What is a timeshare?
This is a complex question which requires some explanation to ensure that it is fully answered. Timeshare is a generic term used to describe one of three different types of vacation ownership. While essence of the what the purchaser receives is very similar, the legal manner in which the product is delivered is different.
The three different types of timeshare is deeded property, right-to-use or a vacation club. Vacation Villas at FantasyWorld is a deeded property resort. However, I will explain each of the different types incase anyone is interested.
Deeded property is very similar to purchasing home. The deed is the document which conveys and ownership interest. In a normal home purchase the legal descriptions specifically defines the location of the property on the earth based on the accepted method used in the area where the property is located. In a deeded timeshare purchase, the legal description defines the location of the property on the earth plus it specifics a specific annual usage period. For example, in a weekly timeshare plan where each owner purchases use of a specific unit for one week (7 nights) at a time the legal description will include the week number assigned to that ownership interest. There are 52 weeks in a normal calendar year, so weeks are numbered 1-52 in order. Deeded property is associated with perpetual ownership. Once you buy it the owner has the right to sell it or keep it for their lifetime and leave it to their heirs in a will.
Right-to-use timeshare is similar to a long term lease of property. Again the lease covers a specific property and is usually associated with a specific week. This difference between a right-to-use timeshare and a deeded is in the fact that the lease ends at some point in the future. There is no perpetual ownership. Ownership of the property never changed hands so the timeshare owner owns nothing at the end of their right-to-use agreement.
Vacation Clubs are different still. This type of ownership is neither a deeded transfer of property, nor is it a lease. A Vacation Club is a contractual agreement between the provider and their purchaser, nothing more. The specific details of the vacation club can be found in the contract and any accompanying documents. The only way to learn the specifics of a club is to read the documents.
Which type of timeshare ownership is best?
Good Question! There are benefits and drawbacks to each type (isn’t that always the case?). Each of the different forms is desirable to different people based on their personal objectives.
What is the difference between Gold and Platinum Season?
The resort developer sold usage at the resort in two categories. Platinum Season weeks are the most highly sought after week normally associated with holidays or popular vacation times. Gold weeks are associated with the border times when the areas attractions are less crowded. While Central Florida is a popular vacation destination throughout the year, the seasons should indicate how crowded the area will be during your visit.
Platinum Season Weeks: 5-17 (Spring Break and Easter), 24-36 (Summer), 46-47 (Thanksgiving), 51-52 (Christmas and New Years)
Gold Season Weeks: 1-4, 18-23, 37-45, 48-50
What is floating time and floating units?
The governing documents of our association requires that every owner at the resort commit the interval recorded on their deed to the resorts floating usage program. This program allow for the greatest amount of flexibility for owners who want to visit the resort or exchange their usage for other resorts around the world. Each owner contributes one unit week to the program and gets one in return. This system ensures that a unit that is out of service for refurbishment or repair does not prevent the owner from visiting the resort. It also allow the resort management to ensure that the owners of this resort are afforded first priority to the most newly renovated units.
How are annual maintenance fees calculated?
Annual maintenance fees are divided into three major components: operating expenses, reserve expenses and property taxes.
Operating expenses include all of the costs which the resort spends to deliver your vacation experience. This includes the payroll for all employees, utilities, supplies, laundry, inventory, insurance, repair and maintenance costs on everything at the resort along with a million other things large and small.
Reserve expenses are associated with the costs of replacing capital assets of the resort when they reach the end of their useful lives. An excellent example of a reserve item is a refrigerator. Conventional wisdom suggests that a refrigerator will last for 7 years, at which point it is no longer economically reasonable to continue repairing it, but to instead replace the refrigerator with a new one. The concept of a reserve fund suggests that the resort should save 1/7th the cost of the refrigerator each year to avoid the challenges associated with raising the funds to replace the refrigerator all at once. Florida law requires timeshares to reserve for all capital items.
Legally, a timeshare is an investment in a vacation home (or at least part of one). Local governments levy property taxes on real estate in its jurisdiction for the purpose of providing services in the community. Each timeshare interval is a 1/52nd share of a vacation home and as such, property taxes are collected by the resort and forwarded to the government taxing authority on behalf of all timeshare owners.
When computing each part of the annual maintenance fee, the resort managers divide the sum of each category of expense by the total number of timeshare owners to determine the amount each is responsible for each year.
Every interval owner is responsible for paying an equal share.
I didn’t vote for __ (you can fill in the blank), why do I need to pay for it?
US President Harry S. Truman has been quoted saying, “Decisions are made by those who show up.” This statement is applies as much to the governing body of a timeshare association as it does to any other governing authority.
When the Orlando Resort Development Group, our resorts developer, create our timeshare resort, they dictated that the resorts operation would be governed by our timeshare owners association. Every timeshare owner is automatically made a member of the association by the same process which made them an owner at the resort. That ownership interest and membership in the association includes both rights and responsibilities.
The rights include the ability to use the resort in accordance with the association’s rules and regulations, receive information about the operations and administration of the resort, run for elected leadership positions of the association, propose changes to the association’s rules and regulations and to vote on any matter presented to the ownership.
The responsibilities include staying informed about our common interests, to vote in elections and for matters presented to the ownership, and to pay a fair share of our common expenses alone with any expenses incurred for individual use.
While it is understandable that most timeshare owners do not have the time, interest, funds or desire to participate in many association matters, this is a choice which owners make for themselves. The opportunity to participate is available to all who are interested. Any owner who is not willing or able to run for association office is welcome at all meetings of the association or the board of directors. Owners are welcome to attend the weekly meetings at the resort where matters are discussed. Further, any owner is welcome to e-mail the board of directors with their ideas, suggestions, compliments, complaints or questions. They can also expect an answer or reply. We reply to everyone and we discuss the matters presented in the e-mails at the board meetings.
We all pay, because that is how a timeshare owners association works. Majority rules when deciding what to do and everyone shares the benefits and expenses equally. If you are unhappy with how things are working, ask yourself this question: Am I willing to work to make the changes that I believe in? If so, write the board members, attend the meetings, run for election. You thoughts, ideas and energy are most welcome; let’s make this the best timeshare experience possible.
How does the resort determine which services are included in the annual maintenance fee and which incur and extra charge?
The governing documents of the association established the basic services which the developer originally included in the annual maintenance fee. Beyond that the Board of Directors and management are charged with the responsibility of determining what additional products and services to offer and how to pay for these extras. In general, three factors (commonality, feasibility, and capacity management) are considered when evaluating the services and the prices charged.
As an example, consider attraction shuttles which is a feature that the resort currently offers to owners. This service is not included in the association’s governing documents. It is however a service that is in high-demand at the resort. The vast majority of owners use the service and it is a major selling point for exchangers, therefore benefiting owners who choose to exchange their usage with Interval International. While it is true that not all owners use this service, the fact that most do makes it reasonable that the association include it without additional charge. Managing the shuttle service is not impractical and their is little concern for capacity management as the transportation provided can add additional shuttles during busy times.
Shuffleboard is another example of an amenity which is not required by our governing documents. This feature is not used by many owners so it can be argued that there is not enough commonality to warrant including it without additional cost to the user. However, feasibility is a concern here. The association would incur more cost in managing fee collections than would be raised by collecting fees. For this reason, we don’t charge extra for shuffleboard.
The cabanas at the main pool area are an example of a feature which are in high-demand by many owners, if they are offered without an additional charge. Unfortunately, there is not enough room to have a cabana for each family staying in a townhome. There are only 10 cabanas to service people from 302 townhomes. A fee is charged for cabana usage to manage the supply and demand equilibrium. The people who value cabana usage the most will be willing to pay for their experience. The people who don’t get to use the cabanas will benefit from the proceeds of the cabana rentals offsetting future maintenance fees.
I don’t want my timeshare anymore. Why won’t you take it from me?
The timeshare owners association is a not-for-profit organization made up completely of timeshare owners from our resort. If the association takes a week from a timeshare owner, then the costs of ownership must be divided amongst the remaining owners. These people already own a timeshare and pay for the costs of ownership. It is simply not fair to ask that everyone else assume the costs associated with a timeshare interval that you purchased and have lost interest in. If you don’t want your timeshare interval anymore sell it to someone who does want it.
How do I sell my timeshare week?
We are working on some resource to help owners sell, we will post them as soon as possible.
If my timeshare is a real estate investment, why doesn’t the value increase when the value of other local properties increases?
The surprising answer is that timeshare values do fluctuate with the real estate market. Please understand that when many developers sold their original timeshare products, they incurred significant marketing expenses and passed these cost on to buyers. Industry estimate suggest that 40-65% of the purchase price of the initial purchase price of timeshare was recouped marketing expenses. (Those attraction tickets, dinner coupons, or gifts were not free. You paid for yours and for the premiums given to many people who did not buy a timeshare.) Further, another 10-15% of the price was spent on the contents of the unit, the furnishings, appliances and housewares that we use when we stay. Developer profit generally accounts for another 15-20% of the sale price. This leaves less than 30% (usually a lot less) of the purchase price to be the value of the real estate. The value of that part does fluctuate with the real estate market. The parts spent of marketing and consumables do not appreciate. When you consider the various elements of a timeshare purchase each part behaves as expected: marketing costs are sunk costs that we never get back, unit contents decrease in value significantly the day they are installed and then slowly over time as they wear out and the real estate fluctuates based on the supply and demand equilibrium.
When are townhomes refurbished?
Beginning in 2003 the association implemented a 6-year rotation plan for renovating the interiors of our townhomes. Approximately 20% of our townhomes are renovated each year and then we take the 6th year off for planning the next series of renovations. Renovations are funded by the reserve funding program which is part of everyones annual maintenance fee.
I lost the deed to my timeshare, how do I get a copy of it?
Timeshare deeds for our resort are recorded in the public records of Osceola County, Florida. You can search for your deed using your name on the Osceola County Clerk of Court website.
How is it possible that I lost my annual usage despite having paid my maintenance fee on-time?
The association’s governing documents detail how annual usage is reserved for owners. Reservations are confirmed on a first come - first served basis once all of the fees associated with that usage year have been paid. Owners can pay fees and reserve usage up to one year in advance of the desired arrival date.
Each year quite a few owners book in advance to ensure that they are able to visit the resort during their preferred week. The vast majority of owners request their annual usage when the maintenance fee billing arrives in late November or early December. Unfortunately other owners delay making their reservation requests until later in the year. This delay is what creates the problem. Each week at the beginning of the year which is not completely sold out results in some townhomes being empty for the week and each of these results in an owner who will lose their annual usage for that year. In essence the time slots which are available to assign to owners who delay their usage requests have already passed.
The best way to avoid losing the benefits which we have paid for are to follow the rules and request usage as soon as possible and never after the usage year begins.
What supplies will I find in my unit when I arrive?
The housekeeping department will furnish each townhome with some basic supplies designed to ensure that owners will not need to the store the evening they arrive at the resort. This starter pack of supplies is not intended to last for your entire stay.
What housekeeping services are available during my stay?
Why are maintenance fees more costly than advertised rates at local hotels?
More Coming Soon..