Our Timeshare In The Sun

IT consultant Matt Dimbylow, 35, and his wife, Emma, realised they could afford a luxury villa rather than a basic apartment in Portugal when they came across the concept of timeshare ownership.

They bought a share in a three-bedroom, three-bathroom furnished villa with its own pool on a golf development in the Western Algarve at Parque da Floresta for £75,000 two years ago.

The Dimbylows, pictured with their two daughters, Lauren, four, and two-year-old Ella, can use the villa for two weeks at Easter and two weeks in August. This is not timeshare as you own your portion of the freehold and profit from any increase in the property's value.

The couple, who also run a football coaching scheme called Socatots in Cheshire, have seen the value of their timeshare increase by £20,000 already. Last July they bought a quarter share of a beach house being built nearby at Salema by the same developer, Vigia, for £114,000.

Matt says: 'The properties are in an area of the Algarve which is mostly a National Park, so it can't be over-developed.'

His annual maintenance fees are £1,175 for the villa and £2,000 for the beach house. They raised the money to buy the properties by tapping into the equity of their home in Northwich, Cheshire, using a Flexible Advance on their Nationwide mortgage.



Timeshare began in the U.S. and is also common in the Caribbean. The main drawback is that you can't get a mortgage on part of a freehold so you have to have funds available or release the equity in your main home. Check the contract to see when you can use the property and how much rent you can get when you don't use it.

Simon Conn, of Conti Financial Services, says: 'It's a good stepping stone to buying a place abroad outright. It's becoming more common in Europe, but you should be aware that it could take longer to sell than normal should you want to cash in your share.'

Raymond and Kathryn Finch are buying a new townhouse in Spain with an initial payment of just £2,000. The couple, with their 15-year-old son, Jason, and a daughter, Hayley, 22, are selling their home in Grays, Essex, and moving to Los Altos, near Torrevieja on the Costa del Sol.

The three-bedroom end-of-terrace house sold by Parador costs £140,000, including fees and taxes, and should be completed at the end of the year. They have a new type of loan from Spanish bank BBVA which releases payments in two stages during the building process.

The Finch family are moving to a newly-built home in the Spanish CostasTheir two-year, interest-only loan for £55,000 is charged at around 4.8% This sum and the remaining £85,000 will be repaid when their £175,000 Essex home is sold later this year.

Raymond, 53, says: 'My brother and his wife already live near our new home. We saw the Los Altos development when we were visiting in November last year and fell in love with it. We looked at loans from two British banks before Parador put us in touch with BBVA.'

Property developers such as Parador and Noray, which sell new homes along the Spanish coastline, have linked up with BBVA to lend British home-owners up to 40% of the purchase price for two years to cover payments during the building period.

The loan's interest rate is variable, with 1.9% being added to the European inter-bank rate, the euribor (currently 2.9%), making for a current rate of 4.8%.

Interest is paid quarterly and the loan can be repaid early without penalty. Your UK home is used as security and your existing mortgage and the new loan can't add up to more than 70% of your UK property's value.

Once the Spanish property is completed, you can take out a new mortgage, if necessary. The danger is that if the developer goes bust or the building work is delayed, the Spanish bank could call in the second charge on your British property, putting it at risk.