Members are angry at a lack of amenities and services they paid for being provided at large timeshare companies like Club La Costa, Diamond Resorts and Anfi.
High annual fees
Timeshare memberships are expensive, but many people were willing to pay for them because they promised higher standards than those provided by normal travel agents. Members enjoyed the exclusive feel of the clubs, and they naturally expected that they would be able to enjoy the same high standards for as long as their memberships lasted.
As well as paying an often significant joining fee, members also signed up to pay high annual fees, which are often no less than a standard holiday. These annual fees must be paid even if they don’t want to go on holiday or are unable to do so.
Difficult times for timeshare companies
The fact is, as the years have gone by, the travel industry has upped its game and overtaken timeshare. Now, holidaymakers can visit TripAdvisor, read some reviews and get a good idea of what they can expect on holiday with no nasty surprises when they arrive.
Timeshare complexes are also failing to provide members with the exclusivity they signed up for. Non-members can now easily book a stay on a standard booking site, often for the same price as a member. The benefits of timeshare are less clear cut, and fewer people are buying them as a result.
This has led many of the biggest European timeshare companies to face significant problems. Industry giants like Azure, Silverpoint, Anfi, Club La Costa and Diamond have stopped selling to customers, stopped doing business or even gone into administration.
Some are still managing to keep going, but consumers today are less keen to tie themselves to an annual payment for something they can just as easily rent when they want to for about the same price.
This has led to sales drying up, and the revenue streams are being hit hard. This has seen many resorts cancel services and get rid of facilities that members had been promised when they bought their timeshare deals.
Sales drying up
“The fact is that these companies have had to cut costs,” Andrew Cooper, CEO of European Consumer Claims (ECC), says. “We speak to angry timeshare members all the time. They are disappointed that facilities and services like the kid’s club and onsite entertainment are missing from their resorts now. There is often no welcome pack in people’s rooms or welcome meeting when they arrive. Concierge services have been cancelled and restaurants are closed.
“Many of these people signed up and paid a lot of money based on a sales presentation that promised all of these little touches whenever members came to their ‘home from home’.
“Even when it became indisputable that timeshare no longer made financial sense, many resort members didn’t kick up much of a fuss. They continued using the system they had become accustomed to.
“Firstly, they were used to their resort and that familiarity made them feel at home on their holidays, despite declining standards.
“Secondly (and this is why a lot of people tell us they convinced themselves of the first reason) they didn’t know it was possible to escape from the contract.”
The reason why standards are falling may have a more pragmatic reason, suggest industry experts. With sales operations ceasing, it is becoming too expensive to maintain the same standards that customers once enjoyed.
“Most people bought timeshare during a presentation on the resort itself,” says Cooper. “Because of this, the resorts needed to appear amazing. Facilities and services had to be demonstrably plentiful and high quality. The people staying on-site had to be happy. That way when a salesperson is showing a prospect around, they see the kind of resort they would like to join.
“The high standards and great facilities were never for the existing members. They were to impress potential new members.
“The ‘welcome breakfasts’ for example were only subsidised so that inhouse sales staff could spend time with clients and attempt to upgrade them into ever more expensive memberships.
“Now that sales are suspended or ceased altogether at many resorts, the need to impress has evaporated. The remaining revenue stream is annual fees and members are contractually obligated to pay whatever the resort demands every year, whether they are happy with standards or not.
“Once new member sales slow down or stop, that’s when people start noticing towels being changed less often, rooms not being made up every day, painting and pool maintenance becoming less frequent and so on. In short, the financial model becomes that of any budget hotel. They minimise expenses by cutting corners.”
Members want out
As a result of the high costs, the lack of flexibility and the falling standards, it’s perhaps unsurprising that more timeshare owners want to be free of their contracts.
“It isn’t easy to escape,” says Andrew Cooper. “For timeshare companies, the annual fees are their only remaining revenue source. They don’t care if members want to leave, they are forcing them to stay and to keep paying as long as the contract can be legally enforced.”
“It’s a sad fact of life that people will agree to things more easily when they are in a good mood,” says Cooper. “People signed these long, detailed contracts while they were surrounded by Sea, sunny palm trees and Spanish sunshine. Decades later, seemingly small details are still costing them hundreds or even thousands of pounds a year.”
Can anyone really escape from their contracts, then? “Yes, usually it is possible to get free from a timeshare contract,” Cooper says, “but in most cases, unless you have enough legal understanding to navigate the process (and plenty of free time), you will need expert help.
“The good news for anyone who bought in Spain on or after the 5th January 1999, is that there is a strong chance your contract is illegal. If so, you can not only escape, but you will be in a position to claim significant compensation.”
If you want a confidential chat without any obligations to find out about your timeshare membership options, contact ECC today.