Rules protect time-share owners

Four out of every 10 real estate purchases are second homes either being used for an investment or vacation property, according to the National Association of Realtors. With today's evolving leisure real estate market, consumers are faced with a variety of ownership options, including time shares, luxury fractionals or private residence clubs, destination or non-equity clubs, condo-hotels and traditional second-home ownership. These dramatically different products offer varying forms of ownership, levels of pricing, consumer protection and performance records.

When a consumer purchases a vacation ownership product commonly referred to as a time share, whether it is a traditional one-week interval, a points-based time share or membership in a private residence club, comprehensive regulations specifically designed to protect the consumer apply to the purchase, contrary to what was recently reported in the Deseret Morning News.

It is these built-in protective measures, such as developer financial assurances and a purchaser's right of rescission, that have contributed to the rise in the popularity of time shares and in customer loyalty. The vast majority of all owners — 80.3 percent — express satisfaction with their time share purchase; 75.7 percent claim owning a time share has increased their looking forward to vacations; and 68.4 percent say owning a time share has increased the amount of time they spend on vacations, according to a recent study, "Resort Time Share Consumers: Who They Are; Why They Buy, prepared by Ragatz Associates. A full 66.4 percent of all owners say time share has increased their learning experiences, and 52.8 percent claim owning a time share has increased their health and happiness.

Of those who purchased a time share in 2005, 37 percent were already time-share owners who purchased additional time shares, either at the same resort or at another property at a sizeable amount for any consumer product. Some major brands have attributed up to 50 percent of sales to existing owners, the ultimate endorsement of the product.

As with any purchase, consumers need to take the time to understand the terminology and details of the purchase, as well as to evaluate their vacation preferences, travel goals and budget.

To help in this process, the American Resort Development Association recently produced a brochure, "Understanding Vacation Ownership," available free of charge at www.arda.org. It offers a wealth of information on how vacation ownership works, purchasing shared leisure real estate, vacation exchange and selling a time share.