More disastrous cost of living news for trapped timeshare owners

Onslaught of devastating financial news makes holiday flexibility a higher priority for British consumers

Mortgage costs to surge

Homeowners with mortgages will get hit hard in 2023, with an estimated three million households expected to have increases of over £3000 a year to find. This from income which has declined by around 12% in real terms due to the broader impact of inflation on food and transport prices.

Mortgages hikes are cascade effects resulting from increases by the central bank over the past twelve months from 0.1% to an eye-watering 4%. These rises directly affect the cost of borrowing to both businesses and households, which in turn reduces purchasing power and further dampens the financial system.

Energy caps expansion

In an economy where wage increases average only 6%, with most of those increases being enjoyed by top earners (many low earners have had no or minimal raises in years), the current average energy cap is about to soar by 20%. People currently capped at £2500 now have to find an extra £500 in order to pay the new rate of £3000.

The Government imposed £2,500 limit was scheduled to remain in place until October 2024 - but chancellor Jeremy Hunt has announced that instead it will now end a full eighteen months earlier, in April 2023.

Smarter spending

Brits are cutting down on or altering luxury spending. Survey respondents say they will still treat themselves, but less often and in more cost effective ways.

46% are eating out less, 34% are shopping at a cheaper supermarket, 35% will spend less on new clothes, and 45% will reduce TV subscriptions.

When it comes to holidays, 48% of Brits plan to reduce total expenditure and 41% will go abroad less.

Holiday flexibility

Holidays are a major, luxury purchase with UK households spending up to 2 months wages on their family break. Canny Brits can still take those holidays but save on expenditure by any or all of the following:

• Choosing different days of the week to fly. Airline costs can drop significantly depending on departure days
• Choosing different, better value destinations that have equal flight costs. Such as Romania or Albania instead of Spain
• Opting for lower season than usual
• Reducing the length of stay. From two weeks to ten days for example
• Taking one holiday instead of two, or taking one break abroad an one in the UK
• Choosing a lower grade (and more economical) standard of accommodation

Timeshare trap

Timeshare owners do not have the flexibility to adjust their holidays in the ways described above. Their costs are fixed, and even subject to hefty increases at the discretion of their resort

In most cases, their arrival and departure dates are fixed, so selecting cheaper flight days are not an option. Going to better value destinations involves a substantial exchange fee which can cancel out savings made on spending while at the new location, and in any case it is rare that a timeshare owner is able to achieve an exchange to a preferred resort at the time required.

Changing to a lower season also generates exchange fees, and reducing the length of stay will only save on daily spending money as the accommodation costs are fixed. Taking less holidays abroad would similarly involve paying for accommodation that is not being used.

Opting for a lesser standard of accommodation does not save on expenses either as timeshare owners are generally charged fees even for downgrading.

"Timeshare memberships were groundbreaking idea back in their heyday of the 80s and 90s," says Andrew Cooper, CEO of European Consumer Claims. "Sadly they just haven't evolved to compete with the innovations of the wider travel industry."

Way out

Timeshare memberships can be relinquished, with expert help. In some circumstances compensation may be due to the owner, if mis-selling or other infractions took place.

For a free, no obligation consultation about your options, contact our team at ECC.