The New Vacation Revolution

Most timeshare contracts fall into one of two categories, either a deeded property or a “right to use” agreement. These contract types are independent from the method of week assignment, points program, etc.

The difference between these two types of agreements have to do with who actually owns the property and the length of that ownership. This is because some localities have laws that restrict foreign owners from owning land outright. The various types of agreements allow resort developers flexibility to design their resort and sell intervals while remaining within the boundaries of the law.

A deeded property is one that will be yours forever. You are a part owner of the property, and you are obligated to pay the fees necessary to maintain it. If the management of the property goes bankrupt, you still own your share. A deeded property can even be passed down to heirs in a will.

On the other hand, a right-to-use property is akin to a lease, and is similar to a deeded week that has an expiration date. You can still use it, trade it, rent it out, etc. The terms may range from 20 years to 50 years or more, but a right-to-use week, by definition, has an end point.

Even though you just possess a right to use the property, you can still sell your interest to do so. Note that the value of a right-to-use week lowers over time. For example, weeks for sale with an expiration date of five or ten years away may be fairly inexpensive, whereas right-to-use weeks with 20+ years left will often cost more.

Thus there are some instances where a right to use week can be quite practical, especially if you decide that a few years of vacationing in one particular location will be enough for your tastes.

Owners of right-to-use weeks are still obligated to pay annual maintenance fees, exactly like owners of deeded weeks.
Whether a property is deeded or right-to-use often has to do with local laws and regulations. Some countries have laws which prohibit the purchase of deeded timeshare intervals.

In other cases, the decision was made by the developer because it provides the opportunity to continually sell interest in the property.