SPG Points & Cash Costs Increased

[jarta]

Cost of points and cash reservations increased for Level 1-6 hotels. Level 7 hotels remain the same. Points and cash may now be used for Level 1 and 2 hotels worldwide. See link:

http://www.flyertalk.com/the-gate/b...ts-increased-by-starwood-preferred-guest.html

Salty

 

[Ken555]

Thanks for the link. I hadn't seen this yet. I use c&p several times a year, and not sure if this is a good change...but if it opens up availability for more c&p rooms at a hotel per night, then it may be a good thing.

 

[Eagle7304]

Thanks for the link. We used the point & cash once in New York. At the time it was well worth it

 

[spencersmama]

Thanks for posting, jarta. I made a couple of reservations for later this summer. They are honoring the old rate if you make the reservations before the change date.

 

[MichaelColey]

It looks like they're still a decent value, but not as good as before.

 

[LisaRex]

It looks like they're still a decent value, but not as good as before.

....and, of course, it makes converting our timeshares to SPs even less of a benefit.

 

[MichaelColey]

Of course that was rarely a good value, anyway.

 

[jarta]

Michael, ... The devaluation of Starpoints is only for points and cash reservations.

Of course that (converting StarOptions to Starpoints) was rarely a good value, anyway.

I disagree with that statement. It depends on the use made of the Starpoints. Rather than clutter up this thread by repeating the calculations that show why converting StarOptions to Starpoints is often a very good deal, I'll just state that I find them a very good deal for further conversion to air miles and for use at Level 5-7 Starwood hotels.

Straight use of points and their further conversion to air miles is not affected by any change I posted about changes for points and cash reservations. Salty

 

[Ken555]

"Rarely a good value" is an excellent description of the value of the conversion of StarOptions to StarPoints, by the majority of TUG contributors. There will always be exceptions.

 

[jarta]

"Rarely a good value" is an excellent description of the value of the conversion of StarOptions to StarPoints, by the majority of TUG contributors. There will always be exceptions.

That's why the usual advice on this forum (for most posters) is not to buy weeks that carry StarOptions from the developer or for retroing to achieve Elite status. The usual advice is to buy a voluntary resort with low MFs and trade in II. Nothing wrong with that.

If you wouldn't ever stay at Starwood Level 5-7 hotels or wouldn't ever need the air miles to fly business or first class it makes no sense to convert. If you would, however, it makes a lot of sense to convert. I don't think people who convert and find value in converting are that all that rare on this TUG forum. Salty

 

[MichaelColey]

Don't the Starpoints you get through StarOptions basically cost you around 4-5 cents each (just counting maintenance and program fees, and not original purchase price)? If so, this is what those Level 5-7 hotels cost:

Level 5 : 12k-16k points/night : $600/night
Level 6 : 20k-25k points/night : $1000/night
Level 7 : 30k-35k points/night : $1400/night

Or for airlines, assuming 100k miles for a Business Class overseas flight (and a 25% bonus transferring SPG -> miles) would be $3000-$4000.

Maybe I'm missing something somewhere, but those don't seem like good deals to me.

 

[pointsjunkie]

Don't the Starpoints you get through StarOptions basically cost you around 4-5 cents each (just counting maintenance and program fees, and not original purchase price)? If so, this is what those Level 5-7 hotels cost:

Level 5 : 12k-16k points/night : $600/night
Level 6 : 20k-25k points/night : $1000/night
Level 7 : 30k-35k points/night : $1400/night

Or for airlines, assuming 100k miles for a Business Class overseas flight (and a 25% bonus transferring SPG -> miles) would be $3000-$4000.

Maybe I'm missing something somewhere, but those don't seem like good deals to me.

so far through rentals my MF's for the year are at 0 cost to me and i still have 2 units left to convert to starpoints if i choose and i get 10% more when i convert so it is a win win for me.

 

[Ken555]

Don't the Starpoints you get through StarOptions basically cost you around 4-5 cents each (just counting maintenance and program fees, and not original purchase price)? If so, this is what those Level 5-7 hotels cost:

Level 5 : 12k-16k points/night : $600/night
Level 6 : 20k-25k points/night : $1000/night
Level 7 : 30k-35k points/night : $1400/night

Or for airlines, assuming 100k miles for a Business Class overseas flight (and a 25% bonus transferring SPG -> miles) would be $3000-$4000.

Maybe I'm missing something somewhere, but those don't seem like good deals to me.

It makes financial sense, now and then and based on which SVN MF you're paying, when converting using the summer US Air 50% bonus promo.

 

[Ken555]

so far through rentals my MF's for the year are at 0 cost to me and i still have 2 units left to convert to starpoints if i choose and i get 10% more when i convert so it is a win win for me.

But wouldn't you say that it's even rarer for owners to rent their weeks than convert to StarPoints? I've never rented one of my weeks, for instance.

 

[Ken555]

If you wouldn't ever stay at Starwood Level 5-7 hotels or wouldn't ever need the air miles to fly business or first class it makes no sense to convert. If you would, however, it makes a lot of sense to convert. I don't think people who convert and find value in converting are that all that rare on this TUG forum. Salty

I stay in those hotels and fly business class and have never converted (not just because I can't, but because I wouldn't).

 

[jarta]

Again, it depends.

I have rented out my 2-br Plat. HRA week because I make reservations for Presidents Week and the rent more than doubles the MF each year.

I use my WKV and WMH weeks (and maybe 1 Lagunamar week) mostly to trade in SVN - usually for Premium 1-brs for my wife and I and friends to go to Palm Desert or Scottsdale in winter or late fall.

I have 2 weeks at FSA that I use all the time. So, I have the ability to go there, too.

I use 2-3 Lagunamar weeks to convert each year because of the low MFs (and because my wife refuses to go to Cancun until there is a casino! lol). They give me 80K Starpoints or 100K air miles for about $1,250 (or 1.56 cents per Starpoint; or 1.25 cents per air mile).

Plus, the last 2 times I upgraded or retroed a week, Starwood gave me 6 options to purchase 80K Starpoints each time to purchase Starpoints for $1,550 for each option. It's a little higher, 1.93 cents per Starpoint or 1.55 cents per air mile. But, 100,000 air miles (without waiting for the 50% bonus) gets me a round trip business class ticket to Europe or South America for $1,250 for converting Lagunamar or $1,550 by exercising my options to purchase and then getting the Starwood 25% bonus when transferring.

Don't know how Michael comes out at his prices, especially the $3-4K for a round trip business class ticket to Europe. He could be paying $3-4K for annual MFs. But, even my 3-br 196,900 week at HRA is only about $3.2K for the annual MF and it gives me more than 80K Starpoints when converted.

I admit the cost goes up if you haven't purchased Platinum or Platinum Plus weeks. Maybe that's the mistake Michael made when he bought. All my Starwood weeks are 2-br or larger Platinum or Platinum Plus. Salty

 

[MichaelColey]

Don't know how Michael comes out at his prices, especially the $3-4K for a round trip business class ticket to Europe. He could be paying $3-4K for annual MFs. But, even my 3-br 196,900 week at HRA is only about $3.2K for the annual MF and it gives me more than 80K Starpoints when converted.

If your Starpoint cost is $0.04, 80k starpoints (which gets 100k miles) is $3.2k. It looks like your Starpoints cost a bit less than than, but not much.

Considering that Starwood sells Starpoints for $0.035 (and sometimes 20% off of that), anything in the neighborhood of 4-5 cents is outrageously expensive. My preferred way of earning Starpoints is through credit card spending, where my effective cost is 1 cent per point (based on the opportunity cost of using a 1% cash back card instead).

Sure, you can find some situations here and there where you can get considerably more than 3-5 cents value ON PAPER, but you have to make assumptions that rooms are worth hundreds of dollars per night or that flights are worth thousands and thousands of dollars. To me, there's a difference between price and value, and very few people pay that kind of price.

I admit the cost goes up if you haven't purchased Platinum or Platinum Plus weeks. Maybe that's the mistake Michael made when he bought. All my Starwood weeks are 2-br or larger Platinum or Platinum Plus. Salty

I don't own any Starwood.

 

[DavidnRobin]

Renting and SP conversion are two separate issues when it come to SVO VOI value. To combine them leads to false dichotomies (common place now-a-days)

There are many ways gaining SPs other than SO conversion - and while it is always best to optimize SPs (and Cash and Points is one of them...) - be careful of fuzzy math that may be used to justify SVO VOI ownership that usually involves using back-door hotel rates or full fare airline miles - especially by TS salespersons. (this has been discussed ad nauseum)

Yes - it is possible to maximize SP value - especially if you actually paying full fare for airlines or hotel - but in actuality this is a rarity in travel.

But... Buying a VOI from SVO with the intent of SO conversion??? Only fuzzy math can be used to justify this, and can only be spun this way by the user to delude themselves into finding this as a good value (unless you are the salesman) - and of course being a 5* helps getting more value (at a high upfront cost). As a back-up plan - sure, SO-SP conversions has value, but as a pure ROI - that is just plain crazy talk...

 

[MichaelColey]

Renting and SP conversion are two separate issues when it come to SVO VOI value. To combine them leads to false dichotomies (common place now-a-days)

Exactly. I've heard timeshare salesmen use the same argument, essentially saying that if you rent out half of the timeshares (that they want to sell you) for twice the maintenance fee, the timeshares are basically free.

 

[jarta]

Exactly. I've heard timeshare salesmen use the same argument, essentially saying that if you rent out half of the timeshares (that they want to sell you) for twice the maintenance fee, the timeshares are basically free.

No, that statement by the salesmen (which I have never had said to me) is not true about renting. But, in the example, each year you rent out at double the MF, you recoup a portion of the investment/purchase price in the amount of the rent in excess of the current MF.

If you buy a HRA timeshare today for $15K and you can make $3K per year over the maintenance fee, you will break even in 5 years. If you go to HRA every other year and rent the other year you will break even in 10 years (and have 5 years worth of great vacations). Still, there are better ways to use your assets, i.e., the market is up lately (but, it also can go down).

Most people are too impatient, too risk avoidant or do not have sufficient assets to stay the timeshare course. So, they will not benefit by holding for 10 years because they will not rent every 1 of 2 years for a high MF timeshare with an advantageous rental market. I'm in for the long term. Admittedly, I have been forced to be in for longer than I thought I would because the timeshare market tanked about 4 years ago.

What makes the Starwood brand attractive to me is the overall flexibility it provides. I can vacation at pretty nice places I own at. I can trade to other places (like WDW) internally. I can trade through II to other nice places or back into Starwood. I can bank StarOptions for later use. I can rent my high MF week at HRA for double the MF. I can convert my low MF, low rental weeks at Lagunamar from StarOptions to SPG Starpoints and stay at luxury hotels and my cost will be 1.6 cents per Starpoint or make a further conversion to air miles for 1.25 cents per air mile (or much less than that if the airline is giving its own bonus, 50% or, sometimes, even 100%).

All of these opportunites can, if used judiciously, give me value - monetary and otherwise. (I just returned from a great 2.5 weeks at WDW. I arrived and for 5 days couldn't get rid of my office tension, but I am now refreshed, relaxed, tanned and ready to get back to work - until my next trip. How do you value that benefit? I am at the age and career level where I measure time by how long it is until my next trip.) It's the Starwood package of opportunities that, for me, gives more value than looking at each opportunity in a vacuum. But, I can only speak for myself. For many reasons, your usage and circumstances may vary and, so, YMMV.

Enjoy your timeshares! Salty

 

[YYJMSP]

I am at the age and career level where I measure time by how long it is until my next trip.

I second that state-of-mind

I look for paying projects to fill the time in between booked holidays... our vacation bottleneck is my wife, who does the regular job thing with only 4 weeks off a year...

 

[jarta]

I second that state-of-mind

I look for paying projects to fill the time in between booked holidays... our vacation bottleneck is my wife, who does the regular job thing with only 4 weeks off a year...

YYJMSP, ... Tell your wife to retire and live off you. That's what I tell my wife. lol! Salty

 

[LisaRex]

Whether or not you can make the most of the SP conversion isn't really my point. My point is that as time goes by, because of the SP inflation, converting to SPs makes less and less sense. Starwood should do something to make the conversion more attractive for owners, if not out of a sense of fairness, then because it makes good business sense. An empty villa means that they can offer it up for exchange ($) or for rental ($$$$).

If they can't or won't increase the number of SPs that they'll give an owner for converting, they could at least do something creative, such as offering something like a 10%, 20% or 30% bonus respectively for 3,4 and 5* elite members. Or targeting high-demand resort owners and offering them a FAIR number of SPs for converting. (Capacity controlled, of course.)

 

[YYJMSP]

YYJMSP, ... Tell your wife to retire and live off you. That's what I tell my wife. lol! Salty

I actually need her to work for the medical benefits.

 

[YYJMSP]

they could at least do something creative, such as offering something like a 10%, 20% or 30% bonus respectively for 3,4 and 5* elite members.

I like that -- differentiates the tiers a bit more, instead of the 10% bonus for both 4- and 5-star's...

Or offer the 5-star's the 50-nights version of SPG Platinum.