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Take time to share quality time with loved ones. That's what timeshare is all about!
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Commissions Charged By
Licensed Brokers Since most of us are entrenched with the idea that the commission charged on RESIDENTIAL real estate is usually 6 per cent, it warrants discussion why timeshare Brokers must charge a higher percentage. First, realize that 6 per cent on a typical house may be a low percentage, but because the sales price is many times higher than for timeshare, 6% is a HIGH amount of dollars. A timeshare sale involves just as much work and expense as selling a house, sometimes even more, but the commission DOLLAR AMOUNT is so low that most traditional realtors consider it a waste of their time to sell timeshare. So yes, the percentage is higher for timeshare, but the dollar amount is low; it's a mathematical reality because the sales price is so low. It is a high-percentage but low dollar-amount commission. Compared to home sales, timeshare is a completely different industry with very small sales prices and expenses that are proportionately much higher. It is very difficult and expensive to properly market the sale of a timeshare. On a new sale from the timeshare Developer, it is well known that the commissions and marketing paid by the buyer as part of the purchase price, total approximately 50 per cent! That is one of the reasons that the resale on a typical timeshare is only a maximum of about 50 per cent of what was originally paid. In the timeshare RESALE industry, Brokerage commissions average 20% to 50%. Most Brokers have a mandatory minimum commission amount ranging from a low of about $1,500 to a high of about $2,500, with the average being about $2000. Because the average resale price is so low, the mandatory minimum commission is necessary if the Broker is to stay in business while paying the proportionately higher expenses pertinent to professionally marketing a timeshare. Again, the average commission of $2000 is not a lot of money compared to the the work of initiating the sale, following it through with buyer and seller until it closes, the liability, and the responsibility for the expenses incurred for the whole process. Our company is paid a fee only if we are successful in selling the timeshare, we bear all the expenses whether it sells or not, and we firmly believe that this is the only way it should be. We were the FIRST Broker to sell timeshare on the Internet, and also the first Broker to do so WITHOUT charging any sort of an advance fee. It is our company that led the way and set the example for the relatively few other Brokers out there who have the same policy. We are well aware that we could make many times more money and we could easily devise some scheme convincing enough to cause sellers to pay upfront fees - it is far less work and far easier to find desperate people willing to pay to get out of a timeshare, than it is to find buyers who are willing to pay to buy one! But we are firmly committed to our policy of a reasonable fee for service, only after the service is performed. So when you are considering paying a timeshare commission, focus on the dollar amount for the job done, and not the commission percentage. And when comparing between Brokers, the lowest offered commission may not be the wisest, either. If the goal is to actually sell the property, the Broker with an average commission who expends what it takes and actually sells the timeshare, is certainly a wiser choice than choosing a Broker willing to list it with a low commission but who doesn't do much, and doesn't sell the property. Rest assured that no-upfront-fee Brokers make only a modest return on the high-percentage but low dollar-amount fee. The worst thing a seller can do is to take the attitude where the seller says to the Broker, "no way am I going to pay that kind of percentage to sell my timeshare!" - then they foolishly turn around and pay upfront listing fees and appraisal fees repeatedly to companies who DON'T SELL THEIR TIMESHARE and usually aren't even licensed real estate Brokers. The result is that these sellers end up paying exorbitant fees to NOT SELL IT, rather than a fair commission, to SELL IT! PLEASE, don't fall prey to the many companies out there who are ready, willing, and able, to convincingly tell you how they are going to sell your timeshare for a grand price as soon as you pay them (or the company they refer you to) some sort of an upfront fee - no matter how logical the reason for the upfront fee sounds. It is our standard company policy, at no charge, to give sellers an honest estimate of market value. On a positive note, before the Internet came along, there was virtually no means of marketing a timeshare resale at any price, but the good news is that there now is a strong market, as long as the price is in accordance with the price for which other sellers are willing to sell identical units.
See related article: How to succeed in
selling a timeshare. |
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