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U.S.A vs European Timeshare Ownership

Mar 27, 2015
Category: Europe, RCI Points, USA
Dollars and Euro notes

If you live in the USA you may find owning a timeshare in Europe makes more sense, even if you never intend to take your vacations outside of the USA

We’re forever being encouraged to buy local. It’s a concept that has seen somewhat of a renaissance in recent years, especially for those choosing where to take their next vacation.

With such a wealth of great vacationing opportunities in the U.S.A it’s no surprise that less than 15% of Americans travelled abroad in 2014. From the ski slopes of Colorado, the balmy shores of Key West and the sights and sounds of NYC, there’s something to suit everyone almost all year round. However, when it comes to buying a timeshare, is it always best to buy local?

Well for many Americans the answer is probably “No” as there’s now a compelling case to show they could actually be better off owning in Europe, even if they never plan to leave the U.S.A.

In short, cheaper running costs, more favourable ownership agreements and the surplus inventory of discounted timeshare accommodation available to exchange members are the three main reasons why. So let’s take a closer look.

RCI & II Extra Holidays

The idea of owning a timeshare you may never visit isn’t new. Together with a membership to an exchange organisation such as RCI or II a timeshare owner can of course exchange what they own to visit another destination. However, what many members overlook is the wealth of discounted accommodation on offer where there is no requirement to “bank” or “deposit” an existing timeshare.

Extra Holidays, Late Deals, Getaways, Bonus Weeks…there’s generally no limit to how many of these breaks an exchange member can take and members get the same opportunities regardless of wherever they “own”. Availability throughout North America is good and costs are low meaning having just one week of timeshare is the most cost-effective solution for many people.

To illustrate just how good some of these offers are, take a look at which documents the journey of a retired couple who are living in timeshares full time!

So you see, where you actually own a timeshare is completely irrelevant for most people. What actually matters are the running costs.

Maintenance Fees

There’s a lot that goes into the running of a resort. But, when you break it down, it is often labour that is the single biggest cost and can often equate to 40% of a resort’s annual expenditure. Since staff wages are comparatively much cheaper in many parts of Europe, it stands to reason that you’ll get more bang for buck there.

To put this into perspective, annual maintenance fees at the Pestana Grand Hotel in Madeira (one of the Portuguese Archipelagos in the Atlantic Ocean) are less than $700 per week for a 2-bedroom apartment that can sleep up to 6-people. What’s more, local laws in Madeira are in place to keep any rise in maintenance fees in check. In comparison, for a similar standard 2-bedroom apartment in Florida you can expect to pay in the region of $900 (including property taxes).

Sure, European accommodation is generally smaller than in the U.S.A but since this has no bearing on access to additional weeks through the exchange organisations it doesn’t matter.

What does matter is that owners of timeshares in the U.S.A. not only have to pay annual maintenance fees but additional Property Taxes too which are either rolled into the maintenance fee or invoiced separately. European owners don’t have to suffer an additional invoice with any property taxes or rates likely to be substantially cheaper and incorporated into the annual maintenance.

European Club System

Timeshare agreements in Europe are generally set up as leasehold or right-to-use protecting the owner from the unnecessary complication and bind of owning bricks and mortar. Whilst it may seem a more attractive option to have a deeded or fee simple timeshare, this form of ownership provides no end-date and so you could be tied in for life. That’s a very important consideration since when it comes to your future vacations your needs are likely to change quite dramatically over time. You’ll always have good reason to own a property outright but will you want to own a timeshare in thirty years from now?

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