# Don't forget VRBO this holiday season...



## PerryM

Just got the November VRBO newsletter.  Here are a couple of units to drool over:

Crested Butte 

Lake Tahoe

I should imagine that those 2 units would easily make it into ANY DC and there is NO commitment up front just rent.


So before anyone plunks down $70k to $300k as a personal, unsecured loan, to someone over the phone, and then makes eye-watering MFs, consider VRBO too.


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## Bourne

Will it be an option next year and next and next...

That 300K loan gives you consistent access to these quality of homes. 

VRBO is an option but so is timesharing. I just don't have the time to make it work anymore. 

Example 1
Morritts Grand is good enough but Morritts Tortuga can be a toss up. I just don't want to face that option anymore. 30K buys me that for 25 perfect days.


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## PerryM

Bourne said:


> Will it be an option next year and next and next...
> 
> That 300K loan gives you consistent access to these quality of homes.
> 
> VRBO is an option but so is timesharing. I just don't have the time to make it work anymore.
> 
> Example 1
> Morritts Grand is good enough but Morritts Tortuga can be a toss up. I just don't want to face that option anymore. 30K buys me that for 25 perfect days.




I'd suggest that those folks who spend lots of time "tweaking" timeshares can get the same exact results tweaking VRBO in the DC world - that's what I'm proposing.

Last night I got a 1BR Marriott MountainSide for Dec 22 - 29 (II exchange).  Already had a Studio MountainSide and will now ask Marriott to merge the two together for 2BR Christmas week in a ski in/out at Park City.

I exchanged into the $75k MountainSide Christmas week with a Gold Summit Watch that cost me $5,500.  MFs are about the same.

I probably can do the same exact things with VRBO and a little negotiating skills and some research time.

So use VRBO to leverage your money and stay at DC quality resorts for NO money up front but probably higher MF costs.


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## TarheelTraveler

I respectfully disagree with Perry.  In my experience, DCs offer consistent quality of the highest measure that VRBO rentals can't offer.  With a DC, you know exactly what you are going to get ahead of time and every time.  I know that every kitchen appliance and utensil will be there.  I know what movies, board games, and video games will be there.  I know the beds and sheets will be great.  I know the furnishings will be in immaculate condition.  I know that there is a professional manager for the property and a host to get us acclimated and take care of things like reservations and activities. I know that at every property I will have access to resort or club amenities.  Best of all, I know that all of this is there without having to spend countless hours working deals and doing research on the internet.  Like most others, I've got enough on my plate as far as work, family and community.  Joining a DC has made life simpler.  I think I used to spend more time researching and making travel arrangements than actually being on vacation.


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## Steamboat Bill

I agree that VRBO can be a good alternative to joining a DC, but one advantage of joining a DC is you lock in your buy-in fee and yearly dues are tied to CPI. VRBO rental fees could increase much faster than CPI in the future. In addition, I HATE the VRBO website....very inefficient. Also, these feature properties are awesome, but not all properties match the description or photos. DCs guarantee a high quality of accomidations and toys and provides concierge services.

Let's look at the cost per night to rent these flagship VRBO properties and compare them to joining a DC based upon The TravelGuy Approved Cost-Per-Night Summary.

VRBO Creste Butte rental rate is $1,600-$2,000 per night
VRBO Lake Tahoe rental rate is $675-$975 per night

Typical cost per night of DCs are as follow:
ER = $2,247
UR = $1,460
BH = $1,115
PE Platinum = $735
PE Premiere = $431
HCC = $399

HGVC TS = $228

It is clear to me that joining HCC or PE is a fantastic bargain and joining BH is still a good deal and may be much cheaper depending on the real estate appreciation. ER and UR represent the rarefied air for elite travelers who want the congierge services that VRBO can't match, but their prices are not that far off renting a comparable property.

Readers should know that PerryM is an "EXPERT" timeshare trader and is NOT typical for most owners. Trading into Marriott MS or SW during ski weeks, let alone a holiday week, is VERY HARD and 99.9% of people won't be able to duplicate this. I think PerryM idea on leveraging VRBO may actually be a possible "new business" and could beneftit renters, but I personally think joining a DC allows most people to have hassle free vacations at fantastic properties at a great price.

There are now about 20 DC members on TUG and I have yet to read any negative comments on the industry from any DC member that has actually joined.


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## Steamboat Bill

TarheelTraveler said:


> I respectfully disagree with Perry.  In my experience, DCs offer consistent quality of the highest measure that VRBO rentals can't offer.



What is your cost per night for joining Crescendo?


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## vineyarder

> Last night I got a 1BR Marriott MountainSide for Dec 22 - 29 (II exchange). Already had a Studio MountainSide and will now ask Marriott to merge the two together for 2BR Christmas week in a ski in/out at Park City.
> 
> I exchanged into the $75k MountainSide Christmas week with a Gold Summit Watch that cost me $5,500. MFs are about the same.



To me, this emphasizes the key difference between DCs and TS; I toured the Marriott Mountainside resort, and while they may be able to get $75K for Xmas week, I thought the place was a depressing dump that I personally wouldn't stay in even if THEY paid ME...  Maybe I am a rich, lazy snob, but I have never felt that way about a DC property... IF you are satisfied with the quality & consistency and availability and trading features of timeshares, then, sure, stick with them and no reason to join a DC... But if you are only satisfied with more luxurious accomodations, then DCs are a much better fit.  Four Seasons is the only TS I've seen that comes close to a DC quality, and I am dumping my FS Aviara week since I'm no longer interested in that location, and trading for any other TS is a huge step down in quality (and impossible to trade within the FS 'system').  

I'm keeping my Marriott Custom House TS because I just trade it for points every year... so for about $800 a year, I get 125K marriott points that I then use for international properties where room rates run in excess of $500 (i.e. Paris, Moscow, etc.).  But I guess that's tangential to the point - TS are fine for some people, great for others, but DCs are a much better fit for lots of people.


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## PerryM

*The thrill of the chase....*

We have way too many timeshare units/points now for me to get into VRBO now.  Is there anyone out there that uses VRBO and your experiences?


The few times I’ve spent some time with VRBO has me licking my chops – the rates are ALL negotiable and the locations and units look just as nice as DCs.

All I’m saying is that you might find that your money and time will leverage you into just as nice accommodations as a DC for the same or less MF.  Then there is the matter of the membership fee that you don’t have to worry about.

I’m not knocking DC ownership – I’m just amazed at what VRBO has to offer now and what it can offer in the future.

My gut feeling is that VRBO is a great alternative to DCs at any price level.  Is it as convenient as a DC – no.  But if you find that your vacation doesn’t start the day you head for the airport but months earlier when you scored an unbelievable deal then VRBO is something to consider.

I find the fun of timeshare ownership is getting to a fantastic resort for 1/10 the cost that the guy next to me in line – I can’t tell you how much that adds to our vacations.  I always check in with a huge smile on my face - no matter how poorly the airline just treated me.


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## PerryM

vineyarder said:


> To me, this emphasizes the key difference between DCs and TS; I toured the Marriott Mountainside resort, and while they may be able to get $75K for Xmas week, I thought the place was a depressing dump that I personally wouldn't stay in even if THEY paid ME...  Maybe I am a rich, lazy snob, but I have never felt that way about a DC property... IF you are satisfied with the quality & consistency and availability and trading features of timeshares, then, sure, stick with them and no reason to join a DC... But if you are only satisfied with more luxurious accomodations, then DCs are a much better fit.  Four Seasons is the only TS I've seen that comes close to a DC quality, and I am dumping my FS Aviara week since I'm no longer interested in that location, and trading for any other TS is a huge step down in quality (and impossible to trade within the FS 'system').
> 
> I'm keeping my Marriott Custom House TS because I just trade it for points every year... so for about $800 a year, I get 125K marriott points that I then use for international properties where room rates run in excess of $500 (i.e. Paris, Moscow, etc.).  But I guess that's tangential to the point - TS are fine for some people, great for others, but DCs are a much better fit for lots of people.




Well one man's dump is another's castle - we used to own that Christmas week - paid $45k back in 2000; now it's $75k.  Sold it for a profit and 3 years of usage and Marriott Reward Points.

I do like the Summit Watch better but I didn't score there this year (did so 2 years ago for Christmas week too).


We will be sitting around the MountainSide fireplace Christmas Eve with sore muscles and a strong Eggnog and celebrate the holidays.  I'll be looking at the folks skiing/snowboarding down the mountain and I'll be smiling.


I would not put MountainSide into the "Dump" category - but that's just me.

P.S.
It did cost me about $1,500 for the week to stay in a ski in/out 2BR resort Christmas week.  I could pay 5 times that for something further from the slopes and a bit fancier.  But I'm one happy snowboarder this morning.


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## vineyarder

Steamboat Bill said:


> What is your cost per night for joining Crescendo?



Interesting question, with the emphasis on "your cost"...  We often speak of cost per night, but generally use current prices, etc., so that we are looking at what someone who joins today pays... But since pretty much all DCs 'protect' their earlier members by locking in annual fees at original plus some inflationary factor, and have changed refund policies, etc., it may be interesting to look at actual 'cost per night' based on when some early adopters got in... For example, with my personal circumstances, my cost per night for PE Platinum is running $482 per night (as opposed to the 'new member cost' of $735 quoted above).


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## vineyarder

PerryM said:


> Well one man's dump is another's castle
> 
> I would not put MountainSide into the "Dump" category - but that's just me.
> .



Exactly - if you are happy there, then there is no reason for you to consider a DC.


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## PerryM

vineyarder said:


> Exactly - if you are happy there, then there is no reason for you to consider a DC.



Ahhh, but I want to take the skills I've learned with timeshares and do the same exact same thing with DC's - the next adventure for me.

I can't do that if I own a DC - I see no way to leverage myself into the same resort/neighbourhood as the DC is in unless I go the VRBO route.

I want to stay at the equivalent of your DCs for a fraction of the price!

Someday I'll start to investigate how to do this - or maybe a new DC will come around and I consider the membership fee expendable and take the plunge.

P.S.

I like the concept of sweat equity - my time and knowledge replacing money - I live for this.


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## Bourne

Fraction of a price.... 

The unit listed above will run you 14K for 7 nights. ER is cheaper than that.....if you want to consistently use it.


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## PerryM

Bourne said:


> Fraction of a price....
> 
> The unit listed above will run you 14K for 7 nights. ER is cheaper than that.....if you want to consistently use it.



Well, that's the suggested list price - I normally don't pay sticker price for things I buy.


DC's do come with a feeling of "way beyond middle class" - I would not buy a DC for that reason.  I would buy one where I felt that I got an unbelievable deal - someday I might find one of these too.

I think VRBO can offer that to folks - unbelievable deals to unbelievable residences at unbelievable holiday times.  But I just don't know VRBO well enough to give unbelievable examples.

Hopefully, someone has done this....


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## oldkey

*Use VRBO frequently....*

to rent for use and to rent our Marriott timeshare. But....it never would have occured to me to compare VRBO to a DC. As noted above, VRBO is very fluid, very owner dependent. One good experience can be followed by a poor one, even in the same building - it is all owner specific. As also noted, it can be time consuming....not a problem for the timeshare specialist who enjoys the game, but a real hassle for those who prefer simplicity.

I use VRBO as my "utility" source, complimenting my DC and timeshares. I use it for:

- last minute bookings (best opportunity for a price discount)
- weekend stays
- short stays
- stays where I do not have coverage

As an example, my son is a competitive snowboarder ( www.patrickhanna.net) who trains at Copper Mountain in CO. I recently booked a one bedroom/2 bath  for two seperate weekend stays for $115/night, right next to the lift (could throw a ski boot at it from the balcony). The HCC Mill Club location would be overkill for this....and a real hassle considering the "weekend only" need.....and it is way cheaper than renting from Copper directly - where I could end up in the same room!

Most of us talk about a "portfolio" of properties. VRBO is how I fill in the holes. Would not consider it in lieu of a TS or DC. Used in the correct circumstances, as an adjunct to my portfolio, PerryM is right - VRBO is a great tool.......we love it.

IMHO


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## TarheelTraveler

The Crescendo cost per night for me is $587 - $750/night in dues depending on the number of days I choose to get + some opportunity cost ($147-295 assuming 3% net appreciation and again depending on the number of days), for a total of $734 to $1045.  Assuming no appreciation, add $387-737 in cost, for a total of $974 to $1487.

Under current plans, assuming I did my math right, $871 - $1,000 assuming 3% net appreciation, and $1,171 - $1,375 assuming no appreciation.  The reason the numbers appear a little bit funny is that Crescendo now offers a family plan with a lower membership fee of $225K, which they did not offer when I joined.  However, dues for new members are a little higher.


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## TarheelTraveler

I can certainly appreciate Perry's enjoyment in getting the deal. I even do Priceline's name your own price on a fairly regular basis with great results, but agree with Oldkey and others in that VRBO and DCs are not really comparable in most situations.


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## vineyarder

PerryM said:


> Ahhh, but I want to take the skills I've learned with timeshares and do the same exact same thing with DC's - the next adventure for me.



Nice thought, but just because you want it doesn't mean that it can or will happen; I want to win the lottery without buying a ticket, but that's not likely to happen either...



> I want to stay at the equivalent of your DCs for a fraction of the price!



ibid

The VRBO Crested Butte home that you mention is 4 to 5 times my nightly rate for PE Platinum, so the VRBO route will get you an equivalent home at a fraction of the price, as long as you don't mind it being an improper fraction (i.e. 4/1 or 5/1)!  The best way to stay at an equivalent home for a (proper) fraction of the price is to be an early adopter and join a new DC while they are offering teaser rates... which is why my per night costs for PE Platinum are a (proper) fraction of current rates, about 2/3.  You can join early and get a better deal with higher risk, or join later and get a higher price with lower risk, but you have to choose which you prefer... And if you're really risk-averse, don't join a DC, but don't pretend that a $1600 - $2000 per night rental is 'equivalent'...



> or maybe a new DC will come around and I consider the membership fee expendable and take the plunge.



HCC is still offering plans starting at $20K, and as of a few weeks ago, DHH was offering plans starting at $25K; I don't know how much lower a DC could go!  And if you don't consider $20K - $25K expendable, then a DC probably isn't for you!


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## PerryM

*The numbers tell another story...*

My gut instinct tells me that I should be able to duplicate a DC without putting up a penny and pay no more than the same cost per week as DC owners pay.  I'm guessing that I should be able to put my own DC (Perry's DC) for half the cost of any DC....

Take the example of 2 identical condos costing $1 M each.

Whole ownership:
Let’s say it’s 80% financed at 7.5% for 30 years, that’s $5,594 per month in mortgage payments.  That comes out to be $1,290 per week.  If you say that 5% is lost per year on the 20% down payment then add another $10,000 per year or $193 per week.  Throw in $1,000 a month for MFs to the resort and gas and electricity ($250 per week).  *Total cost to the owner is $1,733 per week*.  The landlord can charge whatever the market will bear.

A DC:
That buys this same condo would have 8 owners each paying $125,000 each as a membership fee and 8% of that as the MF per year or $10,000 per year for 4 weeks of usage or $2,500 per week.  If you want to say that the $125k could have generated 5% per year then that’s $6,250 lost per year or $1,563 lost per week (4 weeks) for a *total cost of $4,063 per week*.


To recap:
The *DC costs $4,063 per week *to use the condo and the *whole ownership is $1,733 per week*.  Something tells me that as a renter I can spend much less and stay at the same place as the DC member.  Plus I don't need to worry about that $125k and if I will ever see it again.

I just don't see how I, as a renter, can do worse than a DC member, even in the hottest of holiday weeks.


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## Bourne

PerryM said:


> *So before anyone plunks down $70k to $300k as a personal, unsecured loan, to someone over the phone, and then makes eye-watering MFs, consider VRBO too. *



It's still money ....70K or 300K or 14K ( Price of the 4 Br rental on VRBO). 

With VRBO, you would make a personal payment to someone over the phone by just glancing over a few photos. 

Its the same. What is different is the level of the risk. IMHO, I consider paying $14,000 to someone for a VRBO rental a bigger risk than a DC membership. 

I know that the 14,000 amount is the asking price but there is some amount of leeway with DC price structure too.


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## oldkey

*Time is money....*

Certainly VRBO has a place:

- short stays
- weekend stays
- places you don't have covered in your portfolio
- last minute stays

But, it has much greater risk and can take a lot of time.....especially to get the lower rates. It's not unusual for me to send out 20+ emails before we book our stays at Copper with days of follow-up.

VRBO , again, will fit better for a timeshare person who enjoys the game of getting the deal....it would be a very frustrating, risky experience for your typical DC member.


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## vineyarder

PerryM said:


> My gut instinct tells me that I should be able to duplicate a DC without putting up a penny and pay no more than the same cost per week as DC owners pay.  I'm guessing that I should be able to put my own DC (Perry's DC) for half the cost of any DC....
> 
> Take the example of 2 identical condos costing $1 M each.
> 
> Whole ownership:
> Let’s say it’s 80% financed at 7.5% for 30 years, that’s $5,594 per month in mortgage payments.  That comes out to be $1,290 per week.  If you say that 5% is lost per year on the 20% down payment then add another $10,000 per year or $193 per week.  Throw in $1,000 a month for MFs to the resort and gas and electricity ($250 per week).  *Total cost to the owner is $1,733 per week*.  The landlord can charge whatever the market will bear.
> 
> A DC:
> That buys this same condo would have 8 owners each paying $125,000 each as a membership fee and 8% of that as the MF per year or $10,000 per year for 4 weeks of usage or $2,500 per week.  If you want to say that the $125k could have generated 5% per year then that’s $6,250 lost per year or $1,563 lost per week (4 weeks) for a *total cost of $4,063 per week*.



You are absolutely correct; as long as you have the resources to buy homes in your top 30 - 50 destinations, and the time to manage them, you will certainly do much better financially in the long-run by purchasing 30 - 50 homes and creating your own DC.

From a personal standpoint, a few years back, I owned 5 homes; a primary residence plus 4 vacation homes.  I felt like they owned me; despite having property managers for each one, I was constantly on the phone dealing with repairs, etc.  And when I got to one of the homes, invariably there would be issues to deal with; internet not working, smoke alarms going off with low battery warnings in the middle of the night, car that doesn't start, plus the usual things like stocking the fridge, making restaurant reservations, cleaning, etc.  And then I'd feel guilty vacationing somewhere else, leaving 5 empty homes to rent a home or stay in a hotel.  So I sold off 3 of them, and while I am foregoing any future appreciation that the home ownership would provide, I am now enjoying my vacations much more (which is the whole point of a vacation).  So yes, you'll do better financially by buying 30 homes instead of joining a DC, but you need to decide if it is the best use of your time and money... and for most people, even those in the DC 'sweet spot' net-worth-wise, buying 30 homes just isn't finacially feasible...


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## PerryM

vineyarder said:


> You are absolutely correct; as long as you have the resources to buy homes in your top 30 - 50 destinations, and the time to manage them, you will certainly do much better financially in the long-run by purchasing 30 - 50 homes and creating your own DC.
> 
> From a personal standpoint, a few years back, I owned 5 homes; a primary residence plus 4 vacation homes.  I felt like they owned me; despite having property managers for each one, I was constantly on the phone dealing with repairs, etc.  And when I got to one of the homes, invariably there would be issues to deal with; internet not working, smoke alarms going off with low battery warnings in the middle of the night, car that doesn't start, plus the usual things like stocking the fridge, making restaurant reservations, cleaning, etc.  And then I'd feel guilty vacationing somewhere else, leaving 5 empty homes to rent a home or stay in a hotel.  So I sold off 3 of them, and while I am foregoing any future appreciation that the home ownership would provide, I am now enjoying my vacations much more (which is the whole point of a vacation).  So yes, you'll do better financially by buying 30 homes instead of joining a DC, but you need to decide if it is the best use of your time and money... and for most people, even those in the DC 'sweet spot' net-worth-wise, buying 30 homes just isn't finacially feasible...



I'm not advocating whole ownership I'm just taking a VRBO owner's costs for a week and relating them to a DC - they are half the cost and thus I should be able to negotiate a reasonable rental rate that compares to a DC.

However, I don't need to loan a DC a lot of money to do this.  I can choose from 88,200 homes/condos to rent in just about any location I can dream of.


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## travelguy

*Apples to Watermelons*

Perry,

Several quick points on the VRBO vs. DC issue from someone who has done both:

1. Regarding your math, a High Country Club "Private" member has a cost-per-night of $297 INCLUDING cost of money, write-off of non-refundable membership fee, etc.  The HCC Private member cost-per-bedroom/night is only $99 (including taxes and all extra charges).  A quality VRBO rental is hard pressed to beat that value.  Oh, and my average time to book a High Country Club vacation is less than 5 minutes!

2. The average quality of property available on VRBO vs. DC quality is like an apples to watermelons comparison.

3. An issue that is BIG news on Maui right now is the number of vacationers who show up on the island and find their rentals are unavailable due to foreclosure!   This is a problem that is becoming bigger in vacation areas as the housing credit issue continues.  After all, where to you think most of those sub-prime investors bought investment property? 

4. Finally, my experience with rentals has been, at best, a mixed bag while I've never been disappointed with my High Country Club experiences.  I don' want to fly half-way around the world only to be let down by the quality of a rental.  Lack of stress is worth something to me!


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## PerryM

travelguy said:


> Perry,
> 
> Several quick points on the VRBO vs. DC issue from someone who has done both:
> 
> 1. Regarding your math, a High Country Club "Private" member has a cost-per-night of $297 INCLUDING cost of money, write-off of non-refundable membership fee, etc.  The HCC Private member cost-per-bedroom/night is only $99 (including taxes and all extra charges).  A quality VRBO rental is hard pressed to beat that value.  Oh, and my average time to book a High Country Club vacation is less than 5 minutes!
> 
> 2. The average quality of property available on VRBO vs. DC quality is like an apples to watermelons comparison.
> 
> 3. An issue that is BIG news on Maui right now is the number of vacationers who show up on the island and find their rentals are unavailable due to foreclosure!   This is a problem that is becoming bigger in vacation areas as the housing credit issue continues.  After all, where to you think most of those sub-prime investors bought investment property?
> 
> 4. Finally, my experience with rentals has been, at best, a mixed bag while I've never been disappointed with my High Country Club experiences.  I don' want to fly half-way around the world only to be let down by the quality of a rental.  Lack of stress is worth something to me!




My response:
#1) This "DC Math" is the reason I am not a member of HCC or any other DC - the numbers never seem to make sense to me.  A $1 M condo MUST cost more thru a DC than from the owner - someone is making a HUGE profit and its not the private home owner.

#2) I have no doubt that there are VRBA rentals that are in the $1 M and above range - just like a DC.  These are private homes/condos and I guess the private furnishings could express the views and likes of the owner but I'd guess that they would be comparable to a DC.

#3) Any renter or timeshare owner who blindly jumps on a 12 hour jet ride only to find that a 10 cent phone call could have saved them from a ruined vacation deserves exactly what they get.  ALWAYS check on a reservation BEFORE making the airline reservations, 30 days before, 2 weeks before, and 24 hours before - I do on EVERY vacation we have taken for the past 10 years.

#4) I agree that dealing with individual owners can be mixed.  This is exactly why VRBO has past renter's reviews of the units - here is an example  Again, it's up to the renter to do their homework and check out past renter's reviews - if the renter is too lazy, like verifying the reservation before traveling, they deserve exactly what they may get - a horrible vacation.


Conclusion:
To me, VRBO and a little common sense, can take on DC's - there is nothing magical about them - they must operate according to Generally Accepted Accounting rules or wind up in jail or in some country that has no extradition policy with the US.


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## Kagehitokiri

oldkey, 
i would also consider villa rentals for long term as well (like a month or two) in cheap ($300/nt) places like Asia.

perrym, 
do you still like the one key world model? what do you think of the model of worldwide private residences?

personally, i look at the deposit as a writeoff in order to obtain the discounted nightly rates a club provides on an annual basis. i see it like any other initiation fee. except you can get it back if you resign.


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## PerryM

Kagehitokiri said:


> oldkey,
> i would also consider villa rentals for long term as well (like a month or two) in cheap places like Asia.
> 
> perrym,
> do you still like the one key world model? what do you think of the model of worldwide private residences?
> 
> personally, i look at the deposit as a writeoff in order to obtain the discounted nightly rates a club provides on an annual basis. i see it like any other initiation fee. except you can get it back if you resign.



WorldMark has THE best DC model out there - bar none.

Will WM ever get into DC's?  Who knows but it would take them 1 day to do so if they want.

The WM DC model (current model) is very simple:

1)	A developer, like Wyndham, goes out and buys condos.  They bring is up to the existing level (like $1 M condo furnishings)

2)	Wyndham turns over the deeds to the DC to a Master Trust (debt free) where EVERY WM DC owner owns a fraction of the units

3)	Wyndham then sells DC credits and you simply buy what you want.  Just need 1 week – that could be 25,000 DC credits or $25k.  (No connection to existing WM credits)

4)	MF is just a cost per DC credit – could be 10¢ a DC credit

5)	You get to resell your DC credits for whatever the market bears – you could also buy resale DC credits

6)	Wyndham has a ROFR and can snap up DC credits sold by desperate owners

That’s it – this is EXACTLY what WM does now with $250k condos – simply buy condos worth $1 M.  WM would base the number of credits per week based upon rental rates and 1 DC credit = $1.  

If Wyndham sells to the wealthy folks then they are shooting for $100k sales at a minimum and resale DC credits would be 50% of that.

The fact that Wyndham could do this so fast should send shivers up the spine of all DCs.


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## Kagehitokiri

> The fact that Wyndham could do this so fast *should* send shivers up the spine of all DCs.


 isnt saying that like saying they "*should*" have put all other TS companies out of business? 

so you DONT like the one key world model anymore because it doesnt have ownership? 

http://www.sherpareport.com/index2.php?option=com_content&do_pdf=1&id=117
seems like a great model to me, in terms of offering a "free" DC. too bad it looks like they wont survive.


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## Bourne

Is a master deed enough protection ???


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## PerryM

Kagehitokiri said:


> isnt saying that like saying they "*should*" have put all other TS companies out of business?
> 
> so you DONT like the one key world model anymore because it doesnt have ownership?
> 
> http://www.sherpareport.com/index2.php?option=com_content&do_pdf=1&id=117
> seems like a great model to me, in terms of offering a "free" DC. too bad it looks like they wont survive.



If it sounds too good to be true.......

To me a $1 M DC HAS to charge $125k and $10k MF to each of 8 "investors" and that costs more than a mortgage and related expenses of $1,733 per week for whole ownership.

If a DC is charging less than $1,733 per week then they are using numbers that I can't come up with.  "DC numbers" that exist only in DC land.




Bourne said:


> Is a master deed enough protection ???



Sure, the master trust has the deeds in the name of the club and have NO liens on them.  The members own those deeds and the DC could sell them for a profit if it wanted to and disburse the profits back to the owners.

I don't know how the DC industry looks at making profits but I've got to believe that a timeshare organization is going to at least equal the profits that any DC can cook up.


----------



## Kagehitokiri

i dont see how you can equate DCs with fractional ownership... 

TS have ridiculous margins because they charge ripoff (WAY above market value) prices to initial buyers. then they have the ability to increase annual fees way faster than CPI.

fractionals, at least high end ones, only seem to be going much above market value recently because of high demand.

questioning the value and profit of DCs is no different than questioning the value and profit of other clubs and things that work like clubs. different people value different things a different amount.

no comment on worldwide private residences LP's numbers? the PDF i linked seemed fairly detailed to me.


----------



## vineyarder

> If Wyndham sells to the wealthy folks then they are shooting for $100k sales at a minimum and resale DC credits would be 50% of that.



Wyndham isn't upscale enough to attract 'the wealthy folks'... Three to four star at best.



> The fact that Wyndham could do this so fast should send shivers up the spine of all DCs.



Why?  Maybe some smaller DCs that need to grow enough to increase destinations offered would have their sales negatively impacted, but how would this hurt ER or PE/UR?


----------



## PerryM

vineyarder said:


> Wyndham isn't upscale enough to attract 'the wealthy folks'... Three to four star at best.
> 
> 
> 
> Why?  Maybe some smaller DCs that need to grow enough to increase destinations offered would have their sales negatively impacted, but how would this hurt ER or PE/UR?



Wyndham can be whatever Wyndham want's to project - I don't think they would ever use WorldMark for a DC name, they would just create one for the DC market; how about "Ultimate Resorts" (taken) or "Apex Resorts"  its just a marketing decision.


----------



## vineyarder

PerryM said:


> Wyndham can be whatever Wyndham want's to project - I don't think they would ever use WorldMark for a DC name, they would just create one for the DC market



Balderdash.  You yourself have stated in previous posts that wealthy folks want a prestigious name brand that their friends know (like a Four Seasons or Ritz Carlton); Wyndham is a name brand, but it isn't a particularly prestigious one, and whatever cute name they pick, it will still be Wyndham, with a 3 to 4 star reputation.


----------



## PerryM

vineyarder said:


> Balderdash.  You yourself have stated in previous posts that wealthy folks want a prestigious name brand that their friends know (like a Four Seasons or Ritz Carlton); Wyndham is a name brand, but it isn't a particularly prestigious one, and whatever cute name they pick, it will still be Wyndham, with a 3 to 4 star reputation.



Just click here and you will find a world class company that can easily become a DC.


----------



## vineyarder

PerryM said:


> Just click here and you will find a world class company that can easily become a DC.



ibid.

Wyndham is BIG, but not prestigious enough to attract HNW individuals.  It could certainly enter the DC market, but not in a way that would 'send shivers up the spine' of ER or PE/UR.  And yes, Four Seasons or Ritz Carlton could enter the market and be prestigious enough to attract HNW individuals, but we've been over this scenario many times in this forum, and most of us believe that the entry of FS or RC would 'legitimize' the industry, get it more press and attention, and end up helping existing DCs.  

As has been said many times here, DCs aren't for everyone, and you are clearly not one of the ones that they are right for... So instead of manufacturing reasons that DCs are doomed to fail, why not just admit that they are great for some, marginal for others, and inappropriate for others (such as yourself)?


----------



## PerryM

vineyarder said:


> ibid.
> 
> Wyndham is BIG, but not prestigious enough to attract HNW individuals.  It could certainly enter the DC market, but not in a way that would 'send shivers up the spine' of ER or PE/UR.  And yes, Four Seasons or Ritz Carlton could enter the market and be prestigious enough to attract HNW individuals, but we've been over this scenario many times in this forum, and most of us believe that the entry of FS or RC would 'legitimize' the industry, get it more press and attention, and end up helping existing DCs.
> 
> As has been said many times here, DCs aren't for everyone, and you are clearly not one of the ones that they are right for... So instead of manufacturing reasons that DCs are doomed to fail, why not just admit that they are great for some, marginal for others, and inappropriate for others (such as yourself)?



Wyndham is a well known name and WorldMark model is ideal for DC usage - I have no idea if Wyndham wants to get into this industry.

I stand by my statement that the DC industry is built on a house of cards and that it would not take much for it to implode.  Just look at what happened to the founding DC - it ain't no more.....

As to whether a DC is right for me I think I'm a better judge at that than you are.


----------



## Steamboat Bill

vineyarder said:


> So instead of manufacturing reasons that DCs are doomed to fail, why not just admit that they are great for some, marginal for others, and inappropriate for others (such as yourself)?



I personally think the DC market is well past their initial growing pains and have a very healthy future. There are only about 5,000 members worldwide and I consider myself to be one of the lucky few early adopters to enjoy this industry.



PerryM said:


> I stand by my statement that the DC industry is built on a house of cards and that it would not take much for it to implode.  Just look at what happened to the founding DC - it ain't no more.....
> 
> As to whether a DC is right for me I think I'm a better judge at that than you are.



T&H is a classic example of what the DC industry initially did wrong. Just like the old time surgeons that thought you could perform surgery without gloves and washing your hands was unnecessary....doctors learned from their mistakes and people died. The DC industry has not killed anyone (that I know of) but some people did get burned by T&H. The DC industry has adapted and learned from the T&H meltdown and is much less risky today. Will there be problems in the future? Perhaps, but the current risk to reward ratio is well worth it for me, so I decided to drink the cool-aid and it really tasks good.

-----------------

Guys.....I know PerryM is skeptical about the DC industry and I enjoy all the "healthy debates" with him, but let's try to keep professional as TUG rules want all of us to be courteous to each other (including myself).


----------



## Steamboat Bill

applegirl said:


> We rented a house in San Diego Beach area once and when we arrived, the owner was still getting some of his things out of the house. Yuuuuuuuk! This was his full time residence and during the summer he rents some weeks out just to make extra money. It was totally creepy and uncozy. Not A LOT of his stuff was around, but it was enough that I really didn't like it. If this is your full-time residence, PLEASE DO NOT PUT IT ON VRBO.COM. But, if this is a family vacation home and you don't keep a lot of personal effects there, then VRBO.com is a good option.  Timeshare your home? That just sounds weird.



I had to post Applegirl’s comments from another thread as it describes her experience with VRBO.

To read the entire thread click here:
http://tugbbs.com/forums/showthread.php?p=413084#post413084


----------



## vineyarder

PerryM said:


> As to whether a DC is right for me I think I'm a better judge at that than you are.



Of course you're a better judge of whether or not a DC is right for you... 

but with statements like: 

"the DC industry is built on a house of cards and it would not take much for it to implode. Just look at what happened to the founding DC - it ain't no more....." 

and "This "DC Math" is the reason I am not a member of HCC or any other DC - the numbers never seem to make sense to me" 

and "I don't need to loan a DC a lot of money to do this. I can choose from 88,200 homes/condos to rent in just about any location I can dream of" 

and "Something tells me that as a renter I can spend much less and stay at the same place as the DC member" 

you make it abundantly clear that YOUR OPINION is that a DC isn't right for you!


----------



## vivalour

<< you make it abundantly clear that YOUR OPINION is that a DC isn't right for you!>>

As one of the original --and very enthusiastic -- advocates of DCs, maybe  PerryM could still be looking for "reasons" to buy in -- even when he doesn't smell the Ultimate Bargain DC. I'm not a psychologist, but have come to my own conclusion that for some people, buying into a DC is like buying a car -- not always a purely rational choice of how much to spend and what to buy based on pure transportation needs. The "cost per night" will not affect my life one way or the other in the long run -- but I too like to think I am making a "wise" decision with my purchases.


----------



## vineyarder

vivalour said:


> I'm not a psychologist, but have come to my own conclusion that for some people, buying into a DC is like buying a car -- not always a purely rational choice of how much to spend and what to buy based on pure transportation needs. The "cost per night" will not affect my life one way or the other in the long run -- but I too like to think I am making a "wise" decision with my purchases.



Exactly - the cost per night is just one factor, along with quality, consistency, ease of use, additional services & amenities... intangibles that make it a very personal decision, just like a car.  If everyone based their automobile purchase on 'cost per mile' luxury brands wouldn't exist.  Bentleys are great cars for some people, if they get 'enough' enjoyment out of them, whereas for me, I'm just not that into cars to spend 4 times what a Mercedes costs.   But rather than being 'anti-Bentley', I just accept that a Bentley isn't a good purchase for me...


----------



## Kagehitokiri

PerryM said:


> [T&H] ain't no more



 TERRIBLE business model, practices, no transparency...



vineyarder said:


> But rather than being 'anti-Bentley', I just accept that a Bentley isn't a good purchase for me...


 i strongly agree with that mentality. 

while there might be "name calling" towards DCs, at least there isnt name calling towards posters here. for example, in the american express forum on flyertalk, all too often people are ranting about how "stupid" people who pay for centurion card are. 

*vineyarder*, id be curious to know what are your thoughts are on >
http://www.sherpareport.com/index2.php?option=com_content&do_pdf=1&id=117


----------



## Steamboat Bill

vineyarder said:


> But rather than being 'anti-Bentley', I just accept that a Bentley isn't a good purchase for me...



It is getting ridiculous with the number of Bently's in Boca Raton. There are at least five of them at my kids school and my kids have already been in three of them. One of the coaches on my kids soccer team has a cool burnt orange one (at least that is what it looks like and I have never seen that color before) and one of my friends has a green ragtop...all the rest are black.



Kagehitokiri said:


> in the american express forum on flyertalk, all too often people are ranting about how "stupid" people who pay for centurion card are.



So are we to assume that you, like a bunch of my friends, carry the black card?



vivalour said:


> I too like to think I am making a "wise" decision with my purchases.



Me too or is that me three?


----------



## Kagehitokiri

i have not said much about what i value outside of DCs/etc, because i thought it would be kind of offtopic.

definitely agree re "wise decision," i cant imagine there are many people here who dont feel that way..


----------



## hipslo

I just LOVE vrbo - but not for the reasons Perry cites (which may be perfectly valid, I just have no experience with them).  I have multiple Marriott Mountainside weeks that I rent out each year (in addition to the one week that I use myself).  This year I decided to list them on vrbo, rather than on redweek or myresortnetwork, just to see what would happen.  The response has been tremendous - many more hits (1300 to date!!), many more inquiries, rented for more than last year on the timeshare sites, and much earlier in the season.  The potential audience that is aware of, and uses, vrbo, as oppopsed to the timeshare rental sites, is HUGE, and they are happy to pay my asking prices when they see what they are getting for it.  I explain to them that these are timeshare units but that as far as they are concerned they are essentailly condos with resort amenities, and they are intrigued, and have been grateful to me for making them aware of this particular lodging option.

Long live vrbo!


----------



## GregGH

*more photos --more feedback to sort out the bad from the good*



hipslo said:


> I just LOVE vrbo - but not for the reasons Perry cites (which may be perfectly valid, I just have no experience with them).  ...snip....Long live vrbo!



I think it was Steamboat Bill that posted a link a while back explaining sites like VBRO --one particular point I found interesting --for VBRO and similar -they charge MORE MONEY the more photo's you list as a renter.  So renters cheap out and just don't show us enough to make a good decision.  For me - it is a LOT of pictures ( and some positive users feedback like I can see in www.tripadvisor.com )

GEEEEE !!!!

I wish we could get an UPSCALE VBRO --- more photos ....  and some independent rating system to sort out the 'poor' from the 'great' locations -- gone are the stains and dirty locations -- more power to the clean and updated locations.

I can wish ...

Greg

ps - I don't get back here as often as I would like to - love to  see the objective points that Perry throws out.  Personally I have dismissed may DC's with their policy of 'raising prices' to attract new owners - does a 'bubble' have a smell?   I long for 're-sale' in this as a way to establish true value.


----------



## Kagehitokiri

VRBO has plenty of very nice stuff. like at four seasons punta mita for example. or setai miami. there are lots of places that are thousands/nt.

"upscale VRBO" examples >

http://www.homesaway.com
http://www.caribbeanway.com
http://www.lacurevillas.com
http://www.villasofdistinction.com

there are a fair number of properties on sites like the last 2 above that are also on VRBO for the same price and everything. the first 2 above though offer local hosts and other value added stuff.

top, full service, from $2K/nt >
http://www.villazzo.com

DHH does have a resale model for their "equity."

personally, id rather wait and pay more, once the DCs im watching have more beachfront properties etc.


----------



## hipslo

GregGH said:


> I think it was Steamboat Bill that posted a link a while back explaining sites like VBRO --one particular point I found interesting --for VBRO and similar -they charge MORE MONEY the more photo's you list as a renter.  So renters cheap out and just don't show us enough to make a good decision.  For me - it is a LOT of pictures ( and some positive users feedback like I can see in www.tripadvisor.com )



Exactly right - and I use this to my advantage - I think vrbo gives you 3 pictures included in the price of the listing, with each additional picture costing another $25 (if I recall correctly).  Listings are then ranked by number of pictures.  So, for an extra $25 (for a full year's listing), my listing has 4 pictures, rather than the standard 3.  This ranks me 2nd among all postings for Mountainside in Park City (there are a few dozen listings, I think).  Since most potential renters likely dont get past the first few listings, assuming they find something attractive in the first few that they look at, that extre $25 has been very well worth it, and it seems that most folks listing their units are not savvy enough to realize that, surprisingly enough.


----------



## Kagehitokiri

odd.. you are #2 by default, but if you sort by BR, then you drop to near the bottom...

it seems like most of the savvy TS people are on TUG 

also wonder why some people on VRBO dont post any pics, if 3 are included for free..


----------



## PerryM

*"inconvenient customer" - that's me*



vineyarder said:


> Of course you're a better judge of whether or not a DC is right for you...
> 
> but with statements like:
> 
> "the DC industry is built on a house of cards and it would not take much for it to implode. Just look at what happened to the founding DC - it ain't no more....."
> 
> and "This "DC Math" is the reason I am not a member of HCC or any other DC - the numbers never seem to make sense to me"
> 
> and "I don't need to loan a DC a lot of money to do this. I can choose from 88,200 homes/condos to rent in just about any location I can dream of"
> 
> and "Something tells me that as a renter I can spend much less and stay at the same place as the DC member"
> 
> you make it abundantly clear that YOUR OPINION is that a DC isn't right for you!




I'm not sure why you want to put words in my mouth - wrong ones too.

I am not a DC owner today because not a single DC has convinced me to part with my money - it's just that simple.

Here is all that is required for any DC to get my business:

1) I want 80% of the CURRENT membership fee returned to me when I leave the DC

2) I want a performance bond (or something equivalent) put up to guarantee that I will get that 80% back

3) I want a 1 in/ 1 out to leave and no more than 90 days to get my money


Beyond that I'd have to study the residences the DC has and if they fit our vacationing needs.  I'd also need to review their holiday policy since 75% of our vacations revolve around standard US holidays.


Will the DC market ever meet my demands?  I hope so - especially if they want my business.  

There is one exception to all the above - a new DC who is offering most of the above (during the initial startup phase - want 4 weeks too) and the membership fee is what I would call "throw away", which to me is $35k.

So far the DC industry is tied with the airline business for treating me like an "inconvenient customer" - one they hold their nose and are forced to do business with; a pesky consumer who wants a lot more than what's thrown at them.


----------



## vineyarder

PerryM said:


> I'm not sure why you want to put words in my mouth - wrong ones too.



I'm NOT 'putting words in your mouth'; these are all VERBATIM quotes from this one thread alone!  Why do you make these statements if you don't mean them?



> Here is all that is required for any DC to get my business:
> 
> 1) I want 80% of the CURRENT membership fee returned to me when I leave the DC
> 
> 2) I want a performance bond (or something equivalent) put up to guarantee that I will get that 80% back
> 
> 3) I want a 1 in/ 1 out to leave and no more than 90 days to get my money



Interesting; do timeshares fulfill these requirements?  



> Will the DC market ever meet my demands? I hope so - especially if they want my business.



Perhaps... but my guess is that it will come with a much higher pricetag; back to same old higher cost/lower risk vs. higher risk/lower cost equation.  And it is certainly reasonable to choose higher cost/lower risk (it appears that is Kag's choice; he'd rather pay more but be more certain of what he is getting).  On the other hand, that flies in the face of your earlier comments about "DC math" and how you can do much better with rentals... 

Right now the majority of DCs are still in the phase of appealling to early adopters who are willing to take on higher risk to get lower costs (appropriate for this stage of the industry).  At this stage they are not staying up nights worrying about how to get Perry M as a member.  Once the industry matures, and the 'early adopter' market is saturated, then they will begin to tailor their approach to appeal to more risk-averse customers.



> So far the DC industry is tied with the airline business for treating me like an "inconvenient customer"



Interesting observation, and very different from my experiences.  I have found that every DC that I've spoken with was very interested in my business, to the point of being willing to offer customized packages to meet my particular needs (yes, even ER).  In addition, they were all very professional, with no 'hard-sell' tactics.  OTOH, my experience with the airline industry is also different from your experience; while airlines with whom I have no elite status are generally very poor at customer service, as a 3 million mile, lifetime Platinum member of AA, I find AA is exceedingly attentive to my needs, so I make every attempt to fly them whenever I can.


----------



## PerryM

*"Trust me"...my BS-O-Meter is pegged....*



vineyarder said:


> ...
> 
> Interesting; do timeshares fulfill these requirements?
> 
> ...
> 
> Interesting observation, and very different from my experiences.  I have found that every DC that I've spoken with was very interested in my business, to the point of being willing to offer customized packages to meet my particular needs (yes, even ER).  In addition, they were all very professional, with no 'hard-sell' tactics.  OTOH, my experience with the airline industry is also different from your experience; while airlines with whom I have no elite status are generally very poor at customer service, as a 3 million mile, lifetime Platinum member of AA, I find AA is exceedingly attentive to my needs, so I make every attempt to fly them whenever I can.



I am a proud timeshare owner – own a bunch of them.  Each comes with:

1)	A deed or ownership of the deeds
2)	The ability to resell to ANYONE I’d like
3)	Tons of state real estate laws to protect me – from the right to rescind to making sure the unit I bought wasn’t sold over and over again.

Let’s take one example – the prevention of the same unit sold over and over again.  I have state laws, in whatever state I buy in, that track my unit and insure that it can’t be sold multiple times.  We own WM credits and WM credits are illegal to be sold in Hawaii – they don’t track back to a deed that resides in the bowels of a state of Hawaii.  Other states allow this and I believe I have protection on my side.

So where is the protection for a DC member to know that if 8 memberships are being sold for each condo and 9 weren’t sold?  Who would really know?  Is there a state real estate law protecting the DC owner?  How about fraud statutes – would they apply in this case?

I can go thru example after example where I don’t like the answers provided by the DC industry – they always boil down to “Trust me” – and that comes from a guy over the phone that I’ve never met.

So who here has proof positive that ONLY 8 memberships are sold per residence and not 9?  Where are the independent CPA audits backing up just this one claim?  Maybe a single DC has it, don't know who it is, but this should be the #1 priority of the DC industry - backing up their claims with CPA verified documents since no state laws exist to do so.

So to conclude, there is a VAST difference between DCs and timeshares – too vast for my tastes at this time.  Maybe a large corporation, one with deep pockets, will enter the market and I have a feeling that they would care about bad press and the typical BS that salesreps spout.

As an aside, I get a kick out of how virtually ALL timeshare owners here on this chat room know that *BS is the number one sales tool to sell timeshares *but when it comes to DCs no BS seems to be needed to sell them?  My BS-O-Meter is pegged when DCs are mentioned – I just know there is a bunch of it out there.  You can almost smell it in the air....


----------



## Steamboat Bill

PerryM said:


> So to conclude, there is a VAST difference between DCs and timeshares – too vast for my tastes at this time.  Maybe a large corporation, one with deep pockets, will enter the market and I have a feeling that they would care about bad press and the typical BS that salesreps spout.



I own several timeshares, several condo-hotels, used to own several condos, I am a member of one DC, and I even rented a house via VRBO. They are all different animals and any of those can satisfy different people.

Here is my "opinion" on the following:

1. Hotels - Ultimate in flexibility - just pay cash for what you want. This is fine for me on business travel or an occasional 5-star trip with my wife, but they really don't cater to family travel well.

2. Timeshares - if you buy a property at a good rice (usually resale) at a location and time (floating/fixed) and room type (1 bedroom vs 3 bedroom) in a single location you like to visit every year, then this is probably the lowest priced option for many people. I find trading a hassle and the quality of most timeshares leaves much to be desired. I like DVC, Marriott, Four Seasons.

3. Hotel-condos - my personal experience tells me that these are scam ripoffs for most buyers. Maui may be the only exception to this rule.

4. VRBO - interesting concept that can be executed much better. Where is VRBO 2.0? I personally hate the layout of their web site and find searching for a property equivalent to a visit to a dentist.

5. condos/vacation homes - offers the most upside, but also offers the most headaches. Been there, done that....not interested in doing it again any time soon. I may consider selling my house and buying 2-4 condos/townhomes in different areas when the kids are off to college.

5. Destination Clubs - these are my first and ultimate choice for anyone desiring upscale travel with families. I joined HCC, but also like ER, UR, PE, BH, DHH, Quintess....just about all of them. It is a RARE day to hear any complaint about the DC industry from a DC members.


----------



## Steamboat Bill

PerryM said:


> There is one exception to all the above - a new DC who is offering most of the above (during the initial startup phase - want 4 weeks too) and the membership fee is what I would call "throw away", which to me is $35k.



Perry,

Why have you NOT taken advantage of the HCC trial offer or the PE preview memberships?

They both offer 100% refunds of your membership fees and very little risk.


----------



## Kagehitokiri

Perry, what would you spend max on a club that fit your requirements?


----------



## range_life

*Another DC bites the dust?*

We were just about to take the plunge with trial membership at HCC, when we read about "Premier Destinations" suspending its activities. This is the second destination club to run into problems in two years. 

Does anyone have any thoughts about how to evaluate the risks of an HCC membership? Since it is unsecured, aren't you really just rolling the dice and hoping for the best?


----------



## Kagehitokiri

http://www.tugbbs.com/forums/showpost.php?p=408930&postcount=40
http://www.tugbbs.com/forums/showpost.php?p=412914&postcount=42

if you werent looking at joining them, not sure why that would make you feel uncomfortable... my global playground im not sure how many members/properties they had, but premier destinations never even really got off the ground... so it didnt "run into problems."

clearly larger clubs are not "running into problems" and no club is acting like T&H in terms of the terrible business model/practices/lack of transparency.


----------



## vivalour

<<As an aside, I get a kick out of how virtually ALL timeshare owners here on this chat room know that BS is the number one sales tool to sell timeshares but when it comes to DCs no BS seems to be needed to sell them? My BS-O-Meter is pegged when DCs are mentioned – I just know there is a bunch of it out there. You can almost smell it in the air....>>

Personally, I've had very limited experience with the TS industry; we've never owned one, and have few friends who do. My brief brush with TS sales people (who impressed me as near-morons) did leave a strong odor of BS and I find the whole scene too dicey for my taste. 

The concept of DCs is simple as pie by comparison. And by comparison, both risks and rewards of DCs are pretty apparent (as PerryM and others have outlined here) and so, imho, this product is much less BS-prone. It's true, you're taking big leaps based on trust rather than legal protection, but in the end, enforcing/protecting individual legal rights is usually pretty costly anyway. So as with any consumer item, you pays your money and takes your choice....


----------



## Kagehitokiri

right, DCs are like any other club type entity. that seems to be part of what Perry doesnt like.. 

TS, OTOH, make their insane profits by ripping off initial buyers, mainly by misrepresenting the details (not technically lying).


----------



## PerryM

Steamboat Bill said:


> Perry,
> 
> Why have you NOT taken advantage of the HCC trial offer or the PE preview memberships?
> 
> They both offer 100% refunds of your membership fees and very little risk.




If I remember correctly, and I could be wrong, I can't use that membership to vacation at holiday times.  That's what "rings a bell" why I've not taken up that offer.  It could also be that we are 100% booked 13 months ahead of time and that we have used all of our 4 weeks of vacation already - the DC would have to be beyond the 13 month mark.


----------



## range_life

That's what I thought. Not much there other than the word and reputation of the company. And since these are small, fledgling companies, you are taking a chance.

Sorry I missed the other threads.

Timeshares are often regulated, and to the extent they are real estate, your investment can be secured, although the ease with which you can enforce the security will vary depending on the jurisdiction it is in. I agree with Steamboat Bill's analysis of the downside of timeshares, though.

So, our choice come sown to the possibility of a superior product versus the risk of the company going belly-up.


----------



## Kagehitokiri

> And since these are small, fledgling companies, you are taking a chance.


----------



## range_life

What don't you get about that? DC's are tiny, relative to leading timeshare companies-Hilton, Disney, Four Seasons, Intrawest, etc.


----------



## Kagehitokiri

they are mostly in the luxury market.

luxury markets are smaller than the general market.

thats exactly what i want.


----------



## range_life

Agreed. But that's not my concern.

Mama didn't raise no fools, and I don't like to spend that kind of money without some guarantees.


----------



## Kagehitokiri

examples of financial structures for several clubs >

http://lussocollection.com/page/assurance.jsp

http://www.bellehavens.com/me_protection.php

http://www.heliumreport.com/archives/658-crescendo-real-estate-portfolio-appreciates-8-8-in-2006

http://www.heliumreport.com/archives/487-interview-with-jonathan-harding-president-and-coo-of-ciel
"100% refundable...60% of deposit goes to capital reserves to acquire real estate; 40% in T-bills"

http://www.sherpareport.com/index2.php?option=com_content&do_pdf=1&id=117

http://www.tugbbs.com/forums/showpost.php?p=386513&postcount=67
DHH's resale model

you realize you sign a contract that would have these financials in it, correct?


----------



## Bourne

range_life said:


> That's what I thought. Not much there other than the word and reputation of the company. And since these are small, fledgling companies, you are taking a chance.
> 
> Sorry I missed the other threads.
> 
> Timeshares are often regulated, and to the extent they are real estate, your investment can be secured, although the ease with which you can enforce the security will vary depending on the jurisdiction it is in. I agree with Steamboat Bill's analysis of the downside of timeshares, though.
> 
> So, our choice come sown to the possibility of a superior product versus the risk of the company going belly-up.



A secured "investment" does not buy me anything...nor does a deed...

Over time I have owned 4 TS weeks. 2 FS Aviara and 2 Hiltons. First Hilton was purchased from the developer back in '01. The rest were resales...

Sold all but the first Hilton after buying HCC membership. 

The last one is being a pain. Bought it for 18K. The average market price for it is around 12-12.5K. A "secured investment" with deed gets me 33% less. 

I'll bit the bullet if I'll get that price. After being on the market for 8 months, the best offer I can get is 10K...with fuzzy math on the contract to get it through ROFR. 

Called up a broker known around Tug with whom I have done business in the past. Has an offer for 11.0K but will net me 8.5K after commision. 

Bottom line, I am looking at a 33 - 50% loss on the timeshare. An option that I have a DEED for. Does it buy me anything...NO...

The point I am making is that I will gladly take the 20% ding with my DC membership and a 2-1 out option. Correct me, but I may have had a 100% chance of getting 80% back if my timeshare was a DC.

Before be start going into the resale vs developer purchase discussion, remember that the resale market makes up for only 10% of all timeshare sales in terms of total sale price.


----------



## range_life

Interesting, thanks. I hadn't compared these structures to HCC. Some seem to offer a greater level of security than does HCC. I have read HCC recent audit, but it seems to me that if the company folded, members' deposits would come second to investors and secured creditors.


----------



## TarheelTraveler

The level of protection with respect to a DC varies from club to club.  Exclusive Resorts has size and deep pockets behind it.  Private Escapes/Ultimate also rely on their size.  Others use legal structures such as Lusso.  Some guarantee that a certain percentage of deposits are used towards the acquisition of real estate.  Some offer a combination like Bellehavens and Crescendo (real estate is owned by the members and 70-90% of deposits are used for the acquisition of the underlying real estate and furnishings).  The fact that neither My Global Playground nor Premier got off the ground isn't a negative.  To me, it just means that the industry is maturing and people are doing their due diligence more and that upstarts are going to have a tough time competing without some sort of differentiation.

The destination club guides from The Helium Report and Sherpa are very useful in evaluating and doing the due diligence on destination clubs.


----------



## Kagehitokiri

range_life,

what club has practices like T&H?

what large club is in financial trouble?

Perry, 

what would you spend max on a club that fit your requirements?



			
				TarheelTraveler said:
			
		

> To me, it just means that the industry is maturing and people are doing their due diligence more and that upstarts are going to have a tough time competing without some sort of differentiation.


 agreed. its the same as people who join ER because its all they know, and then switch after learning about other clubs that might be more appealing to them.


----------



## vineyarder

PerryM said:


> Here is all that is required for any DC to get my business:
> 
> 1) I want 80% of the CURRENT membership fee returned to me when I leave the DC
> 
> 2) I want a performance bond (or something equivalent) put up to guarantee that I will get that 80% back
> 
> 3) I want a 1 in/ 1 out to leave and no more than 90 days to get my money





> Originally Posted by *vineyarder*
> Interesting; do timeshares fulfill these requirements?





> Originally Posted by *PerryM*
> I am a proud timeshare owner – own a bunch of them. Each comes with:
> 
> 1) A deed or ownership of the deeds
> 2) The ability to resell to ANYONE I’d like
> 3) Tons of state real estate laws to protect me



OK - so the answer is no, timeshares also do not fulfill your 3 requirements. 

Had me confused for a moment, since I was pretty sure that Four Seasons will not guarantee me 80% of the current selling price of its timeshares, nor will they put up a performance bond to ensure that I will get back at least 80% of what I pay, nor will they guarantee me that someone will buy it within 90 days.  But I guess that's OK, since once a big luxury hotel brand gets involved in timeshares, they will certainly put in place all these protections, and then it will be safe to buy...  But wait a minute... Isn't Four Seasons a big, reputable, luxury hotel brand... Now I am really confused... When Four Seasons, Hyatt, Marriott, etc., moved into timeshares, they basically conformed to industry norms... but if/when they move into the DC market, they will ignore the industry norms and instead follow Perry's rules (which only apply to DCs, not TSs...) verrry interesting...


----------



## Kagehitokiri

i agree with vineyarder's above analysis.

its fine for perry to have requirements for a DC, and i agree with his/everyone's analysis of TS (although i dont consider TS and DCs comparable) but i disagree with his "conclusions?" regarding DCs.


----------



## pwrshift

With 99% of these DC companies private, you really have no idea as to whether they have financial trouble.  Only the owners do ... or shareholders ... and DC members are not privy to that info.  Even Steve Case could go under ... he's done it before and laughed all the way to the bank while his shareholders (Turner) lost their fortunes.

Brian



Kagehitokiri said:


> range_life,
> 
> 
> what large club is in financial trouble?
> 
> .


----------



## Kagehitokiri

for those who have joined clubs, how transparent are they in terms of their financials?


----------



## Bourne

Kagehitokiri said:


> for those who have joined clubs, how transparent are they in terms of their financials?



I can vouch for HCC, PE and ER. All three of them were very open about it. 

I could not justify ER even though I could afford it. Between PE and HCC, I liked the quality of HCC a bit better than PE. However, HCC membership was a bigger risk because that had about 14 properties. 

Would I put down 400K for the likes of My Global Playground. Never. For that money, I'll go with ER. At 25K, I can take a calculated risk with the likes of HCC. Then again, I will not touch DHH for the same amount. 

Due diligence and level of risk.


----------



## pwrshift

Naturally, buying direct means you pay more than resale on timeshares. That's a given because you have to pay the salesmen their $400k a year in commissions ... and the buyer incentives like Marriott Rewards.  

I suspect you all feel the salesmen of DC's don't get paid those huge TS commissions as that's one thing that hasn't been speculated on this forum yet.

However, on Ebay you can pick up a Marriott Grand Ocean oceanfront TS for $24,000 resale which probably sold to the original buyer for less than $20k and included enough points for a 'world trip for two' back then. Same with Marriott Ocean Pointe and others. A Marriott Manor Club (MMC) week can be had for $8500 on Ebay.

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&rd=1&item=270163676675&ssPageName=STRK:MEWA:IT&ih=017

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&rd=1&item=290164527149&ssPageName=STRK:MEWA:IT&ih=019


So if you bought any of those resale today on Ebay you could sell them tomorrow on Ebay, in 7 days, for very close to what you paid, maybe more. I don't know about the lesser brands like Hilton TS, but there's a big Ebay demand for Marriott resales ... so, the knowledgeable TS buyer/seller can usually get 100% of his money in 7 days.

Can the DC buyer do that? Can he even sell his membership to another party?

Conversely, if you buy top of the line DC like ER for $400,000 and resign, you'll lose $80,000 when they decide to pay you out for the free loan of your money to build their shareholder equity ... and there is no 100% guarantee or timeframe! For just what you lose on that deal, you could buy up to 10 MMC weeks and stay 10 weeks in a row if you wanted and have 60 free rounds of golf on their 3 golf courses.

Correct me if I'm wrong, but none of you have any real inside stats of the actual financial status of any non-equity-based DC, and financial speculation otherwise is misleading to a novice buyer. ER could be going down too and only Steve Case and his buddies would know for sure until it was leaked to the public ... and then what would you think about the future of DC's? And where would the remaining DC's find the new customers in order to pay you when you wanted out too?

Brian



Bourne said:


> ...Bottom line, I am looking at a 33 - 50% loss on the timeshare. An option that I have a DEED for. Does it buy me anything...NO...
> 
> The point I am making is that I will gladly take the 20% ding with my DC membership and a 2-1 out option. Correct me, but I have had a 100% chance of getting 80% back if my timeshare was a DC.
> .


----------



## Kagehitokiri

> Can he even sell his membership to another party?


 yes, if he is a member of DHH. they are the first to have such a model.


> ER could be going down


ER is a profit machine, because of their model of buying in bulk. 


> I suspect you all feel the salesmen of DC's don't get paid those huge TS commissions as that's one thing that hasn't been speculated on this forum yet.


 relevance?


----------



## pwrshift

But did you actually see their corporate financial statements like you would see for a public NYSE corporation ... or were they just trying to sell you something?



Bourne said:


> I can vouch for HCC, PE and ER. All three of them were very open about it.
> 
> .


----------



## Kagehitokiri

plenty of DCs have indepedent audits. doesnt DCA require it?

for example, i believe it was TarheelTraveler who said he cant discuss any details because of an NDA.


----------



## Steamboat Bill

*We are at an impasse*

We seem to be at a proverbial impasse on the value of joining a Destination Clubs with "PerryM" and "pwrshift" and the current TUG members that are members of a DC.

I fully enjoy debating the pros and cons of joining a DC and comparing a DC to TS, condo-hotels, fractional, stocks, bonds, cash, VRBO, etc. but sometimes it seems like these discussions take on a life of their own and nothing ever gets resolved.

I personally think PerryM is happiest owning a traditional timeshare and spending his time "trying" to beat the system and trading cheap Worldmark credits for Marriott ski weeks or Hawaii beachfront weeks. In fact, I will delete the word "trying" and simply state that he "regularly" beats the system. PerryM is a "timeshare trading pro". I also think Perry will be able to successfully rent $1m+ homes from VRBO and create a "PerryM DC style club" for no money down and will probably spend about $400 per night in rentals. What most TUGers fail to realize is that Perry has spend years perfecting his system and to learn it or reproduce it, is easier said than done. Perhaps Perry will join a DC someday, but I doubt it. I don't think it comes down to money, it comes down to the "art of the trade" and Perry is the timeshare equivalent of Donald Trump.

I personally think pwrshift is happy owning his Marriott BeachPlace timeshares as he obviously like to spend a month or two there. Hopefully, we will meet at Hooters when he in in town. Because pwrshift does not have a family and does not need 3-4 room properties, a DC is not really a good option for him. I do, however, think a HCC corporate membership would be a good deal for him and his company, but I am not privy to the size or revenue of his corporation. 

For all the "non-traditional Interval Ownership" regulars that are members of DC's.....I have never seen such a happy bunch of travelers. I can't even begin to describe all the horror stories I have heard about timeshares and I have not heard one single complaint from a DC member....that alone is pretty impressive.

Now on to cocktail talks in Boca Raton. If I am ever brave enough to bring up the topic of timeshares, people look at me like I am a two-headed alien from Mars and quickly change the subject. If I bring up the topic of Destination Clubs, I seem to attract a crowd of people that are very interested in the concept. I find comparing destination clubs to joining a golf club to be the best analogy for DC newbies.


----------



## TarheelTraveler

I'm pretty sure the DCA does require an independent financial audit.  Most of the DCs do so (including Crescendo).   Most also verify through the audit process that they are meeting whatever covenants they have established, such as a net asset test (sufficient assets to meet the deposit obligations).  

I agree with SteamboatBill that DC members are a satisfied bunch. You never hear complaints.  Compare that to what people say about timeshares and any other product that is debated on an internet forum.   It's not the right product for everyone, but it has struck a chord with a large number of very satisfied consumers.  I have seen a number of member survey results from various DCs including Lusso, Quintess, Crescendo and others, and post-trip very satisfied feedback is in the 90's across the board (typically approaching 100%).  This is from what I would think would be a pretty demanding set of consumers.  Again compare this to any other product, particularly a travel product.


----------



## Bourne

pwrshift said:


> Naturally, buying direct means you pay more than resale on timeshares. That's a given because you have to pay the salesmen their $400k a year in commissions ... and the buyer incentives like Marriott Rewards.
> 
> I suspect you all feel the salesmen of DC's don't get paid those huge TS commissions as that's one thing that hasn't been speculated on this forum yet.
> 
> However, on Ebay you can pick up a Marriott Grand Ocean oceanfront TS for $24,000 resale which probably sold to the original buyer for less than $20k and included enough points for a 'world trip for two' back then. Same with Marriott Ocean Pointe and others. A Marriott Manor Club (MMC) week can be had for $8500 on Ebay.
> 
> http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&rd=1&item=270163676675&ssPageName=STRK:MEWA:IT&ih=017
> 
> http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&rd=1&item=290164527149&ssPageName=STRK:MEWA:IT&ih=019
> 
> 
> So if you bought any of those resale today on Ebay you could sell them tomorrow on Ebay, in 7 days, for very close to what you paid, maybe more. I don't know about the lesser brands like Hilton TS, but there's a big Ebay demand for Marriott resales ... so, the knowledgeable TS buyer/seller can usually get 100% of his money in 7 days.
> 
> Can the DC buyer do that? Can he even sell his membership to another party?
> 
> Conversely, if you buy top of the line DC like ER for $400,000 and resign, you'll lose $80,000 when they decide to pay you out for the free loan of your money to build their shareholder equity ... and there is no 100% guarantee or timeframe! For just what you lose on that deal, you could buy up to 10 MMC weeks and stay 10 weeks in a row if you wanted and have 60 free rounds of golf on their 3 golf courses.
> 
> Correct me if I'm wrong, but none of you have any real inside stats of the actual financial status of any non-equity-based DC, and financial speculation otherwise is misleading to a novice buyer. ER could be going down too and only Steve Case and his buddies would know for sure until it was leaked to the public ... and then what would you think about the future of DC's? And where would the remaining DC's find the new customers in order to pay you when you wanted out too?
> 
> Brian




2 Things...

1. You missed this. 


> Before we start going into the resale vs developer purchase discussion, remember that the resale market makes up for only 10% of all timeshare sales in terms of total sale price.



Yes, i made 25% profits on both FS Resales and a grand on Hilton Craigandarroch but I am in a minority. If all timeshare owners out there were TUG members, timeshare industry will cease to exist.  

2. I put my money where my mouth is. I trusted HCC with my membership dollars and my investment dollars. I would not be where I am if I did not do due diligence on my financial deals. And took calculated risks. 

Then again, I bought a HGVC Ordlando 7000 pts from the developer.  I'm going to take that one to the grave. :rofl:


----------



## PerryM

vineyarder said:


> OK - so the answer is no, timeshares also do not fulfill your 3 requirements.
> 
> Had me confused for a moment, since I was pretty sure that Four Seasons will not guarantee me 80% of the current selling price of its timeshares, nor will they put up a performance bond to ensure that I will get back at least 80% of what I pay, nor will they guarantee me that someone will buy it within 90 days.  But I guess that's OK, since once a big luxury hotel brand gets involved in timeshares, they will certainly put in place all these protections, and then it will be safe to buy...  But wait a minute... Isn't Four Seasons a big, reputable, luxury hotel brand... Now I am really confused... When Four Seasons, Hyatt, Marriott, etc., moved into timeshares, they basically conformed to industry norms... but if/when they move into the DC market, they will ignore the industry norms and instead follow Perry's rules (which only apply to DCs, not TSs...) verrry interesting...




I am addressing DC's in this thread - there is NO reason why a DC can't:
1) Return 80% of CURRENT selling price.  HCC did it.
2) Guarantee the refundable part of my deposit - simple; have the principals pledge their homes and property to cover the deposits.
3) 100% transparent in operations and CPA verified audits of critical things like 8 memberships being sold and not 9 per unit.


I guess I've given everyone enough time to respond to my challenge of ANY DC verifying that they are NOT overselling their memberships with a CPA statement of the fact.

Come one guys; if the DCs can't even verify this fundamental principle (Not overselling memberships) this qualifies DCs as a "House of Cards" in my book.


----------



## Kagehitokiri

1. m private residences = 92% current
2. http://www.tugbbs.com/forums/showpost.php?p=413495&postcount=67

to clarify, would you say "house of cards" = slotmachine?


----------



## PerryM

*Mmmmmm...goose for dinner....*



Kagehitokiri said:


> 1. m private residences = 92% current
> 2. http://www.tugbbs.com/forums/showpost.php?p=413495&postcount=67
> 
> to clarify, would you say "house of cards" = slotmachine?



A "House of cards" is any organization that can implode in a second - the DC industry is a prime example.  ONE bad news article by the Drive-By media on TV and attention would be focused on DC's - focus that could instantly dry up sales.

And a lack of sales (fresh meat) is something the DC industry might find some DCs folding up one night and the founders splitting the proceeds.  The carcass of what's left would find the members fighting for scraps, after everyone else.

No sales prevents DC owners from exiting the DC - how much is your membership worth then?  Answer: not even one penny.  That's why I factor in the DC membership into the overall cost and haven't bought one yet.


I guess I could post another challenge to DC owners - show me a document that prevents my above scenario from happening....  I know that the fat cats that start DCs don't want to kill the Golden Goose, but if that goose gets cooked my guess is that they will be the first to eat it.


----------



## vineyarder

PerryM said:


> there is NO reason why a DC can't:
> 1) Return 80% of CURRENT selling price.  HCC did it.
> 2) Guarantee the refundable part of my deposit - simple; have the principals pledge their homes and property to cover the deposits.
> 3) 100% transparent in operations and CPA verified audits of critical things like 8 memberships being sold and not 9 per unit.



Yes, of course they _could_... I already addressed this:

_"my guess is that it will come with a much higher pricetag; back to same old higher cost/lower risk vs. higher risk/lower cost equation. And it is certainly reasonable to choose higher cost/lower risk (it appears that is Kag's choice; he'd rather pay more but be more certain of what he is getting). On the other hand, that flies in the face of your earlier comments about "DC math" and how you can do much better with rentals... 

Right now the majority of DCs are still in the phase of appealling to early adopters who are willing to take on higher risk to get lower costs (appropriate for this stage of the industry). At this stage they are not staying up nights worrying about how to get Perry M as a member. Once the industry matures, and the 'early adopter' market is saturated, then they will begin to tailor their approach to appeal to more risk-averse customers."_

As for founders pledging their personal assets to guarantee the return of your deposit, I cannot see that happening...  I've been a founder or director of a dozen start-ups, and an investor in a dozen others, and we have never pledged our personal assets; on the contrary, they are always protected as best we can by the corporate viel... and that has not stopped us from getting $4m - $90M in investments, from investors that are not risk-averse...




> I guess I've given everyone enough time to respond to my challenge of ANY DC verifying that they are NOT overselling their memberships with a CPA statement of the fact.



PE does do this annually, and also publishes (on the members-only website) quarterly updates on memberships sold, ratio of members to homes, and occupancy rates for the quarter, and includes a link to download the quarterly financials and minutes of the board of directors minutes.  In addition, the statutory board (as well as an advisory board) has member representation.


----------



## NeilGoBlue

PerryM said:


> I am addressing DC's in this thread - there is NO reason why a DC can't:
> 1) Return 80% of CURRENT selling price.  HCC did it.
> 2) Guarantee the refundable part of my deposit - simple; have the principals pledge their homes and property to cover the deposits.
> 3) 100% transparent in operations and CPA verified audits of critical things like 8 memberships being sold and not 9 per unit.
> 
> 
> .




Bellehaven's meets your criteria.  

1. It returns 90% of current pricing
2. There is no debt and the members own 100% of the homes.  So, in a liquidation, we would get 90% of the sales prices of the homes, (10% to bellehavens)
3.  I believe that Bellehaven's CPA audit would meet your criteria.


----------



## vineyarder

PerryM said:


> A "House of cards" is any organization that can implode in a second - the DC industry is a prime example.



Technically this is not correct; an organization cannot, by definition, implode.  An implosion concentrates energy and matter; this does not occur in a bankrupty or business failure.  A 'house of cards' could implode, but that would require the strategic and calculated application of external forces.  A 'house of cards' may (or may not) be an unstable structure at risk of *collapse*.  If you are saying that DCs have an inherently unstable business structure, then they at risk of failure (not implosion), and the appropriate 'house of cards' analogy would be '*collapse*', not implosion.


----------



## vineyarder

NeilGoBlue said:


> Bellehaven's meets your criteria.
> 
> 1. It returns 90% of current pricing
> 2. There is no debt and the members own 100% of the homes.  So, in a liquidation, we would get 90% of the sales prices of the homes, (10% to bellehavens)
> 3.  I believe that Bellehaven's CPA audit would meet your criteria.



Great - Perry, let us know where you decide to go on your first Bellehaven's vacation!


----------



## PerryM

*You say explode, I say implode....*



vineyarder said:


> Great - Perry, let us know where you decide to go on your first Bellehaven's vacation!



I've looked at Bellehavens - it is the closest to what I envision in a DC.  However, just because they meet it does not mean they won't be sucked into a whirlwind of the DC marketplace being hit with bad press due to the shakiness of DCs.

I view DCs as unproven - they are about 10 years old and just look at what happened to the Sub-Prime market - hundreds of lending institutions belly up in the blink of an eye.  Look at the consumers sucked into an imploding market - bankruptcies and ruined lives.

I see little difference between the high-rollers who ran those sub-prime companies and DC's - somebody show me the difference.

Conclusion:
Bellehavens is close to what I want, but it can suffer just as bad as any other DC if they should meet a fate like the Sub-Prime folks.  I can easily see this happening.


----------



## Bourne

PerryM said:


> I've looked at Bellehavens - it is the closest to what I envision in a DC.  However, just because they meet it does not mean they won't be sucked into a whirlwind of the DC marketplace being hit with bad press due to the shakiness of DCs.
> 
> I view DCs as unproven - they are about 10 years old and just look at what happened to the Sub-Prime market - hundreds of lending institutions belly up in the blink of an eye.  Look at the consumers sucked into an imploding market - bankruptcies and ruined lives.
> 
> I see little difference between the high-rollers who ran those sub-prime companies and DC's - somebody show me the difference.
> 
> Conclusion:
> Bellehavens is close to what I want, but it can suffer just as bad as any other DC if they should meet a fate like the Sub-Prime folks.  I can easily see this happening.



I hate to make a personal comment but...

what you want is a perfect DC based on your requirements...

Bellehavens comes VERY close but the DC industry is not mature enough...

By the time the DC industry matures, it will be the price point because DCs will command a price point that would not make sense to you on a cost per night basis. 

It seems to me that you are a risk taker but at lower numbers. You are risk averse with your money when the numbers get larger. Makes perfect sense. 

IMHO, a DC is not right for you. Not in its current format and not where it is going to be in terms of price point for a mature industry. Period.

What I question is your judgement regarding other people's ability to handle risk. With respect to DC's, many members are taking a higher risk than you but it is still within reasonable limits as a whole. 

Anyone taking a higher risk than you is not doomed for failure.


----------



## vineyarder

PerryM said:


> I've looked at Bellehavens - it is the closest to what I envision in a DC.  However, just because they meet it does not mean they won't be sucked into a whirlwind of the DC marketplace being hit with bad press due to the shakiness of DCs.



Huh?

Here is what you said 2 days ago...



> Originally Posted by *PerryM*
> Here is *all* that is required for any DC to get my business:



So Bellehavens steps up to the plate and meets your criteria, but you're not mailing in a check?  OK, so those criteria are 48 hours old by now.  What are _today's_ requirements for a DC to get your business??



> Originally Posted by *Bourne*
> IMHO, a DC is not right for you. Not in its current format and not where it is going in terms of price point for a mature industry. Period.



Amen. Exclamation Point.


----------



## PerryM

vineyarder said:


> Huh?
> 
> Here is what you said 2 days ago...
> 
> 
> 
> So Bellehavens steps up to the plate and meets your criteria, but you're not mailing in a check?  OK, so those criteria are 48 hours old by now.  What are _today's_ requirements for a DC to get your business??
> 
> 
> 
> Amen. Exclamation Point.




It takes, what 24 hours, to start a DC:


There are NO real estate statutes to worry about.

There are no SEC rules to worry about.

There are no DC laws that I'm aware of to worry about.

Hell, Jack the Ripper could start one and I'd bet he'd do a ripping business.


Seriously, a felon could start one - that's the status of the DC market right now.

It seems that there is an endless supply of folks who don't mind plunking down large sums of money to join a DC.  

I just don't see where its unusual to assume the DC market is in for a rough time ahead and that some will go belly up.  Is anyone here suggesting that 100% of the existing DCs will be here 20 years from now?  

If so, I'll have Jack give you a call....


----------



## TarheelTraveler

PerryM said:


> It takes, what 24 hours, to start a DC:
> 
> 
> There are NO real estate statutes to worry about.
> 
> There are no SEC rules to worry about.
> 
> There are no DC laws that I'm aware of to worry about.
> 
> Hell, Jack the Ripper could start one and I'd bet he'd do a ripping business.
> 
> 
> Seriously, a felon could start one - that's the status of the DC market right now.
> 
> It seems that there is an endless supply of folks who don't mind plunking down large sums of money to join a DC.
> 
> I just don't see where its unusual to assume the DC market is in for a rough time ahead and that some will go belly up.  Is anyone here suggesting that 100% of the existing DCs will be here 20 years from now?
> 
> If so, I'll have Jack give you a call....



I think that you seriously underestimate what it takes to start a DC, particularly a successful DC.  Based on what I saw when looking at the various options, I was surprised at the level of legal documentation and work that goes into what seems like a fairly simple idea.  The devil is always in the details.

Not all DCs will make it, but does it mean that the members or investors will lose all of their money or is it more likely that the weaker clubs get absorbed into the stronger ones or maybe you don't get all of your deposit back once the properties are liquidated. In any event, you can't suggest to me that every timeshare or real estate development will be there 20 years from now or that you won't lose all or a portion of your money.

The T&H bankruptcy did not curtail the growth of the DC industry.  It led to more protection for the consumer and better business practices.  Given the complete financial mismanagement of that DC, I was pleasantly surprised with the positive result for most members.

Like anything else, there are definitely risks with DCs, but also ways of mitigating those risks.


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## vineyarder

PerryM said:


> It takes, what 24 hours, to start a DC:
> 
> 
> There are NO real estate statutes to worry about.
> 
> There are no SEC rules to worry about.
> 
> There are no DC laws that I'm aware of to worry about.
> 
> Hell, Jack the Ripper could start one and I'd bet he'd do a ripping business.
> 
> 
> Seriously, a felon could start one - that's the status of the DC market right now.
> 
> It seems that there is an endless supply of folks who don't mind plunking down large sums of money to join a DC.



unless this is a new development within the past 48 hrs, these comments are irrelevent vis-a-vis your prior statment as to what a DC needed to do to get your business:

Here is what you said 2 days ago...




> Quote:
> Originally Posted by *PerryM*
> Here is *all* that is required for any DC to get my business:



So Bellehavens steps up to the plate and meets your criteria, but you're not mailing in a check? OK, so those criteria are 48 hours old by now. What are today's requirements for a DC to get your business??




> Quote:
> Originally Posted by *Bourne*
> IMHO, a DC is not right for you. Not in its current format and not where it is going in terms of price point for a mature industry. Period.



Amen. Exclamation Point.



> Originally Posted by *PerryM*
> Seriously, a felon could start one - that's the status of the DC market right now.



That is the status of the vast majority of industries in the USA; there are very few businesses that a felon *cannot* start!  A felon can become a physician, a lawyer, or even the President of the United States.  But this aside, you could, without much effort, obtain background checks on the principals of any DC that you were seriously interested in joining...  This 'Jack the Ripper' line of reasoning is reeeeally stretching the credibility of your arguments!  To paraphrase:  'Yes, Bellehavens meets my criteria of what I wanted in a DC 48 hours ago, and teh industry hasn't changed in the last 48hrs, but OMG, maybe it was started by a felon!'  

I'm getting the idea that maybe you're just posting here as a case study in fallacial logic for some high school class to have fun analyzing?


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## Steamboat Bill

PerryM said:


> I view DCs as unproven



It surprises me that nobody compares joining a DCs with joining a private golf club or even a resort like the Boca Raton Resort and Spa.

There are 10s of thousands of people that join golf clubs and resort spas. The Boca Resort has a 5:1 new member to refund ratio and costs about $50k to join. Donald Trump charges $100k or more to join Mar-a-Largo club and $300k to join his private golf club in WPB.

Nobody who joins these clubs ever worries about if they are proven or not or that the "math does not work". They just enjoy the amenities of the club. A DC is the same concept.

Too often TUGers compare a DC to a TS and they should really compare it to a private golf or spa club.

In fact, I am the only one of my Boca friends that is not a member of a private golf club or the Boca Resort. It's not that I don't want to join, I just don't see much value as I don't play golf that much or go to "the club" that often. I get invited all the time for free!

Now a DC represents great value to me and some of my Boca friends are beginning to see the light.


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## vineyarder

*If you only have a hammer, everything looks like a nail...*



Steamboat Bill said:


> It surprises me that nobody compares joining a DCs with joining a private golf club or even a resort like the Boca Raton Resort and Spa.
> 
> Too often TUGers compare a DC to a TS and they should really compare it to a private golf or spa club.



Perhaps, just perhaps, this has something to do with this forum being hosted by the Timeshare Users Group?  Over at the Country Club Users Group forum, they are always comparings DCs to Country Clubs....

http://www.ccug.com/forums/destclubs.php?f=32


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## travelguy

*Still In Hawaii*

I'm still in Hawaii enjoying my High Country Club membership.  I logged in to see what's going on at the TUG Non-Tra forum and I see it's still many happy DC members fighting against the DC misinformation of a few.

I'd join in but I have to get back to enjoying my DC membership now.  Keep up the good fight!

P.S. - The High Country Club Maui house is not made of cards, rather hurricane resistant concrete with a beautiful stucco finish. Oh, and the sky is not falling but is a vibrant blue and sunny.

P.P.S. - Perry, Thanks again for letting me know about DCs when you were going to buy a HCC membership last year.  Best decision I ever made! 

Aloha!


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## Steamboat Bill

travelguy said:


> P.P.S. - Perry, Thanks again for letting me know about DCs when you were going to buy a HCC membership last year.  Best decision I ever made!



Here is one of the original threads on Destination Clubs started by PerryM on July 19, 2006

http://tugbbs.com/forums/showthread.php?t=28527

Wow….HCC has really ramped up their prices.

HCC  July 2006 prices:

An Affiliate membership gives you 3 weeks of usage per year and costs $20K to join and $4,200 MF per year. A Private membership gives you 6 weeks of usage and costs $30K to join and $7,200 MF per year.

Here is the Steamboat Bill’s “Cost per Night Calculation” price breakdown:

2006 Affiliate = $1,000 lost opportunity costs + $4,200 MF = $5,200 total costs / 21 nights = $248 per night.

2006 Private = $1,500 lost opportunity costs + $7,200 MF = $8,700 total costs / 42 nights = $207 per night.

----------------------------

I missed this price level as I joined in December 2006, but I beat the two most recent price increases.


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## pwrshift

You could buy Marriott Manor Club for $8000 and $845 annual fees and get membership in the Ford's Colony Golf Course's 54 holes for 6 games a week included.  That's a pretty good deal.    

Brian



Steamboat Bill said:


> It surprises me that nobody compares joining a DCs with joining a private golf club or even a resort like the Boca Raton Resort and Spa.
> 
> .


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## vivalour

Steamboat Bill said:


> It surprises me that nobody compares joining a DCs with joining a private golf club or even a resort like the Boca Raton Resort and Spa.
> 
> Too often TUGers compare a DC to a TS and they should really compare it to a private golf or spa club.
> .



Bill, I have to disagree and find this comparison faulty for a few reasons:
1. Golf and tennis clubs (don't know much about spas) are usually rooted in a community with known owners, and some kind of local business links. DCs are remotely run (to most members) by unknown owners. 
2. DCs' business consists of buying and managing a large real estate portfolio while keeping a happy client base. A much more complicated business than running a golf/tennis club imo.
3. The industry is still new and evolving. It's hard to judge the value of your membership in one club, when the competition is always coming out with new features and deals. In other words, there is no one tried and true model.
Although there is a superficial likeness between DCs and clubs, I think there are enough differences to keep many people on the sidelines until the industry has more of a history.


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## Steamboat Bill

pwrshift said:


> You could buy Marriott Manor Club for $8000 and $845 annual fees and get membership in the Ford's Colony Golf Course's 54 holes for 6 games a week included.  That's a pretty good deal.
> 
> Brian



I actually own MMC....cost per night = $180 per night for a 2 bedroom or $90 per bedroom. Thus, HCC with 3 bedroom properties average at $300 per night is almost the same cost per bedroom. The kitchen, living rooms, etc are a free bonus. I really like the MMC property and the "free golf" but most HCC properties are far superior to MMC.




vivalour said:


> Bill, I have to disagree and find this comparison faulty for a few reasons:
> 1. Golf and tennis clubs (don't know much about spas) are usually rooted in a community with known owners, and some kind of local business links. DCs are remotely run (to most members) by unknown owners.
> 2. DCs' business consists of buying and managing a large real estate portfolio while keeping a happy client base. A much more complicated business than running a golf/tennis club imo.
> 3. The industry is still new and evolving. It's hard to judge the value of your membership in one club, when the competition is always coming out with new features and deals. In other words, there is no one tried and true model.
> Although there is a superficial likeness between DCs and clubs, I think there are enough differences to keep many people on the sidelines until the industry has more of a history.



I am NOT comparing the "business" of a DC vs golf club, I am comparing the cost, benefits, and satisfaction of their members. I know over a dozen people that have spent $50,000-$200,000 to join a private golf club or private resort. The only benefit is getting to play golf, eat at the clubhouse, hang out by the pool, hob-nob with others, etc. When I tell these people about DCs and describe it as a private club where you get to use upscale properties, they immediately understand. The funny thing is nobody questions the business model of DCs or compares them to timeshares....only TUGers do that.


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## Kagehitokiri

i agree with bill here, DCs are MEMBERSHIP based, not OWNERSHIP based.

it seems to me thats part of what perry doesnt like. he wants clubs to have to accept anybody and have to have no standards or ability to set their own prices etc. personally, i like things to be closer to "invite only." i dont qualify for amex centurion right now, but i dont want them to lower their requirements, because that would only ensure faster decrease of benefits.

IMHO theyre comparable to high end fractionals, even though theyre ownership based, because theyre the same kind of luxury commodity. 

the luxury market is NOT affected by the media, at all..


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## PerryM

As I’ve said many times before, someday we will buy a DC membership – I suspect that when that happens that DC will be considerably different than the model currently used, or a new one will come around and my “throw away” tolerance of $35k will have us in a club that offers at least 2 holiday weeks per year.  I can’t guess which will come first.

I also suspect that we will be in units that are a bit better than high end Westins/Marriotts but not above $1 M.

Until then I’ll keep reading the exploits of DC owners.


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## Bourne

2 holiday weeks for < 35K... 

It's not gonna happen. Impossible with an equity model...

Then again, for a bit more I would recommend HCC Affiliate with a customized option. 

For 45K(40 + 5), you could get 25 days with 2 holiday weeks. Its not too far from your 35K limit and HCC is a reasonably safe bet with 400+ actual members.


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## GOLFNBEACH

Steamboat Bill said:


> I am NOT comparing the "business" of a DC vs golf club, I am comparing the cost, benefits, and satisfaction of their members.



I've used the country club analogy before, but I'm not sure it really fits.  I suppose there are numerous reasons for joining a CC, but the main benefits are the ability to play golf and socialize at an exclusive club - a club where outsiders do not have access.  Most DCs that I am familiar with will accept anyone who is willing to write a check.

When you join a DC you generally travel with your existing circle of family and friends - not with the DC membership.


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## Tedpilot

*Shocker....?*

I feel compelled to go back to the original thought Perry had w/ VRBO.  I have had average to poor experiences w/ VRBO...units are in the right place but tend to have poor finishings, are tired, or the reservation process was cumbersome and that all drove me crazy.  I did have much better luck w/ some of the villa rental sites, particularly those that deal with the Carribean.  I once snagged a very nice 5 bedroom villa in St Lucia w/ a daily maid/chef, private pool and ocean front for less than $300/night and that was at the end of the prime season.  BTW, St Lucia is over rated, I'll never go back.

Shocker #1:  When I was doing my due dilligence on HCC in Nov/Dec 05' I scoured for every piece of info about HCC I could find - the people, the registration of the company, telephone numbers, etc...I didn't want to be had by a scam.  During that search I came across a couple of VRBO ads that were HCC units!!!  This struck me very oddly, but when I asked Heath about these ads he said that they did list them.  He said it was to gain some income and expose the properties and concept to a potential market segment which made perfect sense.  My concern was that they might book up time that I thought was for the exclussive use of HCC members.  

The reality is that they shortly there-after quit the VRBO angle.  Maybe a few months later once they got some momentum with memberships.  I can say I'd do the same thing when I had just 20 members too.  In any case it did not last long and I have not seen this practice since then.

Shocker #2:  VRBO does have some quality units in their system but by and large HCC prices per night are better.  If you look at the units down in Playa Del Carmen you'll see direct comparisons of apples vs apples with the Luna Encantada units listed.  Off season you can get one of the Luna units almost as cheap as you can through your HCC membership, otherwise they are much more expensive per night through private parties.  Of course, this is just this one location and I have not done much research of other comparable units.

I do describe the semantics of the DC concept similar to a golf or country club concept and those in the know understand this simple analogy.  I've had a few friends jump in and join HCC too, they see the inherent value and the added benefits of what the staff provides.  They have questioned the financial model but each of them has felt comfortable enough to send in a check.

It does appear to me that the DC industry will not now or ever be able to provide what Perry is looking for.  I also doubt that he could ever out-perform what most DCs offer by using the listings in VRBO without spending in excessive amount of time to get just the right unit at the right time with significant negotiations either.  Even if he did, he would lose some of the non-tangible value of membership services through the respective DCs.


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## vivalour

Tedpilot,
Thanks for your input re "shockers". Interesting points. We are about to hop off the fence and join HCC as well -- good to hear they had enough integrity and sense to admit why they were listing HCC properties for rent. I gather HCC's second "brithday" is in November. They have come a long way!


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## Tedpilot

Vivalour - Glad to hear that you are moving on your decision to join.  I've only had good experiences in dealing w/ HCC and they have always answered my questions quickly and in a straight forward manner.  Two attributes I really appreciate.  I also did not feel like I was dealing with snake-oil salesman during the due dilligence phase, they answered questions, never pushed for a "sale" and were readily available to discuss my concerns for this emerging sector of travel.  So far so good, I hope they keep up the great service!

Ted


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