Timesharing, or how to own 1/52nd of a Caribbean condo

With the price of real estate what it is, many people are finding it difficult to buy a home, let alone a vacation property. Yet, because of an unusual new concept known as time sharing, vacation homes are actually more affordable now than they have been in years.

Because of time sharing, the Chicago couple who wants a condominium on a Caribbean island or a yacht resting in a Florida harbor need not lay out $100, 000 for the condo or $400,000 for the yacht. For prices ranging from $5,000 to

The catch is that they don't own the condo or the yacht at all times -- only for a specified time,usually one week, each year. During the rest of the year the other property is inhabited by other time sharers or else rented out by the resort firm that manages it.

Over 250,000 Americans have opted for time-sharing plans offered by resorts in Aspen, Nantucket, the Riviera, Fiji, the Poconos, western Canada, and almost any place travelers frequent. Most lodgings are condominiums, but some are houseboats, yachts, staterooms in cruise ships, hotels, beach cottages, ski chalets, and converted railway cars.

Some resorts, like Tristam's Landing on Nantucket, offer fee simple ownership , which means the buyer owns the property for the same time each year until he disposes of it. Just as in any other real estate transaction, the buyer gets a deed that can be sold, willed, or transfered.

Palmas del Mar, a lush, 2,700-acre resort in Puerto Rico, is one of many that offers a right-to-use form of ownership that expires after a certain amount of time, in this case 25 years. Buyers at Palmas can will their time share or sell it providing the sale does not exceed the purchase price. On the average, the purchase price of a right-to-use time share is 30 percent less than fee simple.

With either method buyers must also pay an annual fee to cover expenses such as heat, security, electricity, maintenance, furniture replacement, and property taxes. The fees are usually at least $100 for every week bought, and are subject to rise along with inflation and operating costs.

Time sharing is ideally designed for those who like the same vacation spot each year, and don't like to worry about reservations and available space. But those who don't want the same vacation each year have the options of renting their property or trading with other time sharers. All resorts that offer time sharing are affiliated with a vacation exchange service, usually Resort Condominiums International or Interval International. Time sharers are limited to trading for vacations at resorts connected to the same exchange service.

The 100,000 members of Resort Condominiums International pay $36 a year in membership dues, which entitles them to a directory of trading options and discounts on travel expenses such as rental cars. If an exchange is made, there is an additional fee of $28. At Interval International the 85,000 members pay $ 35 in dues and an additional $35 exchange fee.

At either organization members can only trade for a time share of equivalent value -- a $1,000 week in Florida during August will not fetch a $15,000 Christmas week in Vail. All exchanges require planning -- Resort Condominiums International requires 60 days advance notice and two alternate choices. Despite such conditions, both organizations have a successful-exchange rate of over 80 percent.

The fact that over a quarter of a million Americans have bought time shares is amazing when one considers that only 17,000 did so in 1975. To find out just who these purchasers are the Resort Time Sharing Council recently sponsored at poll of 10,000 time sharers at 183 resorts. Most were between 35 and 55, married with several children, and had incomes of over $30,000 a year. A whopping 86 percent said they were pleased with their transactions.

But despite such findings, time sharing can have its pitfalls and should not be done without a good deal of forethought. A useful guide is "The Buyer's Guide to Resort Timesharing" by Carl Burlingame, available by sending $7 to C.H.B. Company, PO box 184, Los Angeles, Calif. 94022. some things to consider are:

* Time sharing should not be purchased as an investment alone -- or at all. Although the purchase price will most likely rise with inflation, and is, in the long run, cheaper than renting, there is no ready resale market yet. Because over 100 new resorts get into the time sharing market each year, supply is keeping pace with demand.

* Do not buy a time share purely because of the trading option. The location , time period, and amenities of the home resort should be selected on the basis of your vacation needs.

* A maintenance fee that is exceptionally low -- under $100 a week -- can mean that the property is not well cared for. It is essential to find out -- and get in writing -- exactly what the fee covers. Make sure there is a limit on how much the fee can rise each year.

* Make sure that the resort is in good financial shape and is not turning to time sharing because it cannot sell its condominiums. Consider if it will be able to provide good services and amenities throughout the time-sharing period.

* Above all, use all the precautions that you would in buying a home. Review any contracts involved in the transaction with a lawyer.