Timeshare Valuation

[Tim Leger]

I have just received my first order for a timeshare appraisal in FL. I am not sure what form to use, the lender does not know either, suggested 2055. I know the sales comparison is the best method of valuation, however, should this go on a 2055 form? Also, what about property rights? Fee simple? If anyone has experience in this field, I would like to hear your input. Thanks a million. Tim.

 

[Fred]

Tim,
The property rights are not fee simple. I think you could say timeshare, since the interest appraised is a "share" of the fee simple defined mostly as a period of "time" (as well as other terms and conditions specified in the sales agreement or deed).

You should consider talking them out of an appraisal. These are tough assignments and I would charge "big" money and that could work out to a significant percentage fo the value. Depending on your area, sales from the developer are probably easy to find, but owner resales may take a lot of hunting. Owner resales are the real comps if your client is an individual owner - because I suspect the developer, who may have a significant marketing campaign in place, can probably get a higher (ie "full retial") price than most individuals. Along those lines, you should be very interested in sales of units going back TO the developer moreso than sales FROM the developer; looking for a discount from full retail. There are comanies that advertise on cable, saying they buy timeshares. You might call to see how they establish price.

I think the form is the least of your concerns.

 

[Francois K. Gregoire]

Over the past twenty years, I've had about three requests to appraise either an individual timeshare or interval ownership interest. In each case, the fee I quoted for the assignment exceeded what the client and owner thought their interest was worth. In each case, the client found another appraiser or found an alternative means of solving their problem.

DISCLAIMER: This is my personal experience only and not a recommendation. Your mileage may vary.

 

[Dee Dee]

Tim,
Rev up your search engine for the internet and type in "Timeshare Appraisals".

Not sure who is hiring you to do this, but there are some interesting links that pretty much confirm what other posters have said....and then some.

 

[Restrain]

You can get these things for as little as "take over the payment", "$500 total costs", etc as the bugaboo is the Homeowners Costs. These can get expensive and run up the costs. Resale of a timeshare, unless you are talking French Quarter during Mardi Gras (floating week), Vegas at New Years, etc., is very, very low. There's no equity to be gained in these things.

Also, check EBay for sales. These things get auctioned all the time to get rid of realtor costs.

Roger

 

[George Hatch]

Unless you intend to do these on a regular basis, I'm afraid no matter how much you charge it won't be enough to warrant the research and original writing necessary for a one-off appraisal. You might come out ahead by simply referring this to someone who does these on a regular basis - if you can find anyone.

Just identifying the property interest appraised and dealing with the marketability aspects of this are going to be tough.

Personally, I pass when people call me for these - too much hassle for an interest with too little value.

 

[Walter Kirk]

I was asked to do a timeshare appraisal last year. I asked to see the unit and I asked for the dates of the timeshare. I was told that the owner had never been in the same unit (or even the same resort) twice and that the time floated within a window of several weeks. With those facts in mind I determined that the time share was not an interest in real property.

 

[Fred]

In each case, the fee I quoted for the assignment exceeded what the client and owner thought their interest was worth

And that's before you make the downward adjustment for personal property (ie furniture).

 

[Paul Ness MAI]

We're getting somewhat off the topic of timeshare appraisals and more into the merits of time shares. I know many people who own multiple timeshares, some of whom are appraisers, and they love them. A buyer must understand that they are not an investment like real estate, but can provide inexpensive access to some pretty nice resorts. I am considering the purchase of one right now and have investigated the various organizations that provide exchange opportunities. If you own a time share at a nice location and in the right season, it can afford you some clout in swapping to another nice place, so you're not locked in to just the place you purchased. I'm looking at Florida because all Florida times are considered "red week" from what I understand (prime exchange value). Resales are far far cheaper than developer sales. Never buy a first generation timeshare from the developer. Now back to appraising a time share...I wouldn't touch one if I were you.

 

[Mountain Man]

Come by our court house the first Tuesday of every month. You can pick up all you want for $50 each. They are constantly foreclosing on those things for the maintenance fees.