertise your property, they should be your original photos. Pictures provided by the resort or the rental platform will need to be used with permission, or you can cause yourself more problems.
Regardless of any other factors, most people would agree the listings on sites like KOALA generally look better to potential renters than those on less specific platforms like eBay and Craigslist.
It is highly doubtful that you will do anything other than lose money on a timeshare rental. First, note that the per-night rental prices in the listings linked above are not incredibly high. Then, add that to the fact that your timeshare resort (and/or the listing partner/website) will likely want a fee for allowing the rental. Also consider that, because a timeshare is a fractional interest to start with, you don’t have that much vacation property to rent.
Therefore, the bottom line is that you are not likely to make much money, if any at all, renting your timeshare out to others.
Even if you could get a steady stream of rental income to pay maintenance fees and other costs, you may ask yourself whether renting out a timeshare is preferable to simply exiting that timeshare.
Unfortunately, it is not. The nature of rentals is that they are temporary. Even assuming that you were able to cover your timeshare fees for one month, that doesn’t guarantee you’ll be able to do that again. And, regardless of whether you have renters or not, the bills for your timeshare will keep increasing and last forever.
The sad truth is that there is no amount of rental income that will cover all the money your timeshare costs you. Centerstone Group can help though. Our team has collected decades of experience, both in the timeshare industry and in achieving exits for owners who cannot tolerate the expense and trouble of vacation ownership.
A rental is only a temporary fix. Centerstone Group, on the other hand, can help you with a timeshare cancellation, a transfer, or a pressure campaign against the developer to convince them to take the timeshare back. We can even get you help from a lawyer or law firm, at discounted rates, if that is what you need.
Why settle for the temporary fix of a rental when, with Centerstone Group’s help, you can be free for good?
Whatever your decision with regard to renting out a timeshare, it is important not to rush into a decision. Talking your options through with Centerstone Group could be the best decision you ever make. We are an A+-rated, accredited business with the Better Business Bureau (BBB), where we also enjoy a customer satisfaction rating of 4.78-out-of-5 stars.
Consulting with Centerstone Group is free, so you have nothing to lose by simply exploring your possibilities with us. Contact us today for your free consultation and case evaluation.
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