The Revival of the Timeshare Sector

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Over the past two years, the economic depression has had an undeniable negative effect on the tourism industry. But nonetheless, experts maintain that despite tougher times, the timeshare segment of the industry was able to endure the market collapse better than expected.

2008 and 2009 saw a considerable drop in sales in the timeshare industry, coupled with more and more timeshare owners losing the ability to maintain their properties and wanting to exit their contractual obligations. But despite these, developers point out that the crash in sales was actually a strategy (purposely reduced sales) that aims to maintain the flow of cash in the face of tightening market condition. The ‘exodus’ of owners from their contracts, although expected due to the prepaid nature of timeshare, was also not able to paralyze the industry. Renting vacation units in timeshare resorts became a popular substitute to hefty hotel rooms and provided relief to timeshare owners during times of weak economic conditions.

However, lesser consumer spending affects vacationers too, although this could be one of the reasons why the timeshare industry was able to wrestle against the economic slump since vacationers were inclined to use timeshare units (either owned or rented) as a substitute to pricy hotel rooms. Another factor to be considered is the rising fuel prices that force many vacationers to prefer closer destinations.

ARDA Chief Executive Officer, Howard Nusbaum, once predicted that timeshare sales were going to remain dreary in 2010. But despite this, new resorts are continued to be built in the U.S and all over the world, especially by larger developers. In fact, numerous timeshare resorts are set to open this year in the country, with more in popular travel destinations like Mexico, China, and parts of Europe. Back in February, Wyndham Worldwide Corporation opened its first resort in Maryland, Wyndham Vacation Resorts at National Harbor. The eleven-story property conforms to the new trend among timeshare owners to stay in urban areas inside the country and already has more than 75% of the 250 units sold.

Another giant developer, Marriott also opened a new timeshare property back in January. Marriott’s Oceana Palms Resort in Palm Beach, Florida has one 19-story tower and 75 units, with additions on the plan. The resort is supposed to have a total of 169 units upon completion.

With experts believing that the US economy is starting to slowly recover, so too will timeshare get back on its feet. Although the timeshare industry was slow to feel the effects of the economic depression in the country, it should not take long for it benefit from the improving economic situation.

Article Source: http://depositarticles.com/

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