Timeshare Industry Requires Relief after Several Write Downs

The economy is said to be recovering this 2010 but other problems seem to arise for the timeshare industry. They are not merely seeing timeshare owners seeking for timeshare relief but the timeshare industry is also seeing timeshare companies writing – down some of its timeshare investments.

Starwood Hotels and Resorts Worldwide, Inc. disclosed its fourth quarter earnings last Thursday. The sad part of the industry is its announcement of a write down amounting to $362 million because it is ceasing the construction of some of its timeshare resorts.

Starwood Chief Financial Officer Vasant Prabhu stated that their engagement with the timeshare industry is an adjunct to its hotel business as long as the high rates of return are achievable and they can get a good spread of their capital. But now that the economy has changed the playing field, they are aware that putting in more capital will not be beneficial for the company. 

Starwood is not the only company to have made such write down. Five months ago, Marriott International, Inc. also made the same decision. This shows that the timeshare industry is suffering from the financial crisis with all the cessation of timeshare developments and constructions.

Once the economy gets back to a good shape, the timeshare industry as well as the rest of the accommodation industry can start recovering from their losses. Timeshare owners who want to get rid of their timeshares may continue with their decision but their effect will not be that hazardous to the timeshare industry.

CNN recently reported that with the current state of the economy, hotels are looking at jacking up their fees to cover expenses and make more money.

This pending increase in hotel fees may make timeshare ownership more lucrative to vacation travellers.

CNN cited a study by Bjorn Hanson, associate professor at New York University Tisch Center. “Despite a forecast for a continued decline in hotel rates in 2010, hoteliers will become more aggressive in collecting fees and surcharges this year,” Hanson said.

CNN warns travellers to check for hidden fees and additional charges, which may include fees for services that used to be free. Soon hotels may charge you for leaving your bags at the check-in counter after checkout, cancelling your room, or for early checkouts and even late check-ins. Hotels may also up current charges for room service and property damages.

Worse, these increases are not uniform across hotels within one chain. This means that the service which you take for granted because it is free at a hotel in Sacramento may cost you an add-on fee at the same hotel in Los Angeles. To be sure, you will have to ask first about every move you make to avoid surprise charges, or you may just be shocked at how much your total bill is upon checkout.

Thankfully, these charges will not cause any worry for timeshare owners. Because the timeshare industry allows you to lock in the cost of your accommodation and then pay it off, you are not burdened by these impending hidden hotel charges.

Though perhaps your hotel stay may pay you back in loyalty points, in the end, no matter how many times you stay there, you will still be paying it – and all the hidden charges – out of your pocket. 

So if you have timeshares, now is the time to use them, and at the least you may break even on the amount you would have been paying for hotel accommodations. And especially if you bought it from a trusted timeshare resale company, you will save money over the years you own the timeshare.