The One Really Big Issue . . .

[bravesfan Member Find all posts View Profile Close bravesfan]

In a normal real estate business the commissions are 6-7% and that takes care of all marketing etc. I can't imagine that timeshare is really that different is it?

[Hobbitess Senior Member Find all posts View Profile Close Hobbitess]

I can't imagine that timeshare is really that different is it?

I'm thinking of the whole process, not just the TS sales guy per se. I don't want to pay for the people in the booths, the guys who try to sign me up before handing over my parking pass,, the guy who comes in after you chase off your salesperson who also tries to talk you into buying, the calls I get trying to sign me up the week before my reservation, any of that.

[JWC Super Moderator Find all posts View Profile Close JWC]

...They don't say, "It's $23,500 here, and a buck on eBay."

It would be absurd for them to say that.

[sbkyoshi Member Find all posts View Profile Close sbkyoshi]

I'm thinking of the whole process, not just the TS sales guy per se. I don't want to pay for the people in the booths, the guys who try to sign me up before handing over my parking pass,, the guy who comes in after you chase off your salesperson who also tries to talk you into buying, the calls I get trying to sign me up the week before my reservation, any of that.

I agree.. the resorts would be much nicer and the staff much more pleasant if 100% bought into their properties for next to nothing

btw reps make 6%

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

In a normal real estate business the commissions are 6-7% and that takes care of all marketing etc. I can't imagine that timeshare is really that different is it?

I'm not sure what you're asking, because the marketing costs are so much higher than that for developer weeks, like 50-75%, that I don't believe you would be asking what it seems like you are asking.

Anyway, you can use the search feature, or google it, but in a recent post I made quoting the sales exec at Orange Lake in Orlando, he is saying they will get $2,000,000 (100 EOYs @ $20,000) for something that cost $250,000 :

The $39 million construction cost of the latest tower, equal to $250,000 per unit, hardly seems to concern Sutherland and other executives at Orange Lake. They're confident that the shared condos, promoted as one-week units to be used biannually at prices averaging $20,000 apiece, will sell out in short order.

http://www.timeshareforums.com/forum...h-reality.html

[bravesfan Member Find all posts View Profile Close bravesfan]

holy macaroni 50-75% just on marketing? How can they make any money in this business?

I thought buying a new car was bad news!

[Will Junior Member Find all posts View Profile Close Will]

Enlightened Self Interest

The future of timesharing for everyone can be improved if people would act out of enlightened self interest. As it stands now, because there are no effective exits, 2 or 3 percent of owners who are distressed or unhappy can devastate the market, by flooding ebay, PCC companies, and completely destroying market psychology. This situation makes people who might otherwise be happy with their timeshare want to sell, and the lack of exits ensures no buyers.

Some, like Timeos2, think the answer is to hold tight and make sure that everyone pays their MF's until they sell, or face the legal consequences. This might make some people feel better at times, but it is a completely short sighted response to the problem. It ensures a long painful unwinding of timeshare ownership that cannot end well. It ensures that timeshare will tank in fifteen years or so, with widespread pain in the meantime.

Such a short sighted approach is not necessary at all. Timeshares are an economically viable product meeting an important niche in the economy except for this one problem, that no one can sell. Despite rising MF's, timeshare are still a wonderful alternative. Yes MF's increase over time, but so do taxes, utilities, insurance and other costs of other real estate ownership. These rising costs do not make other real estate ownership unviable.
And the costs of paying current MF's do not make timeshares economically unviable. Only the inability to sell does that. Timeos2, for all his good intentions, does not seem to be able to see that. Fix that one problem, and you solve the bigger problem. Insisting that everyone pay till they sell means not many can sell because not many will buy. So 2% get desperate and the market collapses. That 2% will increase to 5%, then 9%. Eventually a tipping point will be reached.

Timeshares have lost all their value, but the real estate they sit on is often extremely valuable. And people are happy to pay to take vacations. There is one problem, and one problem only, and that is that the current system has locked the exits. Until this problem is fixed, the long painful demise of the timeshare market is ensured.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

800% markup.

That makes "figuring the commissiion" kinda hard.

[ace2000 Senior Member Find all posts View Profile Close ace2000]

Despite rising MF's, timeshare are still a wonderful alternative. Yes they increase over time, but so do taxes, utilities, insurance and other costs of other real estate ownership. These rising costs to not make other real estate ownership unviable. The costs of paying current MF's do not make timeshares economically unviable.

Here's the part you're missing. MF's have increased far beyond the inflation rate for at least the last five years. That same trend does not apply to taxes, utilities, insurance and other costs of other real estate ownership.

Also, looking at current MF's is not smart. Instead, look at your MF's increasing at 10% clip in the next 5 to 10 years to see how they really look. It only takes about 7 or 8 years for your MF's to double if your fees are increasing at 10% per year.

So, it's really hard to see your points.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

Here's the part you're missing. MF's have increased far beyond the inflation rate for at least the last five years. That same trend does not apply to taxes, utilities, insurance and other costs of other real estate ownership.

Also, looking at current MF's is not smart. Instead, look at your MF's increasing at 10% clip in the next 5 to 10 years to see how they really look. It only takes about 7 or 8 years for your MF's to double if your fees are increasing at 10% per year.

So, it's really hard to see your points.

I may be slow, but it seems that higher fees make his point even more valid.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

I'm still having a hard time being OK with the industry continuing to sell something for $20,000 that can't get a buck in the real world market, and a harder time being OK with those who are OK with that.

[Hobbitess Senior Member Find all posts View Profile Close Hobbitess]

This situation makes people who might otherwise be happy with their timeshare want to sell, and the lack of exits ensures no buyers.

Agree absolutely. Some people who're totally happy with their TS, suddenly hate it when they discover they could have gotten it that much cheaper. I think that's actually more common now, because of the Internet. People who find out about resales after they've paid theirs off are less likely to get wound up about it.

Here's the part you're missing. MF's have increased far beyond the inflation rate for at least the last five years.

I can't speak to other TSs, but in our system, those higher maintenance fees are often paying for upgrades that are much snazzier than the original. Replacing pretty basic kitchen counter tops with granite, for instance, or putting in free wireless systems. It isn't just "replace and repair," so it's not surprising the MFs go up. Although BG also didn't raise the MFs this year, in response to owner complaints. It's a balancing act; keeping the resorts "new" enough they trade or show (since points systems are still selling) competitively, versus keeping the current owners happy about their yearly fees.

[JLB Please excuse me, I'm a Dick. Not a moron just a Dick Find all posts View Profile Close JLB]

When the figures are right, there are resales, and values are in line.

Just roughing it . . . Bonita Resort & Club: 26 units, 1300 owners, times $2000 (average) per week equals $2,600,000.

Yeah, it could probably be sold for that. That would be $100,000 per unit if condoed out. That would be pretty low for the location, but they would be small condos.

Those figures are do-able in a dissolution scenario.

http://www.mysanibelrealestate.com/B...-Sale/i1366231

[Will Junior Member Find all posts View Profile Close Will]

Another reason MF's have gone up so much in recent years is deliquencies and uncollectables, which, again, are related to the inability to sell. As noted, upgrades are also part of it. I think MF's are high, and I don't like paying them. But I also think my oil bill is high, and don't get me started on the real estate taxes for my house. Some continued increases in MF's are also likely, but what basis is there for projecting 10% increases per year, unless related costs also go up this much, which means hotels and vacation home expenses also go up?

[ace2000 Senior Member Find all posts View Profile Close ace2000]

I may be slow, but it seems that higher fees make his point even more valid.

Yep, one of us is slow, still not sure who it is then.