Could resale buyers lose ability to trade in HGVC system?

[david5437]

Bought a 7000 pt resale Kohala Suites timeshare in 2014 for $7K. At owner's update, salespeople said that with HGVC going public, they are likely to go Marriott and Starwood route and make it impossible for resale owners to trade outside their home resort. Offered us to upgrade to Kings Land 8400 pt package for about $31.5K. Deal includes 25,800 bonus points.

How likely do you think that resale owners will lose ability to trade in the HGVC system?

 

[alwysonvac]

When all else fails they use fear.
You got a good resale deal. Stop going to the owner (aka SALES) updates.

Here's a recent thread regarding the same topic
http://tugbbs.com/forums/index.php?threads/hgvc-restricting-points-for-developer-only.251934/

 

[brp]

But the answers is Yes, the could do this. Certainly they could do it to future resale owners (as DVC did- discussed in the referenced thread). And this would impact our ability to sell.

Will they? No idea. Could they. Of course.

Cheers.

 

[Talent312]

How likely do you think that resale owners will lose ability to trade in the HGVC system?

Zilch. "How do you know a TS salesman is lying? ...His lips are moving."
First, it would devalue the entire brand. Even retail would take a big hit.
Also, they'd grandfather in current owners and apply it only to new buyers.

.

 

[brp]

Zilch. "How do you know a TS salesman is lying? ...His lips are moving."
First, it would devalue the entire brand. Even retail would take a big hit.
Also, they'd have to grandfather in current owners and apply it only to new buyers.

.

Since it's been done elsewhere, why are you so sure that they would not make changes for new resales? Granted, the other cases I know of were smaller in impact. Still, changes were made.

Cheers.

 

[alwysonvac]

But the answers is Yes, the could do this. Certainly they could do it to future resale owners (as DVC did- discussed in the referenced thread). And this would impact our ability to sell.

Will they? No idea. Could they. Of course.

Cheers.

Ok, let's be clear what DVC did....

I also own DVC.

DVC Resale points can be used for all Disney Vacation Club resorts as well as RCI.
What DVC did was prevent DVC resale points being used for other options/ perks (think similar to HGVC Partner Perks such as Honors points, cruises, etc).

See this summary for details on DVC retail vs resale - http://www.dvcnews.com/index.php/dvc-program/buying-dvc/buying-resale

 

[SmithOp]

Just ask the salesman, "Why would I buy something that would be stripped of benefits if I tried to sell it in the future?



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[brp]

Ok, let's be clear what DVC did....

I also own DVC.

DVC Resale points can be used for all Disney Vacation Club resorts as well as RCI.
What DVC did was prevent DVC resale points being used for other options/ perks (think similar to HGVC Partner Perks such as Honors points, cruises, etc).

See this summary for details on DVC retail vs resale - http://www.dvcnews.com/index.php/dvc-program/buying-dvc/buying-resale

Yup. As I said in my other post above, the impact was smaller. The fact of the matter, though, is that they made changes that impacted resale owners after a certain date only. Just means it has been done. Means it can be done. That's all I was saying.

I don't think that HGVC would do as suggested here, but I also don't agree with the apparent unequivocal "no, it won't happen" posts.

Cheers.

 

[brp]

Ok, let's be clear what DVC did....

I also own DVC.

DVC Resale points can be used for all Disney Vacation Club resorts as well as RCI.
What DVC did was prevent DVC resale points being used for other options/ perks (think similar to HGVC Partner Perks such as Honors points, cruises, etc).

See this summary for details on DVC retail vs resale - http://www.dvcnews.com/index.php/dvc-program/buying-dvc/buying-resale

Yup. As I said in my other post above, the impact was smaller. The fact of the matter, though, is that they made changes that impacted resale owners after a certain date only. Just means it has been done. Means it can be done. That's all I was saying.

I don't think that HGVC would do as suggested here, but I also don't agree with the apparent unequivocal "no, it won't happen" posts.

Cheers.

 

[brp]

Ok, let's be clear what DVC did....

I also own DVC.

DVC Resale points can be used for all Disney Vacation Club resorts as well as RCI.
What DVC did was prevent DVC resale points being used for other options/ perks (think similar to HGVC Partner Perks such as Honors points, cruises, etc).

See this summary for details on DVC retail vs resale - http://www.dvcnews.com/index.php/dvc-program/buying-dvc/buying-resale

Yup. As I said in my other post above, the impact was smaller. The fact of the matter, though, is that they made changes that impacted resale owners after a certain date only. Just means it has been done. Means it can be done. That's all I was saying.

I don't think that HGVC would do as suggested here, but I also don't agree with the apparent unequivocal "no, it won't happen" posts.

Cheers.

 

[david5437]

They let me think about the offer overnight... Said they have an e-mail from management suggesting that such a change is being considered and that they will show it to me tomorrow... I am on the fence on this one...

 

[david5437]

Thanks alwaysonvac for a good explanation of what dvc did... anybody have a simple explanation of what marriott and starwood did to limit rights of resale owners?

 

[alwysonvac]

They let me think about the offer overnight... Said they have an e-mail from management suggesting that such a change is being considered and that they will show it to me tomorrow... I am on the fence on this one...

All I can say is walk away and don't fall for the trickery.
Honestly, if they ever decide to go down that path you can make the decision to upgrade at that time. For now, I won't go on hearsay or whatever document they provide tomorrow until it's fully implemented. Keep in mind this sales threat has been around for years.

I also own Starwood (now called Vistana). They have implemented rules that have excluded resale buyers from internal resort exchanges. Access to the Starwood Vacation Network (SVN) is included with resale for some resorts (aka mandatory) and denied for others (aka voluntary). They basically screwed owners at voluntary resort causing these resorts to have very little resale value. Let's hope HGVC is smart enough not to go down that path.

See this thread for additional discussion on mandatory vs voluntary - http://tugbbs.com/forums/index.php?threads/history-of-mandatory-vs-voluntary.241011/

 

[GT75]

When all else fails they use fear.
You got a good resale deal.

Honestly, if they ever decide to go down that path you can make the decision to upgrade at that time. For now, I won't go on hearsay or whatever document they provide tomorrow until it's fully implemented.

I second @alwysonvac.

 

[tschwa2]

Since it's been done elsewhere, why are you so sure that they would not make changes for new resales? Granted, the other cases I know of were smaller in impact. Still, changes were made.

Cheers.

I was going to ask the same question as the other poster. Where has it been done elsewhere? There are no points owners or participants in Marriott, DVC, Wyndham, Starwood, bluegreen, etc that are limited to home resort only. They have never taken points away from a current owner that is enrolled in a points program. What some systems have done is prevent the points membership from transferring through resale to another owner but none have taken the enrollment away from a current owner regardless of how they purchased. This would effect retail and resale purchasers equally when they go to sell and the membership is worth less because the ability to exchange using the points system won't transfer to a potential buyer.

 

[onenotesamba]

I've spent a grand total of $5500 (plus transfer fees) for 9600 points annually. Since I'm at low MF properties, my annual MFs and taxes, etc. are much lower than the price I'd pay to get the rooms I've booked, were I to try to book them as hotel stays.

If HGVC devalues the resale value of their product to the point where it no longer makes sense to be a member, I'd be happy to dump my units for as little as I could get rid of them, and if it came to it--I'd lose that $5500 to be free and clear of them.

Analogy--I've been a loyal frequent flyer on American Airlines for many years. Now that they've followed suit with Delta and United to de-value their frequent flyer program, it no longer makes sense to maintain loyalty. So, I'm now flying on the lowest-cost carrier, and switching my credit card loyalty to a card that provides points/benefits across a range of air travel providers.

 

[GregT]

If HGVC did do something like this (and they could), I believe it would only affect future resale transactions. Other systems like Worldmark (Nov 2006) and Marriott (June 2010) have dates where their system changed dramatically. In those systems, existing owners were grandfathered in under old rules. Hyatt has made a recent change, but I do not know what the impact has been.

We will see, but hopefully no changes are coming -- and if changes come, that we will be grandfathered.

Best,

Greg

 

[Panina]

If HGVC did do something like this (and they could), I believe it would only affect future resale transactions. Other systems like Worldmark (Nov 2006) and Marriott (June 2010) have dates where their system changed dramatically. In those systems, existing owners were grandfathered in under old rules. Hyatt has made a recent change, but I do not know what the impact has been.

We will see, but hopefully no changes are coming -- and if changes come, that we will be grandfathered.

Best,

Greg

I agree they could. As other systems you stated changed dramatically, Hgvc sees this and knows they can do it too. Time will tell but I guess things will change and not for the best interest of Hgvc owners.

 

[Talent312]

Since it's been done elsewhere, why are you so sure that they would not make changes for new resales? Granted, the other cases I know of were smaller in impact. Still, changes were made.

As they say, "Past performance is not indicative of future results." However, since it's inception 25 years ago (1992), HGVC has avoided making wholesale changes. They've been a stable and conservative player in the field. They tout their reason for being as that of a "club," and so, I don't believe they'd cut off their left foot.

We may whine about it's website and pesky little fees, but generally, it's treated its members fairly... Once you get past (or avoid) the sales-office. HGVC doesn't need to prop up sales at this point - only the sales-weasels need to do so.

.

 

[Jason245]

If they kill that.. why would I keep paying the 160 per year membership fee? On top of that they would lose those reservation fees from me... cause at that point this stuff becomes home weeks reservation. ..

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[Talent312]

If they kill that.. why would I keep paying the 160 per year membership fee?

Becuz you'd be grandfathered-in? Or becuz you wouldn't be able to sell the weeks you own?
If they dissolved the club, it'd prolly lower our dues... and I can drive to my home resorts.

 

[1Kflyerguy]

I would be surprised if HGVC did make that sort of change, as i agree with the others that it would reduce the value of the brand. Might even make the new developer sales harder if people realize they can't easily sell their unit when they want.

Probably more likely to strip off some other benefit, like the ability to exchange with cruise partners, or convert to Honors.

Just my two cents...

 

[SmithOp]

As they say, "Past performance is not indicative of future results." However, since it's inception 25 years ago (1992), HGVC has avoided making wholesale changes. They've been a stable and conservative player in the field. They tout their reason for being as that of a "club," and so, I don't believe they'd cut off their left foot.

We may whine about it's website and pesky little fees, but generally, it's treated its members fairly... Once you get past (or avoid) the sales-office. HGVC doesn't need to prop up sales at this point - only the sales-weasels need to do so.

.

Past performance has been to raise the transaction fees on resale purchases, that is the direction I would expect.


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[brp]

I was going to ask the same question as the other poster. Where has it been done elsewhere? There are no points owners or participants in Marriott, DVC, Wyndham, Starwood, bluegreen, etc that are limited to home resort only. They have never taken points away from a current owner that is enrolled in a points program. What some systems have done is prevent the points membership from transferring through resale to another owner but none have taken the enrollment away from a current owner regardless of how they purchased. This would effect retail and resale purchasers equally when they go to sell and the membership is worth less because the ability to exchange using the points system won't transfer to a potential buyer.

Right. As I mentioned, DVC has made changes affecting new resale owners. So, changes have been done before. Not the same changes as proposed here (as I also mentioned), but changes that impact resales.

And, yes, the did not take away things from current owners, even resale owners. Only new resales.

So, it seems that we're saying the same things here.

Cheers.

 

[david5437]

Update... Did not go through with transaction... thanks for all your inputs!

The e-mail about a new policy for resale owners never materialized... the Sr. Sales Leader who mentioned it in the first place said he deleted it because he did not think he needed it. I know, I know if their lips are moving... To boot, this guy just came off as untrustworthy in all my interactions with him. On the other hand, the salesperson I started off with really was decent.

Spoke to another Sales Director and he said he does not see HGVC going the way of other developers and removing rights from resale owners. Rather, they are trying to use their right of ROFR more often and with the economy better think there will be fewer resales.

Some tidbits from the salespeople:

I was offered a credit equivalent to the price the original owner paid if I upgraded my timeshare with HGVC. Of course, I needed to spend at least $25,000 on top of this to get the credit. Apparently it is HGVC policy to offer this to resale owners only once. If that initial offer is refused, subsequent offers will be for a credit equivalent to 35% of the current price of the resale unit.

Mauii will not be finished before the towers at the Hilton Waikoloa hotel are converted to timeshares.

The five year plan is to have more timeshares in cities. Boston and San Francisco were mentioned so was Seattle I believe.

Hope this helps.

 

[alwysonvac]

I was offered a credit equivalent to the price the original owner paid if I upgraded my timeshare with HGVC. Of course, I needed to spend at least $25,000 on top of this to get the credit. Apparently it is HGVC policy to offer this to resale owners only once. If that initial offer is refused, subsequent offers will be for a credit equivalent to 35% of the current price of the resale unit.

Thanks for sharing the outcome. I'm glad you didn't go through with the transaction.

I would take the statement about subsequent upgrade offers with a grain of salt.
They would be shooting themselves in the foot if they ever change their policy. It's the 100% credit that seems to get owners attention and moves them closer to accepting the upgrade offer.

As far as I know they have always offered a credit equivalent to the original developer price with a minimum spend required for the update. But HGVC has increased the minimum spend amount over the years. I remember 10+ years ago the minimum upgrade spend was about $7K. Of course it's significantly higher now.