The timeshare market is quite different than traditional real estate. The factors that go into timeshare valuation are totally different than other types of real estate and are quite unique to this market. Market comparison appraisal techniques, typically used for traditional real estate do not work for timeshares. Timeshare price erosion is a problem that plagues this industry. We explain the various factors that determine the value of a timeshare and things that can be done to stop price erosion. To learn more about timeshares go to http://orangelakeforrent.com”>Givebacktimeshare.com.
As in traditional real estate, the desirability of a property for sale as well as the supply and demand for that property weighs heavily on timeshare valuation. However, this is where the similarity ends between traditional real estate and interval ownership price assessment. With traditional real estate it is unusual to locate similar properties in the same locality with widely different selling prices. Homes located adjacent to each other, with similar characteristics, would not normally sell for widely different prices.
Market comparison appraisal methods do not work well for timeshares, and there is not standard bank valuation for them either.
Timeshare valuations have determining factors that are unique. Some of these factors are season availability, exchange benefits, extraordinarily high marketing costs. Some other factors include the location of the property, type of ownership and the amenities available in the timeshare resort in question. These factors are unrelated to traditional real estate. To learn more about available timeshares go to Givebacktimeshare.com.
Purchase value is determined by the following factors, what a buyer is willing to pay and what a seller is willing to accept. In addition is it is determined by the seller’s motivation to sell, a seller that is highly motivated will tend to reduce the price for a quick sale. The last factor is an auction format that encourages buyers to bid against one another.
A typical format of auction has sales incentives of the selling agents. These incentives help promote the highest marketable price, which in turn helps to prevent price erosion.
Because the resale market is very diverse and always the result of negotiation between buyer and seller, it is not possible to accurately predict the sales price.
If sellers have limited resale options, price erosion will be significant. Sellers can end up with their backs against the wall as a result of fruitlessly attempting to sell the unit themselves or trying to sell through an Internet bulletin board. These bulletin boards or advertising websites may provide a price list, photograph and general description of the property, but not the other essential services offered. These bulletin boards and advertising websites actually increase price erosion and do not offer the consumer the professional assistance needed to complete negotiations. Procuring prospects is only one step in facilitating a sale. Contracts have to be prepared, escrow must be held, and ownership must be transferred and properly filed to assure the new owner’s usage. A licensed resale broker specializing in timeshare resale can represent the seller and perform all the services needed in a proficient manner.
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