US timeshare investors suffer buyer’s remorse as fees pile up


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When Ellen Callis, a 68-year-old retired high school teacher from Phoenix, Arizona, first dipped her toes into the timeshare property market in August 2008, she was helping a colleague who was experiencing financial difficulties.

After investing in a second property in 2013, Ms Callis now says she has buyer’s remorse – she is one of a growing number of timeshare owners desperate to quit burdensome contracts that extract hefty fees even when properties are unavailable to use.

"I am loath to add up how much I lost overall," Ms Callis tells The National.

"Neither was an investment; my investments are to make money, not toss it to the wind. I purchased pipe dreams of spending good times with family or friends, not investments."

Ms Callis paid her former colleague about $3,000 for the timeshare property at the Wyndham Vacation Resort in the town of Flagstaff, 240 kilometres from her home and best known as the training base for Apollo 11 astronauts Neil Armstrong, Buzz Aldrin, Michael Collins and Charles Duke before they landed on the Moon in 1969.

In 2013, Ms Callis invested in a second timeshare property in the picturesque city of Sedona, Arizona, after attending an information breakfast hosted by Wyndham. Ms Callis bought both timeshares sight unseen.

“Sedona seemed like an attractive place to enjoy a vacation, especially during the autumn apple-picking season,” she says.

Wyndham Vacation Resorts did not respond to requests for comment.

Ms Callis is one of an estimated 10 million Americans who own timeshares in an industry that dates back to the early 1960s. The self-catering timeshare concept started in Switzerland in 1963.

It is a form of holiday ownership, in which a person owns a "right" to use a week or weeks in a resort property, the UK-based Timeshare Consumer Association says on its website.

Worldwide, the industry is worth an estimated $14 billion a year, according to research by business analyst Brandon Gaille.

There are timeshare properties in an estimated 180 countries and more than 20 million households around the world have ploughed money into them, according to statistics by the Timeshare Consumer Guide. More than half are in the US with over 206,000 units spread across 1,500 resorts, while Europe has about 25 per cent of the share, it adds.

Hotel groups including the Wyndham, Disney Vacation Club, Marriot Vacation Club, Hyatt Residence Club, Hilton Grand Vacations and Diamond Resorts are the major timeshare players in the US.

The principle underpinning timeshare properties is that ownership and running costs are shared, theoretically making a holiday home affordable. With an average price in the US of around $20,000 and maintenance charges of $880 a year, timeshares seem an attractive option.

But from a consumer’s point of view, there is a major issue. There is no guarantee when they get to use their timeshare unless they signed a "fixed-week" contract.

Many timeshares are sold on "floating" contracts and competition for prime weeks is fierce, as Ms Callis discovered.

"They told me I had a brief advance period of time to secure my use of my week," Ms Callis says.

"If I missed the window, it went to the next person. I was forever late booking but never knew just what the timeframe was. I have no idea how many times the unit was sold. Perhaps for as many weeks in the year as they can sell it.

"Obviously, popular seasonal weeks, as for skiing or autumn leaves, are sold fastest. Any time I wanted to use Flagstaff or Sedona, they were always booked. I could never snag the times I wanted.

"The bills kept coming; I had never been to the Sedona timeshare and I only was able to use the Flagstaff property in 'my week' once."

Despite not being able to use the properties, Ms Callis was being charged monthly maintenance fees of between $100 and $200 for each timeshare.

Ms Callis says she was not looking to make money out of her timeshares, which was just as well.

Timeshares are a terrible investment because most people won't use it long enough to make it worth the money

"Timeshares are a terrible investment because most people won't use it long enough to make it worth the money," Sam Dogen, an investment expert who runs the Financial Samurai advice website, says.

"Furthermore, there are often ongoing usage fees and maintenance fees even if you don’t use the property. If you ever decide to sell a timeshare, it may be impossible, unless for a great discount, due to the lack of liquidity in the secondary market. My advice is to stay away from them."

Paul Charles, the chief executive of consultancy The PC Agency and one of the UK's leading experts on the travel and holiday market, agrees.

“The timeshare market is shot to pieces,” he says. “These are assets in decline and I think experts want more flexible arrangements."

Over the years, the industry has faced accusations of unethical practices and misleading customers about the benefits and costs of timeshare ownership.

In the US, regulation of the timeshare industry is left to individual states. In 2017, Arizona settled a case with the Diamond Resorts Corporation after receiving more than 500 complaints alleging the company used "deceptive sales practices".

Consumers were allegedly misled over how much maintenance fees could increase every year, their rights to rent out their properties or sell their shares.

The agreement, reached with Arizona’s Attorney General Mark Brnovich, allowed consumers to surrender their timeshares without any further obligation.

Diamond Resorts, which has a network of more than 379 destinations across the world, is also facing a class-action lawsuit from disgruntled owners in Arizona, Colorado, Indiana, Nevada and Baja, Mexico, accusing the company of inflating fees to cover operating expenses.

In 2018, a study by the University of Central Florida found that 85 per cent of timeshare owners regretted their purchase.

However, in 2019, the American Resort Development Association, the trade association that represents the timeshare industry, said on its website that 85 per cent of timeshare owners are content – even if the remaining 15 per cent were unhappy.

These studies were carried out before the Covid-19 pandemic, which left millions of timeshare owners unable to use their timeshare properties because of travel restrictions.

Another factor in the groundswell of discontent is that the first generation of owners are now well into their 60s and the attraction of their timeshares is waning. Advanced in years, some are in poor health, making travel to their properties more difficult.

But as the owners discovered, timeshares are notoriously difficult to sell on, especially in the US where most contracts have a perpetuity clause, which means the obligations are passed on from generation to generation.

This means that a timeshare property forms part of an estate, which can be a welcome gift. But for many, they are a financial millstone.

Timeshare owners in Europe are in a better position and protected by a 2008 European Union directive that outlawed perpetual contracts. The Spanish Supreme Court also imposed a 50-year limit on timeshare contracts signed after January 5, 1999, while Australian law now caps contracts at 80 years.

Gordon Newton, president and founder of the Newton Group, which specialises in helping owners exit their contracts, estimates that as many as one million people in the US are desperate to offload their timeshares.

"There is also a life cycle of ownership and there are many owners who loved their timeshare experience but are simply ready to end it. They are no longer travelling and don’t need it," he says.

For a fee of $7,000, Mr Newton succeeded in extricating Ms Callis from her timeshare contracts.

The company, which says it represents thousands of clients a year, charges a flat fee for its services. It negotiates with the timeshare resorts to agree an exit fee from the contract. If a deal cannot be reached, the company enlists the help of lawyers.

In most cases, clients will see a return on their timeshare exit fee after three to five years, Mr Newton says.

While the Newton Group delivered for Ms Callis, there are many unscrupulous operators in the burgeoning "timeshare exit" industry, Mr Newton adds.

Using hard-sell tactics similar to those used to lure people into timeshare ownership in the first place, the exit companies charge upfront fees that can be as high as $10,000.

Ms Callis turned to the Newton Group, having previously attended a breakfast for disgruntled owners hosted by another timeshare exit company.

As far back as 2014, the US Federal Trade Commission warned consumers about rogue timeshare exit companies, which, for a fee, promise either to help rip up the contract or offer to sell the property – before disappearing with clients' money.

The Better Business Bureau, a non-profit consumer protection organisation dating back to 1912, has been flooded with complaints about the activities of some of the exit companies.

"Unfortunately, we continue to hear stories from consumers who put their trust in third-party companies to rid themselves of their unwanted timeshares, only to find themselves deeper in debt," Michelle Corey, president and chief executive of the bureau in St Louis, Missouri, says.

States have moved against some of the bogus exit companies, Ms Corey adds.

Just last month, Leslie Rutledge, the Arkansas Attorney General, announced a $2.6 million judgement against Real Travel, a now-defunct exit company, and its owners Brian Scroggs and Bart Bowe.

The company was accused of scamming 88 people by promising to extricate them from timeshare contracts and failing to do so.

“Dishonest timeshare exit companies need to understand that they have no place in Arkansas,” Mr Rutledge said about the judgement.

“Instead of helping people, Real Travel left consumers with unwanted timeshares and additional debt. That’s why I made it a priority to hold them accountable for their inexcusable deceptive practices.”

Another trick employed by scammers is pretending to have found a timeshare buyer and demanding upfront fees to complete the transaction.

This was the tactic used by 47-year-old Mark Boring of St Petersburg, Florida.

However, he was caught, prosecuted, ordered to pay $895,011.03 to his victims and jailed for seven years.

"There are different scams in the exit industry, some are by con artists and some are accidental," Mr Newton of the Newton Group says.

"An example of a con is someone calling saying they have a buyer for the timeshare and asking for a listing fee but then the timeshare never gets sold.

"A lot of exit companies lure clients in with the promise of a money-back guarantee but don’t have a stable business model and once they take on too many clients they have to file for bankruptcy, taking the money and leaving people still owning their timeshares."

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Tearful appearance

Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday. 

Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow. 

She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.

A spokesman said her upset demeanour was due to a personal matter.

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Engine: 8.0-litre, quad-turbo 16-cylinder

Transmission: 7-speed auto

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Pharaoh's curse

British aristocrat Lord Carnarvon, who funded the expedition to find the Tutankhamun tomb, died in a Cairo hotel four months after the crypt was opened.
He had been in poor health for many years after a car crash, and a mosquito bite made worse by a shaving cut led to blood poisoning and pneumonia.
Reports at the time said Lord Carnarvon suffered from “pain as the inflammation affected the nasal passages and eyes”.
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Lexus LX700h specs

Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor

Power: 464hp at 5,200rpm

Torque: 790Nm from 2,000-3,600rpm

Transmission: 10-speed auto

Fuel consumption: 11.7L/100km

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Price: From Dh590,000

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The specs: 2018 Nissan Altima


Price, base / as tested: Dh78,000 / Dh97,650

Engine: 2.5-litre in-line four-cylinder

Power: 182hp @ 6,000rpm

Torque: 244Nm @ 4,000rpm

Transmission: Continuously variable tranmission

Fuel consumption, combined: 7.6L / 100km

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The specs

Engine: 4 liquid-cooled permanent magnet synchronous electric motors placed at each wheel

Battery: Rimac 120kWh Lithium Nickel Manganese Cobalt Oxide (LiNiMnCoO2) chemistry

Power: 1877bhp

Torque: 2300Nm

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Specs

Engine: 51.5kW electric motor

Range: 400km

Power: 134bhp

Torque: 175Nm

Price: From Dh98,800

Available: Now

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ESSENTIALS

The flights

Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.

The hotels

Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.

The tours

A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages. 

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Cricket World Cup League 2

UAE squad

Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind

Fixtures

Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE

Specs – Taycan 4S
Engine: Electric

Transmission: 2-speed auto

Power: 571bhp

Torque: 650Nm

Price: Dh431,800

Specs – Panamera
Engine: 3-litre V6 with 100kW electric motor

Transmission: 2-speed auto

Power: 455bhp

Torque: 700Nm

Price: from Dh431,800

Emergency

Director: Kangana Ranaut

Stars: Kangana Ranaut, Anupam Kher, Shreyas Talpade, Milind Soman, Mahima Chaudhry 

Rating: 2/5

Famous left-handers

- Marie Curie

- Jimi Hendrix

- Leonardo Di Vinci

- David Bowie

- Paul McCartney

- Albert Einstein

- Jack the Ripper

- Barack Obama

- Helen Keller

- Joan of Arc

If you go

The flights

Etihad flies direct from Abu Dhabi to San Francisco from Dh5,760 return including taxes. 

The car

Etihad Guest members get a 10 per cent worldwide discount when booking with Hertz, as well as earning miles on their rentals. A week's car hire costs from Dh1,500 including taxes.

The hotels

Along the route, Motel 6 (www.motel6.com) offers good value and comfort, with rooms from $55 (Dh202) per night including taxes. In Portland, the Jupiter Hotel (https://jupiterhotel.com/) has rooms from $165 (Dh606) per night including taxes. The Society Hotel https://thesocietyhotel.com/ has rooms from $130 (Dh478) per night including taxes. 

More info

To keep up with constant developments in Portland, visit www.travelportland.com. Good guidebooks include the Lonely Planet guides to Northern California and Washington, Oregon & the Pacific Northwest. 

 

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Venue: Sharjah Cricket Stadium

Date: Sunday, November 25

'Munich: The Edge of War'

Director: Christian Schwochow

Starring: George MacKay, Jannis Niewohner, Jeremy Irons

Rating: 3/5

Indoor cricket in a nutshell

Indoor Cricket World Cup - Sep 16-20, Insportz, Dubai

16 Indoor cricket matches are 16 overs per side

8 There are eight players per team

There have been nine Indoor Cricket World Cups for men. Australia have won every one.

5 Five runs are deducted from the score when a wickets falls

Batsmen bat in pairs, facing four overs per partnership

Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.

Zones

A Front net, behind the striker and wicketkeeper: 0 runs

B Side nets, between the striker and halfway down the pitch: 1 run

Side nets between halfway and the bowlers end: 2 runs

Back net: 4 runs on the bounce, 6 runs on the full

LA LIGA FIXTURES

Friday Valladolid v Osasuna (Kick-off midnight UAE)

Saturday Valencia v Athletic Bilbao (5pm), Getafe v Sevilla (7.15pm), Huesca v Alaves (9.30pm), Real Madrid v Atletico Madrid (midnight)

Sunday Real Sociedad v Eibar (5pm), Real Betis v Villarreal (7.15pm), Elche v Granada (9.30pm), Barcelona v Levante (midnight)

Monday Celta Vigo v Cadiz (midnight)

The specs
Engine: 4.0-litre flat-six
Power: 510hp at 9,000rpm
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
Price: From Dh801,800

Padmaavat

Director: Sanjay Leela Bhansali

Starring: Ranveer Singh, Deepika Padukone, Shahid Kapoor, Jim Sarbh

3.5/5

The specs

Engine: 2.2-litre, turbodiesel

Transmission: 6-speed auto

Power: 160hp

Torque: 385Nm

Price: Dh116,900

On sale: now

Remaining Fixtures

Wednesday: West Indies v Scotland
Thursday: UAE v Zimbabwe
Friday: Afghanistan v Ireland
Sunday: Final

Volvo ES90 Specs

Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)

Power: 333hp, 449hp, 680hp

Torque: 480Nm, 670Nm, 870Nm

On sale: Later in 2025 or early 2026, depending on region

Price: Exact regional pricing TBA

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part one: how cars came to the UAE

 

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

Read part one: how cars came to the UAE

WHAT%20MACRO%20FACTORS%20ARE%20IMPACTING%20META%20TECH%20MARKETS%3F
%3Cp%3E%E2%80%A2%20Looming%20global%20slowdown%20and%20recession%20in%20key%20economies%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Russia-Ukraine%20war%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Interest%20rate%20hikes%20and%20the%20rising%20cost%20of%20debt%20servicing%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Oil%20price%20volatility%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Persisting%20inflationary%20pressures%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Exchange%20rate%20fluctuations%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Shortage%20of%20labour%2Fskills%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20A%20resurgence%20of%20Covid%3F%3C%2Fp%3E%0A
Maestro
%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EBradley%20Cooper%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%20%3C%2Fstrong%3EBradley%20Cooper%2C%20Carey%20Mulligan%2C%20Maya%20Hawke%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%203%2F5%3C%2Fp%3E%0A
The specs

Engine: 3.8-litre twin-turbo flat-six

Power: 650hp at 6,750rpm

Torque: 800Nm from 2,500-4,000rpm

Transmission: 8-speed dual-clutch auto

Fuel consumption: 11.12L/100km

Price: From Dh796,600

On sale: now

MISSION: IMPOSSIBLE – FINAL RECKONING

Director: Christopher McQuarrie

Starring: Tom Cruise, Hayley Atwell, Simon Pegg

Rating: 4/5

Explainer: Tanween Design Programme

Non-profit arts studio Tashkeel launched this annual initiative with the intention of supporting budding designers in the UAE. This year, three talents were chosen from hundreds of applicants to be a part of the sixth creative development programme. These are architect Abdulla Al Mulla, interior designer Lana El Samman and graphic designer Yara Habib.

The trio have been guided by experts from the industry over the course of nine months, as they developed their own products that merge their unique styles with traditional elements of Emirati design. This includes laboratory sessions, experimental and collaborative practice, investigation of new business models and evaluation.

It is led by British contemporary design project specialist Helen Voce and mentor Kevin Badni, and offers participants access to experts from across the world, including the likes of UK designer Gareth Neal and multidisciplinary designer and entrepreneur, Sheikh Salem Al Qassimi.

The final pieces are being revealed in a worldwide limited-edition release on the first day of Downtown Designs at Dubai Design Week 2019. Tashkeel will be at stand E31 at the exhibition.

Lisa Ball-Lechgar, deputy director of Tashkeel, said: “The diversity and calibre of the applicants this year … is reflective of the dynamic change that the UAE art and design industry is witnessing, with young creators resolute in making their bold design ideas a reality.”

Company profile

Date started: 2015

Founder: John Tsioris and Ioanna Angelidaki

Based: Dubai

Sector: Online grocery delivery

Staff: 200

Funding: Undisclosed, but investors include the Jabbar Internet Group and Venture Friends

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

Fight card
  • Aliu Bamidele Lasisi (Nigeria) beat Artid Vamrungauea (Thailand) POINTS
  • Julaidah Abdulfatah (Saudi Arabia) beat Martin Kabrhel (Czech Rep) POINTS
  • Kem Ljungquist (Denmark) beat Mourad Omar (Egypt) TKO
  • Michael Lawal (UK) beat Tamas Kozma (Hungary) KO​​​​​​​
  • Zuhayr Al Qahtani (Saudi Arabia) beat Mohammed Mahmoud (UK) POINTS
  • Darren Surtees (UK) beat Kane Baker (UK) KO
  • Chris Eubank Jr (UK) beat JJ McDonagh (Ireland) TKO
  • Callum Smith (UK) beat George Groves (UK) KO