# Buy to Flip?



## CMF (Dec 22, 2010)

Does anyone believe that this is the time to scoop up an eBay week or two at rock bottom prices, rent them for a few years, then resell when prices recover?

Will prices recover???

Charles


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## GregT (Dec 22, 2010)

CMF said:


> Does anyone believe that this is the time to scoop up an eBay week or two at rock bottom prices, rent them for a few years, then resell when prices recover?
> 
> Will prices recover???
> 
> Charles



Charles, 

I love the creativity, but don't think this will be a profitable exercise.   I think renting won't be simple and I think with MFs going up, prices will remain depressed.

I've been offering a Week 25 Studio for rent on redweek.com or for points exchange, but no takers.   The only offer I've received was for 80% of what I'm asking and it's not that important.  I suspect I'll just deposit it into II.    

So, I think renting isn't a sure thing, but increasing MFs are!!!!

I do think however that if there is a timeshare you know you will use, and you can afford the MFs, that it's a good time to buy that deeded property.

All the best,

Greg


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## DanCali (Dec 22, 2010)

CMF said:


> Does anyone believe that this is the time to scoop up an eBay week or two at rock bottom prices, rent them for a few years, then resell when prices recover?
> 
> Will prices recover???
> 
> Charles



Banking on prices to recover would not be wise since Marriott has been very consistent over the years with destroying resale values by increasing MFs and changing rules. There is no reason to believe they will change that.

The only time I'd consider buying to flip is if you follow one or several resorts, are very familiar with the current prices, and then manage to find a week selling for much less. This can happen on eBay if an auction is mislisted (I've seen several Starwood ones that were...) so it doesn't show up on people's automated searches, or if you find a seller off eBay who is either uninformed or just wants to sell quickly at any price. This would allow you to flip within a couple of months and make a profit rather than wait a coupld of years to see if prices recover.


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## Mr. Vker (Dec 22, 2010)

GregT said:


> Charles,
> 
> I love the creativity, but don't think this will be a profitable exercise.   I think renting won't be simple and I think with MFs going up, prices will remain depressed.
> 
> ...




Agree totally. If you consider MF in the $1k range, you have to rent for a decent amount to cover them and count on a lot of appreciation.


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## jimf41 (Dec 22, 2010)

I've never rented nor sold one of my timeshares so I'm hardly an expert. On the other hand I've never seen anybody ever suggest that buying a TS was a good investment tool.

If you were to try to invest in this manner I would say that right now is the "buy low" part of the "Buy low, sell high" investment strategy. I don't think the "Sell high" part will come to pass for a few more years, if ever


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## ondeadlin (Dec 22, 2010)

Prices will never rise again IMO.

There are opportunities to flip from time to time, but the sums to be gained aren't enough to justify the trouble, again IMO.


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## Stefa (Dec 22, 2010)

jimf41 said:


> I don't think the "Sell high" part will come to pass for a few more years, if ever



I agree with this.   While it is possible prices will recover at some point (I personally don't believe this will happen) it is also possible that you will find yourself in a position where you can't even give away the timeshare.   I would advise against buying anything you don't plan to use.


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## SueDonJ (Dec 22, 2010)

Like Jim I've never rented or sold timeshares, or bought on the resale market for that matter, so I'm definitely no expert.  Plus I've never thought of timeshares as financial investments, and buying them as deliberate flip vehicles makes less sense to me than any other timeshare-as-investment tool (even in the best market.)  I'm having heart palpitations for you just thinking about it.


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## CMF (Dec 22, 2010)

It's a crazy business and I'm not likely that I'll buy to flip.  The thought crossed my mind when a Manor Club platinum week sold for under $700 last night.  I do hope that prices pick up.

Charles


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## larryallen (Dec 22, 2010)

It's not a get rich quick plan. However, if you really know a resort, bid low, you can get a good deal on a purchase.  You can then put on Redweek at a higher price and some actually do sell. In the meantime you pay your fees, enjoy the resort (take a vacation there), and hope it sells within a year so you don't have to pay fees again.  You have to do it with the expensive resorts to be worthwhile since it's always a percentage gain and simply not worth it to buy for a cheap resort for $800 and then sell it for $1,400.  However, if you can put a nice resort for $12k and sell 6 months later for $17k maybe it's worth it. I use those numbers as the Ko Olina 2 bedroom that closed last night for $12,176 has "asking" prices on Redweek of $16,500 and up. So you buy for $13k (including closing costs) list on Redweek for $18k, sell for $17k and you make $4k. I suppose it's worth a try. However, there is no telling where the timeshare bottom is so make sure you buy really smart to cut your chances of losing money and keep track of the market once you list on redweek so you don't trail the market continuing to drop.


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## mwwich (Dec 22, 2010)

One often prospers the most when conventional wisdom says not to buy (maximum pessimism)....but despite that I don't think I would buy what you're not going to use.


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## timeos2 (Dec 22, 2010)

*They have disappeared - no timeshare is worth over $5K anymore*



larryallen said:


> However, if you can put a nice resort for $12k and sell 6 months later for $17k maybe it's worth it. I use those numbers as the Ko Olina 2 bedroom that closed last night for $12,176 has "asking" prices on Redweek of $16,500 and up. So you buy for $13k (including closing costs) list on Redweek for $18k, sell for $17k and you make $4k. I suppose it's worth a try. However, there is no telling where the timeshare bottom is so make sure you buy really smart to cut your chances of losing money and keep track of the market once you list on redweek so you don't trail the market continuing to drop.



First I agree with the majority of replies that say it is an extremely risky "investment" and highly unlikely to produce a significant profit. Way too risky as timeshares in general just aren't an in demand commodity. 

Then to the idea that any timeshare might still be worth $12K:hysterical: or more in today's market. You are dreaming. The maximum for 99% of all timeshares is maybe $5K. That for the best of the best in every facet (location, use dates, size & overall quality). Even those that meet or exceed that high bar still get hammered due to the high fee commitment that comes along for the ride. Once the $5K price is exceeded it becomes way too risky to assume anyone would ever pay that to YOU when you decide to sell. It is just too easy to rent or find another seller to risk any purchase above $5K. And most - 80% I'd guess - aren't close to $5K but more like $2K or less. Usually far less. 

I'll admit there may be a handful - no more - of great resorts & times (or views or size or something) that will garner a singe bid of over $5K IF the right buyer, who just HAS to have have it no matter what the financial loss down the road, decides to buy. But that is so rare as to be virtually impossible. Thinking your week is one of those very very few is fooling yourself. Assume the most any week will bring is $5K. Or less. That's reality.


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## larryallen (Dec 22, 2010)

_Then to the idea that any timeshare might still be worth $12K or more in today's market. You are dreaming. The maximum for 99% of all timeshares is maybe $5K. That for the best of the best in every facet (location, use dates, size & overall quality). Even those that meet or exceed that high bar still get hammered due to the high fee commitment that comes along for the ride. Once the $5K price is exceeded it becomes way too risky to assume anyone would ever pay that to YOU when you decide to sell. It is just too easy to rent or find another seller to risk any purchase above $5K. And most - 80% I'd guess - aren't close to $5K but more like $2K or less. Usually far less. 

I'll admit there may be a handful - no more - of great resorts & times (or views or size or something) that will garner a singe bid of over $5K IF the right buyer, who just HAS to have have it no matter what the financial loss down the road, decides to buy. But that is so rare as to be virtually impossible. Thinking your week is one of those very very few is fooling yourself. Assume the most any week will bring is $5K. Or less. That's reality.
_


I determine what stuff is "worth" by what they SELL for on Ebay. That's REALITY.  I am not dreaming.  I encourage you to check Ebay closed auctions before you make offensive comments. Every other year, mountain views, at Ko Olina have SOLD, in the last two weeks, for $5k and $6k. The two bedroom, ocean view, annual SOLD last night for $12,176 so, as of today, it's worth $12,176 plus costs. Additionally, I know for a fact that people do pay the high asking prices on Redweek sometimes. You just need to dangle it until someone bites. I personally don't own a timeshare week but I think your comments are rude, offensive, and flat out wrong. Good day. Ebay Linky Dinky


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## timeos2 (Dec 22, 2010)

*Rude? I don't thinkso. Offensive? Maybe to sellers. Wrong? Not IMO - but you may be.*



larryallen said:


> I determine what stuff is "worth" by what they SELL for on Ebay. That's REALITY.  I am not dreaming.  I encourage you to check Ebay closed auctions before you make offensive comments. Every other year, mountain views, at Ko Olina have SOLD, in the last two weeks, for $5k and $6k. The two bedroom, ocean view, annual SOLD last night for $12,176 so, as of today, it's worth $12,176 plus costs. Additionally, I know for a fact that people do pay the high asking prices on Redweek sometimes. You just need to dangle it until someone bites. I personally don't own a timeshare week but I think your comments are rude, offensive, and flat out wrong. Good day. Ebay Linky Dinky



Larry -  You don't even own and you feel that strongly about it? Wow. While it hurts - believe me I am at the head of the list that wants my ownerships (now down to four and dropping from a one time high of 9) to be worth a great deal to a new buyer. I don't, and never did, expect anything close to developer prices for the reasons covered many times here but I did think that buying resale would, at worst, leave me in a spot to resell at least for what I paid. It hasn't happened since 2008 - although prior to that there were isolated cases where we sold for the purchase cost or slightly more. But those days are long gone. 

Until you have weeks to sell or sit on a timeshare Board or two to hear first hand just what people are trying to sell and what they are getting for offers and, of course, SOLD units on eBay where a few hundred is a good sale - most go unclaimed - you just don't know how really bad the market has become. It is easy to look at the offerings and think things are scraping by but that just isn't the case. A resale buyer - at any price - is a very rare commodity and most know that they have the supreme upper hand. Offering prices mean absolutely nothing. Only completed sales. And any of those above $2K are getting harder and harder to find. Again there will be the occasional super demand unit or an uninformed buyer that pays WAY too much  but they are fewer and fewer as word gets out. Your own linked list shows the one sale (and that may or may not actually be completed as bids are NOT binding on eBay) while the rest are at $1000 or far less. 

If you are a buyer you are in a great market never seen before. If you are a seller it is the worst time ever to try to get a good price. If those facts are offensive so be it.  I know I'd like to see a robust and thriving resale market for a number of reasons. It just isn't so and isn't likely to change anytime soon. If ever.  If you feel that is the wrong take then you are welcome to buy in and then sell for a decent profit to prove me wrong. I wouldn't advise trying but more power to you if you can pull it off. If I'm wrong I couldn't be happier as it means all owners are better off. Unfortunately I don't think that's the case.  Merry Christmas.


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## Big Matt (Dec 22, 2010)

I think that it is a good opportunity for folks to get into timesharing that maybe wouldn't know what to do otherwise.  I have three or four friends that I'm trying to educate on how it all works.  For these folks, spending very little to get in is a good move in my mind, especially for those that want to go back to the same place year after year.


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## jimf41 (Dec 22, 2010)

larryallen said:


> _ I personally don't own a timeshare week but I think your comments are rude, offensive, and flat out wrong. Good day. _


_

I agree with you that John is  "flat out wrong" about the current pricing of any TS being no more than $5-6k. I rarely agree with his theories in that area. 

As far as the rude and offensive part I really don't see what portion of his post fell into that category._


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## wof45 (Dec 22, 2010)

I guess I am the contrarian, and I have rented weeks both on ebay and on red week.

The key, is to buy a really good time and location, and to pick it up for virtually nothing.

This is the time of the year to do it since people are trying to quickly sell in order to not pay the MF for next year.

As opposed to the usual "buy where you like to stay", investments need to be based on where and when get the best rentals, making sure that the rentals easily cover the maintenance fees.

If you watch closely enough, you will see some auctions come buy that no-one else pays attention to -- especially during the Christmas to New Year's holidays when people are busy with other things.

Don't buy anything for much more than $1,000 which will leave some room for resale.

My best example of this recently was a late February week that we bought in Fort Lauderdale and resold in the past few months.  There was actually a broker involved looking for a specific location and time in order to put together 8 total weeks for a buyer who wanted the winter season.

But, don't buy what you like -- buy what the market values, and only buy when the price is way below current auctions.

That is my opinion, and we are not buying now since we are still collecting cash to pay for a condo for retirement.


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## laurac260 (Dec 22, 2010)

ok, so all this talk about e-bay certainly got my curiosity up, so I went and looked for myself.  I have a few questions, for anyone who is familiar with e-bay and would care to entertain my questions.

#1, why are there so many timeshares (specifically Marriotts I am interested in), that do not list the week or season they have?  

#2, If say, your primary interest is HHI, and the only time you could really travel due to kids is platinum (summer) season, AND you wanted to possibly pick up a second week to go along with your current plat week, would it make any sense at all, or would it be just plain stupid, to pick up a soft season week and attempt a trade in?  And if that was at all possible, how would it work?  I ask because I am assuming that, if the weeks for sale were PLATINUM weeks, the seller would list that as a bigger enticement.  I see only one Marriott Grande Ocean on e-bay with active bidding happening.  I think it was a plat week, though I could be remembering incorrectly.  

Last year I thought it would be a piece of cake to pick up a second week as a rental, as it was in 2009, for a decent price.  No such luck.  No own was willing to accept an offer below $2000 for rental.


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## ada903 (Dec 22, 2010)

I flipped two Marriott gold weeks and one Westin in the past six months. However, the profit was small, especially when you add closing costs and taxes (I will have to claim a 1099 form I assume). I was just lucky. I did not buy the weeks to flip them, I bought them and then decided to sell and wait for a good deal on a platinum week instead since prices keep sliding.  My rule is that I would buy again somewhere I enjoy using, at a great price, and if I can flip it, great, but if not, I will be happy to continue to use. 

I agree what you see on redweek is asking prices, reality market prices are eBay based.  Non eBay sellers will bargain down their prices too, perhaps even close to eBay levels. It is hard to find someone willing to pay a higher price tag, and there is too much uncertainty in the market to think of any purchase as investment. It's a great time to invest in yourself - find something you use every year at a great price and use it. Unfortunately for me, I have not found the place where I would like to go back every year, so I bought an economical but powerful trader and I keep trying on different places until I find the one.


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## scrapngen (Dec 22, 2010)

laurac260 said:


> ok, so all this talk about e-bay certainly got my curiosity up, so I went and looked for myself.  I have a few questions, for anyone who is familiar with e-bay and would care to entertain my questions.
> 
> #1, why are there so many timeshares (specifically Marriotts I am interested in), that do not list the week or season they have?
> 
> ...



To answer #2:  I do NOT believe it would be in your best interest to buy a soft season to trade into a better season re: Marriott's. With the new Dest. Points system, the weeks to trade for won't be as available over time so trading will be harder Marriott to Marriott. I would buy in the season you wish to reserve. It is a good time to buy Marriott weeks, though, if you plan to use them as prices are falling. I still think a resale week is far better than points (right now)  if the purpose is to use. 

A salesperson couldn't believe what I picked up a HI Waiohai week for - resale. Tried to pitch points but finally gave up with the dollar figures in front of her.


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## Stefa (Dec 22, 2010)

laurac260 said:


> ok, so all this talk about e-bay certainly got my curiosity up, so I went and looked for myself.  I have a few questions, for anyone who is familiar with e-bay and would care to entertain my questions.
> 
> #1, why are there so many timeshares (specifically Marriotts I am interested in), that do not list the week or season they have?
> 
> ...



One reason they don't list the season is that a lot of ebay sellers don't really know what they are selling.  They also frequently cut and paste the information from prior listings so they try to keep them generic. 

HHI platinum can be a tough trade so I wouldn't buy low season hoping to trade in.  Ths is especially true if you want to line up back-to-back weeks.  Buying to trade up works best when you are flexible and it doesn't sound like you are very flexible at this time.  HHI platinum isn't s great bet during flexchange since a lot of owners live within driving distance so there may still be a lot of competition.


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## larryallen (Dec 22, 2010)

*You are a moderator? Amazing!*

My experience, at a lot of different message board sites, is that mods do not try to incite but rather work to keep people focused, friendly, etc....  Your statements do not address my posts but rather go some other direction becuase you are defensive about all the timeshares you have had to dump. Plus, I feel your posts are rude. I realize others did not agree with me so possibly I am wrong but I did take offense. I am sorry you are upset about your timeshares losing value.  It is clear you do not understand simple economics so I will not try to explain myself further. Also, not all of us celebrate Christmas but Happy Kwanza to you my friend!   


_Larry - You don't even own and you feel that strongly about it? Wow. While it hurts - believe me I am at the head of the list that wants my ownerships (now down to four and dropping from a one time high of 9) to be worth a great deal to a new buyer. I don't, and never did, expect anything close to developer prices for the reasons covered many times here but I did think that buying resale would, at worst, leave me in a spot to resell at least for what I paid. It hasn't happened since 2008 - although prior to that there were isolated cases where we sold for the purchase cost or slightly more. But those days are long gone. 

Until you have weeks to sell or sit on a timeshare Board or two to hear first hand just what people are trying to sell and what they are getting for offers and, of course, SOLD units on eBay where a few hundred is a good sale - most go unclaimed - you just don't know how really bad the market has become. It is easy to look at the offerings and think things are scraping by but that just isn't the case. A resale buyer - at any price - is a very rare commodity and most know that they have the supreme upper hand. Offering prices mean absolutely nothing. Only completed sales. And any of those above $2K are getting harder and harder to find. Again there will be the occasional super demand unit or an uninformed buyer that pays WAY too much but they are fewer and fewer as word gets out. Your own linked list shows the one sale (and that may or may not actually be completed as bids are NOT binding on eBay) while the rest are at $1000 or far less. 

If you are a buyer you are in a great market never seen before. If you are a seller it is the worst time ever to try to get a good price. If those facts are offensive so be it. I know I'd like to see a robust and thriving resale market for a number of reasons. It just isn't so and isn't likely to change anytime soon. If ever. If you feel that is the wrong take then you are welcome to buy in and then sell for a decent profit to prove me wrong. I wouldn't advise trying but more power to you if you can pull it off. If I'm wrong I couldn't be happier as it means all owners are better off. Unfortunately I don't think that's the case. Merry Christmas.
_


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## MOXJO7282 (Dec 22, 2010)

I think for the most part TSing are worth 10-20 cents on the dollar, but there are cetainly some that aren't, so 99% is inaccurate.

I'm not sure how that conclusion can be made because there are many.many TSs that change hands that we don't see. For instances, I follow Maui Marriott 2 BDRM OF and OV units. First off I see very few of those go  through Ebay and Redweek, so its a very small sampling.

I say I don't believe there is money to be made in flipping, unless you're working really hard, but I do think buying low and renting/using is a sound approach.

Good example. Buy two Newports for $8500-$9500 on eBay (this is another resort I follow and I've noticed slight uptick in ebay resale for sure.) Secure two summer weeks, use one for vacation rent one for at least both MFs, but typically for more than MF.

If you do that for 10 years or some variation of that eeven if you sell for $5K you received great value.

I've been doing this with my weeks for years, so its not buy low and flip low, its buy low and hold to use/rent.


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## bdh (Dec 22, 2010)

*Motion carries*



> I agree with you that John is  "flat out wrong" about the current pricing of any TS being no more than $5-6k. I rarely agree with his theories in that area.



I'll second that motion. 

Pulled from the *wood board:

Recent e-bay prices for WKV 2 bedroom Plat:

12/21/2008 2 bd LO EY Plat $13512
12/22/2008 2 bd LO EY Plat $12212
2/24/2009 2 bd LO EY Plat $17590
2/27/2009 2 bd LO EY Plat $15712
10/13/2009 2 bd LO EY Plat $15100
12/3/2009 2 bd LO EY Plat $17100
2/25/2010 2 bd LO EY Plat $19357
3/16/2010 2 bd LO EY Plat $17100
5/18/2010 2 bd LO EY Plat $17450
5/24/2010 2 bd LO EY Plat $13222

As far as buying goes - no matter what the reason (to use or to flip), if a person is ever going to buy a TS, the current economic conditions make this a good time to do it.


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## windje2000 (Dec 22, 2010)

MOXJO7282 said:


> I think for the most part TSing are worth 10-20 cents on the dollar, but there are cetainly some that aren't, so 99% is inaccurate.
> 
> I'm not sure how that conclusion can be made because there are many.many TSs that change hands that we don't see. For instances, I follow Maui Marriott 2 BDRM OF and OV units. First off I see very few of those go  through Ebay and Redweek, so its a very small sampling.
> 
> ...



I think that's the right way to look at timeshare.  It's a rent v. buy decision.  

One's choice is either to rent occupancy or own occupancy.  If you own, you can 


collect cash rent, or 

use the occupancy and avoid paying that cash rent.
The value of the timeshare is the risk adjusted present value of the excess of the future rents (either avoided or collected) net of the future maintenance fees. 

If you choose rent over buy, you retain the option to do nothing -- meaning not rent.  The option to do nothing has value.  Why?  

Because if you own, you MUST either use it or rent it.  You can't do nothing.  There is risk associated with renting for cash if you can't use or don't need the occupancy.  Those risks include price, inability to rent, etc. - all the normal risks associated with being a landlord.  The present value discount rate must reflect those risks -- present value is not calculated using a 'risk free' rate.  You as a renter pay the owner for taking those risks.

Timeshare prices are currently so low that the fair rental value of the occupancy it represents is primarily the future maintenance fees.  If you can use the occupancy, or are willing to take the risks of renting the occupancy, its probably not a bad time to buy.  The only way prices can get much lower is when we see owners start paying buyers to assume the future maintenance fees to take the timeshare off their hands.


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## AwayWeGo (Dec 22, 2010)

*Are Those Opening Bid Amounts?  Or Completed Auction Amounts?*




bdh said:


> Recent e-bay prices for WKV 2 bedroom Plat:
> 
> 12/21/2008 2 bd LO EY Plat $13512
> 12/22/2008 2 bd LO EY Plat $12212
> ...


Just curious -- not in the market myself for any 5-figure timeshares.  

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## DanCali (Dec 22, 2010)

AwayWeGo said:


> Just curious -- not in the market myself for any 5-figure timeshares.
> 
> -- Alan Cole, McLean (Fairfax County), Virginia, USA.​



Completed auction amounts.

Another one for the same resort ended yesterday.


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## london (Dec 22, 2010)

*Great Analysis*



windje2000 said:


> I think that's the right way to look at timeshare.  It's a rent v. buy decision.
> 
> One's choice is either to rent occupancy or own occupancy.  If you own, you can
> 
> ...



I agree we your analysis, and the current market reflects the situation.

Rents are just at or very little more than maintenance fees.

I just rented one of my Cocoa Beach weeks for about $100 over the MF.


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## dioxide45 (Dec 22, 2010)

larryallen said:


> My experience, at a lot of different message board sites, is that mods do not try to incite but rather work to keep people focused, friendly, etc....  Your statements do not address my posts but rather go some other direction becuase you are defensive about all the timeshares you have had to dump. Plus, I feel your posts are rude. I realize others did not agree with me so possibly I am wrong but I did take offense. I am sorry you are upset about your timeshares losing value.  It is clear you do not understand simple economics so I will not try to explain myself further. Also, not all of us celebrate Christmas but Happy Kwanza to you my friend!



The mods on TUG post of their own personal experience. Mods are not just the board police. They are here to talk about their own experiences and opinions. They may ore may not be opinions you like or agree with. When posting in their official duty as moderator, they indicate such.

Further to the point, I have to agree with John on this. There are not any timeshares out there that are worth five figures. And I think the reference is more to where these will be in 3-5 years, not what they are worth now. Anyone buying in today's market thinking prices are at bottom will be in for a surprise 3-5 years from now. We bougth a Grande Vista gold unit three years ago for $7500, was it worth that? Probably not. Were those inflated house prices really worth what they were selling for four years ago. Even at that time people were saying we were in for a real big adjustment because homes were not worth what they were selling for.

Off season and shoulder weeks have already dropped to near zero for even the major hotel properties. While prime season tend to hold their value longer, they too will see the same drops in prices. The same thing happens here as happened with home vs condo prices. Condo prices are usually the first to drop.

As MF rise these units will be more and more of a burden. There are not many cases where one can spend five figures on a TS, pay the annual MF and come out ahead of renting. The continued assault on the resale market my Marriott sure won't help matters wither.


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## icydog (Dec 22, 2010)

larryallen said:


> It's not a get rich quick plan. However, if you really know a resort, bid low, you can get a good deal on a purchase.  You can then put on Redweek at a higher price and some actually do sell. In the meantime you pay your fees, enjoy the resort (take a vacation there), and hope it sells within a year so you don't have to pay fees again.  You have to do it with the expensive resorts to be worthwhile since it's always a percentage gain and simply not worth it to buy for a cheap resort for $800 and then sell it for $1,400.  However, if you can put a nice resort for $12k and sell 6 months later for $17k maybe it's worth it. I use those numbers as the Ko Olina 2 bedroom that closed last night for $12,176 has "asking" prices on Redweek of $16,500 and up. So you buy for $13k (including closing costs) list on Redweek for $18k, sell for $17k and you make $4k. I suppose it's worth a try. However, there is no telling where the timeshare bottom is so make sure you buy really smart to cut your chances of losing money and keep track of the market once you list on redweek so you don't trail the market continuing to drop.




I've had many, many timeshares up for sale this year on Redweek. I sold ZERO and my price points were correct. I don't think people are searching Redweek anymore. I used to sell and rent using them exclusively... Not anymore. I think Redweeks days are numbered. I never thought I would use Brokers but I have been doing that and my timeshares have been selling. I pay the price in fees and lowered asking prices but they sell and that's all I care about. BUT NEVER PAY AN UPFRONT FEE TO A BROKER. I never have and I never will


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## tombo (Dec 22, 2010)

icydog said:


> I've had many, many timeshares up for sale this year on Redweek. I sold ZERO and my price points were correct. I don't think people are searching Redweek anymore. I used to sell and rent using them exclusively... Not anymore. I think Redweeks days are numbered. I never thought I would use Brokers but I have been doing that and my timeshares have been selling. I pay the price in fees and lowered asking prices but they sell and that's all I care about. BUT NEVER PAY AN UPFRONT FEE TO A BROKER. I never have and I never will



I too have sold zero on redweek with many weeks currently for sale. I always list mine for the cheapest price of any comparable week at the resort and yet my weeks still aren't selling. I sold one week to a previous renter for the price of this year's rental, and I sold another week to someone who inquired about renting one of my weeks for $1 with them paying the closing costs and 2011 MF's.  That makes 2 weeks sold, 6 or 8 more to sell in 2011 (minimum). I am down from 26 total weeks owned at my worst to 18 currently. Weeks that I consistently rented for 2 to 2.5 times the MF's a few years ago are bringing current MF's or a little more in rental income in this market (if they rent at all). Last year the Gulf oil spill killed 6 of my rentals totally. Hurricanes, renovations, assessments,  and ever increasing MF's all combine to make it where owning weeks you can't personally use is a losing proposition. Heck I can rent many non prime weeks from others at resorts I own for less than the cost of the MF's. I love timesharing, but unless things change I might have to become a former timeshare owner within the next few years.


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## Robert D (Dec 22, 2010)

I've bought quite a few weeks to rent and it's worked very well thus far. The key is (a) maintenance fee has to be low and this rules out most high end TS's such as Marriott and Hyatt, (b) you have to own the peak season in an area where there is strong demand and there isn't an oversupply of TS's, and (c) the purchase price (including closing costs) has to be low enough so that the profit on rental will pay the cost back in 3 yrs which usually means the price has to be under $1,000 including closing costs.  

I've tried to buy a few to flip but haven't been able to buy them cheap enough. I think there's some Marriotts that would be flip candidates but the problem is that it takes too long to get them closed and put into your name and this time delay really increases your risk because the prices of even the best resorts are dropping as time goes on.  Also, the closing costs on both ends of the transaction can eat up a lot of the profit not to mention paying a maintenance fee if you don't get it sold. I'm sure there's people on here who have been successful flipping TS's at a profit but I haven't figured this one out.

One thing I'm convinced of is it only makes sense to buy the peak season for any TS regardless of whether you're buying to rent, flip, or use.  The peak season is the only type that will have continued demand and I think offseason weeks at most resorts, even high end ones, will become worthless or almost worthless as time goes on. When you can rent a week for less than the maintenance fee (usually the case with offseason weeks), there's no reason to own it.


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## kjd (Dec 22, 2010)

Just curious, but if weeks are non-prime weeks doesn't it make sense to turn those weeks in for points and keep the prime weeks out of the points program?  Particularly if you feel that the gold through bronze weeks will be worthless.  If you turn in the non-plat weeks for points couldn't you always buy more points to turn these weeks into platinum?

On the surface however, I would think the opposite.  That is, it might make sense to turn the plat weeks into points and keep the non-plat weeks out of the points system in order to use them for flextime or shoulder season trades. I think a lot of owners are now wondering what the best strategy would be.  I know that's what I'm wondering.


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## yumdrey (Dec 22, 2010)

If you already "bought" Hilton weeks for super low prices, maybe you can make some profit out of it if you sell them now or later. Now Hilton exercise ROFR very agressively and most good deals cannot pass.
If Marriott starts to excercise ROFR, maybe price would go up, but I would not expect that in a near future.


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## scpoidog (Dec 23, 2010)

timeos2 said:


> I'll admit there may be a handful - no more - of great resorts & times (or views or size or something) that *will garner a singe bid of over $5K *IF the right buyer, who just HAS to have have it no matter what the financial loss down the road, decides to buy. But that is so rare as to be virtually impossible. Thinking your week is one of those very very few is fooling yourself. Assume the most any week will bring is $5K. Or less. That's reality.



You've obviously been looking at the prices decline longer than I have, but to make statements that properties won't get more than one bid over $5k unless sold to a desperate and/or uninformed buyer is totally wrong.  Larry just proved in his link to the Ko Olina auction on E-bay that there were 49 bids.   We can't see how many different bidders there are, but there are numerous auctions with mulitiple bids over $5k.

I've looked at Marriotts on eBay and yes there are many that go unsold, but to say that there are NO properties that are worth more than $5k when they are obvious selling for more is simply incorrect.  Your opinion on the value of timeshares today is simply that - your opinion.  I'm not sure if you are making those blanket statements for effect, but it doesn't reflect what is actually selling in the open market today.


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## easyrider (Dec 23, 2010)

At the present time it might look like travel and tourism has slowed way down but the reasons are many and not entirely because of the recession. There is a huge wave of boomer's that are retiring in the upcoming years and many will want to travel. For all of the same reasons we like timeshare condos better than motels so will these new travelers. 

The 50ish people will be wanting adventure as the recession ebbs and they will be traveling like they always have. 

The 40ish people will want to go to Disney World or the beach with their kids like they always have. They are smart enough to see the difference between a condo and a hotel.  

People of all ages like to travel. The recession has hurt many but many more will come out of it alright and some were not affected at all.

Timeshares as an investment may be the best thing ever. The prices difference between resale and wholesale is so huge right now that it is a good time to buy. The only way it could get better is if people start paying the closing costs and future MF, oh wait, I thinks some are. 

If the cruise lines are any indication of future travel then its a very good sign for tourism in general.


http://www.bizjournals.com/orlando/news/2010/12/22/carnival-earnings-show-cruise-industry.html


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## timeos2 (Dec 23, 2010)

*Own to use and enjoy*



scpoidog said:


> You've obviously been looking at the prices decline longer than I have, but to make statements that properties won't get more than one bid over $5k unless sold to a desperate and/or uninformed buyer is totally wrong.  Larry just proved in his link to the Ko Olina auction on E-bay that there were 49 bids.   We can't see how many different bidders there are, but there are numerous auctions with mulitiple bids over $5k.
> 
> I've looked at Marriotts on eBay and yes there are many that go unsold, but to say that there are NO properties that are worth more than $5k when they are obvious selling for more is simply incorrect.  Your opinion on the value of timeshares today is simply that - your opinion.  I'm not sure if you are making those blanket statements for effect, but it doesn't reflect what is actually selling in the open market today.



We're talking percentages. Yes, a few select weeks are currently above my self-proclaimed "maximum" of $5K. But as a percentage of ALL timeshares for sale they aren't close to even 3-4% and dropping.  And remember that 80% of all timeshares, by definition, are not prime time. And even some of those are "pink" - on the ragged edge of lower value periods. 

Take a look at a couple of the posts above from those that previously have been rather successful in renting at a profit or even some limited flips - they see a dramatically changing market - downward. Of course it's an opinion but that is what TUG is famous for. As potential buyers or sellers come here for information I feel this is the trend they need to be aware of. 

For many years my opinion has paralleled the TUG mantra of "Buy to use, buy resale, buy prime time" as the holy grail of pleasant timeshare ownership and value.  The recent near total collapse of resale values across the board just reinforces those ideas. Few will argue that a great, summer week in a Marriott or other top resort in a great area for a reasonable annual fee without the cost and hassles of trade doesn't make for a wonderful vacation value. Avoiding the need to find a renter or a buyer, avoiding the hassles and expenses of trades and getting value for the dollar all come easily if you own the week and want to use it nearly every use period. The occasional trade or rental is then just a bonus and not a key part of the ownership equation. Buying resale gets you in at a big discount from retail/developer prices. Owning the best time means you and your potential traders/renters will want to use it. 

There you have the key to happy and full value timeshare ownership IMO. Trying to make it something else like a income stream may work in the short term  but has been shown to be a risky proposition over the long term as the economy, program changes, fee increases and developer moves all conspire to undermine the base assumptions.  Many of those can be mitigated if you own to use and don't need to worry about those changes. You simply use what you own and look forward to next year. It makes timeshare what it was best able to be. A great value in luxury vacations that few could otherwise afford.


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## SueDonJ (Dec 23, 2010)

timeos2 said:


> We're talking percentages. ... It makes timeshare what it was best able to be. A great value in luxury vacations that few could otherwise afford.



Almost completely agree with John's entire post here - the timeshare landscape has changed dramatically in the last few years.  Timeshares have always meant an investment in a vacation lifestyle to me, and I've always thought that the only "wrong" purchases (regardless if you pay resale or developer prices) are the ones the buyer can't afford or can't use as intended.

For purposes of this thread, I'd be worried that Charles' intent to flip for a profit wouldn't pan out and so I'd call his hypothetical purchase "wrong."  Plus, his idea is still giving me heart palpitations.


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## scpoidog (Dec 23, 2010)

timeos2 said:


> We're talking percentages. Yes, a few select weeks are currently above my self-proclaimed "maximum" of $5K. But as a percentage of ALL timeshares for sale they aren't close to even 3-4% and dropping.  And remember that 80% of all timeshares, by definition, are not prime time. And even some of those are "pink" - on the ragged edge of lower value periods.
> 
> Take a look at a couple of the posts above from those that previously have been rather successful in renting at a profit or even some limited flips - they see a dramatically changing market - downward. Of course it's an opinion but that is what TUG is famous for. As potential buyers or sellers come here for information I feel this is the trend they need to be aware of.
> 
> ...



I now agree with you 100%.  We were lucky enough to buy resale where we love to vacation, so hopefully this TS will serve us well.  Merry Christmas, Happy Festivus, etc.


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## CMF (Dec 23, 2010)

SueDonJ said:


> For purposes of this thread, I'd be worried that Charles' intent to flip for a profit wouldn't pan out and so I'd call his hypothetical purchase "wrong."  Plus, his idea is still giving me heart palpitations.



It was not so much an idea as a thought.

Charles


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## SueDonJ (Dec 23, 2010)

CMF said:


> It was not so much an idea as a thought.
> 
> Charles



It's still skeeeery.   :hysterical: 

Hope you know I'm not insulting you for the thought - that's why TUG is so valuable, because between us all we manage to think so many thoughts!


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## larryallen (Dec 23, 2010)

I am not saying it's a good idea but the contrarian, and the risk taker, is often the one who comes out on top monetarialy speaking!   It's risky, and maybe not smart, but like most things in life if you buy low, quick flip, you can make a small profit.  The costs of sale cut into the potential profits. The market risk is part of any "investment."  Presumably anybody who actually bought timeshares to try and flip them could afford the risk.


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## Whirl (Dec 23, 2010)

*LauraC... and on 1% of the t/s market....*



laurac260 said:


> ok, so all this talk about e-bay certainly got my curiosity up, so I went and looked for myself.  I have a few questions, for anyone who is familiar with e-bay and would care to entertain my questions.
> 
> #1, why are there so many timeshares (specifically Marriotts I am interested in), that do not list the week or season they have?
> 
> ...



I also would not suggest buying out of season, if you really want to go there every year. I know from your prior posts that we both traffic largely in the Hilton Head area and have kids and therefore can only go in the summer.   Some people have  reported having success trading in year after year to platinum, but especially if you are trying for a very specific week, even trading another platinum week through Interval to match up with your reserved  week can be tricky and frustrating business ( i.e. you may get the week, but the check in date might not match)....I   owned a summer 
Monarch ( fixed) and Barony week for a decade and had trouble doing this on numerous occasions -- tried it both ways, trading the Monarch to match Barony or the Barony to match Monarch. I then bought another Barony week so that I could reserve them at the same time and all my problems were solved....until I decided we really wanted OceanFront instead of OceanSide and then that opened another can of buying worms...

But, if you are confident that Grand Ocean is where you want to go, then you might as well resolve yourself to paying what people ask  for rent( and I think you can still get some deals, but you are at the mercy of the market and will require a lot of patience to make and have offers rejected) OR you can try to pick up another week, make one phone call, book at the 13 month window and relax because your plans are in place ( you are now more at the mercy of Marriott and your maint fees, but you are already in it for one week)....I remember what you paid for your week, as you did join the group with a good bit of detailed discussion surrounding that purchase, no doubt,  and I bet with patience you can buy one for 3-5K less at the this point. The Hilton Head prices have thus far been pretty sticky, but have definitely come down.  That being said, Marriott is still periodically selling Oceanside and Ocean Front platinum  weeks from 30-45K. These weeks do not move often, so the data points are sparse. I have tracked recorded deeds on them for several years  ( I really track specifically Barony, but Grande Ocean platinums seem to sell even less...note that I have only done the MOST cursory of looks at that resort specifically, so I could be wrong relative to Barony)


I would think that you won't find many platinum OceanSide and particularly Oceanfront weeks selling on eBay ( I know there was ONE Oceanfront about 2 years ago reported), so for those that use this as the barometor for resale prices, I suspect it wont help you much here. I don't track it anymore, but I am sure someone might and can produce a list as an indication.  I used to follow ebay, but it was too timeconsuming since the weeks I was interested in were so rarely posted and required too many phone calls to fact check. I just  decided  to use a good/ reputable broker who will do the looking  for what I want and fact checking for me and assure the details via contract. I bid once years ago and won an Oceanside week that was ROFR'd. Bought the same week even cheaper a year  ago through a broker.

Most ebay transactions,  as you say , list as high demand, but if you check with the sellers, they are probably not platinum. I ONLY track platinum Oceanside and OceanFront views...Don't buy a view that you don't want either and hope to trade into it.


So, despite all the added uncertainly with points now and resale timeshare prices going forward, if that is definitively what you want to do -- book two weeks at Grande Ocean every year --then I would suggest just buying there. Or, if you are happy making offers for the second week and if you get it for your price, fine and if not, then you don't go the second week, then that is an even lower risk option. 

I would definitely not try to trade in from another view or season, as then what do you do with it when it doesn't work? 

Long answer, but hopefully helpful. I was trying to provide some solid, research based background for a part of the market that I think ( for now) still falls into the previously hypothesized 1%  of timeshares still worth WELL above 5k. And if you are interested, then you buy at the best price you can find or, just continue to rent.

Interesting times, but I don't think the cheaper prices change the "sage" old advice…buy what  you KNOW you will use….trading requires flexibility and I am not, and sounds like you are not either. Any thing else will only lead to frustration.


I know some will still disagree, but that's what makes it all interesting....


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## laurac260 (Dec 23, 2010)

Whirl said:


> I also would not suggest buying out of season, if you really want to go there every year. I know from your prior posts that we both traffic largely in the Hilton Head area and have kids and therefore can only go in the summer.   Some people have  reported having success trading in year after year to platinum, but especially if you are trying for a very specific week, even trading another platinum week through Interval to match up with your reserved  week can be tricky and frustrating business ( i.e. you may get the week, but the check in date might not match)....I   owned a summer
> Monarch ( fixed) and Barony week for a decade and had trouble doing this on numerous occasions -- tried it both ways, trading the Monarch to match Barony or the Barony to match Monarch. I then bought another Barony week so that I could reserve them at the same time and all my problems were solved....until I decided we really wanted OceanFront instead of OceanSide and then that opened another can of buying worms...
> 
> But, if you are confident that Grand Ocean is where you want to go, then you might as well resolve yourself to paying what people ask  for rent( and I think you can still get some deals, but you are at the mercy of the market and will require a lot of patience to make and have offers rejected) OR you can try to pick up another week, make one phone call, book at the 13 month window and relax because your plans are in place ( you are now more at the mercy of Marriott and your maint fees, but you are already in it for one week)....I remember what you paid for your week, as you did join the group with a good bit of detailed discussion surrounding that purchase, no doubt,  and I bet with patience you can buy one for 3-5K less at the this point. The Hilton Head prices have thus far been pretty sticky, but have definitely come down.  That being said, Marriott is still periodically selling Oceanside and Ocean Front platinum  weeks from 30-45K. These weeks do not move often, so the data points are sparse. I have tracked recorded deeds on them for several years  ( I really track specifically Barony, but Grande Ocean platinums seem to sell even less...note that I have only done the MOST cursory of looks at that resort specifically, so I could be wrong relative to Barony)
> ...



That was, in a word, extremely helpful.  (ok, that was two words, but it was better than JUST helpful!)  Thanks!


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## DeniseM (Dec 23, 2010)

larryallen said:


> I am not saying it's a good idea but the contrarian, and the risk taker, is often the one who comes out on top monetarialy speaking!   It's risky, and maybe not smart, but like most things in life if you buy low, quick flip, you can make a small profit.  The costs of sale cut into the potential profits. The market risk is part of any "investment."  Presumably anybody who actually bought timeshares to try and flip them could afford the risk.



This begs the question:  How many timeshares have you bought and sold?

For clarification - TUG Moderators are TS owners and unpaid volunteers.  We are permitted to participate in forum discussions under the same rules as any other member.  

Per TUG posting rules, if you see a post that violates the posting rules, please click on the red triangle at the bottom of the post, and report it, rather than posting a complaint in the thread. - Thank you.


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## CMF (Dec 23, 2010)

SueDonJ said:


> It's still skeeeery.   :hysterical:
> 
> Hope you know I'm not insulting you for the thought - that's why TUG is so valuable, because between us all we manage to think so many thoughts!



It's all good.

Charles


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## DanCali (Dec 23, 2010)

easyrider said:


> Timeshares as an investment may be the best thing ever. The prices difference between resale and wholesale is so huge right now that it is a good time to buy. The only way it could get better is if people start paying the closing costs and future MF, oh wait, I thinks some are.



The price difference between resale and retail is meaningless because the retail price is arbitrary and has nothing to do with supply and demand. It is the price at which the developer can sell the timeshare to an uninformed buyer in a high pressure sales presentation. The correct metric should be resale price versus rental cost.

Starwood sells Sheraton Vistana Resort for $20K but you can pick those up for $1 on eBay and trade them in II with Starwood priority. They aren't selling for $1 because the MFs are too high compared to Orlando rental costs and, as traders, there are better properties to own. Starwood can sell them for $100K and they still won't sell for $1 on eBay.


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## larryallen (Dec 23, 2010)

_This begs the question: How many timeshares have you bought and sold?
_

I am not sure why this begs the question but I have bought and sold no timeshares at this point.  Economically speaking renting has served me far better thus far in life.  I am looking at some higher end fractionals to buy.  I am merely posting of a timeshare as a widget. It's a risk to buy and flip. I am not suggesting it's a good deal or a bad deal but I am saying a person who takes the risk may come out ahead.  People post the same "flip"  threads on the sports card forum I frequent. "Oh the market is so low, if I buy right, list in a store on Ebay at a higher price, I can turn a profit...."   They are all just widgits.  Econ 101.

I didn't feel the other mod violated a rule so didn't need to figure out about the triangle or whatever you said. I was just taken aback by his abrupt tone.  To ME it was rude.  Reminded me of people that flame others for pleasure on message boards. That's not typical of a mod. Of course maybe I read into his post. It really doesn't matter.


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## tahoeJoe (Dec 24, 2010)

CMF said:


> Does anyone believe that this is the time to scoop up an eBay week or two at rock bottom prices, rent them for a few years, then resell when prices recover?
> 
> Will prices recover???
> 
> Charles



No, prices will NOT rebound (look at Starwood), Overall I think this is a bad idea because you will be stuck with ever increasing MFs. Also, renting is risky and difficult. 

-TJ


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## Big Matt (Dec 24, 2010)

The rental market won't track with timeshare prices though.  It will track with hotel room rates.  Those will come back with the economy just like everything that is associated with vacationing.  The economy is rebounding nicely from 2009.

I believe that now IS a very good time to grab some low priced weeks if for not other reason than to use them.  



tahoeJoe said:


> No, prices will NOT rebound (look at Starwood), Overall I think this is a bad idea because you will be stuck with ever increasing MFs. Also, renting is risky and difficult.
> 
> -TJ


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## winger (Dec 24, 2010)

Big Matt said:


> The rental market won't track with timeshare prices though.  It will track with hotel room rates.  Those will come back with the economy just like everything that is associated with vacationing.  The economy is rebounding nicely from 2009.
> ....


Hotel rental rates as well as airline tickets increased an average of 4-5% over the past year according to CBS' Evening News with Katie the other night.


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## easyrider (Dec 25, 2010)

DanCali said:


> The price difference between resale and retail is meaningless because the retail price is arbitrary and has nothing to do with supply and demand. It is the price at which the developer can sell the timeshare to an uninformed buyer in a high pressure sales presentation. The correct metric should be resale price versus rental cost.
> 
> Starwood sells Sheraton Vistana Resort for $20K but you can pick those up for $1 on eBay and trade them in II with Starwood priority. They aren't selling for $1 because the MFs are too high compared to Orlando rental costs and, as traders, there are better properties to own. Starwood can sell them for $100K and they still won't sell for $1 on eBay.



I disagree with your conclusion because the time share industry is still selling weeks at full retail. Sales will ramp up as the economy ramps up. There is nothing arbitrary about buying a week for $1 and selling it for $500. Money can be made even by renting but flipping might be more profitable in the upcoming years. The difference between resale and new has created a very good profit margin.

If however you buy a useless product ( Orlando TS) no matter what or where how would you do ? Not good. imo

So yes , its a good time to buy if you know what your buying and have a resort that people want to go to. I think the $1 sale will go away soon and it will be those cheap weeks sold that will be the best flips.


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## yumdrey (Dec 25, 2010)

easyrider said:


> If however you buy a useless product ( Orlando TS) no matter what or where how would you do ? Not good. imo



I bought a grande vista platinum week a few weeks ago. I thought it has worth because (1) it is a lock-off, so I can deposit to II and have two weeks of vacations (2) it is a part of florida club, so I can reserve other florida club resorts if I decide not to exchange. I don't have to stay at grande vista over and over again (3) the price is almost "nothing" compared to previous years and months. 
I agree there are many "impossible weeks to sell" in Orlando, but it is case by case.


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## DanCali (Dec 25, 2010)

easyrider said:


> There is nothing arbitrary about buying a week for $1 and selling it for $500.



This wont make money after closing costs.

And even $500 profit after closing is not worth the hours of effort involved, especially after taxes...


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## wof45 (Dec 25, 2010)

DanCali said:


> This wont make money after closing costs.
> 
> And even $500 profit after closing is not worth the hours of effort involved, especially after taxes...



we bought a summer week at the shore this year for $200 that included free closing and usage last summer.

we could sell it for $1 plus closing and come out ahead.  and summer at the shore sells for more than $1 if someone is not just dumping the week.

It is also an easy rental for 1 1/2 to twice the MF, but we plan to use it for the next few years.


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## larryallen (Dec 25, 2010)

Though I still think the buy and flip strategy is a huge risk you have to do it on higher dollar units in my opinion. The closing costs make it impractical to flip a $500 unit. However, a $10,000 unit which could easily sell for $12k with a better auction, etc... makes it POSSIBLE to make a profit. It doesn't seem possible on a $500 unit to me. Or should I say, much more difficult as you likely have to hold longer which makes the annual costs relevant as you likeloy have to hold a few years.


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## easyrider (Dec 25, 2010)

DanCali said:


> This wont make money after closing costs.
> 
> And even $500 profit after closing is not worth the hours of effort involved, especially after taxes...



Many off these TS's now are at a dollar with no closing costs. All of them originally cost someone thousands. The good deals two years ago cost about 2K. Eventually the price of old TS contracts has to increase. Buy low , sell high, make money. The opportunity is here right now unless you think that the TS industry has no chance of recovery. 

There has never been prices this low and it would take another Great Recession to bring them back to this new low. The dollar deal will not last.

Yes, $500 seems like chump change but if you fliped 50 or 100 in a couple of months. What if the prices go up next year to 2k. 

On the other hand, what if you have to rent these. Who really knows but I think its going to get better soon. Tourism has picked up. The cruise lines are making record profits. Hotel chains are buying resorts.


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## DanCali (Dec 25, 2010)

easyrider said:


> Many off these TS's now are at a dollar with no closing costs. All of them originally cost someone thousands....Eventually the price of old TS contracts has to increase. Buy low , sell high, make money.



You are assuming that the price is bounded from below by zero... is it?

The prices of timeshares can and do go negative.... There are many timeshares that can only be sold if an owner pays thousands of dollars to someone to take them off their hands. Most of them are not Marriotts and not prime weeks or seasons. But if Marriott salespeople keep spreading lies about weeks and make them less desirable, or MFs keep going up at 5% (or more) above the CPI each year, we could get there eventually.


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## Robert D (Dec 25, 2010)

larryallen said:


> Though I still think the buy and flip strategy is a huge risk you have to do it on higher dollar units in my opinion. The closing costs make it impractical to flip a $500 unit. However, a $10,000 unit which could easily sell for $12k with a better auction, etc... makes it POSSIBLE to make a profit. It doesn't seem possible on a $500 unit to me. Or should I say, much more difficult as you likely have to hold longer which makes the annual costs relevant as you likeloy have to hold a few years.



Sure seems to me to be a lot more risky buying a $10,000 TS vs. a $500 one. The $10K one has a lot farther to fall (and we're still in a market of declining values, especially for the higher value ones) and you tie up a lot more money. The one you can buy for $1.00 with no closing costs are probably worthless and not worth owning so there's probably nothing to be made on them.  However, sometimes you'll find high demand weeks that usually sell for a couple thousand that no one bids on and you can buy for under a thousand.


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## Robert D (Dec 25, 2010)

easyrider said:


> Many off these TS's now are at a dollar with no closing costs. All of them originally cost someone thousands. The good deals two years ago cost about 2K. Eventually the price of old TS contracts has to increase. Buy low , sell high, make money. The opportunity is here right now unless you think that the TS industry has no chance of recovery.
> 
> There has never been prices this low and it would take another Great Recession to bring them back to this new low. The dollar deal will not last.
> 
> ...



There's people on here who have followed the TS market for a lot longer than me but during the 5 yrs or so I'm been following it, I'm come to the conclusion that TS's virtually never increase in value. The trend is always down and it's driven down by aging resort, increasing maintenance fees, and special assessments.  I think the odds are that the average selling prices two years from now will be lower than they are now.  Hotel room prices haven't gone up anywhere near the increase in maintenance fees over the past 3, 5, or 10 (or pick a number) years.  Every increase in MF's reduces the value of your TS.  The big name ones like Starwood and Marriott seems to have the biggest increases in MF's.


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## DanCali (Dec 25, 2010)

Robert D said:


> Sure seems to me to be a lot more risky buying a $10,000 TS vs. a $500 one. The $10K one has a lot farther to fall (and we're still in a market of declining values, especially for the higher value ones) and you tie up a lot more money. The one you can buy for $1.00 with no closing costs are probably worthless and not worth owning so there's probably nothing to be made on them.  However, sometimes you'll find high demand weeks that usually sell for a couple thousand that no one bids on and you can buy for under a thousand.



As said above, $0 or $1 are just arbitrary numbers when it comes to timeshares. These are not stocks (limited liability). Prices can and do go negative.


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## dioxide45 (Dec 25, 2010)

IMO TS prices will not rebound until residential real estate does. And that isn't showing any signs of a rebound yet. Rising interest rates and people upside down will continue to hold back residential real estate.


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## m61376 (Dec 25, 2010)

dioxide45 said:


> IMO TS prices will not rebound until residential real estate does. And that isn't showing any signs of a rebound yet. Rising interest rates and people upside down will continue to hold back residential real estate.


I tend to agree, but these are strange times, and I wouldn't be surprised if we land up seeing real estate prices in most markets lagging behind other economic recovery areas. There are a few high demand markets where the residential real estate has, in fact, been showing significant improvement (NYC, for ex.), but overall I tend to think it will be many years before real estate recovers nationally. 

As other areas of the economy recover, people will once again increase their travel (something which has already been reported). Increased demand will likely be reflected in higher hotel prices, which will likely filter down to increased rental rates and perhaps even be reflected in timeshare prices. I think people will get antsy and resume vacationing once they feel they have job security, irregardless of their home value.


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## timeos2 (Dec 25, 2010)

easyrider said:


> I disagree with your conclusion because the time share industry is still selling weeks at full retail. Sales will ramp up as the economy ramps up. There is nothing arbitrary about buying a week for $1 and selling it for $500. Money can be made even by renting but flipping might be more profitable in the upcoming years. The difference between resale and new has created a very good profit margin.
> 
> If however you buy a useless product ( Orlando TS) no matter what or where how would you do ? Not good. imo
> 
> So yes , its a good time to buy if you know what your buying and have a resort that people want to go to. I think the $1 sale will go away soon and it will be those cheap weeks sold that will be the best flips.



Closing and transfer costs tend to eat any so called profit in a sale. Orlando isn't worthless IF you buy resale, to use and the best season. Our Orlando timeshare trades as well or better (based on the new RCI valuation) than even our top trader in Cape Cod. That has proven to be the case on the few times we have traded it but we usually use or OR easily rent it. It has to be a quality resort and a top time.  Easy to get both in Orlando as the season is long and the resorts tend to be top notch. The myth that they don't trade well or aren't a good buy is just that (but YOU have to want to use it most of the time like any timeshare or it isn't the right one for you).  There are bad resorts and poor times to own in every area including Orlando but you should just avoid those. Easily done with a small amount of research.

However, the idea that you can MAKE money on any timeshare - even when things were flying was never a good one IMO.  There are just too many out there (and more being added despite the total lack of need).  There is no way it will recover until general real estate recovers and that may be a decade away. Unless the whole process changes timeshares will continue to sell at extremely depressed prices compared to retail as resale represents the true market value - retail is a fabricated, high pressure false value sold as a dream.  There is a good reason it is illegal to represent any timeshare purchase as an investment or real estate as they are in a different world of their own.


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## ondeadlin (Dec 25, 2010)

There are two certain trends in the lifespan of any timeshare resort - resale prices falling precipitiously and fees gradually increasing.

These trends have been greatly accelerated by the great recession.

Prices have been crushed and the cost of foreclosures, late fees and turned back weeks has increased fees at almost all resorts.

If you're betting that timeshare prices will rise over the long term, in general or at any particular resort, you will lose. Period. They do not rise. It just doesn't happen. Timeshare prices fall to a fractional value of their original selling price and then stabilize. The only question is whether they stabilize at $1 or somewhere higher, and obviously $1 is a lot more common than $5,000. Recessionary forces have pushed that stabilization point even lower.

If you're extremely familiar with a particular resort or a particular timeshare system, though, you can spot aberrations in the market and profit from them. If, for example, I were to see a Marriott Streamside Vail Evergreen ski week with an eBay buy-it-now of $5,000, I'm pretty confident I could buy it and flip it for several thousand dollars or more. That's my niche. I know what ski weeks are worth. I can see the aberrations.

Others here have the knowledge to see similar aberrations at Hilton Head, Hawaii, OBX, Mexico, etc.

But you have to have the knowledge to recognize what's a true aberration. 

I don't think we're talking about the chance to make more than a few thousand in profit, best-case-scenario. When you consider the alternative is getting stuck with years worth of MF, I'm just not sure it's worth the trouble.

And, again, if you're waiting for resale prices in general to "bounce back" you're going to be waiting a long, long time. Like, forever. It's not going to happen on any widespread scale. I'm not sure we've even seen the bottom yet.


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## easyrider (Dec 26, 2010)

The resort developers are still in business. People are buying new TS contracts everyday.

TS condo vacations are tied more to tourism than to real estate markets. There are golf courses, casinos and many other attractions being developed right now. The majority of TS condo owners will buy from the developers then maybe find out about the deals elsewhere. 

ondeadlin is right about being familiar with a TS system. You really need to know what, where and everything else about what your buying.


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## dioxide45 (Dec 26, 2010)

easyrider said:


> The resort developers are still in business. People are buying new TS contracts everyday.
> 
> TS condo vacations are tied more to tourism than to real estate markets. There are golf courses, casinos and many other attractions being developed right now. The majority of TS condo owners will buy from the developers then maybe find out about the deals elsewhere.
> 
> ondeadlin is right about being familiar with a TS system. You really need to know what, where and everything else about what your buying.



While hotel rental prices and rental prices in general are tied to tourism, I don't think TS sales is as much. People won't buy a TS before they own a home. With many people out of their homes, or upside down, many will just rent rather than buy. So rental prices will go up. Though I agree with many others that sales prices will continue in only one direction, that is down.

You can't tie developer prices and developer sales in any way to those on the resale market. Developer prices have always only gone up. Even in this down market, Marriott never permanently lowered their prices. They had some "sales", but are now back to very high prices. When developer prices went up, resale continued to go down.

As resorts get older, they lose their appeal, which causes resale prices to go down. Resorts can't get newer and only older, so prices always only move in one direction.


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## Whirl (Dec 26, 2010)

ondeadlin said:


> There are two certain trends in the lifespan of any timeshare resort - resale prices falling precipitiously and fees gradually increasing.
> 
> These trends have been greatly accelerated by the great recession.
> 
> ...



dead on...ondeadlin....Couldn't have articulated my own views better than you did.


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## ada903 (Dec 26, 2010)

I agree with ondeadlin too.  In addition to the natural tendency of timeshare resale prices to go down (and at best stabilize), and maintenance fees to go up at rates that are higher than inflation, we are experiencing the worst recession in half a century.  Paying owners are being slapped with even higher maintenance fees to make up for delinquencies.  Foreclosures and job losses push prices to newer lower levels every day.  

Even though we are officially out of recession, the current growth in GDP is not strong enough to reduce unemployment.  Besides, as soon as the fed stopped propping the economy with stimulus and tax incentives, GDP growth slowed down, and there is still risk for a double dip.  Regardless, it will take many years for the unemployment rate to come down.  No jobs, no income, no money for house payments and maintenance fee payments, more foreclosures and bankruptcies, more folks dumping their timeshares, and more depressed prices.

The only potential resale profit is indeed in seeing a market abnormality - for example a gold annual 2 bdr oceanfront week at Marriott Ocean Pointe sold for $1,500 on ebay few days ago, with closing costs it came to a little over $2,000.  The buyer may be able to turn around and sell it for at least $4,000 and find a quick buyer at that price.  But these deals are rare, the margin of profit is tiny after paying taxes, and you are taking a risk that by the time the week is in your name, prices have taken another downturn.  Starwood for example is taking three months to process ownership transfers after the deed is recorded, and they are excellent at misplacing checks and papers, sometimes turning it into six months. 



Whirl said:


> dead on...ondeadlin....Couldn't have articulated my own views better than you did.


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## wof45 (Dec 26, 2010)

the problem is looking at general trends vs specific short term effects.

the tend for any vacation property is for the price to go not gradually as the property gets older.  There is also the tendency for maintenance fees to go up due to both inflation and to more maintenance required.

while TS MF go up, they tend to match newer similar properties -- so if you look at a single resort, they are going up, but if you look at similar TS, they are in line with older and newer properties, in many cases lower than newer ones.

there is a huge premiun in buying TS weeks, so first you need to take off the sales premium.  Then you can look at the loss of the property over time.  In many cases, this reflects both the economy in general and how well the TS is maintained to both retain what it has, and to match new expectations in the market.  In most cases, there is more value in the older location than in the newness of a newer undeveloped location.

But you also need to get specific about the TS week.  Platinum weeks will retain value much more -- other weeks won't since they all pay the same annual fee.  It would be easy to argue that the bad weeks subsidize the good weeks, which you can see in the points awarded to legacy weeks and the MF ratio.

You also need to be very specific about the location.  Right on the beach will always hold up for platinum weeks.  Right on the slopes will always hod up for ski snow weeks.  If you have to get into a car to go somewhere, the value is not there.

Then look at the time.  this is a bad economy.  But to define bad economy you look granularly at people.  It means that fewer of people are doing well and more people are doing poorly or are worried.  The people doing well are still TS sales targets at the old prices.  Many people who are hurting or worried are dumping TS weeks instead of paying MF.

When the economy is better for more people, those additional people will join the market and sales will increase.  that will include people buying resale week.  Weeks that are platinum with reasonable MF in good locations in perfect sites will sell for more.  Add the difficulty of information about where TS are listed for resale and sale timing on ebay auctions, there are certainly arbitrage profits to be made on TS resales -- the timeframes are just longer.


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## CMF (Dec 26, 2010)

ondeadlin said:


> But you have to have the knowledge to recognize what's a true aberration.



This is what made me start this thread: a $700 eBay sale price for a Manor Club platinum every year week.  I would be shocked if these weeks continue to sell at this price or lower.

Charles


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## ondeadlin (Dec 26, 2010)

wof45 said:


> When the economy is better for more people, those additional people will join the market and sales will increase.  that will include people buying resale week.  Weeks that are platinum with reasonable MF in good locations in perfect sites will sell for more.



I'm couldn't disagree more.

There is simply no history of resale prices ever rising after a sustained fall. Timeshare prices move in one direction - down. Once they fall, they do not rise. 

Your theory relies on the proposition that this recession is a singular event and that when it's over and buyers return to the market, they'll see these bargains and buy them, thus causing prices to rise.

There are multiple flaws in this argument. There is a huge glut of inventory on the resale market. Most buyers are never even aware there is a resale market. Many of the buyers who become aware of the resale market are leery of it ... and so it goes.

But the biggest flaws are the ones I identified above: Every resort falls in value over time, and every resort's fees rise over time.

The longer you hold waiting for a price rise, the more these forces make any such rise unlikely, if not impossible.


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## ondeadlin (Dec 26, 2010)

CMF said:


> This is what made me start this thread: a $700 eBay sale price for a Manor Club platinum every year week.  I would be shocked if these weeks continue to sell at this price or lower.
> 
> Charles



I would be shocked if they don't.

Aside from the golf, Manor Club has very little to recommend ownership there IMO. Particularly with Marriott essentially designating weeks owners as second-class citizens and injecting a ton of uncertainty into the strategy of using Manor Club as an effective trader into high value Marriotts.


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## wof45 (Dec 26, 2010)

ondeadlin said:


> I'm couldn't disagree more.
> 
> There is simply no history of resale prices ever rising after a sustained fall. Timeshare prices move in one direction - down. Once they fall, they do not rise.
> 
> ...



you logic falls apart when you do not look at specific properties and weeks.
there is no such thing as a generic timeshare time, MF, location and upkeep.
Some buyers believe that, which is why some auctions end at prices that are too low -- and selling the same property not in an auction, with buyers able to find what they want results in higher sale prices that reflect worth.

When properties are selling for less than the replacement cost, and the location is great, the prices will eventually come back to the replacement price.  If you want a comparison look at the sale prices of houses and apartments on Singer Island and how they rise and fall over time.  Ocean Pointe and Oceana Palms might as well be condos in this location since they have prime locations.


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## ada903 (Dec 26, 2010)

There is truth that platinum beach and ski weeks retained better resale value - perhaps they declined 50% and not 95-100% from their peak resale value - but the downward trend is there for platinum, too.  Platinum two bedroom annual Ko Olina was 25k two years ago.  Now you can get one for less than half of that.  And a year or two from now, that may be worth 5k-10k only.  

The trend is indeed similar to residential real estate - yes, prime locations (and for timeshares, prime seasons) retained better value than non-prime locations, yet they did take a hefty (-50%) hit and will likely continue the downward slope for another while.  Unlike real estate, where you can lock in your payment and mortgage rate, the problem with timeshares is uncertainty - maintenance fees go up, you are slapped with special assessments, developers change the rules, etc.  That uncertainty adds to the problem and to spiraling down of prices - timeshares are not as likely as residential real estate to recover, even in prime seasons and locations.

Will resale prices recover? They might somewhat - but I think recovery will not mean going back to pre-recession - or even close to pre-recession - resale prices, I think at best they will go up with inflation, and not fast enough to generate profits for someone looking to invest in timeshares for financial benefits.


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## ondeadlin (Dec 26, 2010)

wof45 said:


> you logic falls apart when you do not look at specific properties and weeks.



Feel free to cite any specific examples of a timeshare property or properties where the baseline price for any season has gradually fallen to a point markedly below the original sales price and then experienced a significant across-the-board rise.

Please note we're not talking about specific instances of price aberration, which I dealt with above, but a specific instance of general prices at a property markedly falling and then markedly rising.



wof45 said:


> Ocean Pointe and Oceana Palms might as well be condos in this location since they have prime locations.



This is an extremely unsophisticated answer that has been debunked multiple times on TUG. There is very little correlation between timeshare prices and whole ownership prices.

This comparison is usually only cited when (1) a salesperson is trying to justify an unrealistic price; or (2) someone who paid a lot of money for a timeshare is trying to justify the purchase.

I can buy a 1BR studio at the Marriott in Kauai for under $1,000. A similar beachfront condo in Kauai would cost me more than $500,000. Yet the condo prices keep rising and the resale prices at Marriott Kauai were steadily falling even before the recession. Know why? Because that's what timeshare prices do, for a variety of reasons, regardless of the surrounding real estate. I could give you similar comparisons in Vail, Hilton Head, etc.


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## CMF (Dec 26, 2010)

ondeadlin said:


> I would be shocked if they don't.
> 
> Aside from the golf, Manor Club has very little to recommend ownership there IMO. Particularly with Marriott essentially designating weeks owners as second-class citizens and injecting a ton of uncertainty into the strategy of using Manor Club as an effective trader into high value Marriotts.



I think Manor Club it is the most beautiful resort in Williamsburg and there is enough to do in the area to keep me coming back for years to come.  I suppose that I could trade in using a less expensive week, but I will not sell it for $700 dollars.

Charles


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## wof45 (Dec 26, 2010)

ondeadlin said:


> Feel free to cite any specific examples of a timeshare property or properties where the baseline price for any season has gradually fallen to a point markedly below the original sales price and then experienced a significant across-the-board rise.
> 
> Please note we're not talking about specific instances of price aberration, which I dealt with above, but a specific instance of general prices at a property markedly falling and then markedly rising.
> 
> ...



actually, we are talking exactly about price aberrations because that is when there is an opportunity to flip timeshares -- which is what this tread is about.  If you want to make general comments about timeshares losing values from developer prices, that is not what the thread is about.  Five years ago, I had 50 TS weeks, I am at 10 now because of rental conditions starting about 4 years ago -- so, yes, I do have some experience in this.

this is also not an unsophisticated answer because the value of a specific timeshare week will mirror that of a similar condo in a similar location with similar features.  If you are looking at condos with door people, maintenance and lots of features, the prices are different than a condo you buy that does not have features.  I would never buy TS to flip in Vail, Hilton Head or Kauai, exactly because there is not a market for condos in these locations even if they might do well as hotels.


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## timeos2 (Dec 26, 2010)

CMF said:


> This is what made me start this thread: a $700 eBay sale price for a Manor Club platinum every year week.  I would be shocked if these weeks continue to sell at this price or lower.
> 
> Charles



Once a low price point is set history says it is almost impossible to have it recover in any significant way. Again people have to realize a timeshare seller isn't competing only against other, similar weeks but all offers from all sources. Few are willing to pay a premium for what is perceived to be basically "the same" product as hundreds of other, often lower cost options.


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## timeos2 (Dec 26, 2010)

CMF said:


> This is what made me start this thread: a $700 eBay sale price for a Manor Club platinum every year week.  I would be shocked if these weeks continue to sell at this price or lower.
> 
> Charles



Once a low price point is set history says it is almost impossible to have it recover in any significant way. Again people have to realize a timeshare seller isn't competing only against other, similar weeks but all offers from all sources. Few are willing to pay a premium for what is perceived to be basically "the same" product as hundreds of other, often lower cost options.  If you are holding a week to sell all it takes are a couple annual fee payments of $1000+ (the fee for many top weeks) and any "profit" is gone. 

No one can say it's impossible to make money on resale of timeshare but the odds don't favor it at all.


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## ondeadlin (Dec 26, 2010)

wof45 said:


> actually, we are talking exactly about price aberrations because that is when there is an opportunity to flip timeshares -- which is what this tread is about.  If you want to make general comments about timeshares losing values from developer prices, that is not what the thread is about.  Five years ago, I had 50 TS weeks, I am at 10 now because of rental conditions starting about 4 years ago -- so, yes, I do have some experience in this.



With all due respect, your ownership - past or current - is irrelevant.

If you can't cite any specific examples of a timeshare property or properties where the baseline price for any season has gradually fallen to a point markedly below the original sales price and then experienced a significant across-the-board rise, your opinion on this topic is nothing more than a guess or a prediction, and one _that goes against all historical trends we've witnessed with timeshares._



wof45 said:


> because the value of a specific timeshare week will mirror that of a similar condo in a similar location with similar features.  If you are looking at condos with door people, maintenance and lots of features, the prices are different than a condo you buy that does not have features.  I would never buy TS to flip in Vail, Hilton Head or Kauai, exactly because there is not a market for condos in these locations even if they might do well as hotels.



Again, your answer is simply disconnected with reality.

Timeshare prices do not generally mirror those of similar condos in similar locations with similar features. They just don't. Using your own metrics, take the time to compare Manhattan Club prices with the cost of a condo at a similar doorman-equipped building in Manhattan. It's the perfect rebuttal of your argument. Manhattan Club prices are exponentially cheaper. Why? Because it's a timeshare, not a whole ownership condo.

I'm going to respectfully bow out of any further back-and-forth with you on this topic, because we're so far apart that it's probably not productive to continue rehashing it.


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## wof45 (Dec 26, 2010)

ondeadlin said:


> With all due respect, your ownership - past or current - is irrelevant.
> 
> If you can't cite any specific examples of a timeshare property or properties where the baseline price for any season has gradually fallen to a point markedly below the original sales price and then experienced a significant across-the-board rise, your opinion on this topic is nothing more than a guess or a prediction, and one _that goes against all historical trends we've witnessed with timeshares._
> 
> ...



you speak of generalities rather than specifics.
you use comments in tug as through they are facts.
you believe that the fact that I have flipped TS over time does not matter since what you believe is correct.
you don't understand pricing of condos and how bundled services affect the prices.
what do you actually know?


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## ondeadlin (Dec 26, 2010)

What I know is that you appear to have difficulty separating the difference between potentially making money on a pricing aberration (which has been acknowledged as a possibility multiple times on this thread) and your unsupported outlier theory that, at some point, timeshare prices will rise again, either at specific properties or a general class of properties, etc.

That and the fact you appear to take this discussion more personally than you should.

And with that, as I said above, I will leave others to evaluate our respective positions.


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## wof45 (Dec 26, 2010)

ondeadlin said:


> What I know is that you appear to have difficulty separating the difference between potentially making money on a pricing aberration (which has been acknowledged as a possibility multiple times on this thread) and your unsupported outlier theory that, at some point, timeshare prices will rise again, either at specific properties or a general class of properties, etc.
> 
> That and the fact you appear to take this discussion more personally than you should.
> 
> And with that, as I said above, I will leave others to evaluate our respective positions.



you apparently aren't able to read and understand my theories since I have been very specific about resorts, seasons, locations and fees.  Good ones will return to their replacement costs.

as for resales --
Fort Lauderdale Beach Resort - week 8 high floor ocean bought 800 sold 4200
Westgate vacation Villas - week 51 deluxe 2BR bought 800 sold 3000
La Renaissane (atlantic city) - week 30 bought 500 sold 2000
Coronado Beach Resort - week 51 bought 300 sold 1500
Bonita Bay - week 28 bought 800 sold 2500
etc

Marriotts are tougher since they are by season rather than week, and are only now reaching below $1000 for good seasons and locations.

I did not buy Sabal Palms since I no longer trade or rent, but 2 red went on ebay in the past year for $1 for both weeks, and now 1 red is up for 500 (i believe) and another asking for several thousand.  If you were patient, you would get $1000, and they will go for close to $2000 when the economy gets better.

If you have patience and are not risk averse, this is the time to buy good TS.


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## m61376 (Dec 26, 2010)

I find such opposing opinions interesting. While I personally wouldn't risk approaching timeshare purchases as "investments," I do agree that there is potential for profit even now with some of the aberrations we have seen lately. 

What will be very interesting is to revisit this thread 2 or 3 years down the road and see who was right. I do not think that we can necessarily make future assumptions based on historical price trends, because we are in a unique point in history. I tend to think that prices will recover slowly as demand for travel again increases and, since we are at such a low point, it will be easy to see real value in purchasing versus renting if rental prices return to their prior levels (and, since rental prices are a reflection of market demand and other competition, as hotel prices begin to climb I do expect to see a commensurate increase in rental rates as well over time). Moreover, week ownership may have real appeal to buyers interested in frequent return to the same destination. While many owners like to trade there are many others who enjoy returning to a "second home" of sorts and like the security of knowing that they are guaranteed a week in their season every year, rather than having to vie for one, in what is essentially a points based trading system. Not having any home resort priority for new points members is a big program detriment, imho.

Thus, I tend to think that premium properties may very well enjoy price increases a few years down the road. People who want to ski in the winter or go to the Caribbean, etc., don't want to wait for a week to find it's way into the exchange pool to reserve, and remember that for those who only need a 1BR or studio, there is far more value in week ownership than point ownership, especially when considering MF's.

Time will tell who here was mistaken....

btw- even in today's climate, the real estate market has shown strong recovery in a few high demand and isolated markets. I wouldn't be so quick to maintain that high demand timeshare properties won't react in similar fashion.


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## dioxide45 (Dec 26, 2010)

wof45 said:


> you apparently aren't able to read and understand my theories since I have been very specific about resorts, seasons, locations and fees.  Good ones will return to their replacement costs.
> 
> as for resales --
> Fort Lauderdale Beach Resort - week 8 high floor ocean bought 800 sold 4200
> ...



I still don't see where these prove a general rise in resale prices, more so aberrations that has been well discussed. You didn't provide any dates as to when the purchase and sales occurred.

As for Sabal Palms, buying one for $1 and reselling for $500 would actually be a loss since the closing costs to buy would be more than any potential gain.


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## wof45 (Dec 26, 2010)

dioxide45 said:


> I still don't see where these prove a general rise in resale prices, more so aberrations that has been well discussed. You didn't provide any dates as to when the purchase and sales occurred.
> 
> As for Sabal Palms, buying one for $1 and reselling for $500 would actually be a loss since the closing costs to buy would be more than any potential gain.



actually, most of the $1 sales include closing costs since they are sold by postcard companies (sometimes even including free use with MF paid) -- and my sales have always had closing costs covered by the buyer.  There are closing companies who will handle closing for less than $200, and my wife volunteered to handle the transfer since most are pretty simple, but we never did it since the buyer was always happy to work with the lower priced closing company.

I would never have resold for $500 since that is not enough margin for the bother.  (good resale TS are also good rental TS)  Our last sale was about 20 months ago, and our last purchase to flip was more than 3 years ago.  trading (including tickets) kept me busy in early retirement, but I went to consulting since it was a much better return for my time since I was working anyway.


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## tombo (Dec 26, 2010)

3 or more years ago flipping for profit was not hard to do if you knew about buying on e-bay and/or from the post card companies and as long as you purchased the right prime weeks.... 3 or more years ago most timeshare buyers only knew about retail developer sales and many buyers who knew about e-bay were scared of buying high dollar items from e-bay. You could buy desirable prime weeks at many resorts for $1000 to $2000 on e-bay and sell them on redweek and Myresortnetwork for $3000 to $5000 to buyers who only wanted to buy from owners or developers. People thought they were stealing weeks from owners on redweek for $5000 because developers were selling them for $15,000 or more retail. Now everyone young and old knows about e-bay, Craigs list, etc. The genie is out of the bottle. Anyone can buy timeshares cheap on e-bay, and millions of Americans shop e-bay routinelly. Developers now have a harder time selling weeks too because anyone can google timeshare for sale and find lots of sites to buy cheap weeks on. 

When we used to have a place to buy cheap that few people knew about (e-bay), and places to sell at a profit where there were eager buyers (Redweek, Myresortnetwork, etc), then it was easy to make a profit. Now most everyone is buying the cheap e-bay timeshares if they are buying timeshares at all. There are many here on TUG who used to say that they would NEVER buy from e-bay who now own several e-bay purchased weeks. I have several redweek weeks for sale that have been for sale for months (at low by redweek standards prices), and none have sold. None have had any offers. All were purchased resale by me several years ago, and all are listed for sale for cheaper than I paid for them. I am flipping weeks, just not flipping them for profit lol.

I for one don't feel like the prices will ever rebound and there is no reason to buy or own unless it is for personal use and the MF's are lower than the prices you can rent from someone else. Sadly most places now are cheaper to rent than own.


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## dan_hoog (Dec 26, 2010)

I have no idea if prices will briefly increase. I am purchasing a couple with a built in assumption that they will drop precipitously. 

However, we are in the trough, maybe slightly up from the lows, of the worst recession in many decades. Many of the low and negative cost sales are effectively liquidations from families that lost, or fear losing, one or more incomes. They can't afford the vacations, let alone the magical vacation machine they were sold. 

When the economy rebounds, many of the urgent or panicked sellers will go back to just holding the "asset" again. This will reduce downward price pressure. 

It remains to be seen if these unusual times will create aberrations in overall ts resale pricing trends. It certainly could. I wouldn't buy to flip, given I am just saying the dice may get reweighed for a time. Also, the risk and illiquidity of the item makes it unsuitable anyway - mixing valuation risk and illiquidity is a very bad proposition. 

If someone already buys to use or rent, maybe a few positive flips will enhance the proposition. Rental rates will definitely improve as the recession recedes. 

Just my thoughts. Interesting discussion. 

-dan


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## larryallen (Dec 26, 2010)

ondeadlin said:


> There are two certain trends in the lifespan of any timeshare resort - resale prices falling precipitiously and fees gradually increasing.
> 
> These trends have been greatly accelerated by the great recession.
> 
> ...





That's all I was ever saying. If you know a resort you can profit short term.  You have said it better than I have previously. 

Yes, there is risk but there is room for some profit. Not enough for me to give up my day job and actually do this. Just saying it can be done. It's just simple economics. I still believe the theory is better served with a high dollar timeshare than low dollar because, most likely, closing costs are fixed and general profit margins are based on a percentage (so higher dollar value gives higher chance for profit).


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## Robert D (Dec 26, 2010)

ondeadlin said:


> There are two certain trends in the lifespan of any timeshare resort - resale prices falling precipitiously and fees gradually increasing.
> 
> These trends have been greatly accelerated by the great recession.
> 
> ...



I think this is very good advice. I'd agree that TS values fall quickly to a fraction of retail and at some point plateau but the market value continues to fall over time as maintenance fees rise, although usually at a slower rate.  I agree totally that you can find aberations in pricing here and there if you study the value of a particular TS over a long period.

One thing I didn't realize is that Streamside Evergreen ski weeks are worth $5,000. Don't know that I've see an Evergreen ski week come up on Ebay but units in the other Streamside buildings go for next to nothing (even ski weeks) because the maintenance fees are so high.


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## yumdrey (Dec 26, 2010)

wof45 said:


> as for resales --
> Fort Lauderdale Beach Resort - week 8 high floor ocean bought 800 sold 4200
> Westgate vacation Villas - week 51 deluxe 2BR bought 800 sold 3000
> La Renaissane (atlantic city) - week 30 bought 500 sold 2000
> ...



Are all these sales happened within the last 2-3 months? If not, it is no longer effective in today's market.
Maybe you could do these in the past, but not in the future anymore.


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## Robert D (Dec 26, 2010)

wof45 said:


> you logic falls apart when you do not look at specific properties and weeks.
> there is no such thing as a generic timeshare time, MF, location and upkeep.
> Some buyers believe that, which is why some auctions end at prices that are too low -- and selling the same property not in an auction, with buyers able to find what they want results in higher sale prices that reflect worth.
> 
> When properties are selling for less than the replacement cost, and the location is great, the prices will eventually come back to the replacement price.  If you want a comparison look at the sale prices of houses and apartments on Singer Island and how they rise and fall over time.  Ocean Pointe and Oceana Palms might as well be condos in this location since they have prime locations.



Keep in mind that TS's originally sell for upwards of 10X replacement cost. Some resales are quite a bit less than replacement cost now but don't hold your breath waiting for them to ever get back to that level. One problem is you have no control over ongoing costs which are a lot higher than if you own a condo outright.  A maintenance fee of $1,000 for a TS equates to $50,000 a year for a condo, which is pretty steep where I come from.


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## Stefa (Dec 26, 2010)

wof45 said:


> Marriotts are tougher since they are by season rather than week



This is why I don't believe there will be much, if any, price recovery, especially for the less desirable resorts.  It may be that some of the higher demand resorts/seasons see an increase as the economy recovers and/or if competition from the DC makes it more difficult to trade in.  

Another reason Marriott resorts are different from the examples you cited in your post is that at least some of their value is tied to perceived ability to trade up within the Marriott system.  If more potential buyers believe (as I do) that it will become more difficult to trade up in the future, resorts such as Sabal Palms that get a fair amount of their value from the ability to trade into better Marriott resorts will suffer.


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## wof45 (Dec 27, 2010)

Stefa said:


> This is why I don't believe there will be much, if any, price recovery, especially for the less desirable resorts.  It may be that some of the higher demand resorts/seasons see an increase as the economy recovers and/or if competition from the DC makes it more difficult to trade in.
> 
> Another reason Marriott resorts are different from the examples you cited in your post is that at least some of their value is tied to perceived ability to trade up within the Marriott system.  If more potential buyers believe (as I do) that it will become more difficult to trade up in the future, resorts such as Sabal Palms that get a fair amount of their value from the ability to trade into better Marriott resorts will suffer.



an interesting guide, of sorts, to the value of Marriott weeks is the DC points required to trade into resorts by time period using DC points.  my guess is that the MF is about half the points value, which suggests that the rental value is close to the points value.  

Weeks with a points value less than twice the MF should not be bought if you don't want to use them -- and the weeks with points more than that begin to have value for resale.  I don't see weeks with lower than DC points at four times the MF have a real investment component.  I believe the rest only make sense to use or trade.


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## bdh (Dec 27, 2010)

This debate could/will go on, on and on as both sides of the debate can cite “personal experiences" or "facts & figures".  

The reality is that all sectors (auto industry, construction industry, real estate, etc) of our economy go in cycles - when they all go down at the same time it’s called a recession.  They all come back at some point, but not necessarily at the same time.  

The TS world has been hit extremely hard by this cycle - for the most part, it will come back as confidence in the economy returns.  When/if it comes back to each individual TS owner is a function of what they own - obviously it’s a "when" for prime weeks at higher end properties and an "if" for shoulder weeks at decent properties.  If it’s a mud week at a poor property, the dollar days are here to stay.

Place your property/week somewhere on the sliding scale of desirable to undesirable to pick your recovery point.  If you believe your prime property/week is worth only a dollar - you'll have ample buyers.  If you believe your miserable property/week is worth a million - you'll never sell.  So just like the standard TUG answer of “there isn’t one TS property/week that is the best one for everyone”, there is no singular answer to the question of this thread.


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## ondeadlin (Dec 27, 2010)

bdh said:


> The reality is that all sectors (auto industry, construction industry, real estate, etc) of our economy go in cycles - when they all go down at the same time it’s called a recession.  They all come back at some point, but not necessarily at the same time.



You're mixing apples and oranges here. The timeshare industry will likely rebound. The value of resale timeshares will not.

The American auto industry is rebounding right now. That will not raise the price of your used Ford.



bdh said:


> The TS world has been hit extremely hard by this cycle - for the most part, it will come back as confidence in the economy returns.  When/if it comes back to each individual TS owner is a function of what they own - obviously it’s a "when" for prime weeks at higher end properties and an "if" for shoulder weeks at decent properties.  If it’s a mud week at a poor property, the dollar days are here to stay.



Again, buying a timeshare is much more like buying a car - the product is massively devalued the second it drives off the lot or is sold by the developer. Just as a used car has increased costs the older it gets, so does a timeshare property.

Just as a used car never increases in value, a timeshare never increases in value.

If you're waiting for the day "when" a week "bounces back," you're going to be waiting a long, long time.


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## dan_hoog (Dec 27, 2010)

Actually, used car prices do fluctuate both up and down, though the trend is down. Timeshares may, and I repeat may, have a similar lift for a while. If so, I doubt it would be a material investment opportunity, but some broad short term appreciation of higher intrinsic value situations might happen. Prime locations and weeks where rental is several times maintenance may actually increase for a while. Markets have a strong tendency to over-react and correct.  The rapid declines this year could be such an over-reaction. 

As I said earlier, this is no ordinary recession. The effects are deeper than anything in decades. Of course, that doesn't mean timeshares will recover, just that these are unprecedented times and we may see unprecedented effects through a recovery. 






ondeadlin said:


> You're mixing apples and oranges here. The timeshare industry will likely rebound. The value of resale timeshares will not.
> 
> The American auto industry is rebounding right now. That will not raise the price of your used Ford.
> 
> ...


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## CMF (Dec 27, 2010)

I really don't see an economic model to support the theory that time share resale prices will not increase.  If the price between developer and resale weeks continues to grow, and knowledge of the resale market spreads, resale prices will continue to increase in programs that do not overly discriminate against resale owners.  

Charles


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## Stefa (Dec 27, 2010)

CMF said:


> I really don't see an economic model to support the theory that time share resale prices will not increase.  If the price between developer and resale weeks continues to grow, and knowledge of the resale market spreads, resale prices will continue to increase in programs that do not overly discriminate against resale owners.
> 
> Charles



It all comes down to supply and demand.  It is my belief that much of the demand for some of the older Marriott resorts was based on the opportunity to trade up within the Marriott system.  If that opportunity decreases over time (and I believe it will) the demand for those resorts will decrease accordingly.


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## CMF (Dec 27, 2010)

Stefa said:


> It all comes down to supply and demand.  It is my belief that much of the demand for some of the older Marriott resorts was based on the opportunity to trade up within the Marriott system.  If that opportunity decreases over time (and I believe it will) the demand for those resorts will decrease accordingly.



I can't argue with that, but don't you think that Marriott owners will still have an advantage over non-Marriott owners??

Charles


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## Big Matt (Dec 27, 2010)

I agree with Charles.  

Price is always dictated by the product and how much people will pay for it.  I can only speak for Marriott when I say that you are getting the SAME product when you buy resale.  Now is a great time to buy at places that you want to go to on an annual basis.


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## wof45 (Dec 27, 2010)

everyone has their own idea of what they like and why they do it.

we tend to use or trade into older Marriotts since they have better locations and we do not use a lot of the new amenities at newer resorts.

we bought our first marriotts more than 20 years ago, and our experience is that whatever you enjoy today, you will want something else in ten years.


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## Stefa (Dec 27, 2010)

CMF said:


> don't you think that Marriott owners will still have an advantage over non-Marriott owners??



Yes, I do think the Marriott preference will remain.  Plus, most Marriotts are more desirable than other timeshares in the same location, so the trade value should remain strong.  Marriott will still be a great brand to own, IMO, and owners who know how to work the system and are realistic in their expectations should continue to do well at trading.  

I agree with you (and others) that if you are buying to use or trade with realistic expectations, this is a great time to buy.  I just wouldn't recommend buying anything you can't use.


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## AwayWeGo (Dec 27, 2010)

*Excessive Maintenance Fees At Timeshare Resorts.*




Robert D said:


> A maintenance fee of $1,000 for a TS equates to $50,000 a year for a condo, which is pretty steep where I come from.


Timeshare maintenance fees cover extra stuff that straight residential condo fees don't cover -- e.g., housekeeping services, 24-hour front desk staff, condo furnishings & linens & plates & cutlery & utensils, also interior maintenance (including periodic major renovations) & telephone & cable TV, etc. 

Plus, if the timeshare company still controls the HOA & resort management, it's likely that the management contract generates management fees that go back to the timeshare company's captive management company. 

One company-controlled timeshare (where we own a dinky triennial off-season points unit) has a management agreement with its own management company.  The agreement requires the resort to pay its own management company 15% of the budget maintenance fees "exclusive of the management fee expense."  So when you subtract the $75 per-unit management fee from the $589 per unit maintenance fee, the resort's management company gets $77 -- i.e., 15% of the difference -- on top of the management fee paid to the management company.  

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​


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## siberiavol (Dec 27, 2010)

CMF said:


> Does anyone believe that this is the time to scoop up an eBay week or two at rock bottom prices, rent them for a few years, then resell when prices recover?
> 
> Will prices recover???
> 
> Charles



If you assume Marriott's rental rates have some connection with reality, then it seems entirely possible that this strategy has a good chance to be successful. If you had the flexibility to use the unit bought or trade it now and then so much the better.

Markets are markets. Unless the product had no economic value to anyone then it is still subject to supply and demand and the fear and greed cycle. You make money buying when fear is the greatest and make money selling when greed or optimism is the greatest.

I believe leisure travel is a viable industry. We are in a fear cycle in timeshares yet hotel room rates are rising. I would contend that now is a great time to buy CERTAIN properties if you have the time and interest in marketing them.

I'll take one property I own that I would think is a good buy. I would think there are many like this. It is a silver Barony Beach. These are selling for what, maybe $500.I pay $1000 maintenance fee. Marriott is renting this for $277 a night for the week of March 11.That is $1939. A hotel room at the Marriott is renting for $170 a night.

I traded the silver for a platinum Crystal Shores . The rental price of that unit was over $500 a night.

Everybody on here bought a timeshare to use , trade or rent. I doubt that very few on here paid less than what their unit is selling for now. Some have horrendous losses if they were to try to sell today and that causes negative sentiment but also presents great opportunities.

People want examples of when timeshares have made a great recovery in price. I would ask when have timeshares ever fallen in value this much. Timeshares do compete with condos etc. At least they did for me. They also compete with hotel rooms. Just because prices don't reflect that now doesn't mean it want happen in the future.


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## Robert D (Dec 27, 2010)

siberiavol said:


> I'll take one property I own that I would think is a good buy. I would think there are many like this. It is a silver Barony Beach. These are selling for what, maybe $500.I pay $1000 maintenance fee. Marriott is renting this for $277 a night for the week of March 11.That is $1939. A hotel room at the Marriott is renting for $170 a night.
> 
> I traded the silver for a platinum Crystal Shores . The rental price of that unit was over $500 a night.



I've rented a lot of TS weeks and can tell you that the rent that Marriott or any developer rents nights for is usually close to double what an owner can rent them for.  Consider that the developer will usually rent one night at that price and the renter doesn't have to rent a full week. They usually also provide daily maid service. My experience is that the people who rent TS weeks from someone like me buy by the pound, not the ounce, and these people would never pay developer rents. 

I wonder how much the Interval Getaway weeks go for during your silver season.  From what I've seen these Getaway weeks rent for quite a bit less than the maintenance fee.


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## Bikeguy (Dec 30, 2010)

icydog said:


> I sold ZERO and my price points were correct.



I have a friend that says "I've never owned anything people didn't want to buy.  I just had it priced too high.  When I've lowered the price enough, it has always sold."


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## Robert D (Dec 31, 2010)

Bikeguy said:


> I have a friend that says "I've never owned anything people didn't want to buy.  I just had it priced too high.  When I've lowered the price enough, it has always sold."



Well said!


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## siberiavol (Dec 31, 2010)

Robert D said:


> I've rented a lot of TS weeks and can tell you that the rent that Marriott or any developer rents nights for is usually close to double what an owner can rent them for.  Consider that the developer will usually rent one night at that price and the renter doesn't have to rent a full week. They usually also provide daily maid service. My experience is that the people who rent TS weeks from someone like me buy by the pound, not the ounce, and these people would never pay developer rents.
> 
> I wonder how much the Interval Getaway weeks go for during your silver season.  From what I've seen these Getaway weeks rent for quite a bit less than the maintenance fee.



There are no getaways for Marriotts in March. There are usually a lot in Dec,Jan and Feb.I haven't rented one of my units or rented from anyone. 
What type of things were you able to rent? Is half the developer's rental normal? 
I recognized a unit for rental with cheap getaways available was not viable. It sounds like your experience would indicate nothing that a person could currently buy for less than a $1000 with a maintenance fee of a $1000 is a good rental prospect. Is that right? Again I don't have experience in this area.


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## Robert D (Dec 31, 2010)

siberiavol said:


> There are no getaways for Marriotts in March. There are usually a lot in Dec,Jan and Feb.I haven't rented one of my units or rented from anyone.
> What type of things were you able to rent? Is half the developer's rental normal?
> I recognized a unit for rental with cheap getaways available was not viable. It sounds like your experience would indicate nothing that a person could currently buy for less than a $1000 with a maintenance fee of a $1000 is a good rental prospect. Is that right? Again I don't have experience in this area.



We rent a 2BR Getaway week in Orlando every year in May. Most years we rent at Sheraton Vistana Villages but have also rented at Marriott Grande Vista and usually pay about $550 for a week which is well under the maintenance fee.  I just looked on Interval and saw a Barony Beach 2BR for Feb 27 - Mar 6 for $487 and a Grande Ocean 2BR for same week and price. I've never been to Hilton Head so not familiar with that market but most places have availabiltiy in the offseason. Sounds like March is not really offseason in HH since it's spring break. There might be some Getaway weeks that will show up as you get closer to check in date.

As to ones I own to rent, they are mailing ski weeks in Vail and Avon, Colorado. Also have one week in Orlando and two in Scottsdale that I rent during March.  Have always used our Marriott Timber Lodge weeks - they cost too much to buy and MF's are too high to make them viable rentals.


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## brianfox (Jan 2, 2011)

larryallen said:


> Though I still think the buy and flip strategy is a huge risk you have to do it on higher dollar units in my opinion. The closing costs make it impractical to flip a $500 unit. However, a $10,000 unit which could easily sell for $12k with a better auction, etc... makes it POSSIBLE to make a profit. It doesn't seem possible on a $500 unit to me. Or should I say, much more difficult as you likely have to hold longer which makes the annual costs relevant as you likeloy have to hold a few years.



I have a problem with the notion that a "better auction" will "easily" make a TS sell for 20% more (in your example, a 10K unit being flipped for 12K).  If that was the case, then you should see quite a few completed auctions that point to the "market price" being indeed 12K instead of 10K.  So it sounds like you are really looking for those ads with the mispelled word in the title or an end time inconvenient to most users.  Such a rare case is the only sort of week I could see being "flip-worthy".

Since you have never purchased a TS before, here are a few things that you need to consider if you want to flip:

1) It can take anywhere from a few weeks to a few months before the purchased week is in your hands to resell.  Frr instance, Marriott takes their sweet time to complete weeks re-sales.  That's a long period of time in which the market value can change.  In this economy, I don't see any news that will cause real estate values to pop up (unless Obama plans to bail out the Timeshare industry....which I wouldn't put past him.  A Cash-For-Poor-Traders program, anyone?).

2) There is always a risk that your seller is a flake, and your money could be tied up in a bad deal.  Do a little searching on TUG for deals that fell through or sellers that changed terms or had hidden fees.  It's scary how many you'll find.

3) Having to pay a MF (or worse, a surprise Special Assessment) will destroy most if not all of your profit, so don't buy a property to flip near the time the MF are due.  And the instant a SA hits (or if there is a strong rumor), your resale value will plummet.  Even if you found an unaware buyer, they would balk as soon as they found out about the SA.

4) As was mentioned earlier, Ebay is NOT a good indicator of market value - as far as real estate goes.  For traditional widgets it certainly is - but not timeshares.  On Ebay, any real estate winning bid is not binding.  It is considered to be an offer only.  In fact, the seller and buyer may have negotiated a final sales price after the auction closed.  Or, the week may have been sold to the second highest bidder if the winner backed out.  You simply don't know.

5) What's E-bay's commission on $12K?  Plus your portion of closing costs?  Plus the taxes you'll pay on your small profit?  What you walk away with seems a pittance compared to the risk.

6) This will almost certainly not happen in 2011, but if you find a steal, the developer could do a ROFR.  No loss to you, but no profit, either.  

Personally, I think you need to chart some high ticket properties for a few 
months, and meanwhile set up a search that includes common misspelling variants of the property.  

Good luck in your decision, but I think you'll find very few people on this board who think flipping is a good idea in 2011.


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