tstraveler2
TUG Member
I am new to Wyndham and now understand maintenance fee rates vary from place to place. I am interested in buying resale points and would appreciate information on the resorts with the lower rates. Thank you.
I am new to Wyndham and now understand maintenance fee rates vary from place to place. I am interested in buying resale points and would appreciate information on the resorts with the lower rates. Thank you.
Is Developer subsidizing MF to facilitate sales?
I heard this thrown about on the TUG boards from time to time...is there any solid evidence that this happens?
I heard this thrown about on the TUG boards from time to time...is there any solid evidence that this happens?
....The low mf rate at certain of the Wyndham resorts is low because of the high points requirement to stay there, not because it costs less to maintain these units or because of any developer subsidy. Actually the rate x the number of points results in a higher mf (in actual dollars collected) per unit for these so called low mf resorts,
Paco, I havent read the filings, and I know you are the accountant here, but I dont think they subsidize mf in the sense that the fees are less that they would be because of the subsidy
Think of a hypothetical 100 unit resort that has just been completed and the sales staff has just been given 5000 (100 x 50) weeks to sell. This resort has a 2.5 million dollar operating budget including reserves so the mf for a weeks ownership is calculated to be $500
So at the end of year one of sales, lets assume 1/4 of the intervals 1250 were sold and these 1250 new owners have paid $500 each in maintenance fees or $625000. not nearly enough to maintain the place. so where does the rest of the money come from? The answer is the developer subsidy They make up the difference between what is collected and what is needed to pay the bills. But they don't put in any extra to reduce the $500/unit that is the calculated 1/5000 of the resorts budget/...that would be against the law
So the developer subsidizes the hoa until the place is sold out, but they dont subsidize in the sense that mf is kept artificially low to encourage sales.