How do you determine a fair and resonable offer price?

[where2next Junior Member Find all posts View Profile Close where2next]

I've been considering a timeshare purchase for a while now and periodically do some research, track what's for sale, etc. We've just returned from a trip where we rented from an owner and think that we've found a good place for us to buy. My question is - how do I begin to figure out what is a reasonable price? The for sale listings are all over the place - there is about a 400% difference between the low and high listings I have seen. I've checked out the TUG sales database, but there aren't any recent sales posted there.

I've found one that looks good - the asking price is in the lower/middle range of what I've seen posted, but I have no idea if it is a fair price or not. I did do some research while visiting there last week and another owner shared with me what she paid (direct resale from developer). The listing I'm looking at is asking just over 50% of that amount. I would really like to pay about 20% - 25% less than the asking price, but in order to "negotiate" I would probably have to offer 30% - 40% less.

I'm a terrible negotiator and like to be armed with more real data so I know if I am in the ballpark or not. Is there anywhere I can find more current and reliable sales data?

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

Welcome to TS4M's

One way of getting a good idea of prices is checking out Ebay. Take a look at what this particular timeshare has sold for in the recent past. That should help you with what to expect to pay.


Good luck!!!

[GrayFal Silver Contributor and supermoderator Find all posts View Profile Close GrayFal]

I've been considering a timeshare purchase for a while now and periodically do some research, track what's for sale, etc. We've just returned from a trip where we rented from an owner and think that we've found a good place for us to buy. My question is - how do I begin to figure out what is a reasonable price? The for sale listings are all over the place - there is about a 400% difference between the low and high listings I have seen. I've checked out the TUG sales database, but there aren't any recent sales posted there.

I've found one that looks good - at is asking just over 50% of that amount. I would really like to pay about the asking price is in the lower/middle range of what I've seen posted, but I have no idea if it is a fair price or not. I did do some research while visiting there last week and another owner shared with me what she paid (direct resale from developer). The listing I'm looking 20% - 25% less than the asking price, but in order to "negotiate" I would probably have to offer 30% - 40% less.
I'm a terrible negotiator and like to be armed with more real data so I know if I am in the ballpark or not. Is there anywhere I can find more current and reliable sales data?

Welcome to TS4Ms
It would help us help u if you would share what resort, size unit and season/week u r looking out...we won't 'tell' anyone

But if someone purchased resale from the developer - u should be able to do 50-60-even 70% better - unless it is a resort that has a ROFR...

Another way to 'check' the real value is to check ebay for completed auctions - but remember that the same resort but different seasons can vary GREATLY.

[1950bing Senior Member Find all posts View Profile Close 1950bing]

Do not give up on the idea of just renting. That does not tie you up on anything. You stay, you go, and you are done.

[where2next Junior Member Find all posts View Profile Close where2next]

Thanks so much - I'm new so I wasn't sure how much I could post here.

Anyway, I'm looking at The Royal Sands, week 15 or 16. It is a 2 BR villa. The Royals have no ROFR and are RTU. This unit is in Phase 1 so it would be RTU until 2049. No guaranteed residual on Royal Sands, just your share of the sale price.

I spoke to someone there who bought week 15 direct from the Sands and paid $35k. I see listings ranging from $14k to over $44k! But the 14k listing isn't in a great location - so most of them are 18k and above. The two I am looking at are listing in the $20 - $22k range.

My research on TUG shows developer initial sales in the $17k range, so I'm guessing that is how much the unit went for in 2000.

What is a good range to shoot for?

[Jya-Ning Silver Contributor Find all posts View Profile Close Jya-Ning]

Assume you are planning to use it yourself.

Try this way.

Purchase price (1+ opportunity cost) + MF * total year you will keep this < your cost * year used

So, if you are willing to pay rent for that resort say 1,300 per year. You will have 41 year of usage. And of these 41 years, you maybe able to go 80% of the time and you have no idea what to do with the other 20%. and you plan to hold it until end of RTU which with the hard to get rid of, it proably what your best assumption.

So you are looking at
Purchase price (1+ opportunity cost) + MF * 41 < 1300 * 41 * .8

And depends on how you plan to pay the purchase price, if the money is in CD, you use 3% yearly (I guess) which is about 2 times of purchase price.
or Purchase price * 3 + MF * 41 < 1300 * 41 * .8


Then you get the max you should pay.

Of course, people usually value the ownership. So you can increase the based on your feeling.

Than compare that with eBay complet price to see which one you like better.

Jya-Ning

[GrayFal Silver Contributor and supermoderator Find all posts View Profile Close GrayFal]

Thanks so much - I'm new so I wasn't sure how much I could post here.

Anyway, I'm looking at The Royal Sands, week 15 or 16. It is a 2 BR villa. The Royals have no ROFR and are RTU. This unit is in Phase 1 so it would be RTU until 2049. No guaranteed residual on Royal Sands, just your share of the sale price.

I spoke to someone there who bought week 15 direct from the Sands and paid $35k. I see listings ranging from $14k to over $44k! But the 14k listing isn't in a great location - so most of them are 18k and above. The two I am looking at are listing in the $20 - $22k range.

My research on TUG shows developer initial sales in the $17k range, so I'm guessing that is how much the unit went for in 2000.

What is a good range to shoot for?

Mexicondo / Royal Resorts / Cancun Mexico / Timeshares for sale

Excellent site for Royal resales - they have an oceanfront week 15 listed for under 22K - offer less and see what happens.

tonyg is our 'Royal' expert - hopefully he will chime in.

[BocaBum99 Super Moderator Find all posts View Profile Close BocaBum99]

Once you get into the timeshare market, you will quickly learn that there is no real market for timeshare resales. There are pockets of markets, but prices vary dramatically. I would never buy a timeshare that I didn't have a good feel for what other people are paying. I don't mean listing. I mean paying. That's because most of those listings you see for high amounts will never sell.

That said, once I figure out the market rate for a timeshare, I offer 25% less than that to ensure that I can sell it if I have to do so while having room for negotiating.

So, if you have determined that the market rate is $20000 for a unit you want, I would bid no more than $15000. And, find every owner you can to make that offer. Someone will take it.

If the resort has ROFR or very high closing and transfer costs, factor that into your cost basis before bidding. Figure out the rate at which the resort is exercising ROFR and find a broker who will work with you to ensure your offer passes.

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

Chime was delayed by lunch. I've been watching the prices of Royals for a few years. Prices for the Sands have been very high and to no surprise- few of them sell. I sold a week 16 penthouse at the RC for just under 10k for a friend of mine a few years ago. I really don't like the Sands and the prices seem to be higher than they should be there. Weeks 15 and 16 are great weeks weatherwise and demand-wise, but also a high season for seabathers rash. A great deal of what a unit is worth is based on it's location, with beachfront being the top dollar. I don't think there is a timeshare week anywhere worth 10k or more. The best weeks at the Cancun Royals may be +/- 7 and 51/52. The site Pat mentioned, Mexicondo / Royal Resorts / Cancun Mexico / Vacation Rentals has a guide for selling prices at the Royals and you might want to take a look at that. I wouldn't suggest an initial offer over 7k for either week 15 or 16. Remember that the Sands is still rather new and resale prices will probably be on the decline there for the next several years and might just drop dramatically at any time now.

One more thing you might keep in mind is that the annual fee is around $ 800 right now and if it continues to grow as it has in the past, you may be looking at something around $ 1,500 in 2018. The residual is way to far away to even give much consideration to.

[where2next Junior Member Find all posts View Profile Close where2next]

Thanks for taking the time to reply with such detail. I will take a look at the sites you mentioned. I'm guessing that some people just aren't serious about selling - they put it out there at an outrageous price and figure if someone comes along who wants to buy it - why not? I guess I could do that for my house - I would be willing to sell it for $1 million if someone wants it bad enough! LOL.

This has been very helpful - it seems the market is even lower than I had anticipated. I feel bad for the couple I met who just paid $35k for their week. Ouch!

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

Most owners have no idea of the resale values. They paid big bucks and were told that the value would increase. They think they will get all their money back plus a profit and the horde of unscrupulous resale companies will reinforce that to get an upfront fee. Sometimes it takes a few years and a few thousand in upfront fees to finally see the reality. The Royals are one of the few developers who have managed to keep some decent resale value. I once sold one for more than the original developer price, but it must have been a pre-construction bargain. At one time 50% of the original price was a rough estimated value for the tri-Royals- but it was very rough.

[T. R. Oglodyte Moderator Find all posts View Profile Close T. R. Oglodyte]

I've found one that looks good - the asking price is in the lower/middle range of what I've seen posted, but I have no idea if it is a fair price or not. I did do some research while visiting there last week and another owner shared with me what she paid (direct resale from developer). The listing I'm looking at is asking just over 50% of that amount. I would really like to pay about 20% - 25% less than the asking price, but in order to "negotiate" I would probably have to offer 30% - 40% less.

I'm a terrible negotiator and like to be armed with more real data so I know if I am in the ballpark or not. Is there anywhere I can find more current and reliable sales data?

Whether or not you are a "terrible negotiator" is really not very important. What is important is how much work you are willing to do to establish a price.

As you've noted hard sales data are very difficult to come by. So you have to do work to establish a price - that's where the question of how much work you are willing to do comes. In any illiquid market (which applies to most timeshare resales) the notion of what is "true value" becomes meaningless - all that matters is what any buyer and seller mutually agree upon. And in an illiquid market, there will always be huge variations in actual sale prices.

To start, you must first establish an upper bound price you are willing to pay. That should be based purely on personal economics - your assessment of where the cross over point is between renting versus owning. Because of the uncertainties involved with projecting future prices, that crossover point is more likely to be a range than a specific number. Then set your maximum price somewhere near the bottom of that range. You also need to consider how you intend to handle closing, what the closing costs will be, and who will pay. I typically decide on a minimum closing package to meet my requirements, and will pay closing costs based on those arrangements. I then deduct those costs from my initial offer.

Now you need to decide how much work you are willing to do to complete a purchase, which directly relates to where you set your initial offer. If you want to conclude a sale with minimum work, then set your initial offer at the maximum price you just established for yourself. If you want to score a better deal, then you are going to set your initial offer lower; the lower you set that initial offer the more work you will have to do to complete a deal at that price.

Having done that you now troll the internet to find as many resale listings for the timeshare(s) as you can. Don't worry about asking price. Don't worry about whether the site is an "up-front fee" site; just locate listings. If you find some listings that are close to or less than the your initial offer price, make special note of those listings.

You're now ready to start making offers. First go to those listings you noted that are close to or less than your initial offer. If the lowest price among those listings equal to or less than your previously established initial offer, reduce your initial offer by additional amount for negotiating purposes. Now make offers on each of those listings. If the site offers the opportunity, let those owners know you are making multiple offers and you will accept the first offer that meets your price and conditions. I also raise the issue of closing arrangements and closing costs as soon as I can, indicating the closing arrangements and closing costs I am willing to pay for. If the buyer wants different, more costly closing arrangements, then I expect the added costs to be deducted from my offering price.

If there aren't any listings that are reasonably close to your initial price, then simply make offers to as many of those as you like. Most often I will start with those listings that are most reasonable in price, as I figure those owners are more likely to recognize that their timeshare isn't worth anywhere near what they paid for it. If all of those owners reject my offer, I simply send out another wave of offers to owners I didn't cover the first time. Repeat this process that as necessary or desirable.

If you don't wind up getting your price, you have two options. One option is to raise your offering and repeat the offering process. Another is to just wait five or six months, retroll the internet to refresh your listings, and repeat the process, hoping to score again. You should set up a saved search at eBay for listings of your timeshare. As you are waiting, you should also frequently check-in at other heavily trafficked listing sites to make sure you catch hot listings before someone else grabs them. Don't worry about recontacting owners you contacted previously, even offering the same price. In the five or six months that have passed they may have received no other action and will now be willing to reconsider their listing price. One time I contacted an owner about a property, with an offer price of $5000 on a listing they have for $30,000 firm. Turned out I was the only contact they had received on the ad in over three years time and they were more than ready to negotiate. They weren't willing to go as low as $5000, but they would have accepted $10,000. And $10,000 probably would have been a fair price for that unit for someone (a fixed week 7 in a 2-bedroom property in Whistler), but it's wasn't worth that to me. (I don't have school-age children so a fixed week 7 wasn't a feature that had much value to me.)

And that's the process you follow to come to a mutual agreement in an illiquid market. The more work you are willing to do, the lower the price you are likely to wind up with. If you don't want to work as hard, raise your initial price and respond more aggressively on the rejects you get where the owners indicate a willingness to negotiate further.

There's no magic or secret formula. It's just work and effort. And if you are a a "terrible negotiator" the compensationfor that is simply to do your homework and know what you are willing to offer and what you are not willing to offer. And, most importantly, don't make any counter offers without taking as much time as you need to think it over from your viewpoint and without your emotions.

[where2next Junior Member Find all posts View Profile Close where2next]

Thank you - I am definitely all about doing a lot of legwork. I never make impulse decisions - everything is carefully researched first. The TS data is just so limited - and I knew listing prices weren't selling prices - but I had no idea how much they could vary.

Thanks again!