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[ 2014 ] Natural disasters and timeshares

Chilcotin

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What are owners responsible for in the event of a natural disaster i.e earthquake in California, hurricane in Florida, tornado in Tennesse to their timeshare unit? I am looking to add to my RCI Points and the resorts with the good points to MF ratio seem to be in those areas. I currently own 98000 points at Grandview at Las Vegas.

Thanks for your help and insights.
 

theo

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A three word answer...

What are owners responsible for in the event of a natural disaster i.e earthquake in California, hurricane in Florida, tornado in Tennesse to their timeshare unit? I am looking to add to my RCI Points and the resorts with the good points to MF ratio seem to be in those areas. I currently own 98000 points at Grandview at Las Vegas.

Thanks for your help and insights.
Special Assessments, sometimes...

Insurance deductibles can be quite hefty, particularly in coastal locations. Even healthy "reserves" are sometimes inadequate to absorb the deductible "hit", leaving a resort "short" on funding for required repairs. Dreaded "special assessments" can then be (and sometimes are) subsequently imposed upon owners to cover the shortfall. The unwelcome surprise of a "special assessment" is, of course, in addition to (i.e., not just instead of) customary and usual maintenance fees.
 
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Passepartout

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That's what insurance is for. One would hope that the developer, or HOA has the foresight to have sufficient insurance to cover the possibility. Absent that, owners are staring at a Special Assessment. That's why you own at owner controlled resorts, attend annual meetings, ask questions, and elect good officers to look after all the owners interests.

Jim

BTW, there are not a lot of natural disasters that might befall a Las Vegas concrete property, like GrandView.
 

chriskre

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Enchanted Isle resort.
I used to own at Ft. Laud. beach resort and after a hurricane we got hit with a $950 special assessment.

On the other hand, I also own at Christmas Mountain Village and got hit with a 3K assessment not because
of natural disasters but more from HOA disaster as they did not fund the reserves but kept the MF's artificially low.
That's what happens when you have more landlord owners than owner users. :ignore:
 

ronparise

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You are a property owner, and responsible for the property the same as any other

Hopefully your insurance will cover most of the cost , but if not, you and your co owners will pay the rest.

Im not sure how a total loss would be handled
 
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tugnut

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Bylaws tell how losses are handled partial/total etc.
 
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ronparise

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I used to own at Ft. Laud. beach resort and after a hurricane we got hit with a $950 special assessment.

On the other hand, I also own at Christmas Mountain Village and got hit with a 3K assessment not because
of natural disasters but more from HOA disaster as they did not fund the reserves but kept the MF's artificially low.
That's what happens when you have more landlord owners than owner users. :ignore:
I would have guessed just the opposite. Older resorts with lots of older owner users and a board that wants to keep fees low to satisfy them.

To be fair you should add that your ownership gives you 3 weeks a year (ie there are only 17 owners per unit and in practice you can get a lot more use out of the place than 3 weeks . I know the SA was $3000 but you could say $1000 a week too

Interesting with Blue Green, When they took over Club La Pension, owners there got hit with $1500 a week
 

Chilcotin

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Thanks everybody for your replies. Like Jim said not too much can befall a concrete building in Las Vegas...that is one of the reasons I bought there (resale of course).

There was a good deal on on ebay for Tree Tops in Gatlinburg with free closing and this years maintenance fees paid. I will wait until I can do more research.

In a system such as Worldmark which I am also looking at in case of any natural disaster I am assuming it would be covered by all the owners because you do not have home resort.
 

chriskre

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Enchanted Isle resort.
I would have guessed just the opposite. Older resorts with lots of older owner users and a board that wants to keep fees low to satisfy them.

To be fair you should add that your ownership gives you 3 weeks a year (ie there are only 17 owners per unit and in practice you can get a lot more use out of the place than 3 weeks . I know the SA was $3000 but you could say $1000 a week too

Interesting with Blue Green, When they took over Club La Pension, owners there got hit with $1500 a week
Yes that is true I get even more than 3 weeks out of this ownership but for $51K per unit they could have just leveled the buildings and put in new ones. They are only little 600 sq. ft. cottages. They are not concrete buildings but little rickety prefab houses. It's not like we are restoring a historic building like New Orleans. IMO a waste of 51K but what do I know? :rolleyes:
 

bogey21

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I owned two Weeks at Resorts that were devastated by hurricanes, Chateau Le Grande in Biloxi, MS and Perrigrine near Galveston, TX. Both were 100% repaired without any Special Assessments.

George
 

pacodemountainside

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Where people get zapped is when they have replacement coverage, but not betterment coverage.

This comes into play on older buildings which must be brought up to current building code when major damage is incurred.

For example, I bought at AVP after Katrina hurricane damage was repaired. Seller was hit with SA as electrical equipment and other vital systems had to be moved from basement to second floor, etc.
 
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theo

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I remember reading about Florida Wyndham properties hit by hurricanes several years ago ( Santa Barbra was one), believe they were under insured so it caused special assessments-

http://tugbbs.com/forums/showthread.php?t=199736&highlight=Hurricane+Santa+Barbara
In the above cited instance of Wyndham Santa Barbara (on the FL East Coast, in Pompano Beach), not only were there special assessments, but also a several year delay in even getting the post-hurricane repairs completed at all. :eek:
 

vacationhopeful

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I used to own at Ft. Laud. beach resort and after a hurricane we got hit with a $950 special assessment. <>>>>
Actually, the special assessment was for remodeling the resort. Before THAT hurricane - which took out Wyndham Santa Barbara for 4+ years - the Hurricane rated windows and patio door had already been installed. A new roof had also just been done. The FLBR took in many displaced TS guests from other resort in the area - it was OPEN. As you know, the FLBR is an II and RCI resort - guests housed included displaced persons from the Marriott Beachplace.

Yes, the $950 SA was big money - but VRI took over as the Property Managing company - after the other managers had driven the resort into bankruptcy court.
 

vacationhopeful

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In the above cited instance of Wyndham Santa Barbara (on the FL East Coast, in Pompano Beach), not only were there special assessments, but also a several year delay in even getting the post-hurricane repairs completed at all. :eek:
Yes and if you travel by that Wyndham Santa Barbara resort, you will notice the 2 large lots (2 former motels one with tennis courts) to the south and the very large beachfront lot directly across the street (formerly an ocean front hotel). That hurricane did the same damaged to those 3 concrete structures - as the Santa Barbara resort. That is where the hurricane "HIT" was.
 

SMHarman

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A responsible HOA will build reserves over time to cover any insurance deductibles.

The rest has been covered above.

I know the Westin St John has an oversized MF to build a x million dollar insurance deductible reserve ongoing. It is considered part of the onging MF, not a SA.
 

T_R_Oglodyte

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Don't own resorts that are wood construction. Concrete and steel, and sufficiently new to meet modern codes.

If located in a coastal be sure the building has enough elevation to not be affected by tidal surges. In many areas, such as barrier islands, that means the buildings should be elevated.

Personally, in California I wouldn't worry too much about earthquake if the building is of modern construction and the building foundation is on solid ground. You do not want a building that is sitting on fill material or on soils deposited by streams or lakes. And you don't want to be near a cliff face - those fall away during earthquakes.
 

PamMo

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Morritt's Tortuga Club in Grand Cayman was devastated by Cat 5 Hurricane Ivan in 2004, and it was not properly insured. The owners (RTU), developer and insurance company battled it out in court for years. Timeshare owners had special assessments added to MF's, and a limited number of units to use for years until they could repair and rebuild the resort.
 

ontilt

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Perhaps this is a stupid question, but in light of potential SAs, has anyone taken out loss assessment insurance to provide coverage against a special assessment? It's available for condos and I wonder if it would extend to a TS. I'm not sure if it's even worth it, but wanted to at least weigh the option.

Best,
Harold
 

theo

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<snip> ...in light of potential SAs, has anyone taken out loss assessment insurance to provide coverage against a special assessment? It's available for condos and I wonder if it would extend to a TS. I'm not sure if it's even worth it, but wanted to at least weigh the option.
If even available at all for interval ownerships, I sincerely doubt that paying for any such insurance could or would ultimately provide any cost savings over time.

Fwiw, in my own 3 decades+ of timeshare ownership and personal experience (including owning multiple FL weeks in coastal areas vulnerable to hurricane visitation), I have found that special assessments are actually quite infrequent at responsibly managed facilities with competent HOA's, adequate insurance coverage and sufficient financial reserves --- the only types of places where I would ever consider owning any intervals in the first place.

I've never even considered looking into or acquiring any such "loss assessment insurance" --- and frankly don't plan to. As always of course, YMMV. :shrug:
 
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ontilt

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Thanks for the insight. I agree it would be doubtful to provide any savings. The only scenario where it might help is if someone were to walk into a situation where an "unforeseen" SA was issued immediately subsequent to a purchase -- that could help take the sting off, but it's unlikely, and as you mention -- one should avoid purchasing places with questionable management.
 

vacationhopeful

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I own more than 2 or 3 weeks which needed new owners due special assessments ... $1 purchases after someone else PAID the SA. I got great resorts and totally rebuilt. Some weeks which are totally not seen for sale in last 5 years ...
 

bogey21

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I owned two Weeks at Resorts that were devastated by hurricanes, Chateau Le Grande in Biloxi, MS and Perrigrine near Galveston, TX. Both were 100% repaired without any Special Assessments.
My guess that the reason these two were put back together without Special Assessments is that both were HOA Controlled Independent Resorts with local people managing.

George
 
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