Timeshares might be physical properties, but they are not the same as the home you live in. This can be a confusing topic that many people only truly understand after they’ve signed a contract. It’s important to understand this before you sign on the dotted line, however, because the financial repercussions can be serious and last for many years.
So how are timeshares different from property you actually own? The first is that when you are in a timeshare, you don’t own the land the property is on. You only have a partial interest in the property that’s sitting on the land. Think of it this way — as a timeshare owner you can’t sell the land or decide to build something. All you can do is use the property according to predetermined rules you agree to at the time of purchase.
Next is the type of deed used for timeshares. Typically you’ll have either a shared deed, with each “owner” granted a percentage of the real property based on the amount of time purchased or shared leased ownership. This is where the developer keeps the titled and each “owner” holds a leased interest in the property. Compare this to your house, where your name is the only one on the deed and you make payments toward the total ownership of the location.
Of course, there is also the “use” aspect of timeshares. Every timeshare has stipulations which determine when and how you can use the location. Even terms that are more flexible, such as those which allow you to participate in exchange programs, still restrict your access to the property. Imagine only being able to use your home during certain times or having an outside party determine how much time you get to spend on your property.
When you look at timeshares in this way, you can quickly see how different they are from true property ownership. In fact, it becomes clear that timeshares are actually just a legal agreement to use a location more than anything else. So while a timeshare might be right for some people, it’s important to fully understand what being a timeshare “owner” is before you make any decision.