Fractional ownership, also widely known as ‘timeshare,’ is literally a group of owners ‘sharing the time’ of their vacation ownership, typically in one-week increments. You can find the timeshare model used in many different types of properties, such as vacation resorts, condominiums, apartments, and campgrounds.
A $97 billion dollar industry, today’s timeshare retail sales volume, or in other words direct sales from resort to a consumer (not including the resale industry numbers), amounts to $10.5 billion, topping both the $9 billion Major League Baseball revenue and the $8 billion dollar music industry, according to the American Resort Development Association (ARDA).
ARDA puts out a retail sales report every year. The most recent report shows there are 9.9 million households that own timeshare in America. 61% percent of these are married or in a domestic partnership. It also states that the average age of a timeshare purchaser on the retail market is 40 and 13% of them earn $100k plus per year.
Unfortunately ARDA never puts anything out showing what the secondary market is doing. If they did it would show sales numbers in that realm but that might hinder the number of direct sales at the resorts. Whereas the average cost of a timeshare purchased directly from the resort is around $24,000, the resale value of that same timeshare will be 60% to 80% less, and usually retains all the the benefits of the original package that was purchased direct.
ARDA also does not mention that the average age of a timeshare owner is 55. Which makes sense that they bought retail when they were in their early 40s and now they are trying to resell their timeshare a decade or so later after they’ve had time to use it. 30 percent or more of timeshare owners reaching out to timeshare resale brokers are over 65.
With 1,582 resorts in the United States made up of 206,380 units, timeshare has remained a popular option for families and business professionals alike to experience their vacation getaways. According to ARDA’s recent report, timeshare owners and guests spend approximately $11 billion per year with their timeshare stays of which $3 billion is spent on site at resorts. $8 billion is being spent by them off-site in the surrounding communities.
Vacation resorts also drive a huge job market, offering approximately 612,225 full and part-time jobs. This includes sales reps, customer service staff, massage therapists and other salon positions, housekeeping and so on.
Projecting for the future of the timeshare industry, it’s uncertain at this point just how much the Covid-19 pandemic will have an impact. While this global virus without a cure spreads like wildfire, causing shutdowns and travel restrictions we are also at a time of great civil unrest. Many businesses have been closed permanently because of Covid and with timeshare being a luxury item it is usually the first thing to be let go of for those affected.
While there is a sweeping amount of tragedy happening at that level, there are also many industries doing well, even better than ever! Cleaning services, for instance. With all the deep cleaning each and every public service company has had to implement, cleaning services are thriving. Other industries that are doing quite right now are delivery services, grocery stores, liquor stores, telehealth services, companies that sell games and fitness equipment, behavioral health, tutoring services, home health providers, tech companies and healthcare. That is A LOT of industry that is booming right now!
Looking at these trends, we see we still have an exceptionally viable industry. After all, travelers have not stopped traveling – airports seem just as busy as ever these days! Therefore, while the future of anything is mostly unknown, it is clear that the timeshare market stands strong and is moving in a positive direction.
Be sure and let us know through our Contact Form if you are in the market for a timeshare and we will help you find exactly what you are after at the best price on the resale market.