3 Signs You're About to Buy the Wrong Timeshare

If you're interested in a timeshare, make sure you buy one you're likely to get good use out of.

The decision to sign a mortgage and purchase a home is a big one. And it's one you probably put a ton of thought into. But if you're buying a timeshare, well, that's the sort of purchase you may be more inclined to jump into.

For one thing, the people who sell timeshares tend to be very persuasive. And you may be enticed by the idea of having access to vacation lodging every year without having to think about where to stay.

In some cases, a timeshare could end up being a smart choice. If the area you like to vacation in grows increasingly popular, the cost of finding lodging there could become prohibitively expensive. But if you own a timeshare, you'll have locked in your costs.

That said, if you're going to buy a timeshare, you really need to make sure you're choosing a property that suits your needs well. And if these signs apply to you, you may be about to make a big mistake when buying a timeshare.

1. The maintenance fees are really high

When you buy a timeshare, you don't just hand over money and call it a day. Like townhouses and condos, which commonly come with ongoing HOA fees, timeshares require you to pay an ongoing maintenance fee that is usually due once a year. But if you choose a timeshare with higher-than-average fees, it might really strain your budget (not to mention make that timeshare harder to sell down the line).

The American Resort Development Association says that as of 2018, average timeshare maintenance fees were $1,000 a year. However, the amount of fees you'll be charged will hinge on factors like location and the amenities offered by your timeshare resort. A good bet, therefore, is to research and compare fees before buying your timeshare -- and consider staying away from a timeshare that seems to charge more fees than its counterparts nearby.

2. The area is oversaturated with timeshares

You might think that an area that's loaded with timeshares is apt to be a popular one, which makes it a good choice for you. But actually, if you buy in an area that's already overloaded with timeshares, you might struggle to sell yours if you eventually outgrow it.

It boils down to the basic concept of supply and demand. Any time there's too much supply, you take a financial risk, and this is no exception.

3. You're not taking your future needs into account

Maybe your preschool-aged kids love visiting a certain theme park, and so you're looking at buying a timeshare in close proximity to it. That may seem like a good idea. But what if, by the time your kids are pre-teens, they outgrow that theme park? That could leave you stuck with a timeshare you don't want to use.

You may find that a timeshare is something that benefits you through the years. But it's important to buy the right timeshare, and that means keeping these warning signs on your radar before moving forward with your purchase.