Federal and State Regulation of Timeshares and Fractional Interests By Arthur O. Spaulding Jr., Karen D. Dennison, and Robert S. Freedman
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his article reviews the regulation of timeshares and fractional interests at the federal level and discusses common threads that run through most state laws and regulations, with a particular emphasis on Florida, California, and Nevada.
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State Regulation Compared to other types of real estate offerings, the timeshare industry is highly regulated at the state level. The authors do not intend this regulatory overview to be a compendium of the various state laws. Instead, they emphasize Florida, California, and Nevada—which are among the top five states in the United States with the highest concentration of timeshare units. State timeshare laws regulate both timeshares and fractional interests. In general terms, most state laws do not distinguish between timeshares and fractional interests, the latter being simply a larger time component than the former; however, some state regulatory schemes do exclude the largest fractional interests from regulatory oversight (e.g., onesixth interests). For purposes of this analysis, this article uses the term “timeshare” to include fractional interests unless otherwise noted. Some states, such as Florida and Nevada, are “disclosure” states, meaning that, for the most part, so long as the timeshare or fractional plan complies with state law, and the disclosure document given to prospective purchasers and the required purchase contract provisions satisfy the state’s consumer protection policy, Arthur O. Spaulding Jr. is a partner at Cox Castle Nicholson in San Francisco, California. Karen D. Dennison is a retired partner at Holland & Hart LLP. Robert S. Freedman is a partner at Carlton Fields, P.A. in Tampa, Florida, and is the Section’s Real Property Division vice chair. Published in Probate & Property, Volume 36, No 3 © 2022 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
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