The One Really Big Issue . . .

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

OK, I will expound on Will.

Will is right on.



Not that the following is best suited here, but, why not?

DW and I were just looking at RCI Branson stuff, where we have a week we are stuck with with a $650 annual fee. We try to rent it out to cut our loss. RCI has the same thing for 5 TPUs or $360 cash.

DW said, "This is so over!"



It's like all of sudden, everyone . . . exchange companies, Owners, resale buyers . . . except for people selling them new . . . have decided what they are worth.

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

Thanks JLB for getting people to think out of the box and I hope some comments can be made about Will's earlier post, stay on topic and throw around some ideas or scenarios.

There should really be no need to say more about this, except some on these forums have not been on them as long as others, so I would like to remind all of something someone inside the industry told me sefveral years ago. I would post exactly the way he said it if I was at my PC.

"You need to keep in mind that your audience is much bigger than those of you discussing among yourselves. Things you say on these forums are shared with others that you may or may not want to share with, and that what they read here affects the decisions they make."

I have been on these forum for more than 12 years . . . 100,000 posts . . . longer than most, not as long as some. But I do know that things we have done have caused changes to be made. For the sake of the industry, I can't think of any more important change that needs to be made than this one.

All the other problems of the industry pale in comparison.

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

In some ways the TS purchase is more like a car than real estate. When someone buys a car and takes it off the lot, they lose 10-15% instantly. After 5 years, its down 75% with high mileage it could be down 90%.

I'm not sure what the solution is. I know people that have paid $500K for homes that are now worth $290K. At least when then sell the TS, they usually advertise them as a life long vacation purchase. I haven't heard them push it as having resale or intrinsic value.

If owners were simply able to walk away and stop paying deposits, that would screw the rest of the owners.

A timeshare is nothing like a car nor a home. Both a car and a home are neccessities, a timeshare is not. Buying a new car vs a used one makes sense whereas buying a timeshare from a developer makes no sense at all.

Our resort lists their resales in their newsletter and on their website. These are owners selling their weeks. I don't know if they took these as deedbacks or are just listing them for the owners.

[Ridewithme38 Senior Member Find all posts View Profile Close Ridewithme38]

I think, if the Sheraton Vistana Resort - Courts owners are smart, they now have a solution to 'The one Really Big Issue..."

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

Prediction

I am glad to think about the possibility that people in the industry may be reading some of these posts, so let me go out on a limb a bit make make a bold prediction. If only a few timeshare resorts established a well managed buy back program, capped at 5% of total units with a waiting list, a one year prepaid MF's requirement, and a well run resale program, in two years the market value of units in that resort would increase substantially compared to prices today, and also compared to comparable units in other resorts at that time which do not have such deedback policies. Why? Because timeshares actually do have instrinsic market value. Its just that that value has been completely undermined by misguided policy.

Once the deedback policy is announced and publicized, some desperate people will find a way out, and maybe a few deadbeats, whatever, too, I will grant that. But people would see that there is a plan in place, and would start to feel less nervous. Once units start to given away or resold, and people start moving off the waiting list, a shift will start to take place and people will feel a little better still. Once things start working out, some people will start to feel less jittery and decide that maybe they do not want to sell afterall. And new potential buyers coming along will realize that there will be a way out if they ever want to sell, and might buy. And within a certain amount of time, yes, I agree, it will not be overnight, dilenqencies will start to fall, and that means that MF's can moderate or go down. This new policy would be like taking a bunch of cash to a bank that is experiencing a run that will allow them to pay people lining up in panic. Once it seems clear that the bank has a plan and is able to handle the crisis, many peole will decide that they don't need to make a withdrawal afterall. Market confidence will start to restore itself. But if the bank decides to dig in its heals, and lock the door, the line of people panicing will start to extend around the corner. People walking by will see that and decide they should withdraw too, and the line gets longer and longer.

So to get back to my point, if even only a few resorts do this, it will become clear when the dust begins to settle that their units are the only ones with positive market value, and people will start noticing that. So if you are on an HOA, think about the possibility of being a market leader like this. Just as in the bank analogy, once people begin to see that the resorts have a plan and are able to handle the crisis in a competent manner, market confidence will be restored.

Timeshare themselves are a wonderful economic concept, and they have intinsic market value. It is stupid policy at the macro level that has erased all of the value, and then some. The situation could be improved a lot if we just had policies that were less stupid. Because the ones in place are the stupidest possible. But if we could actually have smart policy, you would see a big improvement. The industry as a whole and its short sighted laissez faire advocates have created an economic albatross the likes of which we have never seen before. Assets sitting on valuable real estate and held by millions of people have negative market value, with ongoing and increasing liabilities from which there is no escape forever. From a diabolical perspective, you almost have to sit back for a minute and admire its cleverness. And the industry and these laissez faire guys, like, you know, whats his name, propose to keep this ridiculous system in place by force, chasing after desperate people with legal threats and lawsuits. They will not be happy apparently until the ensuing ugliness colors the entire market and it crumbles of its own weight. Their one consolation apparently will be that at least they made a lot of people pay as long as possible, because there is no possible way that the current system can lead to a good result. This is crazy, and it can be fixed. But these people don't want to because, if you did, by gosh, well then some people would be able to escape their obligations and we just can't have that. Better to let the ship sink I guess. I hope I am being clear. I am not advocating this policy to help the deadbeats. I am proposing it to save and hopefully restore the market.

Remember the basic problem. Question: Why can't you sell a timeshare today? Answer: Because people, who might otherwise want one, are afraid that if they did buy one they could never sell it, and they don't want to take that chance. Duh! Let's fix that!

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

Think about a number as small as 1%, to me a believable figure, and the smallest whole number you can use, last I checked.

It's about numbers. As the industry grew into millions of owners, a small percentage who could not exit has become a big problem.

For one of our condo associations, that's 75 distressed owners.

For places like Orange Lake and Westgate, that's more than 1000 valueless, unsellable weeks affecting new sales and eroding owner confidence and satisfaction.

For all of RCI (just to pick the largest TS group), 350,000 owners pulling the industry down.

As the KIA dealer (since we have become enamored with the totally inappropriate car sales comparison) down here says, "That's HUGE, Caroline. HUGE."

[Mongoose Member Find all posts View Profile Close Mongoose]

[QUOTE=JLB;491603]I appreciate the irony of negative posts on the Internet criticizing negative posts on the Internet, and it is tempting to go down the dark dead-end alley of distraction, but the issue is more important than pettiness, so I am going to try to pull it back on topic.



JLB, I appreciate the irony of someone presenting themselves as the Godfather of TS Forums when in fact they come across as the king of sniping, cheapshots and arrogance.

[bravesfan Member Find all posts View Profile Close bravesfan]

There should really be no need to say more about this, except some on these forums have not been on them as long as others, so I would like to remind all of something someone inside the industry told me sefveral years ago. I would post exactly the way he said it if I was at my PC.

"You need to keep in mind that your audience is much bigger than those of you discussing among yourselves. Things you say on these forums are shared with others that you may or may not want to share with, and that what they read here affects the decisions they make."

I have been on these forum for more than 12 years . . . 100,000 posts . . . longer than most, not as long as some. But I do know that things we have done have caused changes to be made. For the sake of the industry, I can't think of any more important change that needs to be made than this one.

All the other problems of the industry pale in comparison.

12x365= 4380 days
100,000 posts/4380 days= 24 posts per day give or take

That is passion and committment

[bravesfan Member Find all posts View Profile Close bravesfan]

I think, if the Sheraton Vistana Resort - Courts owners are smart, they now have a solution to 'The one Really Big Issue..."

Our of curiosity do they have a way to get out?

Royal Mayan I think expires next year

[bravesfan Member Find all posts View Profile Close bravesfan]

Like a car, except for it's not like a car. It is no worse for wear, still in like-new condition, the same model as the dealer is selling today, and the dealer takes trade ins.

&, the dealer is normally happy to see a customer he sold to before.

In theory this is true in that you have a unit that by definition has been maintained through Maintenance fees.

As you quote Orange Lake above they are building new and "improved" timeshares. I have stayed there before and it is clear that their product has evolved from fairly basic two bedroom units located on the golf course to the newest River Island. The nature of timeshare sales seems to be like car sales where someone starts out with a Ford Escort and through time and several purchases becomes a Lincoln Continental owner or whatever the top of the line product is.

I don't know how easily it woudl be to integrate the Ford Escort product into the pitch of buying the continental. Obviously it could be at a lower price and if they had no product cost (because the unit had been given back) perhaps their profits could be greater even at a lower cost. Seems like they coudl improve their margin from 15% to 40% just by taking back inventory.

It seems stupid that they would not do this. Are there any lawyers out there? Is there potential liability if they are selling a product for x but, buying it back from consumers at 0?

[tonyg Goomba & Super Moderator Find all posts View Profile Close tonyg]

Royal Mayan I think expires next year

Actually expires in January,2014 per the membership agreement which could effectively be 2013- unsure if January,2014 owners will have usage. Also, the Royal Mayan has a specified by unit & week residual payment due after the sale of the resort. Actual payment could be more or less than this amount.

It is the beauty of the RTU-with or without a resort end payback. The problem with an RTU is the saleability. It may be too easy for the customer to figure out just how much each vacation week will cost them. Of course there is a way to confuse that by the timeshare cost masking systems of points.

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

JLB, I appreciate the irony of someone presenting themselves as the Godfather of TS Forums when in fact they come across as the king of sniping, cheapshots and arrogance.

Thanks.

I guess I have a way of rubbing (some) OLCC owners that way, but, then, if I told you how long ago that started, well . . . OK . . .

23 years ago . . . Sure, I've seen all the units as they evolved, every Village, all the pitches and all the prices. We never stayed in less than a 3-bedroom, even Christmas Week and Week 52.

Have a Sunny Day, unless you need rain.

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

I was hoping to edit my last post to delete an impolite personal reference, but no longer see the edit button. Maybe it is too late? I sometimes get a little carried away when I write posts, and did so in this case. But my intent is to refrain from personal remarks like this. My bad.

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

I was hoping to edit my last post to delete an impolite personal reference, but no longer see the edit button. Maybe it is too late? I sometimes get a little carried away when I write posts, and did so in this case. But my intent is to refrain from personal remarks like this. My bad.

It was decided some time ago to limit the time allowed to edit.

I agree, though, that often some time later it is prudent to temper your words.

That and that it normally takes a few readings to my mistakes, like the missing word in this sentence.

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

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