The Trap In Time Shares

Warning to all vacationers who-on impulse let a sales agent talk them into buying a share. It's easy to love these holiday , but only as long as their pleasures suit style of life. If your taste ever changes, a time share can hang around your neck like an albatross. In most cases, there's no certain way of pulling free.

One reason time shares are so popular is their close fit with the baby boomers, who want a family vacation spot but can't afford a home of their own. Instead they buy a slice of a home-say, a single week at a summer resort. Led by luxury offerings from such brand-name hoteliers as Disney, Marriott and Hilton, U.S. sales this year are expected to reach a record $2.5 billion.

Price tags on new time shares are not low. Two-bedroom units average $9,500, up to a top of $18,000. Annual fees (for maintenance and taxes) average $350 and can reach $770. But you're not locked into the place you buy. Swaps can be had for a similar week at a unit somewhere else.

So what's not to like about this deal? Mainly, its perpetuity. At some point in the future you may not want this holiday anymore-because your children are grown or your spouse has died. But you can't store a time share down in the basement next to your dusty exercise bike. Annual maintenance fees continue. To escape them you have to sell-and that's when you learn that a time-share resort is easy to join but tough to leave.

_B_A glut:_b_At many resorts, "used" time-share weeks are a glut on the market. In almost all cases, they can't be resold for anything close to what you paid. You're doing well if you get even half the original price. Where there aren't a lot of weeks for sale, you might luck into 80 percent or more. But time shares in older, less spiffy resorts, or in undesirable weeks of the year, often draw no bids at all.

That stands in sharp contrast to the pitch of many sales agents, who lead you to think that resales are easy. Officially, the industry deplores that line. "Time shares should not be purchased for investment or resale," says Tom Franks, president of the American Resort Development Association (ARDA). Developers who permit salesroom hype are playing a hypocritical game: tsk-tsking the deceptions in public while privately hauling money to the bank.

ARDA promotes time shares purely as "prepaid vacations"-a lifetime of happy holiday weeks at prices you lock in today. Or half lock in. Your annual maintenance charge will rise, as will the real-estate taxes owed. Still, if you hang on long enough, a time share should ultimately save you money over the cost of annual rentals.

How long do you have to wait? That depends on such things as the inflation rate. Some examples from Disney and Marriott show buyers breaking even in anywhere from eight to 12 years (up to 20, if you include the time value of money). For shorter periods, it's cheaper to rent.

ARDA's David Matheson argues that I shouldn't take a short-term view. Looking out 30 years, he says, owning beats renting every time. Probably so. But my daytime planner doesn't run that far. If I'm taking a heat cure in the year 2023, the odds are that it won't be in Florida.

Families will differ on this point. You might love the thought of time sharing over the next 30 years. In that case, buy a resale from a current owner, which can probably be had at 40 to 75 percent off the developer's price. Most resales are indistinguishable from the time shares offered new. If you're buying deeded property, get title insurance, advises Clinton Burr of the Resort Owners Property Association. You don't want to risk a clouded title that might sink your property someday.

_B_Ditch it:_b_If you don't want your time share anymore, how do you ditch it? Here are six possibilities:

Ask the developer to sell your time share for you. Any Marriott will take resales once its own units are gone. Ditto for a Hilton resort when its inventory drops. Carl Berry, head of California Resorts in San Francisco, handled owner resales at one of his properties even while selling higher-priced units of his own. So some in the industry are developing modest secondary markets. Still, they remain the exception, not the rule.

Hunt up a licensed real-estate broker who handles resales. Unfortunately, there aren't many of them. Marvin Beard, of Outer Banks Resort Rentals in Nags Head, N.C., sold 177 weeks last year, just I 1 percent of his total listings. Independent Timeshare Sales, in Orlando and St. Petersburg, Fla., sold 987 weeks, 24 percent of its new listings. But beware the phony, unlicensed brokers who falsely claim to have customers for you. They'll pump desperate sellers for $300 to $500 billed upfront, then walk away.

Sell at auction. TRI West in Marina del Rey, Calif., holds an auction each September. TRI Realty, in Harrisonburg, Va., holds four a year, three in Washington, D.C.

Sell the property yourself by distributing For Sale brochures to happy vacationers around the pool. Also try resort newsletters, electronic bulletin boards and friends.

If sales attempts fail, try giving the property back to the developer. That saves you the continuing cost of annual fees. Some will refuse you. Others will accept if you prove hardship or if they think they can resell. The Jockey Club and Polo Towers in Las Vegas, Nev., agree upfront to accept any unit from a customer who wants out.

Quit paying. Developers chase you for a while, then usually reach an accommodation. Some report your delinquency to a credit bureau, others don't. The resorts most likely to sic a collection lawyer on you are those run by homeowners' associations. They need your annual maintenance fees to keep their own expenses down, says Joan Ross, who manages The Reef Ocean Resort at Vero Beach, Fla.

Dying, incidentally, doesn't help. Your heirs will inherit the time share and with it the annual maintenance fee.

The pity of it is that time shares can be an attractive deal if they're properly priced and if bodies don't pile up at the exits. Former ARDA chairman Bert Blicher calls resales the industry's "missing link." Unless a resort has solved this problem, I'd rather rent a place than buy.