In the top 10 ... Orlando, Florida is a holiday club hot spot.Credit: AFP
From a 14th-century abbey in Ireland to a “cupboard” in Paris, Michael Donovan has experienced the best and the worst of timeshare holidays.
The former travel industry executive and his wife, Carol, have been timeshare owners for more than 20 years and have had dozens of holidays through various timeshare and vacation club schemes.
The word timeshare can be enough to send many running for the nearest exit, thanks to an image created by unscrupulous operators over the years.
But with a reputable scheme and proactive management, timeshare can be a good way of affording – and encouraging you to take – regular holidays.
Donovan says vacation clubs may not represent good value in the short-term environment of heavy discounting, but as tourism recovers they will again offer “a reasonably priced alternative” to traditional holiday bookings.
One of the benefits for the Donovans, who are now semi-retired, is that it has prompted them to take holidays they might have otherwise put off. “In order to get the best exchanges or uses of points, some advance planning is best and that commits you to planning holidays,” Donovan says. The Donovans go somewhere different for every holiday and can use their points to “mix and match” components including accommodation, car rental, insurance, tours and cruises.
Figures show they are far from alone: while timeshare schemes have been sold in the US for about three times as long as they have in Australia, the per-capita ratio of timeshare owners is now higher in Australia.
So how do timeshare schemes and vacation clubs work?
A simple explanation is that you buy a membership of a vacation club and that entitles you to a certain number of points each year.
You can use these points to book various holidays on offer through that club, subject to availability.
Points-based vacation clubs are a more modern version of traditional timeshare schemes, in which you had to return to the same hotel or resort time after time.
One of the biggest clubs in Australia is the Accor Vacation Club (accorvacationclub.com.au), which has about 25,000 members and more than 20 properties in Australia.
The entry-level cost is determined by how many points you want to receive each year (up to the year 2080), and it is possible to upgrade or buy extra points at a later date.
The minimum investment for Accor Vacation Club is $18,400 and the club says this level of membership will generally buy a week at a four-star resort for two people in the low to shoulder season.
All the apartments available through the club are self-contained, but members have the option of using the hotel's bars, restaurants and facilities. Another major player in the Australian market is Wyndham Vacation Resorts (see wyndhamvrap.com), for which the minimum outlay is about $15,000.
Wyndham says this level of membership can be used for short stays at 19 resorts across Australia, New Zealand and Fiji, with reciprocal rights with Wyndham's sister clubs in the US, Canada and Mexico.
Some use their membership once or twice a year for family holidays, while others use it for regular short getaways or even for business.
Wyndham says its members include young couples, families and older people with more time to travel.
Because the number of credits required to stay at each resort doesn't change year to year, owners can plan well ahead and have the option of accumulating their points for two years or borrowing from the year ahead.
Another vacation club worth checking if you are interested in timeshare is RCI (rci.com), which has more than 3 million members worldwide and has an Australian office on the Gold Coast.
Donovan says he advises anyone considering signing up for a timeshare or vacation club scheme to plan their first five years' worth of use, “to see if you can afford the time, the cost and being together that long”.
“We take a domestic holiday one year and then an international the next, to make the exchange or points work for us,” he says.
“To get a return on the investment, you do have to be proactive.”
If you are concerned about the validity of vacation clubs or timeshare, be assured that such schemes are tightly regulated in Australia.
“The industry is now one of the most heavily regulated in Australia, under the Australian Securities and Investments Commission,” says the general manager of the Australian Timeshare and Holiday Ownership Council (athoc.com.au), Laura Younger.
She says that while any company in active sales has to hold a financial services licence, vacation clubs must be clear in both their paperwork and their sales presentations “that timeshare is not a financial investment, it is an investment in leisure”.
Anyone who attends a presentation must be given a full product disclosure statement and those who sign a contract must be given a seven-day cooling-off period during which they can change their mind without penalty.
VACATION CLUB HOT SPOTS
Gold Coast
NSW North Coast
Phuket, Thailand
Las Vegas, US
Sunshine Coast
Bali, Indonesia
Fiji Islands
Orlando, US
Paihia, New Zealand
Oahu, Hawaii
Source: Accor Vacation Club members' top 10 travel destinations, 2008
Sign up for the Traveller newsletter
The latest travel news, tips and inspiration delivered to your inbox. Sign up now.