We all know that when you drive a new car off the lot, it immediately loses value. For timeshares, the second you sign that contract in the timeshare sales office, it’s like driving a few cars off the lot at one time. All timeshares lose 40 to 75 of their value instantly when purchased with a timeshare salesperson. Why? The timeshare salesperson and the company that sold it needs their cut.
Plus, the timeshare becomes an asset to timeshare resort. They’ll be paid every year through maintenance fees and can issue special assessments to the now timeshare owner. So the value is for the resort, not the owner.
Over time, the resorts have little incentive to maintain upkeep and upgrade. The property is generating revenue through the fees that are guaranteed by contract. The excess revenue can then be leveraged into building new resorts for higher maintenance fees and new unsuspecting timeshare owners.