The economy: There will not be any quick upturn in employment and consumer spending. That means slow timeshare sales and owners will be careful about making travel plans. We expect that more exchangers will be looking for destinations that are within driving distance. Sales of new units and resales will remain be on the down side.
The cost of ownership: With high levels of unsold weeks in the resale marketplace, coupled with low demand in the current economy, owners looking to sell may find it hard to do so. This is especially true for timeshares at less desirable resorts during off-peak times. These factors will translate into increased default rates, causing increases in maintenance fee payments for those owners who can afford to pay.
Great buying opportunities. For timeshare owners on the hunt for units, 2024 will an excellent year to buy. But, this is no time for impulse buying. In a bad economy, the cost of ownership will increase. You must do thorough research on the viability of the resort, the number of non-paying owners who are being carried by management ( not collecting or foreclosing) and the ability of the resort to attract exchangers and renters. Carefully look into the structure of the HOA, operating budgets and the quality of management. Are current owners happy or dissatisfied?
Management will come under closer scrutiny. Owners are going to demand transparency when it comes to the expenses for which they are liable. When the percentage of maintenance fee increases go into double digits, owners are not going to sit passively on the sidelines and accept whatever is being dished out to them. More concerned owners groups will be formed and that could lead to increased litigation.
Well-run resorts will weather the storm: Even in the current economy, there are many resorts that are very desirable destinations. These resorts will be sought out by savvy buyers and exchangers. Any resort that is well-maintained, has kept spending and maintenance fees under control, has a positive relationship with its owners and has avoided shocking the owners with unexpected bad news will be well-situated as the bad economy lingers and eventually improves.
Scammers will thrive: There’s nothing new hear. Scammers have done well during good economic times and even better during recession. In spite of increased action in some states, tens of millions of dollars are being lost by timeshare owners. In recent months, some scammers have assumed the identity of legitimate companies in making their very convincing sales pitches by phone, email and regular mail. Consumer awareness is the best prevention against fraud.
Exit strategy: The industry, especially developers, will come to the understanding that owners who can no longer afford or need their timeshares need a viable way to dispose of them. We know that the American Resort Development Association (ARDA) is aware of this critical issue and we are hopeful that progress will continue to be made. TimeSharing Today is increasing its efforts to work with ARDA and is encouraging HOAs to look into its resources.
Licensed timeshare resale brokers – a critical resource. Owners looking for honest advice about buying and selling timeshares, will utilize the services of legitimate resale brokers. These brokers do not make false claims about having a buyer waiting and then demand high upfront fees. They will counsel you on the salability of your timeshare. We expect that developers will pay more attention to well-qualified licensed brokers in 2023 to handle resales and perhaps, new unit sales as well.
Owners will use their home resorts: While exchanging remains in high demand, many owners will look to use their home resorts to save money. The home resort is truly a second home for vacationing. Owners who are struggling with the recession may still want to take a break to enjoy themselves and their families. The home resort is the ideal way to enjoy a pre-paid vacation.
Potential for resort bankruptcies will increase: Watch out for this one. Resorts with high delinquency rates cannot afford to continue by putting an ever-increasing burden on dues paying owners. Older resorts with aging owners who are surviving on fixed incomes cannot afford the cost of ownership and higher travel costs of getting to their resorts. These resorts may not be able to survive without Chapter XI protection.
Quoted from Timesharing Today.com