Overvaluing low mfs?

[Braindead]

A 654 K Bali Hai was recently listed on eBay for Buy it Now for $8995 plus $800 closing. A relative bargain I guess but I don't think it is an ultra low mf contract. $4.92 per 1000 points is what I calculated it at. I haven't kept a close eye on what is considered ultra low vs. pretty low vs. average lately.

This contract and another Bali Hai that was just listed yesterday sold. The contract listed yesterday was 308,000 even year points.
You can’t tell what they brought as offers were accepted for less than asking price

 

[Roger830]

Also a 1,129,000 National Harbor went for $10,000.

That was a bargain. Seller has no feedback selling, but has other timeshare listings.

 

[ronparise]

In Rons example he is tying up the 2019 & 2020 points but not stripping the contracts. If Ron were to sell the contract in 2018 in his example the 2019 & 2020 reservations would be cancelled. As a result the 2019 & 2020 points would get transferred with the contract

The thing is you can get a vacation or two done before you pay a a full years maintenance fee. Whether you call it stripping points or stripping vacations you are getting some use out of a new purchase before you pay for thatuse And whether you then sell the contract or hold it makes no difference you have still “gamed” the system

I used to get the use of 3 years of points in the first few months of ownership and then I’d hold the contract or flip it back to Wyndham. You can’t do that now

But Now, depending on the purchase date you can use 2 years in the first few months of ownership.and then either hold or sell the contract. I see that as the same basic technique, just not as profitable

 

[ronparise]

In Rons example he is tying up the 2019 & 2020 points but not stripping the contracts. If Ron were to sell the contract in 2018 in his example the 2019 & 2020 reservations would be cancelled. As a result the 2019 & 2020 points would get transferred with the contract

No. I am using all the 2018, 2019 and 2020 points but only paying 13 to 18 months mf.

Buy in late 2018 and make a 2018, 2019 and Jan 2020 reservation

pay nov and dec 2018 mf
Pay all of 2019 mf

So enjoy 3 years of vacations for 14 months mf


I didn’t just tie up those reservations, I used them

 

[ronparise]

Back to the question implied by the original post. And that is how much is too much to pay for a low mf contract

Here’s the thing

The way to use a low mf contract is to use the points for vacations at resorts with low point requirements

For example use Bali Hai points at Fairfield glade. A two bedroom theee is 154000 points. So our Bali hai will get roughly 3 weeks a year in prime season

In 5 years that 15 vacations
MF in 5 years is about $10000 and the purchase price is $8500. And let’s assume the value of the contract after 5 years is a penny a point

So cost is 18500-4500 = 14000 /15= less than $1000 per vacation. I think that’s ok

If our buyer was to get a $7/1000 mf contract for free is cost per vacation will be 154000 points x 7/1000 = almost $1100 per vacation

Which is the better deal

Certainly our buyer could have done better, but he didn’t do bad

 

[Braindead]

No. I am using all the 2018, 2019 and 2020 points but only paying 13 to 18 months mf.

Buy in late 2018 and make a 2018, 2019 and Jan 2020 reservation

pay nov and dec 2018 mf
Pay all of 2019 mf

So enjoy 3 years of vacations for 14 months mf


I didn’t just tie up those reservations, I used them

It all depends on what we are going to call “stripping the contract”. You are using the 2020 points in 2020. I don’t call that “stripping the contract” and I never considered that to be selling a “stripped contract “when it was discussed prior to May 2017.

If you use 2020 points in January 2020. Then sell that contract it will not be transferred until June at the earliest.
The new owner might go 6-7 months before using 2021 points for a 2021 reservation.
When “stripped contracts” were sold Wyndham might of transferred the contract in 2 months so the new owner would not be able to use the first use years points in that year for over 2 1\2 years.

I really don’t think your comparing apples to apples in how “stripping the contract “ was discussed prior. Prior the buyer could have the contract transferred today with the January 1, 2021 being the first use points available that’s what I called “a stripped contract” that can’t happen today

 

[Braindead]

For those that are new here since May 2017 and confused about “stripping the contract”.
Some buyers of resale contracts in the past would time their purchase to where they could use 4 years of points for paying about 1 year of MFs.
They purchased contracts for about the cost of a years MFs. The contracts would go into their VIP Platinum account. Ounce in the Platinum account it was possible to use 4 years of points while paying about a year of MFs. Add in some Platinum discounts and upgrades those 4 years worth of points could turn into the equivalent of 10 years of points. For 10 years worth of points their total cost was about 2 years of MFs[purchase was equivalent to 1 year of MFs plus the 1 year of MFs they paid. Then they sometimes sold those contracts to a blind entity [maybe Wyndham]
Ron would fully inform the buyers the contracts were stripped while selling or giving the contracts away. While others resold the contracts not disclosing the contracts were stripped with the buyers receiving stripped contracts and paying over 2 years of MFs plus the purchase price before getting current points.

That’s not possible anymore. That’s a major reason why rental rates have increased dramatically in the last year. It might also be one of the reasons why resale prices are going up

 

[Cyrus24]

Good explanation Braindead. This 'stripping' process, while legal, is why they took our Credit Pool away. They could have stopped the stripping without taking away the credit pool, IMHO. I'm very angry at Wyndham for not looking out for us little people when they did away with the credit pool just, so it seems, to get at the account strippers.

 

[T-Dot-Traveller]

Oh but you can still strip points, just not in the aggressive fashion I used to do it

This contract is 436000 points for $8500 mf will be roughly let’s assume mf at $150 a month and let’s further assume settlement will be in 6 months. And that the contract comes complete with all 2018 points in it



So $150 x 18 months = $2700 mf plus the $8500 purchase price = $11,200

Then sell the contract for penny a point or $4200. Net cost is $7000

So net cost of about just $1000 per vacation

That’s not stripping points like I used to doe it, but it is using 3 years or points in 18 months And the contract is now stripped of points

Ron - your insight is always interesting and worth reading .

At $ 4200 - the contract might not sell as fast as your famous Canterbury -bargain deal - but if someone already has 18 months+ months of TS vacations booked , it could may sense to a buyer get a deal on a good contract at a resort they want , but don’ t need the points or use asap .

PS - I believe the person who “bought “Ron’s bargain Canterbury is a TUG member and was very pleased with the TS contract acquisition . The monthly MF cost until the points reloaded was less than what a similar contract would likely have cost resale and the payments were monthly to Wyndham instead of a lump sum .

 

[Railman83]

They cancel reservations while transferring so get those vac quick

 

[T-Dot-Traveller]

... They could have stopped the stripping without taking away the credit pool, IMHO. I'm very angry at Wyndham for not looking out for us little people when they did away with the credit pool just, so it seems, to get at the account strippers.

As I understood it from reading TUG .An owner credit pooled point "now" and got back “someone else’s “ deposited points when they booked a reservation .
The TUG Wyndham theorists have speculated that the pool’s points were out of whack for unknown reasons and Wyndham needed to fix this .

Stripping contracts were not the reason for the theorized imbalances .

They were - part of the reason Ron’s acct(s) showed more points and reservations than the account had in ownership . This caused / triggered the suspension of use and audit procedure for some Wyndham owners & TUG members .
Ron’s numerous TUG posts can add details if any new reader is interested .

Cyrus24 - I don’t disagree that taking away the credit pool was a loss for owners use flexibility .

 

[Roger830]

PS - I believe the person who “bought “Ron’s bargain Canterbury is a TUG member and was very pleased with the TS contract acquisition . The monthly MF cost until the points reloaded was less than what a similar contract would likely have cost resale and the payments were monthly to Wyndham instead of a lump sum .

I wonder if that person is still pleased with a stripped contract and paying mf without being able to use future year's points because there is no credit pool.

 

[T-Dot-Traveller]

I wonder if that person is still pleased with a stripped contract and paying mf without being able to use future year's points because there is no credit pool.

Go to "Bargain Deals" put Canterbury in the search box & read the whole thread
Ron;s post listing it was April 18 2016

 

[Cyrus24]

Go to "Bargain Deals" put Canterbury in the search box & read the whole thread
Ron;s post listing it was April 18 2016

Worth the read. Canterbury under the terms of that 'sale' were pretty good, IF, the 'buyer' did not have a need for points at closing. Getting a large, low MF contract was what made it such a good deal.

 

[Roger830]

Go to "Bargain Deals" put Canterbury in the search box & read the whole thread
Ron;s post listing it was April 18 2016

So basically if the buyer has to pay mf for 2 1/2 years of $5000 without use.

It's kinda like taking out a loan for a car and have it sitting in the driveway for 2 1/2 years and not allowed to drive it.
WOW! What a great deal!

Three of out of four of my Wyndham contracts had prepaid mf. The forth was striped of current years points and the seller sent me a check after closing. That's what I call great deals.

 

[T-Dot-Traveller]

Also, not to harp on this, but it occurs to me that I personally might have bought this contract at about 4K had it been my first or second contact but value it less as my point stack has grown.

I suppose there is a point that, even if given a great contract for free you wouldn’t take it because you have reached diminishing returns. Though here if you got for free you could presumably sell at a profit

I can see from your listing on today's bargain deals :
Wyndham Flagstaff 105 K

that this post is more than just verbiage . You are upgrading your points pile by giving away some .

and someone jumped on today's bargain deal in hours .
WIN -WIN for everyone .

 

[T-Dot-Traveller]

So basically if the buyer has to pay mf for 2 1/2 years of $5000 without use.

It's kinda like taking out a loan for a car and have it sitting in the driveway for 2 1/2 years and not allowed to drive it.
WOW! What a great deal!
.

But they paid 1/2 price for "the car" !! AND Timeshares don't rust .

And if the buyer had already booked 2+ years of vacations using existing ownerships AND expected to have more vacation time in the future .

I believe the buyer(not me) participated in the thread and posted in another thread that they were very happy with the purchase and terms .

 

[Railman83]

I can see from your listing on today's bargain deals :
Wyndham Flagstaff 105 K

that this post is more than just verbiage . You are upgrading your points pile by giving away some.

I am going to replace with small Wordmark contact as some western travel is in my future.

Flagstaff has active feedback but I just couldn’t bring myself to. Give a Wyn a freebie

 

[Railman83]

I am going to replace with small Wordmark contact as some western travel is in my future.

Flagstaff has active feedback but I just couldn’t bring myself to. Give a Wyn a freebie

That is deed back not feedback auto correct

 

[Braindead]

Ron would fully inform the buyers the contracts were stripped while selling or giving the contracts away.

I believe the person who “bought “Ron’s bargain Canterbury is a TUG member and was very pleased with the TS contract acquisition . The monthly MF cost until the points reloaded was less than what a similar contract would likely have cost resale and the payments were monthly to Wyndham instead of a lump sum .

I agree and gave Ron credit for full disclosure. Both parties new the facts and both were happy with the transaction.
Also if you don’t think my summary is accurate on stripped contracts for new readers here since last May by all means jump in and point out my inaccuracies

 

[Roger830]

But they paid 1/2 price for "the car" !! AND Timeshares don't rust .

I just traded in my 8 year old car with no rust.

Usually people want to use now pay later.

That deal is ok for someone not being able to travel now but can in the future if he lives that long.

 

[CO skier]

PS - I believe the person who “bought “Ron’s bargain Canterbury is a TUG member and was very pleased with the TS contract acquisition . The monthly MF cost until the points reloaded was less than what a similar contract would likely have cost resale and the payments were monthly to Wyndham instead of a lump sum .

I agree and gave Ron credit for full disclosure. Both parties new the facts and both were happy with the transaction.

The problem with stripped Wyndham accounts was not buyer satisfaction or a lack of disclosure, it was that the stripped contracts were being passed off on TUG as some kind of Bargain Deal, instead of being listed in the MarketPlace ads where anything goes.


Bargain Deal Forum Rules:

-You may not ask the new owner to pay the maintenance fee for a usage year that you are going to keep.

 

[jebloomquist]

2018 is the first year since 2011 that I have not purchased a Wyndham resale contract. The prices have just gotten too high.

5 years ago I could use the following formula to set my maximum bid price, 30 x yearly points - 6 x yearly maintenance fee. I currently have a 375k Bali Hai contract with a total M/F of $1495.50. That would allow me to bid up to $2,277 on a resale contract. Now, even though I havehI can't win bids with a formula 36 x annual points - 6 x M/F. This would result in a max bid of $4527. Today, bidders are using something closer to 46 x annual points - 6 x M/F.

As a small time renter, I can't break even at these higher resale prices. Add to that the inability to cancel/rebook and no upgrade frequency, Wyndham is winning and my previous renters are losing.

I have no plans to sell any of my contracts, but with today's resale prices, I begin to wonder.

 

[T-Dot-Traveller]

The problem with stripped Wyndham accounts was not buyer satisfaction or a lack of disclosure, it was that the stripped contracts were being passed off on TUG as some kind of Bargain Deal, instead of being listed in the MarketPlace ads where anything goes.


Bargain Deal Forum Rules:

-You may not ask the new owner to pay the maintenance fee for a usage year that you are going to keep.

Hi Co skier ,
I know that that is a "Bargain Deal " Forum rule now .
and
I know there was a debate regarding the definition of "giving away " regarding the Canterbury .

I don't recall if this was a forum rule prior to that period ?

 

[CO skier]

Hi Co skier ,
I know that that is a "Bargain Deal " Forum rule now .
and
I know there was a debate regarding the definition of "giving away " regarding the Canterbury .

I don't recall if this was a forum rule prior to that period ?

Why would the TUG rule for Bargain Deals have to be made, if it was not already a rule?

Why would Wyndham do away with the Credit Pool and replace it with the Points Deposit feature, where points may only be deposited to future years?