Home
>
Vacation Rental
>
Timeshares Vs. Condo Hotels For Vacation Home Ownership

Timeshares Vs. Condo Hotels For Vacation Home Ownership

Condo hotels, also known as condotels, are a relatively new concept in vacation home ownership. They allow individuals to own condos in luxury hotels and have access to all the amenities of that hotel. When not using their condo unit themselves, owners have the option of placing it in the hotel's rental program and receiving a percentage of the revenue it generates.

Because the condo hotel concept is so new, it's often confused with timeshares, a popular vacation home option that has been around since the 1970s. In reality, condo hotels have many qualities that set them apart from timeshares and make them appealing to a unique segment of the second home market. Here's a comparison between these two types of real estate investment.

FLEXIBILITY IN USE

Timeshares - When you purchase a timeshare, you choose not only a set location but also a specific week or two that you will use your vacation home every year.

Condo Hotels - With a condo hotel, you have flexibility to use your unit whenever you want. Keep in mind, however, that some condo hotels do have living restrictions that prevent you from making your condo a permanent residence.

AMENITIES

Timeshares - The average timeshare has a community pool and some common areas.

Condo Hotels - Condo hotels have many of the amenities you would find at luxury hotels. In addition to a pool (or pools), there is probably an on-site restaurant (possibly several), a lounge, a full-service spa, a state-of-the-art exercise facility, a poolside bar, etc.

FURNISHINGS

Timeshares ? Timeshares are sold fully furnished. The quality of furnishings depends on the individual development. The cost for the furnishings is built into the price.

Condo Hotels - Condo hotel units are sold fully furnished typically with high-end furniture, appliances and fixtures selected by a professional interior designer. The cost for furnishings is included in the price of the condo hotel unit.

SERVICES

Timeshares - In a timeshare, you are responsible for your own housekeeping and unit upkeep during your stay.

Condo Hotels - You get daily housekeeping as you would in a luxury hotel. You have access to room service, concierge services, maintenance services and check-in services. The vast majority of condo hotels are operated by big-name hoteliers like Ritz Carlton and Hilton, the consummate professionals when it comes to customer service. Most of the same services available at their high-end hotels are offered at their condo hotels.

LOCATION

Timeshares - Timeshares are located in highly-desirable resort areas.

Condo Hotels - Condo hotels are also located in highly-desirable resort areas.

PRICE

Timeshares - Prices for timeshares vary greatly but are typically lower than condo hotel prices because you are only purchasing one or two weeks of usage. In addition, you do not receive any of the revenue generated during the 50+ weeks that your timeshare unit is used by others.

With timeshares, as much as 40%-50% of the price goes to sales commissions. Why are the sales commissions so high? The developer must maintain a large sales force in order to make approximately 50 sales for every unit (one for every week of the year).

Condo Hotels - You receive deeded ownership to the property. Although more expensive, condo hotels tend to give you more for your money than timeshares. More of your dollar goes into "bricks and mortar" high-quality finishes not sales commissions.

In addition, when not using your condo hotel unit, you can place it in the management's rental program and receive a percentage of the revenue it generates, helping to offset your maintenance costs and debt service.

RENTAL INCOME POTENTIAL

Timeshares - You have the option of renting out your timeshare to someone of your own choosing or placing it in a rental program if you decide not to use it during your allotted week. If you participate in the rental program, you will split the revenue generated with the property's management company. Remember, you are only renting out the one or two weeks per year that you own.

Condo Hotels - Like a timeshare, you have the option of finding your own renters or placing your condo hotel unit into the rental program. You may participate in the rental program and receive a portion of the revenue it generates any time that you are not occupying your unit, whether it be for one night or 365 per year.

POTENTIAL APPRECIATION

Timeshares - Historically, timeshares depreciate in value from the time they are purchased. Values have been poor because of the large number of resales on the market and a continuous stream of new developments competing with them.

The secondary market for reselling timeshares has never taken off. The fact is, most people who buy a timeshare will have it for life, whether they want to or not.

Condo Hotels - Because condo hotels are a relatively new type of property investment, they are limited to just a handful of locales across the country. The supply is small and demand is currently high and growing, all of which contribute rapid and significant appreciation. Another factor to keep in mind when reselling a condo hotel unit is that you're selling not only the actual unit but also the luxury lifestyle that comes with an amenity-filled, high-service property.

Many condo hotels are sold out in pre-construction. Often the developers, sensing the high demand, will themselves raise prices many times before all units are gone.

For example, The Mutiny condo hotel located in Coconut Grove, Florida was the first condo hotel to be built in South Florida. From the time the developer began accepting deposits until it sold out in pre-construction, there were nine price increases. People who bought early did exceptionally well.

Joel Greene is the President of Condo Hotel Center, a licensed real estate brokerage that specializes in the sale of condo hotels. For more information on condo hotels -- including property listings, photos and prices -- visit his website at http://www.condohotelcenter.com Be sure to sign up for his Property Alert e-newsletter to receive notification when new condo hotels come on the market and are available at pre-construction pricing.

Highland Park shuttle to O'Hare .. Lockport Chicago limo O’Hare

In The News:

Recent reports show many common passwords can be cracked in literally seconds. Kurt the CyberGuy explains how to strengthen your passwords.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Iron, a robot that stands 5 feet, 8 inches tall and weighs 154 pounds, combines advanced artificial intelligence with human-like movement and exceptional vision.

Hertz, the rental car giant, recently confirmed that customer information was exposed through a cyberattack on one of its software vendors.

There are a number of features with AirPods you may or may not know about to take your listening experience to the next level. Kurt the CyberGuy explains.

These 35 Chrome extensions have privacy and security concerns. Tech expert Kurt “CyberGuy" Knutsson says to delete them now.

Tech expert Kurt “CyberGuy" Knutsson says 329,000 mph fusion rocket promises to be fast, disruptive and enable deep-space missions.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Tech expert Kurt “CyberGuy" Knutsson says a new autonomous AI is a game changer that also raises privacy risks. Is your data safe?

Tech expert Kurt “CyberGuy" Knutsson says robots and drones are revolutionizing fruit farming with faster picking and smarter handling.

Landmark Admin revises May 2024 cyberattack scope to show twice as many people were affected. Kurt “CyberGuy" Knutsson gives tips to help stay safe from an insurance data breach.

Tech expert Kurt “CyberGuy" Knutsson talks about how Yamaha’s hydrogen outboard motor could revolutionize boating with zero emissions.

Tech expert Kurt “CyberGuy" Knutsson reveals how to memorialize or remove a deceased loved one’s Facebook account and protect their digital legacy from misuse or scams.

Tech expert Kurt “CyberGuy" Knutsson says an Apple Watch saved psychiatrist Amanda Faulkner by detecting deadly leukemia early.

Scammers and fraudsters are increasingly targeting the most vulnerable, especially nursing homes and the personal data of their residents. Kurt the CyberGuy has safety tips.

Infected USB flash drives can spread malware among multiple organizations in ways that can easily bypass traditional security systems.

With a fully automated warehouse system and AI-powered robots, Ocado's Hive picks, packs and delivers grocery store orders in just a few minutes.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Recycling robots are using artificial intelligence to learn how to sort recyclables by recognizing patterns in colors, textures, shapes and logos.

The Reachy 2 robot is designed to be friendly and approachable, inviting natural interaction and is perfect for research, education and experimenting with embodied AI.

Kurt "CyberGuy" Knutsson shares several easy ways to keep your credit cards safe from digital thieves while you're traveling this summer.

Arcturus sets up cameras around the edges of baseball stadiums to capture real-time action and generate a 3D digital clone of the game.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

The CyberGuy explains why healthcare organizations are vulnerable to hackers after there have been a half dozen data breaches this year.

Developed at two California universities, the innovative technology combines brain-computer interfaces with advanced AI to decode neural activity into audible speech.

Timeshares Vs. Condo Hotels For Vacation Home Ownership

Vacation Rental