My current stray thoughts about RCI TP assignment

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

I agree. Why should my week get, say 17 TPU when I deposit it 2 years out, but I have to combine 2 weeks' deposits to come up with the 35 they want to book it?

Its a matter of supply and demand...its not as simple as i'm going to make it here...but it should help explain it

If 100 people are depositing your week but only 50 people are requesting it...that would make your the value of your deposit half of the value to exchange into it

I'm thinking in a 100 to 100 ratio, the TPU's would be equal between deposit and exchange

There is also a matter of Wholesale vs retail values...you see when 7-11 buys products for its store they don't pay the sale rate as they will sell it for...i don't know if RCI uses this as part of their calculations...they may when comparing exchanges to rentals

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

Every time I look at availability I do the math to decide if it's worth it financially to take a week. Usually it's not. I can rent - from another owner's independent listing or directly from the resort in some cases - cheaper than I would by combining deposits. Maybe that's why I don't have anything booked yet.

Yeah, but if it is your last planned deposit, made under different rules . . .

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RCI-wise, we have outlived both RCI weeks and our resort (that gave us our RCI ID).

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

The problem with RCI's numbers racket is that it is NOT a matter of supply and demand. Overbuilt areas with tons of oversupply get more points than they deserve and rare areas which are hard to find because there is much more demand than there is supply, on the other hand, are often undervalued.

If RCI were to be fully transparent and show us the formula for their numbers racket and the underlying data, it would reveal exactly what they are doing to shortchange some resorts while giving others more than they deserve. That is exactly why they refuse to do that.

Its a matter of supply and demand...its not as simple as i'm going to make it here...but it should help explain it

If 100 people are depositing your week but only 50 people are requesting it...that would make your the value of your deposit half of the value to exchange into it

I'm thinking in a 100 to 100 ratio, the TPU's would be equal between deposit and exchange

There is also a matter of Wholesale vs retail values...you see when 7-11 buys products for its store they don't pay the sale rate as they will sell it for...i don't know if RCI uses this as part of their calculations...they may when comparing exchanges to rentals

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

The problem with RCI's numbers racket is that it is NOT a matter of supply and demand. Overbuilt areas with tons of oversupply get more points than they deserve and rare areas which are hard to find because there is much more demand than there is supply, on the other hand, are often undervalued.

You over look the demand part of supply and demand...you see if there is one resort in HHI with a supply of 3650 rooms and 5,000 requests...your assumption is that is better then the place with 365,000 rooms and 350,000 requests...But as you can see....just because a place fills up fast doesn't mean its a good place to go...it just means it has a small following of loyal vacationers


To RCI (and anyone else) 350,000 requests trumps 5,000 requests any day...does it matter that they don't fill to capacity? of course not! because they are renting to 70x as many people as the place that fills to capacity

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

No, I look at the overbuilt areas with more supply than demand, which RCI is always trying to do anything they can to move the inventory.

It really doesn't matter why people want to go there, or if you think it is a good place to go or not, or where the people wanting to go there come from. What matters is the totality of supply vs. the totality of demand.

I look at things like the overpointing of the resort in Orllando that Bootleg told us had the biggest oversupply in the entire RCI system versus the underpointing of weeks that are extremely hard to get and never show up online because they are always snagged by ongoing searchs. That reeks of absolute corruption in how RCI concocts their numbers. They need to make their formula for points lite and the underlying data supporting it transparent.

You over look the demand part of supply and demand...you see if there is one resort in HHI with a supply of 3650 rooms and 5,000 requests...your assumption is that is better then the place with 365,000 rooms and 350,000 requests...But as you can see....just because a place fills up fast doesn't mean its a good place to go...it just means it has a small following of loyal vacationers


To RCI (and anyone else) 350,000 requests trumps 5,000 requests any day...does it matter that they don't fill to capacity? of course not! because they are renting to 70x as many people as the place that fills to capacity

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

For some reason your still over looking that a place like Orlando has literally ten's of thousands of requests for exchanges while a place like OB has MAYBE a couple hundred...

Now strictly from a business stand point...which would you value more 100,000 exchange fees at $179 each or 1,000 exchange fees at $179?

It seems like a no brainer to me...does it really matter that OB fills up there few hundred rooms and orlando has trouble filling up a few hundred thousand? Of course not....the demand is so overwhelming at Orlando, that they can afford to over build and STILL maintain a strong market...where as with a place like the outer banks...even a few hundred rooms is almost too much to fill, but they've underbuilt specificly because of the tiny market they have compared to places like Orlando or Williamsburg

Your not looking at the whole picture is what the problem is...if i rent out a single bedroom and its the only room in town and there are 11 people looking for that room...it doesn't matter the quality of my room....the demand is higher then the supply...but if i go one town over and there are 1,000 rooms and ONLY 950 are filled, yes the Supply is higher then the demand...BUT it has 950 requests vs. my 11...its a MUCH more valuable location/resort/TPU

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

Your not looking at the whole picture is what the problem is...

Uhhhh, well look who's calling the kettle black.

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

Its real simple. More supply than demand = poor supply / demand curve, and the more supply over demand, the poorer that curve. More demand than supply = good supply / demand curve, and the stronger the demand over supply the better the curve.

A couple of hundred exchanges per year on the OBX would represent only ONE of the smaller resorts, not the whole OBX. As long as you are pulling numbers out of the air, then at least pull ones that reflect something close to reality.

The real value of Orlando for exchange is shown by the values RCI gives them to trade in. One that is particularly telling is the report OY of a holiday week at Vacation Village at Parkway, where RCI was giving 50 points lite for a deposit at the same point in time that it had inventory of the same week and was offering it at 10 points lite to take as an exchange. That clearly shows RCI gifting 40 points lite more than the week is really worth to the owner who deposits it, and that is nothing short an outrageous abuse by RCI. At the same time some quite rare Sanibel / Captiva weeks have been reported costing more to trade into than what RCI gives for deposit at the very same point in time. That, again, is an outrageous abuse in the other direction.

What makes money for an exchange company is not a week they already have by the ton and will sit gathering dust in their inventory until they find some fire sale method to dispose of it, like Orlando. What makes money for an exchange company is a high demand / low supply week that will go instantly to an ongoing search and bring in a similar week in a like for like trade that will also go instantly. A chain of quick turnovers is what makes the big money, not a hard to get rid of week that sits and sits and sits in inventory with others like it. The high demand weeks that are almost certain to get taken immediately by ongoing searchs are the best money makers for an exchange company. Quick turnover that brings in another week that will have quick turnover is the name of the game. If RCI wants to set up a business model that runs those exchanges to SFX, then that will be RCI's loss and SFX's gain.

Orlando's problem from an exchange standpoint is not low demand, it is massive oversupply of inventory.

For some reason your still over looking that a place like Orlando has literally ten's of thousands of requests for exchanges while a place like OB has MAYBE a couple hundred...

Now strictly from a business stand point...which would you value more 100,000 exchange fees at $179 each or 1,000 exchange fees at $179?

It seems like a no brainer to me...does it really matter that OB fills up there few hundred rooms and orlando has trouble filling up a few hundred thousand? Of course not....the demand is so overwhelming at Orlando, that they can afford to over build and STILL maintain a strong market...where as with a place like the outer banks...even a few hundred rooms is almost too much to fill, but they've underbuilt specificly because of the tiny market they have compared to places like Orlando or Williamsburg

Your not looking at the whole picture is what the problem is...if i rent out a single bedroom and its the only room in town and there are 11 people looking for that room...it doesn't matter the quality of my room....the demand is higher then the supply...but if i go one town over and there are 1,000 rooms and ONLY 950 are filled, yes the Supply is higher then the demand...BUT it has 950 requests vs. my 11...its a MUCH more valuable location/resort/TPU

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

My take on it is that even though the supply demand curve may be higher in the niche markets that Carolinia is interested in; RCI has shown that it is more interested in attracting developers who will bulk deposit 100's of units that RCI can get $179-$579 because they have 10,000 people looking for those 14,000 deposits. Same with the individual owners- if they own in Orlando they probably like Orlando and if they have 40 extra tpu's to spare they may blow it on $179 exchanges into some of the excess Orlando units and tell their friends how great it is and continue to pay membership fees plus 4 -5 exchange fees plus combination fees every so often.

Apparently RCI is not so interested in helping the 300-400 owners who would exchange with RCI if they were given better or fairer valuation for their summer outerbanks units, london units, summer bermuda units etc. Even if 100,000 people wanted those units it doesn't make RCI enough money to make it worth it and they know a few people will deposit yearly from those locations anyway so they can always sell the dream of exchanging in to those that are interested in those locations. Also since most of those locations are sold out to people who mostly own to use they can't count on much developer inventory. RCI doesn't care about these places because it doesn't make them the $ other places do.

In some ways it might help owners in these places. They can rent for more money because RCI isn't undercutting with inventory they received for free. It also helps when people want to sell the units because you can't say- why would I buy there when I can get it cheaper through RCI. If you don't get value from RCI dont use it.

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

The real issue for RCI has nothing to do with exchanging. It has to do with 1)trying to set up a defense for a potential second class action lawsuit, and 2) attracting new members from developers in sales. They have apparently decided that if they booger the exchange system in the process, that is just collateral damage.

The judge in the last lawsuit noted that with the limited time period that the only substantive relief was covered in the sellout / settlement, it just opened the door to another class action after that limited time expired. RCI is trying to build a number based argument to defend their diversion of weeks to rentals for the next potential class action. They want to claim a balance of values of weeks rented out with inflows of other inventory not from member exchange deposits, based on the values assigned for deposit. That way that can try to set up a claim that they are giving equal value replacements to the system. For areas where there is big demand and they want to divert to rentals, that gives them an incentive to undervalue deposits, while in areas where developers are bulkbanking developer inventory, they have an incentive to overvalue deposits. That is exactly the pattern we are seeing in Points Lite.

It is also apparent that you do not understand where the value is to an exchange company in high demand / low supply weeks that set up a chain of exchanges. Some of the oldtimers OY do. The industry professionals that posted on the old TimeshareBeat / StreetTalk sites did. In fact it is amusing to me that so many timeshare owners who own in an overbuilt area can come up with so many wild theories as to why those areas are really, really valuable to timeshare exchanging, while the timeshare professionals who sold in those areas or were otherwise involved in the industry there freely admitted on the industry-oriented sites that the areas were overbuilt and that there was an oversupply in the exchange system. They were not nearly so defensive as the individual owners who own in those places. Of course the higher value to an exchange company of weeks that set up chains of exchanges only considers income from exchange fees, but rentals should not change the picture very much.

I am not sure how you come up with an estimate of 300-400 extra deposits to RCI from a fair system of values on the OBX in summer. First as I have posted several times before, OBX in summer did not get whacked like some other places like the UK in summer. Except against the most grossly overpointed areas, I would say the OBX summer numbers are relatively fair. Second, at least as to the central OBX oceanfront resorts, the vast majority of summer owners own to use, not exchange, and giving them even 100 points lite per week would probably not entice those own-to-use members to RCI or to any other exchange company. I suspect that the far south, far north and off the ocean OBX resorts are probably similar in that regard but am less familiar with them.

If RCI is going to systematically hose owners of rare weeks for wahtever reason, those owners they need to wise up and take their business elsewhere, so that RCI will devolve into an exchange network of overbuilt areas only. Indeed, whole resorts need to do what Sloan Garden Court in London did. They dumped RCI completely and moved to SFX as their exchange provider. Or what the Seasons timeshare chain did, and dump RCI to move to II. An exchange system that overvalues the dime-a-dozen weeks and undervalues the rare weeks is not in the best interests of owners of rare weeks, period.

My take on it is that even though the supply demand curve may be higher in the niche markets that Carolinia is interested in; RCI has shown that it is more interested in attracting developers who will bulk deposit 100's of units that RCI can get $179-$579 because they have 10,000 people looking for those 14,000 deposits. Same with the individual owners- if they own in Orlando they probably like Orlando and if they have 40 extra tpu's to spare they may blow it on $179 exchanges into some of the excess Orlando units and tell their friends how great it is and continue to pay membership fees plus 4 -5 exchange fees plus combination fees every so often.

Apparently RCI is not so interested in helping the 300-400 owners who would exchange with RCI if they were given better or fairer valuation for their summer outerbanks units, london units, summer bermuda units etc. Even if 100,000 people wanted those units it doesn't make RCI enough money to make it worth it and they know a few people will deposit yearly from those locations anyway so they can always sell the dream of exchanging in to those that are interested in those locations. Also since most of those locations are sold out to people who mostly own to use they can't count on much developer inventory. RCI doesn't care about these places because it doesn't make them the $ other places do.

In some ways it might help owners in these places. They can rent for more money because RCI isn't undercutting with inventory they received for free. It also helps when people want to sell the units because you can't say- why would I buy there when I can get it cheaper through RCI. If you don't get value from RCI dont use it.

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

If RCI is going to systematically hose owners of rare weeks for wahtever reason, those owners they need to wise up and take their business elsewhere, so that RCI will devolve into an exchange network of overbuilt areas only. Indeed, whole resorts need to do what Sloan Garden Court in London did. They dumped RCI completely and moved to SFX as their exchange provider. Or what the Seasons timeshare chain did, and dump RCI to move to II. An exchange system that overvalues the dime-a-dozen weeks and undervalues the rare weeks is not in the best interests of owners of rare weeks, period.

Exactly. That is what RCI is becoming a place to find weeks in overdeveloped areas and in places with developer/manager bulk deposits. The gems are harder to find as people who own in these places are hosed (and there are many). Unfortunately there are still many more who own in the overbuilt areas and many of them like traveling to their own overbuilt area or to other overbuilt areas either some of the time or most of the time. People who own where they are hosed need to find someplace to exchange or rent out what they own when not staying there. They need to move on from RCI instead of wasting energy lamenting how things used to be or should be because RCI is not going to change unless they are made to and the last court case showed that they will put a lot of money into defending what they are doing.

You always accuse everyone of not understanding supply and demand and accuse everyone of defending RCI. I think RCI is out to make money. I think some of their practices will screw them in the long term. I think they have no problem screwing individual owners and independent resorts who don't substantially add to their bottom line figures. I also think that a bunch of the companies that you praise also do a little or a lot of back hand dealing with those that can make them money and unfortunately screw over some of those that don't- be it developers like Seasons (who I have heard screw their owners left and right and by claiming the high road in there switch to II is laughable b.c) or II or other "independents" who are constantly coming up with additonal "add-on" features/fees or levels of membership or just plain raising fees to complete.

Everyone has to do their research to find the best ownership that works for them and the best exchange company to meet their needs. There is nothing wrong with loving RCI if it works for you or hating it if it doesn't. At this time, and excuse my inexperience and ignorance of the looong history of TS but I have read up on the subject thanks to great boards like these) but right now things are always changing and if you don't own some place with a great HOA that you want to visit all of the time and works to keep fees low and upkeep UP, you need to be able to make adjustments and move on when things change and hopefully not lose too much money in the process of making the adjustments.