timeshare type investments

[investor2009]

Hi all. Now, I know these are a ridiculous "investment" but I don't know alot about them

There was a discussion about someones 10 year retirement plan at work today where I just sat quiet. Basically, this man has no PPOR and part ownership in 2 units overseas. He plans to have 10 in 10 years and retire off all the income while living in whichever is vacant at the time

Now, while Im no expert on o/s timeshare or even just cheap o/s property but my issues are: why would anyone do this? Apart from not beng educated about investing well. In my mind there are much smarter ways to make it in 10 years other than this. I also doubt he will make the goal because these properties must be paid off with after tax dollars and may not provide any capital growth. He made it clear these would provide $1100 p/w. I also hate the idea of being at other peoples mercy albeit you have to leave when your times up etc

This gent is aware of my personal investments and wonders why I bother.. He says he likes being debt free. Which doesn't make any sense now I hear this. Lovely bloke though

 

[The Y-man]

Timeshare has a lot of lifestyle considerations - if the guy likes the idea of living his retirement days in a TS unit, then that has "value" to him (but probably not to you).

Having said that, is it an investment? I doubt it. It is an "arrangment".

Need to be aware maintenance and refurb costs.

The Y-man

 

[Scott No Mates]

Timeshare units vary in the number of weeks that the owner gets to occupy them eg 13 part owners (each gets 4 weeks to do as they like). Cashflow is marginal (if you're lucky & rent out for your entire usage period), or all rent is pooled and distributed against each owners usage (or lack of usage). Each owner is liable for their share of costs. Definitely not a get rich quick (or slow) scheme.

At best, he may end up with 4 weeks accommodation in 10 different buildings with no income.