This review is aimed at highlighting the pros and cons of Time Share purchase in India.
The idea of traveling on a holiday invariably excites all of us. Particularly when it is done with the loved ones and at an exotic location. This sentiment is well exploited by Time Share companies. Across the world such companies have set up Holiday Resorts at beautiful locales offering excellent facilities. In India, Sterling Holiday Resorts very successfully introduced the concept. Several others like Mahindra Holiday Homes have followed suit. Like many products, it has so far been a poor imitation of the business model from the west.
For those unfamiliar with the concept, following is a brief explanation of Time Share. Here we are talking basically of a vacation timeshare. It is a concept wherein instead of buying a property, at the desired destination that you cannot use for most of the year timeshare allows you to purchase it for week or multiples of a week. The notion of a timeshare evolved in Europe about 40 years ago when a French developer of Skiing Resort encouraged his clients to buy the room for the part of their stay instead of staying for rent. He priced the rooms differently depending on the season. His occupancy rate jumped to a record high and the idea caught on across the world.
Time Share Resorts are normally located in picturesque surroundings away from the crowded business districts. They offer apartment type units made up of one, two or three bedroom accommodations. Some of them have a small, reasonably equipped kitchenette attached to the living room. Unlike a typical hotel, with a few games and recreation facilities built in, the overall ambience is suited more for a relaxed holiday. A moderate level restaurant is a common feature in all Resorts.
Depending on the price, you are allotted a specific week in a year at a particular resort that you have opted to buy. You can choose to stay here during the period, rent it out or gift it to your friends. Where the promoter of the Resort has more than one property in the region, you also have the possibility of exchanging it for other location at another period, subject to availability. You may be allowed to split your week or accumulate the unused days to utilize at a later date. The price ranges anywhere from Rs 60000 to Rs 300000 per week of ownership for a period from 20 years to 99 years. There may be an incremental maintenance charge over and above this. The sad part is, if your Time Share Company is not a member of a consortium of other Time Share Companies, you will end up returning to the same locations year after year. The tragic part is if this facility is available, you may have to part with exorbitant additional membership charges to enjoy it.
In India, the timeshare industry in general and Sterling Holiday Resorts in particular have been delivering far less than what they promise at the time of selling. One can almost equate it to a scam. You are paying the entire amount up front for guaranteed high quality of holidaying for life. This seldom is the case. The maintenance of the properties is very poor. The Time Share companies indulge in renting out the vacant accommodation on daily basis to non-members. This results in the cash customers getting best of the available rooms compelling you to accept badly located or maintained ones. The ever-escalating annual maintenance fees and the exorbitant utility charges leave you with a feeling of being cheated. Despite vacancy, your requests for exchange of locations are invariably turned down during peak seasons. Appliances in the kitchen are in hardly work and most of the listed utensils are either missing or in an unusable shape. Premium prices are charged for every facility used by you, including food. Furniture, beds and carpets have all seen better days of their lives. Tariffs are changed more frequently than the towels. All this when Sterling Holiday Resorts offered a lifetime of free holidaying for a one-time payment.
I was taken in by the Yercaud property of Sterling on one of my drives from Bangalore to Tirupur. I contacted Sterling on my return. They showed me the plan of a very grand Resort coming up at Goa during the next 6 months. I immediately purchased a double bed room accommodation in a premium season. That was in 1993. In the coming year, they said the project was slightly delayed due to some land usage issues but that I could use the make shift resort which they have leased till the new one was built. It is 2005 now and the foundation stone for the grand Sterling Holiday Resort at Goa is yet to be laid. I have used their wonderful facilities sometimes though. Need I say more?
There marketing techniques are worth a mention here. Don’t be surprised if you are invited along with your spouse for a High Tea in one of the Luxury Hotels of your city. Don’t miss it because this invitation is for a select few high society individuals like you. This is not a sales event but a promotional exercise from the company’s side to familiarize you with the concept. Once the High Tea is over, you are flabbergasted by the response of the other guests there. Those far below you on the social ladder are grabbing a few left over Time Share slots. Your ego prompts you to sign on the dotted line. Thank God for not having missed the opportunity of a lifetime. It may do you a lot of good if you never realize that the grabbers of the “few left over slots” were in fact dummies planted by the company. Old tricks always work.
Time Share is an excellent concept enjoyed by people all over the world. Unfortunately we are made to suffer at the hands of the unscrupulous operators in India. These companies have amply exploited absence of a regulating authority. There exists a grave doubt whether the time-share owners would ever recover their money’s worth
Like a fool, I have also invested in Sterling Teak Trees - more of that in my next review.