Government’s Role in improving Timeshare Industry
in India
Although,
Government does not have any direct role in running the timeshare industry in India but it’s their duty to provide the right environment for
growth of this Industry. This creates an atmosphere which will inspire
investors to focus only on running their business instead of focusing on other
infrastructural issues.
Following are the issues in which
Government plays an important role:
1.
Security: Safety and Security is an
important concern for tourism industry. A tourist always wants to roam free in
the tourist place without fear of safety of himself and his belongings. It is
government’s duty to take good care of security arrangements. At some places
government has started a concept of Tourist Police who takes responsibility of
extra care of these tourist places.
2.
Infrastructure: Timeshare industry is
totally dependent upon infrastructure provided by Timeshare companies. And
government monitors this Infrastructure. Government takes care of proper roads,
electricity, drinking water, sewage lines, garbage disposal facility, street
lights etc. in these tourist places
3.
Capital: Timeshare industry is cannot
be run without proper investments. It requires huge initial investment.
Government provides financial assistance by providing loans to these timeshare
companies. Government can also promote this industry by generating money from
import duty, excise duty etc.
4.
Regulatory Commission: Timeshare
industry had lost it’s credibility because of freelance operators before.
Government now is helping the industry by acting as a regulatory commission
which keeps an eye on all the players in this business and controls the
financial transactions between holiday homes and timeshare companies.
5.
Taxation: Government collects taxes
and dues from timeshare companies and this money is later used to improvise
infrastructure of these tourist places.
AIRDA: In 1998, a visionary group of
resort developers and RCI inked a blueprint for an independent body – an
association with a purpose and an agenda – keeping in mind the nascent profile
of timeshare in the country and the constructive role that could be played by
developers to grow the industry. Importantly, to work hand-in-hand with both
promoters and consumers. This was how the foundation was laid for the All India
Resort Development Association (AIRDA).
Timeshares and vacation
clubs are both means for frequent travelers to save money. Which one is best
for you depends on your travel preferences, flexibility and finances.
Timesharing
Unlike a vacation club, timesharing involves the purchace of real
estate. You buy a week or weeks to use a furnished condo, cabins or other
accommodation that offers all the comforts of home, including a kitchen.
Timesharing limits travel options to one location, although often you have the
opportunity to swap with owners of timeshares elsewhere in the country or the
world.
Vacation Clubs
Membership in vacation clubs covers multiple locations. Some vacation
clubs resemble timeshares in that they offer fully-furnished, home-styled
accommodations. Clubs such as one offered by Disney provide discounts to all of
its resorts and theme parks. Hilton club members receive discounts at all the
chain's hotels. Ask if the club will give you a trial membership so you don't
have to commit yourself immediately.
Financial
Obligations
Timeshare owners pay an initial fee to purchase their block of time and
then annual maintenance fees that can rise over time. They can sell their block
of time, much like any other real estate transaction. Vacation club member pay
a single annual membership fee and generally do not have membership options.
What Are the Advantages of
Timeshares?
A timeshare is a property
that is jointly owned by people who use it at different times throughout the
year. Typically, timeshares are condominium apartments in areas that are close
to resorts and attractions. Owners might be able to “swap” their timeshare for
another one in a different location. For many, timeshare ownership has an
advantage over booking a hotel room, and timeshare vacations are becoming more
popular.
Onsite and Nearby Amenities
Typically,
timeshares offer on-site amenities such as swimming pools, tennis courts and
hot tubs. Many have fitness centers, and even spas offering treatments for health
and beauty. Off-site activities are often located conveniently nearby,
including family activities such as boating, skiing, golfing and water sports.
Special children’s activities may also be available. When choosing timeshare
destinations, whether using your own timeshare or “swapping” for another, you
will undoubtedly be close to the attractions of your choice. Some timeshares
even offer cruises.
Value, Flexibility and Convenience
Many
people find that they save money by owning a timeshare. One advantage is that
you can lock in future vacation accommodations at today’s prices, and you have
the option to rent your timeshare space or share it with family and friends.
Timeshare owners have the flexibility of choosing where and when they want to
travel, the amount of vacation time they would like to spend, and the size of
the unit. Typically, timeshare owners belong to an exchange, and can “swap”
their units yearly for another destination worldwide. Timeshare owners may be
able to vacation at another time of the year and group allotted weeks together
for future vacations. For convenience, many timeshare owners are required to
pay a yearly maintenance fee to the resort, eliminating monthly maintenance
fees, utility charges, tax, insurance and cleaning services. Timeshares are a
form of ownership that can be willed to family members.
The Timesharing concept was born in Europe and often been accredited to
Paul Doumier a developer in the French Alps in the late 1960’s who coined the
phrase “ It is cheaper to own the hotel than rent the room” And, it caught on!
The industry has changed along the way however millions of families today enjoy
the simple concept of being able to “own their vacation”
As the industry grew typically in the 70’s and 80”s timeshares were
quickly built around the world and very prominent in the U.S. in places such as
Florida and Hawaii. The industry’s reputation was perceived to be less than
favorable especially due to urgency placed on the choice to “buy today “and
sometimes considered to be high pressure. As the industry evolved with various
governing bodies placing strict measures and implementing improved regulation,
the timeshare industry enjoys a much more consumer-friendly and positive
reputation.
In the early days the timeshare industry had little respect. However
beginning in the 1990s the timeshare industry experienced a renaissance and it
continues to mature. New developer sales and timeshare resales activity
continue to grow beginning a new era for this once questionable industry.
Initially timeshare properties were marketed as investments. Timeshares
are not in fact investments and one should not buy a timeshare with the
expectation of reselling it for a profit.
While one might buy a timeshare property to make an investment in a
lifestyle, few timeshares appreciate—only the ones in choice locations during
specific seasons.
The increasing positive image of the retail and timeshare industry is a
result of two main factors. One is the influx of well established companies
into the new sales market such as Marriott, Disney, Hilton, Hyatt, Wyndham and
others. These corporations have spent significant resources informing the
public of the many benefits of timeshare and counteracting the poor reputation
that lingered from the early days of the timeshare industry. Branding by
Marriott, Hilton, Disney, Westin, Hyatt and others has improved product image
and helped new timeshare sales & resales.
The second factor is that people are realizing that the concept of
timeshare is a real vacation option. With the improved industry reputation,
more and more people are attracted to the idea of timesharing as opposed to
discrediting the concept because of those early, new sales techniques and
marketing. The day has come where consumers are waking to the idea of “Today I
am going to look at buying a timeshare.”
The timeshare industry is the fastest growing segment of the Travel and
Tourism industry. A study released by the ARDA International Foundation (AIF) in
2007 and conducted by Ernst & Young, LLP points out indicators of future
growth and accelerated growth in the future.
In 2006 14,000 new units were built and 11,000 in 2007. In 2008 and
beyond, the current forecast is for about 47,000 new units. The Ernst &
Young study showed a new sales growth of 81% over a five year period.
Additionally, the number of timeshare owners in the U.S. grew from three
million in 2002 to 4.4 million in 2006 with 1,615 resorts operating in the U.S.
and 176,232 timeshare units. The AIF study further found that U.S. new sales
reached a new high of $10 billion in 2006.
Developer/Hoteliers also have found that occupancy rates for timeshare
units exceed those of their hotels.
A condominium, frequently
shortened to condo, is a
type of real estate divided into several units that are each
separately owned.
Residential
condominiums are frequently constructed as apartment buildings, but there had
been an increase in the number of "detached condominiums" which look
exactly like single-family homes but in which the yards, building exteriors,
and streets are jointly owned and jointly maintained by a community association.
Unlike
apartments, which are leased by their tenants, condominium units are owned
outright. Additionally, the owners of the individual units also collectively
own the common areas of the property, such as hallways, walkways, laundry
rooms, etc.; as well as common utilities and amenities, such as the HVAC system, elevators, and so on. Many
shopping malls are industrial condominia in which the individual retail and
office spaces are owned by the businesses that occupy them while the common
areas of the mall are collectively owned by all the business entities that own
the individual spaces.
