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Listing Owners

6 Timeshare Rental Mistakes That Every Owner Should Avoid

Many owners rent out their timeshares to help defray their annual costs. Depending on what your own and what your experience is, it can be complex or it can be easy — especially if you do it on KOALA — but there are some pitfalls you should know about. These errors can make it harder to get your timeshare booked, and can make you more vulnerable to scammers. Here’s how to avoid them:

Mike Kennedy - Oct 19, 2021

1. Setting your price too high

Many owners are intent on recouping their maintenance fees when listing their timeshare. While these fees can be a great benchmark for pricing a rental, they can also be misleading: they can exceed market rates for identical or competitive stays. 

During the pandemic, for example, hotel rates dropped drastically, but some owners still wanted to recoup their costs, so they kept their prices the same. Unfortunately, the market doesn’t care about anyone’s overhead. Travelers are always going to hunt for the best deal possible. 

We always recommended doing some quick market research to know where similar stays are priced at. Check Expedia, VRBO, Airbnb, and similar sites to see what units at your own or similar resorts are fetching. Then set your price competitively. 

How to Price

2. Listing low demand stays

Timeshares can be confusing. The modern points systems allow for way more flexibility than the old fixed weeks, but that requires navigating more minutiae and more rules and regulations. A typical points owner can choose from dozens of resorts, each with multiple unit types. Once they settle on that, they’ll still have to determine when to book it and for how long. 

Making matters worse, many owners attempt to rent only because they’ve waited too long and likely aren’t going to use their points. That means less desirable inventory to choose from, and worse odds for a successful booking. 

Of course, we don’t recommend blocking out all the good inventory from your fellow club owners for profit (don’t be that person!). But by all means, be strategic about reserving what travelers may want. (Our monthly updates on what travelers are booking are a great resource.) If you’re going to need to recoup your fees one year, plan as far ahead as possible and know where there is demand — or use a company (like KOALA) that does.   

3. Paying upfront fees

Scam alert. I can’t say this loudly enough: If a company is asking for upfront fees, be wary. To be fair, there are some reputable timeshare sites that charge small listing fees ($15 to $30). But these sites can feel antiquated, and you probably need to worry about whether the site is appealing to the broader traveler market, not whether it’s legit. Still, paying upfront for listings means the company makes money whether or not your listing gets booked. That’s not how online marketplaces should work in today’s technology-driven world. 

The real scammers are way more hungry and are going for hundreds, or even thousands, of dollars upfront. Here’s how it works: Someone cold calls you, often pretending to be affiliated with a trusted company. They promise thousands of dollars in pre-booked rental income. There’s a catch, of course: You have to pay hundreds of dollars in processing fees before you receive anything. But if there are “guaranteed” renters willing to pay for your timeshare, shouldn’t you be the one getting paid?

These fraudsters prey on timeshare owners that perhaps own too much or are traveling less and still have to pay fees. Their misleading affiliation claim usually sounds a little like this: “Hi this is Joe and I’m calling on behalf of [insert trusted brand here]”. This builds a sense of misplaced trust that a lot of timeshare owners fall for, sadly. It’s nonsense and straight-up fraud. So beware of “false profits.”

4. Setting a strict cancellation policy

Of course you want your timeshare to get booked, but travelers want some peace of mind too. Especially these days — and the pendulum has shifted their way for the time being. 

Of course, you never want to risk losing your week or points. We recommend knowing your brand’s cancellation policy so you can adjust your own reservation with your club. If there is a safe window where you can cancel your own reservation (or rent it again to someone new) then consider passing that benefit onto the guest. 

More lenient cancellation policies typically fetch higher rates too, but you’ll need to decide what level of exposure is right for you. We’ve tailored several cancellation policies that align with those of the major timeshare brands, so you can protect yourself while offering travelers the flexibility they need to book with confidence.   

5. Believing salespeople about rental values

Oof, where do I start here? For the record, I’ve come across many solid, successful salespeople that are diligent and ethical. That said, it’s no secret that unscrupulous timeshare salespeople abound. They love to build financial value where they shouldn’t. Timeshares are lifestyle investments only. While some owners of peak inventory can turn a profit above their annual fees, it is inappropriate (and illegal) for a salesperson to pitch any investment value as a reason to buy a timeshare. And that includes rental value. Furthermore, if they are pitching rentals, they tend to inflate the amount you can make, misinformation that creates unrealistic expectations about what the market can produce. 

6. Expecting payment right away

This is a sensitive topic: On the surface, expecting payment upfront looks totally reasonable. I mean, who wouldn’t want to be paid right away — especially in this industry, where everyone in the secondary market seems to be looking to scam you. That said, requiring upfront payment limits the type and quantity of travelers who are willing to book this way. Less travelers means less competition. Less competition means you’re leaving money on the table. Hard stop. 

Have you ever seen your timeshare unit for rent by the developer for twice what you’re able to get for it? That’s because they use trusted sites like Booking.com or Expedia or their own sites, so travelers know their bookings are guaranteed. Compare that to having to make full payment via PayPal or a personal check six months in advance — not a great way to build confidence with most travelers. In a world that has moved to a seamless online purchasing, you don’t want to limit your audience by creating friction. 

That’s not to say you’re not trustworthy, we’re sure you are! But the process opens the door for scammers and that makes people skeptical. Powerful home rental sites like Airbnb and Vrbo only release payments to hosts once check-in has occurred, which resonates with guests — hence their rapid growth. 

At KOALA, we apply the same logic to timeshares. By creating a frictionless experience, everyone wins. Something to consider the next time you’re looking to rent your timeshare. 

Ready to list your timeshare? KOALA makes it easy and secure.


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