A rising number of callers are contacting the Timeshare Advice Service with concerns surrounding the purchase of a timeshare that was pitched as an investment.
Now this kind of enquiry has not been new to our help desk as many unsuspecting holiday makers have been duped into supposed ‘Timeshare Investments’ in The Canary Islands especially Tenerife for more than a decade.
What we are finding is that more companies are now being accused of this practice. Companies that up until a few years ago had appeared to be genuinely selling holiday products and services including Timeshare Points. It seems that the lure of the investment has been too great to resist!
So today we thought that we would look at the three timeshare scams that are involved when pitching timeshare as an investment.
Multiple Timeshare Week Portfolios
This timeshare con has been around for nearly 20 years or more and involves the purchase of a number of timeshare units for future rental or resale for a profit. The sale goes along the lines that you can purchase ‘unwanted’ or ‘distressed stock’ that is not normally available to the general public. The salesman tells the consumer that this sale is based on the principle that the new owner has to sell on the timeshare in the future at a profit. This profit, they are told, will ensure that the market value of the timeshare units is restored; that the resort can earn a favourable commission and most importantly that the investor reaps great financial rewards.
What could possibly go wrong? Needless to say it does, more money needs to be invested to rescue the original investment and huge maintenance bills mount!
Amazingly this trick is used very often on timeshare owners that simply go back to their resort enquiring as to how to dispose of timeshare!
The amazing thing about this timeshare scam is that it is all been carried out under the noses of RCI, TATOC and the RDO. They have heard hundreds of complaints from disaffected owners but as of now they have done nothing to stop this shameless timeshare con.
Fractional Timeshare Scams
The Fractional Investment with promises of resales and rentals at profit has been growing steadily over the past few years. The sales spiel has one of two avenues, if the client is a happy timeshare owner the salesman endeavours to generate greed with promises of huge profits due to the clients ‘loyalty’! Or should the salesman find a disgruntled owner an exit from timeshare is offered in the form of a Fractional membership that offers more flexibility and financial gain when it comes to the all important fractional timeshare resale!
The trouble is that it seems that there are far more ‘Timeshare Investors’ wanting to invest than there are new potential timeshare owners wanting to spend a fortune on second-hand timeshare resales!
Our question here is, has the resort or holiday club thought up this investment scam or have rogue sales teams orchestrated it? At the moment due to the fact that we are hearing about these investment pitches from Perth to Portugal and Tenerife to Torremolinos it does seem that the timeshare companies have developed and nurtured these investment proposals.
Yet again we are still waiting to of one timeshare investment story with a happy ending!
Holiday Destination Clubs
The latest and it has been alleged, one of the most lucrative timeshare investments schemes has been the new Holiday Destination Clubs. These schemes have emerged as it was hoped, by the timeshare companies, that they could sidestep timeshare legislation.
The idea, like the fractional investment, was that timeshare owners were lured into thinking that if they moved their timeshare ownership and of course a large amount of additional cash into a Destination Club with exotic locations, they could then sell it of for financial gain.
After years of struggle, false promises and tens of thousands of pounds, a group of Club Paradiso members successfully won a court case in Madrid. We reported on the case earlier this month and the details can be found here.
The simple and most important rule of thumb is that timeshare or any of its related products should only ever be bought for pleasurable holidays that you can afford once you have had time to consider all of the financial implications.
Should you feel that you have been the victim of a Timeshare Investment Scam or a timeshare exit scam, then please do not hesitate to contact our helpdesk at the Timeshare Advice Service.