Time-share Holidays Like Sterling Holiday Resorts, Club Mahindra, etc: Any person can be confused about what a time-share is? Or may have a vague idea of what a time-share is but want some more in-depth information on how a time-share really works. In simple terms, a time-share is a resort unit that allows owners to have an increment of time in which they can use for vacations every year.
What Is A Time-Share?
A time-share is a vacation property, or resorts split into fractional o shared ownership. This ownership is usually in weekly increments. Most time-shares today are with large corporations like Club Mahindra, Sterling Holiday, etc. In order to provide customisation and flexibility for vacations for owners, these hospitality brands offer a travel club style of membership.
According to the few Resort Development Association, “timesharing” is determined as shared ownership of a vacation estate, which may or may not incorporate an interest in real property. A time-share enables owners to have an increment at a time in which they can utilise their shared ownership. These increments are commonly for one week but vary by resort and its developer. Basically, a person is sharing a unit with others but “own” it for an assigned week.
How Does a Time-share Work?
Now that we covered the definition of time-share and what it is, now we can define the working or implementing the process of the time-share. If a person is a time-share owner or looking to Buy Time-share, in that case, they must get familiar with their brand that offering vacation ownership because each of them works differently and individually.
The most typical (which is now considered to be outdated!) way of working on a time-share is owning the same resort for a specific week at the same time every year. Traditionally, during their “fixed week”, families could travel to their time-share resort. However, at the present time, there are many more options available for time-share than ever.
Time-share ownership involves payment of an upfront sum with an added yearly fee for maintenance. The time-share business is broken into 52 weeks, and each week is considered as a unit. The price of the week depends upon the season of the slot that the person wants to buy. For various resorts location, depending upon the demand and supply, the period for peak or lean season may differ. In hills, the season of summer may be considered to be the peak season, whereas, at beaches, it may not be the lean season. The season is usually described with the colour codes, and to describe a peak, resorts can use the different colour codes to demonstrate lean season.
For describing the season’s popularity, there are few colour codes used by some companies. The most common time-share in India is Mahindra and Mahindra, Sterling Holiday Resorts, Avelon Resorts, Nanda Tourist Corporation, etc.
- Purple: Peak Season
- Red: Best Season, Vacation Time
- White: Mid Season
- Blue: Off-Season
Understanding Time-Share Holidays Room and Seasons
The Various Type of Room included in Time-share Holidays
- For three adults or two adults along with two kids, gets a studio apartment room of around 300-350 sq feet which is the lowest subscription and AMC.
- For four adults, one bedroom of around 550-650 sq feet is allotted.
- For six adults, two bedrooms of around 750-850 sq feet are allocated, which is the highest maintenance and AMC.
The Different Type of Season included in Time-share Holidays
The type of season in when it would be worthwhile for a person to invest in a time-share week to commence are:
- Purple: Represents the Peak holiday season like summer holidays, Diwali, New year, which will charge the highest subscription fees and AMC.
- Red: Represents the Peak season for the particular location and the Long holidays. (Kasol- January-March, Goa- October-February, Delhi- December-February, etc.)
- White: Represents, or known as the regular season, which is basically the Less than ideal times but not completely off-season.
- Blue: Represents the Offseason which will have the lowest subscription fees and AMC.
A particular colour season member shall be eligible to use a holiday in their category or categories of lower season. For example, if the situation demands, the purple season members can opt for red, white or blue, but members under the white season can only opt for white or blue.
The cost of Membership, as advertised by Mahindra Holidays in 2015, has 12 types of membership (4 seasons x 3 types of accommodation). So, if a person opts for a two-bedroom and purple season, the individual’s subscription and AMC charge will be the highest. As per their website in 2017, the price of membership was between Rs.269,800 for a Blue Studio to Rs.1,824,900 for a Purple Two Bedroom (which was effective from 1st Mar 2017), was available at affordable EMIs term offered for 6 to 48 month period.
Note: the amount mentioned above just talks about the Joining fees, not the fees charged for maintenance. For upkeep of the property owned, staff salaries or utilities, annual fees for maintenance have to be borne by the members according to their room type, which would be approximately about Rs 20K for a purple member and about Rs 15 thousand to Rs 16 thousand per year for a Red member.
Booking for Holidays
The room booking is made on a first-come, first-serve basis. For a confirmed booking, the person should book well in advance.
- For Weekday stay: At least 30-45 days in advance should be booked by the member.
- For Weekend stay: At least 3-4 months in advance should be booked by the member.
A BLUE member CANNOT book rooms in the PURPLE season but can book rooms: in BLUE season between 1 to 120 days in advance, in RED season between 1 to 7 days in advance and in WHITE season between 1 to 15 days in advance.
When booking of a room is made in case of a non-availability, there is NO transparency on the waitlist number
When booking an Air ticket or Bus, people get to see how many seats are still available. But in Time-share holidays, they do not display any available rooms or the number of rooms that are empty. Through travel websites or travel agents, many times rooms are given to non-member.
If a person does the calculation on the Number of Rooms per Number of Members, they will discover that there would be a shortage of rooms. Assuming that a timesharing holiday has 1.83 lakh members. As every member can go for one week holiday for all the members, the number of rooms required is 3520 is evaluated from 1.83L members/52 weeks. Most of these timesharing holidays do not possess these many rooms. Assuming the highest number of rooms of 3500. Then during long-drawn weekend holidays, only 3.5K members can book & avail themselves. The remaining 1.79L members will be unable to avail themselves of the offer.
A cancellation fee is imposed on a Member who cancels a confirmed holiday at least 45 days in advance of the start date of the confirmed Week. One to utilise their Week at a later date can also get it back. No refund will be for cancellations done less than 45 days in advance.
Cancellation of Time Share Holidays
Generally, most of the companies that offer time-share have a free look-in period of 10 days wherein the owner can cancel the membership and avail full refund. But one has to run around to get their refund.
Selling off Time-Share Holidays membership
If a member changes his mind or dislikes time-share, he has an option to sell it off or cancel the policy. But in actuality, this process is not that easy as it sounds. If the policy is cancelled by an individual buyer within ten days of commencement, then the person will be eligible for a complete refund. No refund will be made if the person fails to cancel their membership within the first ten days. In such cases, the only option the member left with is – to sell off the membership in the market. An easy sale of such policies is witnessed in Open markets like Quickr and OLX.
Food & Beverages in Time Share Holidays
A person has to bier the money for food and beverages from their own pockets. Many Resorts are constructed in remote locations, which indirectly forces the person to take food in their restaurants. One can opt for a Buffet per person or go for a package of 2 or 3 meals. One can also opt for individual dishes or la-carte. Always check the Food and Beverages cost, which are the hidden costs/disadvantage in Club Mahindra.
What to Know Before Buying Timesharing Holidays?
- Don’t pay full price: Like most real-estate transactions (even hotel stays), the initial price is usually negotiable and can be paid in installments.
- Know what you are actually buying: Because time-share companies know that one can easily find cheaper options from existing buyers, often from websites or open markets, so they usually offer closing incentives and other perks.
- Know your state’s right of refusal on time-share contracts: Because of many documented cases of exploitation on time-share sales and resales, most states have put in fairly generous opt-out clauses for consumers, so always be aware of all the clauses and rights before buying.
- Know how to trade your time-share interval or exchange it for a time: One should know to share their money at another resort when you can’t use it, especially if they want to trade to another resort, they have to know how to do so.
- Beware of scams: Some unhappy time-share owners may confront a scheme where they’re cold-called and offered a “buyer” for their time-share, typically for an inflated/increased price over the originally paid price, then that probably is a scam. Such scams can lead to huge loss of money caused due to some greed for extra money.