State of the U.S. Vacation Timeshare Industry Study Shows Sales, Occupancy Rates Remain Steady
Industry Points to Sophisticated Consumer, Rental Market Growth
According to the State of the Vacation Timeshare Industry: United States Study 2011 Edition conducted by Ernst & Young, sales of vacation products held steady with a slight increase from the previous year, while nearly 80 percent of owners continued to travel to their timeshare destination. Ten percent of the timeshare occupancy rate was comprised of renters as more timeshare developers expanded their rental program offerings to reach consumers unfamiliar with vacation products.
In the past year, the industry has also added sophistication and ease to the way owners can buy timeshare intervals. Instead of selling just one week per year, many now offer increased flexibility by offering "points" that owners can use to customize their vacation needs. They can break up or extend vacation weeks, travel during various times of the year, and/or stay in various unit types at a range of locations. Some also offer biennial products that allow owners to use intervals every other year, instead of each year. About 73 percent of survey respondents have intervals of the traditional weekly variety; about 55 percent have some form of points-based products; and, 36 percent of respondents have biennials.
The growth in the rental market is another indicator of the industry's vitality. Renters comprised ten percent of timeshare stays last year, or 7.9 million nights rented, of the 79 percent total occupancy. "Developers look to rental programs as a way to reach new consumers and experience the products first-hand," continued Nusbaum. Currently, 82 percent of timeshare resorts offer some form of rental program.
Other report highlights show that 55 percent of new timeshare sales come from new owners, while 45 percent of timeshare sales are from those who already own a timeshare with that developer. This demonstrates high satisfaction with the product through repeat buyers. In addition, the sales costs associated with repeat sales are lower than for first time buyers.
The industry's outlook for the future remains positive based on its track record and performance over the last several years in attracting lenders to the industry, drawing new owners into the market, maintaining sales price levels, and continuing to inform and educate the public about the timeshare product.
The report was conducted by Ernst & Young and commissioned by the American Resort Development Association (ARDA) International Foundation.