Justifying the high developer prices?

[taffy19 Gold Contributor Find all posts View Profile Close taffy19]

I was reading a thread here that prices of timeshare auctions have gone up a lot this last year so I am wondering how much longer timeshare developers are going to keep justifying their high prices. It's not only the well-known hotel resort names but Fairfield and bigger independent developers too.

I still cannot believe the high prices Fairfield quoted us recently at their new development in Waikiki Beach for the point-based packages and the maintenance fees too.

What are your thoughts about this?

[Bill4728 Super Moderator Find all posts View Profile Close Bill4728]

For those of us who have some knowledge of TS and their pricing. I think developers will have a hard time with their pricing. At least until developers put something truly worthwhile in their deals which you can't get thru resale. (Like Starwood not letting resales use star-options or Sunterra not letting resales include Club Sunterra.) Things like HGVC not getting elite thru resale. Or, not getting Marriott hotel points will not make me think about buying from the developer.

What we have to recognize is that most developers are not selling to knowledgeable TS purchasers. They are selling to people who don't have the slightest idea that you can buy worldmark or Marriott at half of developer prices or Fairfield at 20% of developer prices.

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

The trend will end along with cheap money ending, which it will at some point, likely sooner than later. Another factor will be real estate prices, which drive both the price of development and people's confidence, as most people who buy timeshares are homeowners, and many homeowners tap equity for big ticket items to garner tax benefits.

It all goes hand in glove. We're near the top of the cycle, I believe. If I had the flexibility to sell and leave California, I'd do it in a heartbeat. Unfortunately, my mother's illness doesn't allow it. At least I've managed to hang on to her house, which has quadrupled in value in the last 4 years. One plans and then life happens

Mark my words...once easy, cheap money goes away (both the stream and the security), so will the developer timeshare buyers. Prices will moderate or drop and incentives will increase.

Pat

[timeos2 Senior Member Find all posts View Profile Close timeos2]

I am a big fan of the Fairfield system. But I cannot understand how they can continue to sell at outrageous pricing while helping to depress resale pricing. Even as they are asking $.12 -.15 or more along with high annual fees while there are a virtually unlimited number of FF points available for $.03 or less on resale. The points get you to the same resorts. Sooner or later the "average" buyer is going to put two and two together and realize there is no value to a full price purchase making it 4 to 5 times more valuable than a resale purchase. It just doesn't seem to be a sustainable model long term. For now resale FF is a great bargain in all of timesharing while, by comparison, retail purchase has to be called one of the biggest ripoffs. No way to run an otherwise great program.

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

It just doesn't seem to be a sustainable model long term.

They're well aware of this. It's a "what the market will bear" philosophy. Modern business 101. Longevity is irrelevant, to them.

Pat