# Marriott Resale Prices low??



## chemteach (Jan 23, 2017)

I've been watching Marriott prices for Newport Coast Villas and Palm Springs area for about ten years now.  (I own Starwood, and often considered purchasing Marriott, but never did so.)  NCV platinum annual weeks sold for $16K+ ten years ago, and now sell for less than $8k.  Palm Springs resorts seemed to sell for around $8k ten years ago, and now sell for $500 to $2000 for a platinum annual 2 bedroom.  Four questions:
1) Do these prices pass ROFR??  
2) Why such a decrease in resale?  
3) Is it super difficult to reserve a spring week in Palm Springs?   I have always read that it is difficult to reserve summer weeks at NCV.   
Thanks in advance for any feedback.  
4) Why such a drastic price drop?


----------



## VacationForever (Jan 23, 2017)

I own at DSV I (Desert Springs Villas I).  This phase does not have ROFR.  Since I own 2 weeks, I call at 13th month right at 6am PST and have been able to get the 2 weeks for Spring (March).  If I wait until 12th month (for single week), I can book at 6am, and are all gone by 6:03am.

Your observation that the price is now at $500 to $2000 is not what I am seeing for DSV I for a red week.  In Redweek, the going rate is around $5K to $7K.

I believe a drop in the overall prices for these Marriott weeks is due to the inability to be enrolled into DC.


----------



## vacationtime1 (Jan 23, 2017)

Let me respond to your questions 2 and 4.

Starwood/Vistana resale prices have also crashed during the past ten years.  Westin Mission Hills (very comparable to Marriott's Palm Springs/Desert properties) has seen resale prices fall off a cliff.  The numbers you suggest for MDS are comparable to WMH prices.

imo, this is a result of MF's becoming too high compared to rental prices.


----------



## ljmiii (Jan 23, 2017)

NCV's season calendar is somewhat odd - the first 5 months are gold and all the rest are platinum (ignoring weeks 26 and 52) unlike some similar resorts where gold is in the spring AND the fall. So anyone with a platinum week and kids is competing for the same three 'good' months of summer. But from what I've read NCV isn't in the first tier of MVCI resorts with availability issues. I don't really follow the Palm Springs properties so I can't help you there.

As for ROFR, most sales pass and some properties (as VacationForever noted) don't ROFR. But if you have a property, season, and unit size in mind you should look through the ROFR thread and/or websites to look for 'real' selling prices.

IMHO MVCI resale prices have seen such a drastic price drop because of the way MVCI has chosen to implement the Destination Point system. There are many facets to this but the most important are 'stripping' enrolled weeks of their status when sold and reducing the availability of Marriott II trades. II's decision to introduce fees for trading into larger units has also affected the value of lock-off weeks.

Lastly, there is the issue of ever increasing MFs which affects all timeshare systems. But while my HGVC weeks have held their value and my DVC points have increased in value (despite their impending RTU date) the resale price of my MVCI weeks have plummeted around 75%.


----------



## vacationtime1 (Jan 23, 2017)

VacationForever said:


> Your observation that the price is now at $500 to $2000 is not what I am seeing for DSV I for a red week.  In Redweek, the going rate is around $5K to $7K.



Redweek data is obviously asking prices; we don't know what the ultimate sales price really is.

An 2bd platinum eoy unit at Marriott's Desert Springs II just went for $547 in a recent eBay auction by seans0302, a reasonable seller.  Of course, eBay is the bargain basement, DSV II is slightly less desirable, and this is just one data point.  But I agree with OP's assessment of the current FMV.


----------



## chemteach (Jan 23, 2017)

vacationtime1 said:


> Let me respond to your questions 2 and 4.
> 
> Starwood/Vistana resale prices have also crashed during the past ten years.  Westin Mission Hills (very comparable to Marriott's Palm Springs/Desert properties) has seen resale prices fall off a cliff.  The numbers you suggest for MDS are comparable to WMH prices.
> 
> imo, this is a result of MF's becoming too high compared to rental prices.




Sorry - I wasn't trying to compare Westin and Marriott resale values...  The Westin resale prices plummeted years ago for non-mandatory staroption weeks.  I was just surprised by what seems to be a much more recent decrease in Marriott resale prices.  Ten years ago I wanted to buy into Marriott, but resale prices were a bit too high for me.  Now I can afford to purchase a week, but wanted to check on whether it made sense to purchase - or if something in the system made Marriott not work as well as it had in the past.


----------



## BocaBoy (Jan 23, 2017)

In my opinion, the big reasons for the drop in MVCI resale prices are the out of control maintenance fees, the financial and real estate crash of 2008-2009, the inability to enroll these weeks in the DC, and perhaps the biggest one of all--the internet.  With the internet, it is now possible for a buyer to easily find distressed sellers and that drives all prices down.  Going forward, the high and increasing maintenance fees are what will prevent resale prices from increasing a lot.


----------



## JIMinNC (Jan 23, 2017)

BocaBoy said:


> In my opinion, the big reasons for the drop in MVCI resale prices are the out of control maintenance fees, the financial and real estate crash of 2008-2009, the inability to enroll these weeks in the DC, and perhaps the biggest one of all--the internet.  With the internet, it is now possible for a buyer to easily find distressed sellers and that drives all prices down.  Going forward, the high and increasing maintenance fees are what will prevent resale prices from increasing a lot.



But are MVC maintenance fees really increasing at a faster rate than other comparable resort systems like Vistana Signature Experiences, Hilton, etc.? I know my MVC fee increases over the last 3 years have been quite a bit lower than what I experienced in my previous 16 years in the Sunterra/Diamond system.


----------



## Xpat (Jan 23, 2017)

JIMinNC said:


> But are MVC maintenance fees really increasing at a faster rate than other comparable resort systems like Vistana Signature Experiences, Hilton, etc.? I know my MVC fee increases over the last 3 years have been quite a bit lower than what I experienced in my previous 16 years in the Sunterra/Diamond system.



It certainly feels that way based on the different weeks I own with MVC, HGVC and Wyndham.

This year's increase at Canyon Villas, DSV II and Newport Coast were all above 5.5%

See the 7-year compound annual growth rate at these different resorts...

Resort / 2017 increase / 2010-2017 CAGR
Marriott Canyon Villas / +6.8% / +5.11%
Marriott Grand Chateau / +2.1% / +2.78%
Marriott DSV II / +5.9% / +5.64%
Marriott Newport Coast / +5.7% / +4.76%
HGVC Las Vegas Blvd / +2.4% / +1.71%
Wyndham Bali Hai / +3.0% / +2.61%
Wyndham National Harbor / +2.8% / +2.27%
Worldmark / +5.0% / +4.39%


----------



## bogey21 (Jan 23, 2017)

My how times change.  Many years ago I bought Weeks at Sabal Palms, Harbour Club, Heritage Club and Monarch.  I spent something like $62 thousand for them.  I ended up selling them all after using them for 5 or 6 years.  My gross proceeds were something like $80 thousand.  After commissions I about broke even.

George


----------



## Saintsfanfl (Jan 23, 2017)

Marriott maintenance fees are still really low for decent weeks compared to the annual fees for equivalent points to book the same week. Marriott has no problem selling points on a daily basis. It's a good product but it's expensive. I've seen resorts no where near the same quality but with higher fees per sq ft. The resale weeks are still a bargain. It's definitely cheaper to buy than it used to be and obviously more expensive on the annual fees.


----------



## VacationForever (Jan 23, 2017)

I know TUG often compares MF with rentals.  MF is still inexpensive when compared with hotel retail rate, which is what I use to compare with. However I am not thrilled with the high and increasing MF that we are now committed to spend each year, especially now that we are retired.  I am planning on selling my Marriott weeks because those are my highest MFs timeshare, but not for a few more years.


----------



## JIMinNC (Jan 23, 2017)

Saintsfanfl said:


> I've seen resorts no where near the same quality but with higher fees per sq ft.



Bingo...the last year that I have a maintenance fee bill for our old 2BR at Diamond's Kaanapali Beach Club - 2015 - the annual fee was $2090. By contrast, according to the Historical Maintenance Fee spreadsheet, the maintenance fee for a 2BR at Maui Ocean Club (original) for that same year was $2032. While I've yet to stay at MOC, I am very familiar with the property, and there is no question it is superior in most every respect to Kaanapali Beach Club - better location, better grounds, better pool, better furnishings, etc. Both properties have mini-kitchens instead of full kitchens.

One other thing...our first year of ownership at Kaanapali Beach Club in 1999, the maintenance fee was $686 annually. By 2015 it had grown to the aforementioned $2090. That's an annual compound growth rate of 7.2% over 16 years.


----------



## BocaBoy (Jan 24, 2017)

JIMinNC said:


> But are MVC maintenance fees really increasing at a faster rate than other comparable resort systems like Vistana Signature Experiences, Hilton, etc.? I know my MVC fee increases over the last 3 years have been quite a bit lower than what I experienced in my previous 16 years in the Sunterra/Diamond system.


My comments on maintenance fees apply to all the major systems I know of.  It is a timeshare problem and not just a Marriott problem.  I don't feel better being gouged because others systems gouge you too.  The choice is not just whether to buy Marriott or another system, it is whether to buy a timeshare at all.  And it was not always this way.  Marriott timeshare fees in the early hears even went down occasionally.  The problem really started about the time inflation screeched to a halt 10 or so years ago.  It is ironic that fees were better controlled in high inflation times than they are today.  This year is our 30th year of owning Marriott timeshares.


----------



## RLS50 (Jan 24, 2017)

BocaBoy said:


> My comments on maintenance fees apply to all the major systems I know of.  It is a timeshare problem and not just a Marriott problem.  I don't feel better being gouged because others systems gouge you too.  The choice is not just whether to buy Marriott or another system, it is whether to buy a timeshare at all.  And it was not always this way.  Marriott timeshare fees in the early hears even went down occasionally.  The problem really started about the time inflation screeched to a halt 10 or so years ago.  It is ironic that fees were better controlled in high inflation times than they are today.  This year is our 30th year of owning Marriott timeshares.


With respect I still disagree with any assertion that inflation ended 10 years ago.   It did the exact opposite.  It surged once the economy collapsed and the FED threw out the playbook they operated under for decades and went into full time money creation mode.   Real inflation...inflation that impacts real stuff that people need and buy has been running at a 5+% clip for almost 9 years now.   The CPI report has been adjusted multiple times since 1980 and no longer reflects true cost of living increases for the average person. 

Let's keep it even more simple...in any fiat economy...anywhere in the world or anytime in history...it is impossible to have no inflation.  By it's very nature when you create more of something, it adds to the supply and makes what was there already less valuable.

It isn't just timeshare maintenance fees that have surged.  Everywhere the average consumer looks, things are more expensive, smaller in size for the same price, or companies have changed their products to use cheaper parts or cheaper ingredients to minimize their final product cost charged to consumers.  Why?   To keep pace with real inflation...which will ALWAYS track the real growth in money supply in a fiat currency.

This is not a political, ideological, or opinion discussion.  It is just math.

http://www.forbes.com/sites/periann...lation-dont-bother-with-the-cpi/#5a3a1109118b


----------



## taterhed (Jan 24, 2017)

vacationtime1 said:


> Redweek data is obviously asking prices; we don't know what the ultimate sales price really is.
> 
> An 2bd platinum eoy unit at Marriott's Desert Springs II just went for $547 in a recent eBay auction by seans0302, a reasonable seller.  Of course, eBay is the bargain basement, DSV II is slightly less desirable, and this is just one data point.  But I agree with OP's assessment of the current FMV.



Doubt that will pass.....  DSV II has ROFR

*MVC resorts that do NOT require a ROFR: (14 resorts)*

Birch at StreamSide
Desert Springs Villas I
Douglas at StreamSide
Evergreen at StreamSide
Fairway Villas at Seaview
Frenchman’s Cove
Harbour Club
Harbour Point
Heritage Club
Monarch
Ritz-Carlton Club (RCC), St. Thomas
Sabal Palms
Sunset Pointe
Royal Palms

Some recent data (chuckle on the $575)
*Resort* *Date* *Season* *Usage* *Type * *View* *Price* *Result* *Name*
Desert Springs Villas II 3/5/2016 White Annual 2BR N/A $825.00 Failed samara64
Desert Springs Villas II 3/2/2016 Red Annual 2BR N/A $6,200.00 Failed Mark
Desert Springs Villas II 11/10/2015 White Annual 2BR N/A $2,200.00 Failed samara64
Desert Springs Villas II 8/31/2015 White Annual 2BR N/A $2,100.00 Failed saintsfanfl
Desert Springs Villas II 6/14/2014 White EOY 2BR N/A $699.00 Passed Saintsfanfl
Desert Springs Villas II 4/30/2014 White EOY 2BR N/A $575.00 Failed seaport104
Desert Springs Villas II 4/30/2014 White EOY 2BR N/A $575.00 Failed seaport104
Desert Springs Villas II 4/2/2014 Red Annual 2BR N/A $5,000.00 Failed Okies
Desert Springs Villas II 4/2/2014 Red Annual 2BR N/A $5,000.00 Failed Okies
Desert Springs Villas II 11/18/2013 Red Annual 2BR N/A $4,300.00 Failed S1b000


----------



## elleny76 (Jan 24, 2017)

I guess this is the time to buy Marriott Weeks? Just want to use those weeks for Aruba every year. I have been thinking about it for like 8 months now but I still no sure about it.


----------



## BocaBoy (Jan 24, 2017)

RLS50 said:


> With respect I still disagree with any assertion that inflation ended 10 years ago.   It did the exact opposite.  It surged once the economy collapsed and the FED threw out the playbook they operated under for decades and went into full time money creation mode.   Real inflation...inflation that impacts real stuff that people need and buy has been running at a 5+% clip for almost 9 years now.   The CPI report has been adjusted multiple times since 1980 and no longer reflects true cost of living increases for the average person.
> 
> Let's keep it even more simple...in any fiat economy...anywhere in the world or anytime in history...it is impossible to have no inflation.  By it's very nature when you create more of something, it adds to the supply and makes what was there already less valuable.
> 
> ...


With all due respect, any economist would say that is just not true.  The big worry in economic circles the past 8 years has been potential deflation, not inflation.  I guess if the facts don't support you, just make up your own.


----------



## RLS50 (Jan 24, 2017)

BocaBoy said:


> With all due respect, any economist would say that is just not true.  The big worry in economic circles the past 8 years has been potential deflation, not inflation.  I guess if the facts don't support you, just make up your own.


Make it up?   You are free to believe otherwise, I respect your right to do so and no hard feelings.   I did not reply to create an argument nor mean to show you any disrespect.   What I am speaking to is the basic math involved in any fiat currency, anywhere.   Traditional economists don't deny that, they merely defend hedonic quality adjustments used to suggest improvements in the service or technology negate the actual dollar increase in cost.   This is why reported inflation is only running at 2% a year, while money supply growth has been at least 5% a year since 2008.  

Anybody who works and supports a family knows costs have went up across the board on almost everything a family needs and uses from day to day.   Some things have increased a little, some have increased a lot.

It isn't just maintenance fees that have been increasing 5% a year or more. 

Peace.


----------



## VacationForever (Jan 24, 2017)

The basic issue is that the measure of inflation uses a limited basket of goods (CPI) whereas in reality, real cost of living has risen much faster than the reported inflation (CPI) for some groups or population/location.  If you want to read what makes up CPI you can read it up here: https://www.bls.gov/cpi/cpifaq.htm


----------



## BocaBoy (Jan 24, 2017)

VacationForever said:


> The basic issue is that the measure of inflation uses a limited basket of goods (CPI) whereas in reality, real cost of living has risen much faster than the reported inflation (CPI).  If you want to read what makes up CPI you can read it up here: https://www.bls.gov/cpi/cpifaq.htm


Thank you, but I am quite versed professionally in these measures.  But here are some facts.  I just bought a new car for just about the same amount as a comparable model cost me in 2001.  Real estate prices tanked in 2008 and are only now approaching their previous level.  Cars and housing are two of the largest components in any family's budget.  Oil and a natural gas are still MUCH lower than before the crash in 2008, and energy is a major cost element for many if not most things.  I could go on and on, and there are certainly things that have gone up in price besides timeshare maintenance fees, but on balance inflation has been extremely low in recent years, so much so that the Fed has actually been trying to increase inflation to avert the disaster that would likely come with a period of deflation.  In my own life, I don't notice a lot of difference in the aggregate between now and 10 years ago.


----------



## VacationForever (Jan 24, 2017)

BocaBoy said:


> Thank you, but I am quite versed professionally in these measures.  But here are some facts.  I just bought a new car for just about the same amount as a comparable model cost me in 2001.  Real estate prices tanked in 2008 and are only now approaching their previous level.  Cars and housing are two of the largest components in any family's budget.  Oil and a natural gas are still MUCH lower than before the crash in 2008, and energy is a major cost element for many if not most things.  I could go on and on, and there are certainly things that have gone up in price besides timeshare maintenance fees, but on balance inflation has been extremely low in recent years, so much so that the Fed has actually been trying to increase inflation to avert the disaster that would likely come with a period of deflation.  In my own life, I don't notice a lot of difference in the aggregate between now and 10 years ago.


I did go back and change my post to include "for some groups or population/location".  For example, CA minimum wage has been revised many times over the 10 years and I think it has gone up 30% or more.  CPI is nationwide and CA cities form part of the population captured in CPI.  For those living in CA, costs have definitely gone up faster than the reported CPI, and especially for those who rely on services that are provided mainly by lower wage workers - eating out, cleaning services, home care/assisted living facility, timesharing...


----------



## JIMinNC (Jan 24, 2017)

VacationForever said:


> I did go back and change my post to include "for some groups or population/location".  For example, CA minimum wage has been revised many times over the 10 years and I think it has gone up 30% or more.  CPI is nationwide and CA cities form part of the population captured in CPI.  For those living in CA, costs have definitely gone up faster than the reported CPI, and especially for those who rely on services that are provided mainly by lower wage workers - eating out, cleaning services, home care/assisted living facility, timesharing...



Yes...this is an important point I've made before when discussing this same issue. Just because the overall inflation rate - whether you accept the official CPI or not - is a certain stated low percentage does not mean that everything is going up at that low rate. Overall personnel costs have been rising faster than the stated rate of inflation, so any business that is people-dependent has seen costs rise much faster than the 1% to 2% inflation rate that has been reported in recent years. Last fall, the Census Bureau reported that real median household income increased 5.2% from 2014 to 2015, the largest percentage recorded by the bureau since it began tracking median income statistics in the 1960s. Even though overall median U.S. income had been relatively flat in real terms since the mid-1980s until 2015, total personnel costs have still been going up, due primarily to healthcare costs. While the rise in healthcare costs for companies did slow a bit over the last 4-5 years or so, those costs are still rising at a rate considerably higher than the CPI. Then as you say above, in states that have been willing to raise the minimum wage, wages have risen on top of the rising benefits costs. With housekeeping services and other resort staff being such a large portion of every timeshare's budget, it's not hard for me to conceive that a 5% increase in costs is somewhat reasonable.

While it's true as BocaBoy says that energy costs have not been rising - and that has helped the overall CPI stay very low - the fluctuation in the price of oil probably has minimal impact on the typical timeshare budget. If you think about the major controllable costs in a timeshare budget - housekeeping, maintenance, and administration/front desk - all three are heavily impacted by staffing costs. At our Barony Beach Club, these are three out of the top five expense categories - the other two are Property Taxes and the Management Fee. Property taxes are set by the city/county and are out of the control of the HOA. The Management Fee is set contractually as a percentage of the expense base. So of the controllable expenses, rising staffing costs have a major impact.


----------



## catharsis (Jan 25, 2017)

1.  [working pop growth + wage increase + *productivity *gains] accounts for the increase in total output

or to put it another way, labor costs don't feed through to inflation because less people are required to deliver something than the year before, and so on.

2 





> The *Management Fee is set contractually as a percentage of the expense base*.


 - so the organisation in charge of controlling and setting cost levels is paid more as costs increase, and TUG is having difficulty working out why costs are increasing? - Really?!


----------



## MOXJO7282 (Jan 25, 2017)

I've tracked Maui, Grande Ocean, Monarch, NCV, and Myrtle Beach fairly extensively for some time, buying and selling all but Maui which I never sell once I find a good deal.  Resales pricing have definitely come down in the last 10 years but they have stabilized over the last few years it seems to me because I just don't see many really good deals in the marketplace and this has been true for some time.  When I do I jump on it because I see them as far and few between with a lot of others looking for a good deal like i am.


Also I think many of us have bought Marriott units in 2006-2010 that pricing still holds up.  I know I bought my two GO OF gold units for $7500 each while I was selling one for $13800.  Bought on ebay and sold on Redweek.

We also only see a fraction of the resales so it's hard to say what the true average resale price is.  I know the GO I sold for $13800 was being resold by a HHI attorney for like $18k.  So I was buying at $7500, selling at $13800 and someone else was paying $18k. I would imagine that still happens today.


----------



## BocaBoy (Jan 25, 2017)

My final comments and then I will leave this topic:  (1) Energy costs in fact have a huge impact on timeshare budgets.  At Ko Olina, for example, it is the third highest expense item after housekeeping and property taxes.  (I don't count management fee because it is simply a percentage of the total budget.)  I would expect energy to be even more significant in areas with cold winters and much hotter summers than Hawaii.  Boston and Atlantic City come to mind but I have not looked at their budgets.  (2) Most of my career has been spent in senior human resources roles in consulting firms and in Fortune 100 companies.  With the exception of health care costs, there have been only minimal increases in personnel costs over the past 10 years, pretty consistent with the low CPI numbers.  Health care costs have increased much faster, but in the past several years even these increases have been much smaller than in the previous decade or two.


----------



## JIMinNC (Jan 25, 2017)

catharsis said:


> 1.  [working pop growth + wage increase + *productivity *gains] accounts for the increase in total output
> 
> or to put it another way, labor costs don't feed through to inflation because less people are required to deliver something than the year before, and so on.
> 
> 2  - so the organisation in charge of controlling and setting cost levels is paid more as costs increase, and TUG is having difficulty working out why costs are increasing? - Really?!




Actually productivity growth has been flat for a number of years - as the linked New York Times article explains, actual economic output is merely moving in lock step with the number of hours people put in, rather than rising as it has throughout modern history. The lack of productivity growth has been one of the major things holding back economic growth in recent years.

https://www.nytimes.com/2016/04/29/upshot/why-is-productivity-so-weak-three-theories.html?_r=0

So, if productivity is flat, any wage gains feed directly into inflation.

On your second point, I agree that timeshare HOAs do not have the same cost control incentives as exist in other types of HOAs - neighborhoods, condo/townhomes, etc. Timeshare ownership is so diluted by the number of owners involved, the same cost control incentive doesn't exist as it does in a condo complex or neighborhood where people are more connected because it's where they live.

Having said all that, I still don't find the 3% to 5% or so annual increases in Marriott maintenance fees to be out of line with the cost increases I see elsewhere. For example, from 2011 to 2016 our monthly cable/internet bill increased from $148 to $239 (an annual growth rate of +10%); over that same time period our monthly telephone bill has grown from $74 to $104 (annual growth of +7%). In both cases the services we are receiving are identical. I don't have an easy way to track our grocery spending over that same time frame, but my sense is our grocery bills are growing much faster than the stated CPI. Maybe we're buying different things, but I don't think our eating patterns are that much different. So despite what the CPI says, costs ARE going up.


----------



## JIMinNC (Jan 25, 2017)

BocaBoy said:


> My final comments and then I will leave this topic: (1) Energy costs in fact have a huge impact on timeshare budgets. At Ko Olina, for example, it is the third highest expense item after housekeeping and property taxes. (I don't count management fee because it is simply a percentage of the total budget.) I would expect energy to be even more significant in areas with cold winters and much hotter summers than Hawaii. Boston and Atlantic City come to mind but I have not looked at their budgets. (2) Most of my career has been spent in senior human resources roles in consulting firms and in Fortune 100 companies. With the exception of health care costs, there have been only minimal increases in personnel costs over the past 10 years, pretty consistent with the low CPI numbers. Health care costs have increased much faster, but in the past several years even these increases have been much smaller than in the previous decade or two.



At Barony Beach Club in Hilton Head - a place with very hot summers - the costs for Electricity and Gas total $671,448, only about 5% of the $13.4 million operating budget. By contrast, line items that have significant staffing components (accounting, activities, administration, front desk, housekeeping, human resources, owner services) total about $5.3 million, or about 40% of the operating budget. If you throw in maintenance line items which may have significant labor cost components as well (landscaping/grounds, maintenance, pool maintenance, pest control) that adds another $1.7 million (an additional 13% of the budget).

 As I said in my earlier post, I agree that healthcare cost increases have slowed in recent years but they are still significant. According to the Kaiser Family Foundation Employer Health Benefits Survey, from 2000 to 2010 the annual growth rate was 7.3%, falling to 5.3% from 2010-2014, and 4.8% in 2015. So healthcare costs are growing slower, but they are still growing at a rate over twice that of the official CPI.

As I said just above with my cable tv and telephone examples, a lot of things we pay for every day are increasing at rates far above the stated CPI. So I don't agree that if a timeshare operating budget grows by more than the CPI, it automatically means the HOA/Property Manager is gouging the owners. You have to look at the components of the timeshare budget and look at how those types of expenses are actually increasing vs. an overall average like the CPI where meaningful variations in sector or category get averaged out.

But I do agree that most HOAs could do a better job of expense management, and as I said just above, I also agree the management companies may not have the same cost control incentives we see in other areas of the economy. But as long as the rate of growth in timeshare maintenance fees stays in the 4% to 5% range, it means that they are not growing faster than hotel rates. The two articles linked below peg hotel room rate growth at 4.6% (hotel-online) and 5.4% (CNBC) annually.

http://www.hotel-online.com/press_releases/release/u.s.-hotel-revenue-growing-but-slowing
http://www.cnbc.com/2015/01/26/us-average-hotel-room-rate-forecast-to-rise-54-percent.html


----------



## BocaBoy (Jan 26, 2017)

JIMinNC said:


> As I said in my earlier post, I agree that healthcare cost increases have slowed in recent years but they are still significant. According to the Kaiser Family Foundation Employer Health Benefits Survey, from 2000 to 2010 the annual growth rate was 7.3%, falling to 5.3% from 2010-2014, and 4.8% in 2015. So healthcare costs are growing slower, but they are still growing at a rate over twice that of the official CPI.


But the whole point of my responses were addressed to the claim that inflation actually got a lot worse starting with the Great Recession, and even your health care numbers (which I do not dispute) run contrary to that.  I also agree with your comments that incentives for cost control at timeshares are not great because of the dilution of ownership.  And finally, I guess cable and telephone bills vary widely by location because ours have changed very little in the past decade.  In fact,m we recently moved and our new costs for these items are a lot less than they were 10 years ago in our former location, where the last 10 years of costs were rather stable.


----------



## JIMinNC (Jan 26, 2017)

BocaBoy said:


> But the whole point of my responses were addressed to the claim that inflation actually got a lot worse starting with the Great Recession, and even your health care numbers (which I do not dispute) run contrary to that.  I also agree with your comments that incentives for cost control at timeshares are not great because of the dilution of ownership.  And finally, I guess cable and telephone bills vary widely by location because ours have changed very little in the past decade.  In fact,m we recently moved and our new costs for these items are a lot less than they were 10 years ago in our former location, where the last 10 years of costs were rather stable.



I don't recall anyone suggesting that inflation actually got worse during and after the Great Recession. What I recall being said was just that some categories of prices have still been rising (mainly since the recovery began in 2010 or so, not in the depths of the recession) even within what statistically has been a low inflationary environment. You're lucky on the cable and phone - I was shocked myself when I looked ours up that it had risen as much as it had.


----------



## Saintsfanfl (Jan 26, 2017)

I think labor has gone up while many other things have gone down. My wife and I drive around 45,000 miles a year so gas over $4 a gallon 8 years ago to just over $2 today is huge. My cable is the same as 8 years ago and my phone has actually gone down.

Labor going up is a factor with timeshares since the maintenance is heavily labor related but overall defaults and underfunded reserves is what eventually sinks a timeshare property.


----------



## BocaBoy (Jan 26, 2017)

JIMinNC said:


> *I don't recall anyone suggesting that inflation actually got worse during and after the Great Recession. *What I recall being said was just that some categories of prices have still been rising (mainly since the recovery began in 2010 or so, not in the depths of the recession) even within what statistically has been a low inflationary environment. You're lucky on the cable and phone - I was shocked myself when I looked ours up that it had risen as much as it had.


See post #15 from RLS50 in this thread.  It starts like this:

"With respect I still disagree with any assertion that inflation ended 10 years ago. It did the exact opposite. It surged once the economy collapsed and the FED threw out the playbook they operated under for decades and went into full time money creation mode. Real inflation...inflation that impacts real stuff that people need and buy has been running at a 5+% clip for almost 9 years now."

This is what got me so actively involved in this debate.


----------



## RLS50 (Jan 26, 2017)

BocaBoy said:


> But the whole point of my responses were addressed to the claim that inflation actually got a lot worse starting with the Great Recession, and even your health care numbers (which I do not dispute) run contrary to that.  I also agree with your comments that incentives for cost control at timeshares are not great because of the dilution of ownership.  And finally, I guess cable and telephone bills vary widely by location because ours have changed very little in the past decade.  In fact,m we recently moved and our new costs for these items are a lot less than they were 10 years ago in our former location, where the last 10 years of costs were rather stable.


Well, just so we don't talk past each other, my original response was based on your statement "The problem really started about the time inflation screeched to a halt 10 or so years ago. It is ironic that fees were better controlled in high inflation times than they are today."  

While I agree with many of your other points and general critiques as it relates to timeshare fees, and defer to your expansive knowledge when it comes to anything about the Marriott system or timeshares in general, my basic point is that inflation did not screech to a halt. 

Inflation is not linear...it does not influence every segment/sector of the market the same.   But when money supply growth is averaging about 5+% a year, and is not matched by a corresponding pace of economic growth, there will be most certainly be inflation felt throughout the economy.  It is the basic math behind any fiat current system.  Other external factors and regional locations may see inflation in some sectors only be at 1% or maybe even -2% in one sector.  But that means that other sectors somewhere will carry over that difference and could be 6%, 7%, 8%, etc.

You are correct that the FED was worried about massive deflation as the financial crisis exploded in 2008, 2009.    So what did they do?  They undertook a policy to intentionally CREATE inflation, especially to reliquify the banks and to re-inflate assets like the stock market and real estate.   This makes people feel better and increases consumer confidence levels...and they needed consumers to keep shopping and buying because the economy is so dependent on people shopping and buying consumer products. 

However monetary policy is a blunt instrument, it cannot be laser targeted.  Any policy designed to rapidly create and maintain inflation in asset classes the FED wanted inflated also seeped out into other areas of the economy and into other sectors, that created unintended increased inflationary costs for consumers.   The FED knows this, but considered it a necessary evil as part of the price to pay for staving off a global depression.

The above is not meant to render moral judgment or criticism on what was done and how it was done, merely to speak to what happened. 

Sounds like we have similar backgrounds.  I also have worked in Fortune 100 companies my entire career supporting supply chain and finance.

One thing I think we can both agree on is that annual MF increases of 5% or more across the timeshare world (with even more additional nickel and dime fees) are probably not sustainable longer term, unless wage growth keeps up that pace, and it hasn't and won't.


----------



## JIMinNC (Jan 26, 2017)

BocaBoy said:


> See post #15 from RLS50 in this thread.  It starts like this:
> 
> "With respect I still disagree with any assertion that inflation ended 10 years ago. It did the exact opposite. It surged once the economy collapsed and the FED threw out the playbook they operated under for decades and went into full time money creation mode. Real inflation...inflation that impacts real stuff that people need and buy has been running at a 5+% clip for almost 9 years now."
> 
> This is what got me so actively involved in this debate.



I had forgotten about that. No question the Fed has dramatically inflated the money supply, as the attached chart shows. But as the linked article below explains, for a variety of reasons, an increased money supply does not always lead to price inflation.

https://www.ineteconomics.org/perspectives/blog/rapid-money-supply-growth-does-not-cause-inflation

I think the third paragraph in the introductory section sums it up best:

"... And to be fair, conventional monetary economics (and economists) would argue that, all else equal, large increases in the money supply will cause inflation.  But we haven’t seen that, even with the Fed’s historic actions, mainly because aggregate demand remains so low after the Great Recession, and because the massive debt accumulations that helped trigger the downturn are taking years to work through."

Average inflation will likely remain low until average incomes rise enough to drive an increase in aggregate demand. Average incomes have been flat for a number of years and only began to rise in 2015. Household debt may need to be worked down as well.

Despite all this, even though the overall rate of inflation remains low, some categories can and do rise faster than the overall rate. As I've said, I think that fact, plus the diluted/broad ownership of timeshares (which results in weaker owner control) are the main factors in increased maintenance fees. But I still am not that bothered by 3% to 5% increases. For a timeshare, I think that is reasonable and is in line with hotel rate increases.


----------



## BocaBoy (Jan 27, 2017)

JIMinNC said:


> I had forgotten about that. No question the Fed has dramatically inflated the money supply, as the attached chart shows. But as the linked article below explains, for a variety of reasons, an increased money supply does not always lead to price inflation.
> 
> https://www.ineteconomics.org/perspectives/blog/rapid-money-supply-growth-does-not-cause-inflation
> 
> ...


Thank you--finally a post that makes sense.  My only disagreement is with your last paragraph, but we have to agree to disagree on that one.  I am very bothered by the 3-5% increases.  The problems I see in your comparison to hotel rental rates are twofold:  First, hotel rates dropped dramatically early in the Great Recession and only now are back above where they were 8-9 years ago.  During the period that hotel rental rates dropped, timeshare maintenance fees continued to rise as if nothing happened.  They are now hugely above where they were 8-9 years ago.  And second, maintenance fees are ownership expenses, while rental rates are more directly related to rental supply and demand.  With the higher hotel rates, profits in the hotel industry are up a lot too, which is consistent with expenses rising more slowly than rents.  (Of course, it is a lot more complicated than that.)


----------



## JIMinNC (Jan 27, 2017)

BocaBoy said:


> Thank you--finally a post that makes sense.  My only disagreement is with your last paragraph, but we have to agree to disagree on that one.  I am very bothered by the 3-5% increases.  The problems I see in your comparison to hotel rental rates are twofold:  First, hotel rates dropped dramatically early in the Great Recession and only now are back above where they were 8-9 years ago.  During the period that hotel rental rates dropped, timeshare maintenance fees continued to rise as if nothing happened.  They are now hugely above where they were 8-9 years ago.  And second, maintenance fees are ownership expenses, while rental rates are more directly related to rental supply and demand.  With the higher hotel rates, profits in the hotel industry are up a lot too, which is consistent with expenses rising more slowly than rents.  (Of course, it is a lot more complicated than that.)



I agree 100% that the nature of timeshare expenses (purely ownership expenses) vs. hotel rates (supply & demand is a component) are totally different, so it's very true that one doesn't directly justify the other. My rationale for comparing the 3% to 5% increases in maintenance fees to hotel rates was mainly because that's the comparison that is most relevant for our usage - if our timeshare costs were rising faster than hotel rates, then each year, the economics of ownership would be getting less advantageous when compared to renting accommodations. Since they are rising at a similar rate (at least right now) the cost relationship is staying stable - hence my relative comfort level with the current level of increases. I guess a second reason I'm more comfortable than you with the rate of MVC increases is my previous experience with Diamond. By contrast, MVC are expense management tigers!

Secondarily, the costs of operating a hotel are probably the most similar proxy for operating costs at a timeshare. (In reality, the cost profile is somewhere in between a full ownership condo and a hotel, but timeshares are more like a hotel in the provision of housekeeping, reservations, and front desk expenses which condos don't usually have.) But, as you note, hotel rates are not purely cost based, and market supply and demand has a major impact on the rate the market will bear. So in good times, rates go up and hotel profit margins go up, but in bad times, rates and profit go down. That is in fact, one reason hotel companies got into the timeshare business in the first place - a more predictable steady profit stream that, at least on the operating/management side, is more steady and predictable than the economic ups and down of the hotel business. Obviously, on the sales side, slower business conditions impact sales significantly, but the operating side is a more steady revenue stream.


----------



## BocaBoy (Jan 27, 2017)

JIMinNC said:


> I agree 100% that the nature of timeshare expenses (purely ownership expenses) vs. hotel rates (supply & demand is a component) are totally different, so it's very true that one doesn't directly justify the other. My rationale for comparing the 3% to 5% increases in maintenance fees to hotel rates was mainly because that's the comparison that is most relevant for our usage - if our timeshare costs were rising faster than hotel rates, then each year, the economics of ownership would be getting less advantageous when compared to renting accommodations. Since they are rising at a similar rate (at least right now) the cost relationship is staying stable - hence my relative comfort level with the current level of increases. I guess a second reason I'm more comfortable than you with the rate of MVC increases is my previous experience with Diamond. By contrast, MVC are expense management tigers!
> 
> Secondarily, the costs of operating a hotel are probably the most similar proxy for operating costs at a timeshare. (In reality, the cost profile is somewhere in between a full ownership condo and a hotel, but timeshares are more like a hotel in the provision of housekeeping, reservations, and front desk expenses which condos don't usually have.) But, as you note, hotel rates are not purely cost based, and market supply and demand has a major impact on the rate the market will bear. So in good times, rates go up and hotel profit margins go up, but in bad times, rates and profit go down. That is in fact, one reason hotel companies got into the timeshare business in the first place - a more predictable steady profit stream that, at least on the operating/management side, is more steady and predictable than the economic ups and down of the hotel business. Obviously, on the sales side, slower business conditions impact sales significantly, but the operating side is a more steady revenue stream.


So I think we mostly agree, the only major difference being our point of reference.  I compare it to our condominium ownership and you compare it to hotel stays.


----------



## JIMinNC (Jan 27, 2017)

BocaBoy said:


> So I think we mostly agree, the only major difference being our point of reference.  I compare it to our condominium ownership and you compare it to hotel stays.



Yep. Good discussion.


----------



## kjd (Jan 28, 2017)

Resale prices are dropping.  I have been buying lately after selling four units through Marriott before the prices really started to drop.  The units I sold were enrolled and the units that I purchased were not enrolled.  It's a buyers market right now in my opinion because almost anything passes ROFR, resistance to paying maintenance fees has increased, a lack of Marriott inventory with Interval International and more sellers than buyers.

While it's not a pretty picture if one bought their unit directly from Marriott at listed prices it is a good time to buy resales IMO.  No one can pick the bottom of any market. I believe the market for quality timeshare will turn around.  We live in  an economy of scarcity.  As available Marriott weeks dry up on Interval International and a lot of weeks are converted to points, resale prices will rise. In my opinion it still  makes sense to buy where you're going to vacation. The real value of a timeshare is what someone will pay for it.  A marketplace like Ebay will determine the real value of any timeshare at any given time.


----------



## kjd (Jan 28, 2017)

Resale prices are dropping.  I have been buying lately after selling four units through Marriott before the prices really started to drop.  The units I sold were enrolled and the units that I purchased were not enrolled.  It's a buyers market right now in my opinion because almost anything passes ROFR, resistance to paying maintenance fees has increased, a lack of Marriott inventory with Interval International and more sellers than buyers.

While it's not a pretty picture if one bought their unit directly from Marriott at listed prices it is a good time to buy resales IMO.  No one can pick the bottom of any market. I believe the market for quality timeshare will turn around.  We live in  an economy of scarcity.  As available Marriott weeks dry up on Interval International and a lot of weeks are converted to points, resale prices will rise. In my opinion it still  makes sense to buy where you're going to vacation. The real value of a timeshare is what someone will pay for it.  A marketplace like Ebay will determine the real value of any timeshare at any given time.


----------



## dioxide45 (Jan 28, 2017)

kjd said:


> I have been buying lately after selling four units through Marriott before the prices really started to drop. The units I sold were enrolled and the units that I purchased were not enrolled.


If you don't mind me asking, I am curious why you chose to sell enrolled weeks and then buy unenrolled weeks? I know I wouldn't do this as to us, those enrolled weeks are like gold and irreplaceable except for very large dollar amounts (Marriott willing). Even though we don't use the DC points very much, the added flexibility in II and consolidated use fee make it a huge deal. They would have to pry those enrolled weeks from my hands before I would ever give them up.


----------



## BocaBoy (Jan 28, 2017)

dioxide45 said:


> If you don't mind me asking, I am curious why you chose to sell enrolled weeks and then buy unenrolled weeks? I know I wouldn't do this as to us, those enrolled weeks are like gold and irreplaceable except for very large dollar amounts (Marriott willing). Even though we don't use the DC points very much, the added flexibility in II and consolidated use fee make it a huge deal. They would have to pry those enrolled weeks from my hands before I would ever give them up.


I think kjd sold when prices were higher than now and has been buying at lower prices.  I don't think the decision had anything to do with weeks being enrolled, but rather with the level of market prices for the weeks.  We have sold some enrolled weeks ourselves, but of course I do not plan on replacing them.  Our portfolio right now is ideal for us, and I agree that having all our weeks enrolled (which they are) is a huge deal.


----------



## bazzap (Jan 29, 2017)

BocaBoy said:


> I think kjd sold when prices were higher than now and has been buying at lower prices.  I don't think the decision had anything to do with weeks being enrolled, but rather with the level of market prices for the weeks.  We have sold some enrolled weeks ourselves, but of course I do not plan on replacing them.  Our portfolio right now is ideal for us, and I agree that having all our weeks enrolled (which they are) is a huge deal.


I read kjd's comments in the same way and I can understand the sell high buy low reasoning, even if losing enrolled status, if it is clearly financially advantageous to do so.
The benefits of having all weeks enrolled are significant, we have 3 unenrollable weeks in just one of our resorts, but it is the one Son Antem where we have every expectation of always going to.


----------



## kjd (Jan 29, 2017)

To explain a few points in my previous post about why I would sell enrolled weeks and then buy more weeks that are not enrolled, in short I got better weeks as an end result.  I am not a trader or a landlord and I am not a fan of the point system.  My family and I are users and previously traded most of our units for better ones. The point system has clouded the trade enviornment. 

The new purchases were for personal usage or better trades.  Here are some of the prices of the non-enrolled units:  MGC (3 EOYs) 803,  1,000. 1.500.  Newport Coast (EOY) 2,100 and Cyrpress Harbour 1,400.  I kept one rnrolled unit, a three bedroom annual at MGC.


----------



## Ralph Sir Edward (Jan 29, 2017)

Back to the question of weeks dropping in value.

Yes, they are dropping, on average, as they should be, by basic economics. I will describe.

First, absolute supply is always increasing. The big money, from a corporate sense is in the selling of the timeshare, and nowhere else. So supply (averaged for the business cycle) is always increasing.

The underlying buildings and property, are long term durable assets. If reasonable maintained, they will last many decades, maybe even a century. Certainly longer than the lifespan of most buyers. That means the supply is not being consumed, like a candy bar.

Demand does not keep up with supply, because the economic pressure to create new supply is so overwhelming as to continually drown out demand. Hence there is always an oversupply scenario. When supply exceeds demand for long periods, prices drop. Especially for long term durable goods.

Inside this is a business cycle, which at this point (prosperity) is supporting prices. More people have jobs and money to spend on luxury goods. During a recession, just the opposite happens and goods like timeshares fall hard. 

Now in most markets, new supply is only added when the open market prices are greater than the cost of producing new product. Timeshares are such high mark-up, that this mostly ignored.

Of course, there is the relative value scenario, comparing to hotel rentals, condo rentals, and condo ownership. These also affect value. The problem with discussing that is determining how you do a true "apples-to-apples" comparison. I will leave that for others. . .


----------



## JIMinNC (Feb 2, 2017)

During this thread, we got into the old debate about rising maintenance fees and why they increase 3% to 5% a year, even in an overall low inflationary environment. I don't want to re-open the debate or any other such cans of worms, but I thought he Barony Beach Club owners newsletter linked by Susan in the first post of the linked thread below, does a good job explaining some of the personnel/hiring issues faced by that resort, and why staffing costs are a significant factor in the rising operating costs of the resort. I suspect some of these same issues are a factor in many other resort areas as well.

http://tugbbs.com/forums/index.php?threads/barony-beach-gm-newsletter-feb-17.250923/

Again, not trying to re-open the debate, but I thought that some of the folks who had participated in the earlier debate might find the information enlightening.


----------



## BocaBoy (Feb 3, 2017)

JIMinNC said:


> During this thread, we got into the old debate about rising maintenance fees and why they increase 3% to 5% a year, even in an overall low inflationary environment. I don't want to re-open the debate or any other such cans of worms, but I thought he Barony Beach Club owners newsletter linked by Susan in the first post of the linked thread below, does a good job explaining some of the personnel/hiring issues faced by that resort, and why staffing costs are a significant factor in the rising operating costs of the resort. I suspect some of these same issues are a factor in many other resort areas as well.
> 
> http://tugbbs.com/forums/index.php?threads/barony-beach-gm-newsletter-feb-17.250923/
> 
> Again, not trying to re-open the debate, but I thought that some of the folks who had participated in the earlier debate might find the information enlightening.


If wages had been going up 5% every year for the past 10 years, housekeeping salaries in Hilton head would be a lot higher than they are.


----------



## elleny76 (Feb 3, 2017)

kjd said:


> Resale prices are dropping.  I have been buying lately after selling four units through Marriott before the prices really started to drop.  The units I sold were enrolled and the units that I purchased were not enrolled.  It's a buyers market right now in my opinion because almost anything passes ROFR, resistance to paying maintenance fees has increased, a lack of Marriott inventory with Interval International and more sellers than buyers.
> 
> While it's not a pretty picture if one bought their unit directly from Marriott at listed prices it is a good time to buy resales IMO.  No one can pick the bottom of any market. I believe the market for quality timeshare will turn around.  We live in  an economy of scarcity.  As available Marriott weeks dry up on Interval International and a lot of weeks are converted to points, resale prices will rise. In my opinion it still  makes sense to buy where you're going to vacation. The real value of a timeshare is what someone will pay for it.  A marketplace like Ebay will determine the real value of any timeshare at any given time.


Hi, Can you please explain  why you sold "enroll" and bought "not enrolled"..what's the difference?.Money? AF? Looking to buy a 3 bed or 2 bed weeks (of course /no points)  Please share with me your seller so I can see the inventory available. You can please comment here or PM at anytime thanks so much


----------



## JIMinNC (Feb 3, 2017)

BocaBoy said:


> If wages had been going up 5% every year for the past 10 years, housekeeping salaries in Hilton head would be a lot higher than they are.



While it only addresses one year, here's the most relevant part of the discussion of labor costs and maintenance fee:



> *Labor Update and Impacts*
> 
> As you may or may not be aware, labor is a major part of both our operations and your maintenance fee. Over the past few years we have managed labor in several ways. In 2015, we utilized a significant amount of contract labor and overtime due to the labor shortage in our market. During that year, we also increased the hourly wages for housekeepers in order to be equal to all positions at the resort. We felt that this would give us a competitive advantage and aid in hiring. Although we did see an increase in applicant flow, we were not able to compete with the growth of the mainland, Bluffton, and the easier commutes for similar or slightly lower wages.
> 
> ...


----------



## Saintsfanfl (Feb 3, 2017)

Ralph Sir Edward said:


> Back to the question of weeks dropping in value.
> 
> Yes, they are dropping, on average, as they should be, by basic economics. I will describe.
> 
> ...




People decide they no longer want the timeshare much sooner than when they die.  Many times only a few days later. Hotel buildings don't get consumed either but new hotels are booming right now. Timeshares have no problem selling at high prices so the demand is certainly there. The real problem problem is so many people buy timeshares that can't make proper use of them, lack of organized resale market as a comparable to sales presentation purchase, and rising maintenance fees.

Imagine what would happen if every person attending a presentation were given the option of buying resale at real market rates. Prices would go up and supply would go down. It would slow down building new timeshares but you would see the resale supply and demand start to equal out. You would still have maintenance fee issues at poorly run properties but that's a different issue of demand than supply.


----------



## Saintsfanfl (Feb 3, 2017)

Another problem is bad weeks. Somebody has to own them but few people want them. Summer on HHI doesn't have the supply to meet the demand but the winter is the opposite. A hotel can balance this out because it's one owner but timeshares can't work this way unless it is a demand based maintenance fee allocation. This is the problem that Marriott solved by switching to points.


----------



## BocaBoy (Feb 3, 2017)

JIMinNC said:


> While it only addresses one year, here's the most relevant part of the discussion of labor costs and maintenance fee:


I have no complaint with the Barony increases for 2017, as they apparently address a significant local labor issue and the hurricane issue.  Neither have been annual occurrences for the past ten years and do not represent parallels with most other resort locations.  Because 6% of the 2017 increase was due to the hurricane, I would expect the fees to go down next year when the hurricane issue is no longer there, but will they?  We shall see.


----------



## brianfox (Jun 5, 2017)

Regarding the original topic, it appears the bottom has fallen out of the Hawaii MVC market, at least for Waiohai.
I used to see Redweek listings for $9K+ for annual Island view.  They are now around $5.5K.

Likewise, Ko Olina has dropped and is (as always slightly below Waiohai).


----------



## MOXJO7282 (Jun 5, 2017)

Definitely not the case with Maui 2bdrm view units.  They are at a high point. Not sure if it's true for Maui 2bdrm island views or 1 bdrm units.


----------



## StevenTing (Jun 6, 2017)

Back in 2014, I paid $6700 including closing costs for an Odd EOY Ko Olina Ocean View.  Right now Redweek has one listed at $4900 and another at $5000.  Add add about $700 for closing costs and the price is about $1000 less than 3 years ago.  After that, the next ones sell for $6900.  Some people just want to get out at any cost.


----------



## myoakley (Jun 7, 2017)

I am always mystified when I see Marriott St. Kitts selling on e-bay for $1.00.  Is it possible?  Do these sales pass ROFR?  If so, why are the prices for this resort so low?  Can it be because the airfare to this island is extremely high, and there are no direct flights?  Also, Delta has announced that they will be offering non-stop flights from JFK starting in Dec.  Will that make a difference?


----------



## bazzap (Jun 7, 2017)

myoakley said:


> I am always mystified when I see Marriott St. Kitts selling on e-bay for $1.00.  Is it possible?  Do these sales pass ROFR?  If so, why are the prices for this resort so low?  Can it be because the airfare to this island is extremely high, and there are no direct flights?  Also, Delta has announced that they will be offering non-stop flights from JFK starting in Dec.  Will that make a difference?


I own at St Kitts and really like this resort.
Flight cost and availability from the US have certainly been a factor in keeping down resale prices.
(it is less of an issue for me in the UK, as we have direct flights and it costs a lot to fly to most MVC resorts!)
The other reasons are probably 
the high Maintenance fees, although I believe this is true of all the Caribbean island resorts
the laid back, not (yet) overly developed nature of the island, although that for me is really its major advantage!


----------



## jerseyfinn (Jun 10, 2017)

It's more about how the 2007 recession resets the destination travel paradigm than rising MFs.

10 years ago were the golden years when both MVC & TS owners could sell weeks with relative ease, especially high season at select resorts. Strong resale markets existed on the private side as well as with Marriott resales. After 2007 all of us, including Marriott, get a close "haircut" in valuations. All Marriott had to do is write down their losses & jumpstart their Holy Grail quest for DC points program. We owners didn't have that luxury. What came out of it is a meager private resale market & Marriott controlling re-sales by fiat using the cover of DC to cloak that fact. I'm not suggesting MVC subterfuge, just plain & simple market economics in a struggling economy where destination travel was never a priority on anyone's spending list but the bubble economy did indeed make it easier to justify higher price multiples.

The lucky ones were those who sold in 2006 & before as premiums could be had for select weeks/resorts. Also folks who came in the private resale door likely got better valuations that today might be equal to what some weeks fetch now.

Today, 15 cents on your original developer purchase price is a good deal. Just the way things are now. The irony is that the multiples MVC gets from new DC points buyers are equal or above the developer week multiples that existed just prior to the crash. Marriott's done a good job taking care of itself. I myself can't recommend to any newbie to purchase points. Best new ownership value is resale and either occupy at your resort or go fishing in the II trade barrel.

Barry


----------



## bogey21 (Jun 10, 2017)

jerseyfinn said:


> 10 years ago were the golden years when both MVC & TS owners could sell weeks with relative ease, especially high season at select resorts. Strong resale markets existed on the private side as well as with Marriott resales. After 2007 all of us, including Marriott, get a close "haircut" in valuations....The lucky ones were those who sold in 2006 & before as premiums could be had for select weeks/resorts.



About 15-18 years ago I sold my Summer Monarch Crown Suite Week for $42,000.  Does anyone know what it would bring today?

George


----------



## hangloose (Jul 13, 2017)

Anyone know of the Ko Olina 2BR OV Annual weeks are actually passing ROFR at $9k or under?


----------



## GregT (Jul 14, 2017)

hangloose said:


> Anyone know of the Ko Olina 2BR OV Annual weeks are actually passing ROFR at $9k or under?


I passed at $10K and would expect $9K would pass too.  I just couldn't find a seller below $10K. 

Please let us know if you slip one past the goalie. 

Best,

Greg


----------



## hangloose (Jul 14, 2017)

GregT said:


> I passed at $10K and would expect $9K would pass too.  I just couldn't find a seller below $10K.
> 
> Please let us know if you slip one past the goalie.
> 
> ...



Have two offers below $9k for MKO 2BR OV Annual. Both great prices and hard to pass up.  While I want 3BR MKO ($20k), the under $9k for 2BR is very hard to pass on.  I expect for MKO 2BR OV Annuals, Marriott may not want at all given the high trust inventory.  

For MOC 2BR, price seems to be high lately.  Demand here must be high on OF units and inventory low.   What I save in my MKO purchase, I'll likely add to my MOC purchase.


----------



## forestgump14 (Jul 24, 2017)

VacationForever said:


> I own at DSV I (Desert Springs Villas I).  This phase does not have ROFR.  Since I own 2 weeks, I call at 13th month right at 6am PST and have been able to get the 2 weeks for Spring (March).  If I wait until 12th month (for single week), I can book at 6am, and are all gone by 6:03am.
> 
> Your observation that the price is now at $500 to $2000 is not what I am seeing for DSV I for a red week.  In Redweek, the going rate is around $5K to $7K.
> 
> I believe a drop in the overall prices for these Marriott weeks is due to the inability to be enrolled into DC.



Which resorts are not able to be enrolled in DC?


----------



## Fasttr (Jul 24, 2017)

travelover said:


> Which resorts are not able to be enrolled in DC?


Its not a resort thing...its a date thing.  Weeks purchased on the 3rd party Resale market after June 2010 are not eligible to be enrolled, unless you happen to do so in one of the MVC allowed ways.  One of which being a hybrid bundle (week and points) purchased via MVC Resale department.  The other is during a special promotion that MVC will open up from time to time allowing previously ineligible weeks to be enrolled with the purchase of a certain quantity of points.


----------



## forestgump14 (Jul 24, 2017)

OK, My thought would be why not have seller convert to DC points and then buy the points from them?  For a Marriott week that is going extremely cheap on secondary market that seems to make more sense.


----------



## bazzap (Jul 24, 2017)

travelover said:


> OK, My thought would be why not have seller convert to DC points and then buy the points from them?  For a Marriott week that is going extremely cheap on secondary market that seems to make more sense.


This is not possible, because an owner does not convert to points they just enrol their week in the points programme with the option to elect for points annually.
If you buy such a week from them, you lose the right to be able to enrol it.


----------



## dioxide45 (Jul 24, 2017)

travelover said:


> OK, My thought would be why not have seller convert to DC points and then buy the points from them?  For a Marriott week that is going extremely cheap on secondary market that seems to make more sense.


Unfortunately there is no way to cheaply enroll or purchase an DC enrolled secondary market resale week. If there was, we would all be doing it.


----------



## taterhed (Jul 24, 2017)

Heck, I almost bought UK weeks or phuket hoping to enroll..... 

Sent from my SM-N920P using Tapatalk


----------



## taterhed (Jul 24, 2017)

What's your thoughts on current ROFR value for 2BR annual ocean view MKO VS MM1 ?  Thinking of buying /trading one..... We really liked MM1 ocean view this year

Sent from my SM-N920P using Tapatalk


----------



## bazzap (Jul 25, 2017)

taterhed said:


> Heck, I almost bought UK weeks or phuket hoping to enroll.....
> 
> Sent from my SM-N920P using Tapatalk


I would certainly have liked to see a resort here in the UK - haha.
You could have bought a resale Phuket resort week up until mid 2016 and enrolled it, as this was the much later cutoff date there, following the mid 2012 cutoff date in Europe.


----------



## Beachspace (Jul 25, 2017)

myoakley said:


> I am always mystified when I see Marriott St. Kitts selling on e-bay for $1.00.  Is it possible?  Do these sales pass ROFR?  If so, why are the prices for this resort so low?  Can it be because the airfare to this island is extremely high, and there are no direct flights?  Also, Delta has announced that they will be offering non-stop flights from JFK starting in Dec.  Will that make a difference?



I'm surprised to see the new Boston Pulse MVC going for $1 on redweek and other sites. Multiple units in 'gold season' for 1 bedrooms going for $1 or $500. Is it because the MF are $1700+? I mean my dad was just there last week and we couldn't find a hotel in Boston proper for under $500/night..Even my Marriott Friends & Family rates quickly went away but prior to that, it was $350+/night for a Residence Inn. I would think these Boston Pulse units are a steal, even if its April or September usage and not prime May-July....

Am I missing something?


----------



## hangloose (Jul 25, 2017)

taterhed said:


> What's your thoughts on current ROFR value for 2BR annual ocean view MKO VS MM1 ?  Thinking of buying /trading one..... We really liked MM1 ocean view this year
> 
> Sent from my SM-N920P using Tapatalk



MKO 2BR OV Annuals are selling for about $8.5k now +/-, which is a great price!  From what I hear, they are passing ROFR at that price.  It may be hard to find a seller who will let go of one for much lower than that.  Looks like one passed in 4Q16 at $6.8k possibly, per the ROFR Db (http://www.rofr.net).  These are a great price at $10k, excellent value at $8.5k, and a steal at $6.8k (likely at outlier)!

MM1 2BR OV Annuals are likely to be near double the price.  Maui demand/inventory just drive that price higher than Ko Olina.   Last one posted in the ROFR db passed at $16,200 in 4Q16.    Most on RedWeek are listed at $18-19k.  So, perhaps a $16-17k is within reason?   I do think others stated booking high demand periods for MM1 floating weeks can be challenging, with only one week.  Just be aware of that, if a concern for you.


----------



## hangloose (Jul 25, 2017)

Beachspace said:


> I'm surprised to see the new Boston Pulse MVC going for $1 on redweek and other sites. Multiple units in 'gold season' for 1 bedrooms going for $1 or $500. Is it because the MF are $1700+? I mean my dad was just there last week and we couldn't find a hotel in Boston proper for under $500/night..Even my Marriott Friends & Family rates quickly went away but prior to that, it was $350+/night for a Residence Inn. I would think these Boston Pulse units are a steal, even if its April or September usage and not prime May-July....
> 
> Am I missing something?



I think the higher maintenance fees on a 1BR which Custom House is likely scares folks away.  It is also a RTU property.   While, one could make the justification that if you purchase low...the value of those 7 nights vs a hotel...is higher than the maintenance fees at certain times in Boston.   If I recall, I think Custom House has some interesting use options as well...to split the 7 nights?


----------



## taterhed (Jul 25, 2017)

bazzap said:


> I would certainly have liked to see a resort here in the UK - haha.
> You could have bought a resale Phuket resort week up until mid 2016 and enrolled it, as this was the much later cutoff date there, following the mid 2012 cutoff date in Europe.


Obviously I meant trying to buy a week (Spain) via the UK market in an attempt to qualify.  Too late obviously

Sent from my SM-N920P using Tapatalk


----------



## taterhed (Jul 25, 2017)

hangloose said:


> MKO 2BR OV Annuals are selling for about $8.5k now +/-, which is a great price!  From what I hear, they are passing ROFR at that price.  It may be hard to find a seller who will let go of one for much lower than that.  Looks like one passed in 4Q16 at $6.8k possibly, per the ROFR Db (http://www.rofr.net).  These are a great price at $10k, excellent value at $8.5k, and a steal at $6.8k (likely at outlier)!
> 
> MM1 2BR OV Annuals are likely to be near double the price.  Maui demand/inventory just drive that price higher than Ko Olina.   Last one posted in the ROFR db passed at $16,200 in 4Q16.    Most on RedWeek are listed at $18-19k.  So, perhaps a $16-17k is within reason?   I do think others stated booking high demand periods for MM1 floating weeks can be challenging, with only one week.  Just be aware of that, if a concern for you.


Thanks very much; great analysis

Sent from my SM-N920P using Tapatalk


----------



## brianfox (Jul 25, 2017)

My purchase of 2 annual island view weeks at Waiohai just passed ROFR at $5500 each.  Being Waiohai, these are 2BR.
If Marriott is not exercising at that price at Waiohai - that has far fewer rooms than MKO - I think MKO is pretty safe.


----------



## bazzap (Jul 25, 2017)

taterhed said:


> Obviously I meant trying to buy a week (Spain) via the UK market in an attempt to qualify.  Too late obviously
> 
> Sent from my SM-N920P using Tapatalk


Yes, I guessed, just having a little fun.


----------



## bobpark56 (Jul 25, 2017)

JIMinNC said:


> But are MVC maintenance fees really increasing at a faster rate than other comparable resort systems like Vistana Signature Experiences, Hilton, etc.? I know my MVC fee increases over the last 3 years have been quite a bit lower than what I experienced in my previous 16 years in the Sunterra/Diamond system.


Our maintenance fees at Virgin Grand Villas, Westin St john have gone down for 6 years in a row now. Still not cheap, though. Caribbean weather does take it's toll.


----------



## Beachspace (Jul 25, 2017)

hangloose said:


> I think the higher maintenance fees on a 1BR which Custom House is likely scares folks away.  It is also a RTU property.   While, one could make the justification that if you purchase low...the value of those 7 nights vs a hotel...is higher than the maintenance fees at certain times in Boston.   If I recall, I think Custom House has some interesting use options as well...to split the 7 nights?


I can see the RTU being a problem. 

As far as MF fees, you're talking $1700 or so for the week. That's way under $300/night and you get a 1 bedroom with a kitchenette vs a regular room...and the regular rooms at places like the Hyatt Regency are $300-$750/night depending on when you go not to mention very expensive parking fees. 

But still, people pay $20k and more for timeshares with RTU issues or high MF fees no problem. Surprised to see so many $1 and $500 1 bedrooms at Custom House in a very expensive city.


----------



## bazzap (Jul 26, 2017)

Beachspace said:


> I can see the RTU being a problem.
> 
> As far as MF fees, you're talking $1700 or so for the week. That's way under $300/night and you get a 1 bedroom with a kitchenette vs a regular room...and the regular rooms at places like the Hyatt Regency are $300-$750/night depending on when you go not to mention very expensive parking fees.
> 
> But still, people pay $20k and more for timeshares with RTU issues or high MF fees no problem. Surprised to see so many $1 and $500 1 bedrooms at Custom House in a very expensive city.


I don't really understand what the problems/issues might be with RTU resorts?
Yes, they have an end date, although that is typically 30-50+ years down the road so not something that is of any real concern to me anyway.
Even then, if I understand correctly, either the agreement could be extended or the value of the assets at that point divided with owners receiving a share?


----------



## ljmiii (Jul 26, 2017)

bazzap said:


> Even then, if I understand correctly, either the agreement could be extended or the value of the assets at that point divided with owners receiving a share?


It depends on the deed and the resort. In some RTU resorts the ownership reverts to the developer and/or the owner of the land under the resort.


----------



## TheTimeTraveler (Jul 26, 2017)

Barry;  The issue may more involve smart money moves and what one leaves to their offspring after death.  Obviously it makes more financial sense to leave a forever deed rather than an expiring RTU.

At least that is how I look at it....



.


----------



## bazzap (Jul 26, 2017)

Thank you Ijmiii and The Time Traveller.
I will dust off my contracts and check what they actually say happens with my RTU resort weeks at end of term.
That is probably a good starting point.


----------

