Reasons You Should Not Sell Your Timeshare

When financial difficulties strike, the temptation to sell your timeshare can become quite strong. Many people have found themselves in that situation due to the down economy. However, selling your timeshare may not be the right financial decision.

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Financial difficulties of varying degrees are unfortunately commonplace in today’s economic climate. For that reason, many who own a timeshare at some point consider selling it, wanting to free up the money they have invested in the timeshare for other uses. If you are in this situation, however, you should know that selling your timeshare might not be as good an idea as you initially thought.

Most timeshares, unless they are located in an extremely popular resort or other destination, cannot be sold for a high enough price to cover their initial purchase cost plus the fees and other expenses that have been put into them since. Before making any decisions, add up the costs associated with your timeshare, then examine the prices for which similar timeshares are selling for in the current market. Do not forget to include the costs associated with listing and selling your property as well. Most likely, you will find that you will not achieve a profit at this time. Frankly, many investors are looking for panicked buyers wanting to sell at all costs for a low price. You can be sure that you will not come out ahead in this type of transaction.

Another issue you should keep in mind is real estate holding. You likely bought your property, at least in part, hoping it would accumulate value over time. This type of investment does not change simply because your circumstances do. If you sell your property, you will receive a one-time payment which will be gone in a short while if you are in financial distress. If you are sure that this one-time payment will get you over the hump and back to financial health, the decision may be worthwhile. But, if it will simply cover a week’s expenses, it actually makes more sense to plan your future without these funds. You would still need to do so anyway, at least in part, and financial difficulties will work themselves out given time, planning and a little courage.

Your timeshare can also be a source of income for you. Many people rent out their weeks to pay their timeshare fees or simply earn some extra cash. Most timeshare companies can help you rent out your time and will split the fees with you, or you can try to advertise it on your own if your timeshare is in a popular area. However, if you sell your timeshare, this moneymaking opportunity is gone forever.

Many timeshare owners are also able to legally deduct some of their expenses on their taxes, such as for interest and repairs. Once you sell the property, however, the ability to receive a break on your income taxes is lost. Plus, if you actually sell your timeshare at a profit, the tax rate on this type of income is frequently very high. While you may receive some short term cash, the tax ramifications may cause a greater loss of income than you anticipated. Although selling you timeshare might be the right choice in some circumstances, take the time to consider all possibilities before you do so.

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Boris Razmiki

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