Several years ago my husband and I made an impulse purchase on a timeshare in Palm Springs. I was skeptical, but still, in the back of my mind I thought it can’t be a bad investment.

Since we now owned a piece of resort property, we traded it for some marvelous vacations. Most memorable was a deluxe one-bedroom villa in Kauai, replete with gazillion thread-count sheets, orchids on every table and hiking trails and golf galore.

Fast-forward a couple of years and our circumstances changed.

Sadly, my husband and I found ourselves in a divorce after decades of marriage. Because we had a third child to put through college with our waning savings, we decided to figure out how much our $20,000 timeshare was worth and sell it.

Related: Considering Buying a Timeshare? Think Twice

“You will never make money”

It turns out that our timeshare wasn’t an investment at all, at least not a financial one. Ours was merely an investment in a prepaid vacation.

Resorts and hotel companies in the timeshare business have made good on their investments. The company we bought ours from has sold more than $6 billion in vacation timeshare properties to more than 200,000 buyers since the mid-1980s.

But according to Brian Rogers, founder of Timeshare Users Group (TUG), our “investment” story is common. “Most people don’t do their research until after they’ve made the purchase,” says Rogers, who started TUG after making his own timeshare mistake. “They’re on vacation, their defenses are down and they give in to the hard sell.”

Rogers fields hundreds of calls and emails from new owners who didn’t quite know what they were getting themselves into. “Timeshares can bring happiness and relaxation,” he says, “but they aren’t an investment."

Buying used versus new

Most timeshares are the “deeded week” variety: You buy a week or two at a resort, which you can then trade with owners at other resorts. Other timeshares, popular among younger people who don’t like to be locked into one resort, prefer trading points or intervals. The industry makes more money from inflating how many points are required each year.

The resale market on timeshares has always been bad and it’s gotten worse since the 2008 financial crash. There are thousands of legitimate timeshares for sale on Ebay or Craigslist for as little as a dollar — properties that owners like us paid $10,000 to $50,000 for. Some are selling for as little as a dollar.

(Would anyone out there like to buy our timeshare for a dollar? You can trust me. Really!)

Related: 7 Costly Money Mistakes and How to Avoid Them

Most uber-cheap timeshares belong to owners who want to unload them because they no longer want to pay the annual maintenance fees. It’s not a bad deal — “You can save 99 percent,” says Rogers — but you have to do your homework:

  • Find out exactly what you’re buying: Have the resort send you an estoppel letter, which verifies details like what the seller owns and whether the timeshare is based on points or weeks. Make sure the property is in good standing and all fees are paid and up-to-date.

Many people prefer to buy new, directly from the resort, for very legitimate reasons. They love the way the resort is furnished or runs, as we loved our deluxe property in Palm Springs.

Another advantage of buying new is that in every state you have between 3 and 10 days to drop the deal, as with all real estate. Very few states offer this protection for resale properties (Florida does, with its huge timeshare market).

Resorts tend to discourage people from buying resale, says Rogers. Some, for example, won’t let you convert a resale property to points that can be used at hotels for shorter stays.

The day my husband and I fell prey to the hard sell, we did briefly Google information about buying a used timeshare. But when we found out from the salesperson we wouldn’t be able to trade points for hotel rooms for quick trips, we gave up. “To me, [the points] aren’t worth twenty thousand dollars,” Rogers says. “I’d rather keep that in my pocket for the maintenance and upgrade fees for the next few decades.”

For a while, our new timeshare felt like it was worth it. I used a bevy of points during my son’s later years in high school for single hotel rooms during college visits. It did feel like I was saving money as I booked “free” hotel rooms. But I’m certain we haven’t spent $20,000 (or anything close to it) in hotel trips.

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Even if you’re smart and buy our place for a dollar, you’ll still have to pay the maintenance and upgrade fees that go up every year — fees we have to continue to pay unless we want to mar our credit by going into foreclosure. Unfortunately, a lot of people wind up doing that.

So is there a way to enjoy a timeshare without getting stuck with rising fees and a bad investment? According to Rogers, there is: Rent.

“You rent a timeshare for the amount it costs to own it every year in maintenance fees, he explains. “That way you get the timeshare experience, which is often a more luxurious property than you might otherwise be able to afford.” Several sites offer timeshare rentals, including TUG, Redweek.com and VRBO.

In hindsight, of course, I wish we’d done that.  

Kathryn Olney is a freelance writer and editor who has served as a reporter and editor for California, San Francisco and Mother Jones magazines.

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