One of the disadvantages why some owners get out of their timeshares is that there are taxes involve in owning such property. Just like the case in Maui where the timeshare owners have been paying nearly double and triple in property taxes than what local residents are paying in the past year. Despite the decreasing property values, timeshare owners feel that they are getting hit too hard with a four-year-old tax. Thus, they blame the county officials for trying to balance the budget by requiring more money from them than Maui’s full-time residents.
According to the American Resort Development Association or ARDA, Maui County became the only local government in the nation to develop a tax rate category solely for timeshares in 2005. At $14 per $1,000 in assessed valuation, it has the highest tax rate on timeshares in the U.S. In 2005-2006, the county collected just $8 million from taxes. It was the first year the $14 rate went into effect. Before that, timeshare projects were combined in with hotel and resort properties and taxed at a rate of $8.30 per $1,000 of valuation.
One ARDA representative feared that the higher tax bills may lead to timeshare buyers avoiding Maui for their purchases. It may even cause the existing owners to get rid of their timeshares or increase possibilities properties of going into foreclosure. Take note that several owners these days are trying to get rid of their timeshares due to a number of its disadvantages. Some even hire a timeshare transfer company such as the Transfer Smart just to get rid of such property.