2024 Maintenance Fees DISCUSSION THREAD

[SueDonJ]

See my comment above. This can be interpreted to mean that Marriott can reserve unoccupied units, even if the developer doesn't possess any deeds or has exhausted all their owned weeks. However, it doesn't specify that this reservation is without cost. I can book a restaurant for example, it does not mean that I do not have to pay for the food. The lack of explicit payment terms, combined with the diffuse ownership structure and the developer's influential position, creates significant ambiguity in the arrangement.

I gave you the doc language related to three instances of Marriott/the Boards being allowed to take inventory and use it in any way that Owners would be allowed to use it, which includes as rentals.

In the first instance, of Marriott-owned (unsold) inventory, the docs specifically say that Marriott won't be assessed any costs "other than as an Owner." Show me where in the docs it says that Owners who privately rent out their intervals must share any profits over and above the MF's with the ownership-at-large, and then I'll grant you that Marriott could be legally-compelled to do the same.

In the second instance, of fee-delinquent inventory, the docs specifically state that it's the individual resort/Trust boards who are granted the rights to rent this inventory, not Marriott the entity (although Marriott as the manager processes the reservations as any other.) The docs also specifically state how the rental amounts must be used, i.e. "payments shall be applied first to interest, late fees, costs of collection and then to the assessment payment due." And presuming that rental rates will cover over and above the delinquency plus late-fees-and-interest plus the MF's, which is a stretch based on how quickly the fees add up, it's again the Boards - and not Marriott the entity - who assumes any profit.

In the third instance, of unreserved inventory within so many days of check-in (in the Barony Beach Club example, 75 days,) the docs concisely and unequivocally state that Marriott has the rights to that inventory AND that Owners of that inventory are still required to pay the MF's on that inventory. It says nothing about any profit derived by Marriott. You seem to think that if legally-challenged Marriott could be compelled to share any of these profits with the ownership-at-large but I don't think that's how a Court would determine, because when it comes to contractual law the Courts generally adhere to what's in the contracts, nothing more and nothing less except in obvious egregious cases wherein the docs don't sufficiently address a situation or address it in contradictory language. Show me where in the docs it says that Marriott is not allowed to gain a profit off this inventory, or again, where in the docs it says that Owners must share profits of private rentals with the ownership-at-large, and then I'll grant you that Marriott could be compelled to do the same.

And now other than really wishing that a few of the TUG lawyers would come in here and tell either you or me that we're so far off base that we're off the diamond and onto the football field, I'm done doing your homework for you. But please let us know when you sue Marriott - I'm always game for the entertainment in those threads.

 

[Dean]

Indeed it is my opinion that the issue of payment lacks both implicit and explicit clarity. It stands as yet another example of how developers treat owners when they can acquire something for free, with the costs ultimately borne by us. Let's momentarily reverse roles and envision a scenario in which the resort's Board of Directors is genuinely independent, with control over the reservation system rather than the developer. In such a situation, it's easy to visualize the BOD requesting payment for these units and withholding Marriott from making bookings until the financial matter is resolved. If Marriott were to contest this, it could potentially lead to a legal dispute. Marriott's argument would pivot on the idea that the absence of payment is implied and considered customary within the industry.

On the contrary, the BOD would assert that they cannot be denied what the rest of us are obliged to pay for. They could point to other timeshare systems where this arrangement does not exist. Even if some developers might exploit this practice, it is not widely known among the general public. Furthermore, they could contend that their say 20,000 owners are largely unaware of this arrangement, and if properly informed, the owners would prefer to see the developer covering the costs of these units. This approach promotes transparency and accountability, fostering trust and confidence in the management of the resort. It also ensures fairness to all owners, protects the value of ownership, enhances the resort's reputation, and upholds ethical responsibility by ensuring that costs are appropriately allocated without developer favoritism.

Due to the inherent lack of clarity in the clause, in my view, and as is often the case, unclear terms tend to be resolved in favor of the consumer. This outcome might not be particularly pleasing for the developer.

Let me help you with how these things work. They work exactly how state and federal statutes do. Someone is writing rules as a second level and any such rule must pass two tests. That is does the legal paperwork allow a given rule and do they preclude it. What you stated would specifically allow them to take the proceeds as it gives them such weeks. Thus you would look at the rest of the document to see if it directs how those funds are used, who gets them and the like. In the absence of any further direction/limitation, what you posted would clearly and easily give those proceeds to the same group that has control of those weeks. End of story. Your hypothetical is not applicable and it's not realistic for any system. Of course any BOD that took that stance and stuck to it would find themselves excommunicated from the system no matter the resort as MVC has threatened at least two of the newer resorts with that fate for less confrontational situations than that.

 

[timsi]

Let me help you with how these things work. They work exactly how state and federal statutes do. Someone is writing rules as a second level and any such rule must pass two tests. That is does the legal paperwork allow a given rule and do they preclude it. What you stated would specifically allow them to take the proceeds as it gives them such weeks. Thus you would look at the rest of the document to see if it directs how those funds are used, who gets them and the like. In the absence of any further direction/limitation, what you posted would clearly and easily give those proceeds to the same group that has control of those weeks. End of story. Your hypothetical is not applicable and it's not realistic for any system. Of course any BOD that took that stance and stuck to it would find themselves excommunicated from the system no matter the resort as MVC has threatened at least two of the newer resorts with that fate for less confrontational situations than that.

Thanks for your help.

In my perspective, there are numerous vulnerabilities in this process that make it unsustainable over the long term. I'm specifically addressing the entire procedure where vacationers are given a mere 5-10 days to cancel a purchase, virtually devoid of a reasonable opportunity to review the terms, let alone test the product before it's too late to cancel. Furthermore, the cancellation window may expire before they even have a chance to return home and thoroughly assess what they've committed to. The contracts are meticulously crafted with a multitude of pitfalls, elusive terms, and implied clauses, many of which require a deep understanding of the process to discern their implications.
These clauses are consistently interpreted in favor of the developer, leaving little room for doubt about whose interests are being protected. These contracts are not the result of negotiations between two parties and it is possible that if scrutinized properly, many of these clauses would not hold up in the same way as if they had been negotiated between two well-informed and equal businesses. This clause, where the developer may claim they can get free rooms paid by others, is merely one example. Certainly, there's also the matter of representation and the extent to which the developer exerts control over the board member election process, leaving us with minimal influence in the overall decision-making.

I appreciate your own hypothetical scenario concerning the potential strain on the relationship with the resort if this clause or others were challenged, but the decision wouldn't be yours to make, it would be made by the executives. It's highly unlikely that they would sacrifice millions of dollars in revenue per resort from the management fee alone, let alone considering all the other implications for how the vacation club operates, simply due to covering the cost of a few rooms. Additionally, what if not only one but 10 or 50 resorts sought similar alterations? Would the developer sever ties with all of them?

 

[Dean]

Thanks for your help.

In my perspective, there are numerous vulnerabilities in this process that make it unsustainable over the long term. I'm specifically addressing the entire procedure where vacationers are given a mere 5-10 days to cancel a purchase, virtually devoid of a reasonable opportunity to review the terms, let alone test the product before it's too late to cancel. Furthermore, the cancellation window may expire before they even have a chance to return home and thoroughly assess what they've committed to. The contracts are meticulously crafted with a multitude of pitfalls, elusive terms, and implied clauses, many of which require a deep understanding of the process to discern their implications.
These clauses are consistently interpreted in favor of the developer, leaving little room for doubt about whose interests are being protected. These contracts are not the result of negotiations between two parties and it is possible that if scrutinized properly, many of these clauses would not hold up in the same way as if they had been negotiated between two well-informed and equal businesses. This clause, where the developer may claim they can get free rooms paid by others, is merely one example. Certainly, there's also the matter of representation and the extent to which the developer exerts control over the board member election process, leaving us with minimal influence in the overall decision-making.

No doubt this is not a level playing field, I've said that to you several times. However, this is the realities of the situation and beating our head against the wall will not change that. We have to decide whether to play in the sandbox or walk/run away. Most of us here have decided to play in one way or another though many of us started our journey with a less than educated purchase for which we overpaid. I was one of the lucky ones in that I learned about resale and was somewhat educated before my first purchase (DVC) and definitely educated before my first MVC purchase. Even then there were gotcha's the affected my usage and enjoyment to the degree that I spent a day with DVC execs at corporate in Celebration back years ago because of my questions and concerns. At the end of the day they offered to buy me out and make me whole and that was on a resale purchase but ultimately we decided to move forward and stay in. One of the best decisions I've made in timesharing BTW. It's actually worse than you portray here in that they can also make changes easily that will negatively affect many members enjoyment and usage. Certainly there are potential limitations there but they are not very limiting. Even if they push the envelop and we feel they've overstepped, we have to decide whether to pony up for a lawyer which is an uphill venture at best. I laugh when people mention class action lawsuits or legal action like that threat has any teeth.

None of what you say changes any of the facts nor does it create flexibility in the system. Still, the onus is on the consumer to understand what they are signing up for when this much money is on the table. It's a little like buying a car, how many have had an emotional purchase then later had buyers remorse. If timeshare buyers were only those who could truly afford the purchase and understood the ramifications prior to going in, timeshares wouldn't exist. Thus by all of us participating, we are somewhat condoning the process whether we know it or agree with it.

I appreciate your own hypothetical scenario concerning the potential strain on the relationship with the resort if this clause or others were challenged, but the decision wouldn't be yours to make, it would be made by the executives. It's highly unlikely that they would sacrifice millions of dollars in revenue per resort from the management fee alone, let alone considering all the other implications for how the vacation club operates, simply due to covering the cost of a few rooms. Additionally, what if not only one but 10 or 50 resorts sought similar alterations? Would the developer sever ties with all of them?

I can't speak for MVC but I do know they've pushed out at least 6 resorts since I've owned (if you count Vail as separate as they legally are) which, I assume, decreased their bottom line. I also know that BeachPlace and Aruba Ocean Club were threatened based on conflicts but I can't tell you how close they came to that actually happening. I'm sure there are those here that know far more about both issues than do I. I also wouldn't be surprised if there were other examples. As for any organized efforts across a large segment of resorts that created a conflict, MVC would simply have to decide at what point it wasn't worth it to continue with resort management and/or get heavy handed with lawyers.

So I'll ask you again, do you just like to complain, is Eeyore your spirit animal or do you simply like beating your head against a wall. Why do you continue to give money to an organization that you view with such disdain?

 

[sullyboy8]

Dumb question most likely but first time going through MF for Point Resale Owner, when will the MF's show up in our account and when are they due?

 

[Fasttr]

Dumb question most likely but first time going through MF for Point Resale Owner, when will the MF's show up in our account and when are they due?

They are there now. Due Dec 1.

 

[sponger76]

Due to the inherent lack of clarity in the clause, in my view, and as is often the case, unclear terms tend to be resolved in favor of the consumer. This outcome might not be particularly pleasing for the developer.

Then stop bitching about it here nonstop, pony up for a lawyer, and force the issue in a legal setting. and we'll see if you're right or not.

 

[SueDonJ]

... These clauses are consistently interpreted in favor of the developer, leaving little room for doubt about whose interests are being protected. These contracts are not the result of negotiations between two parties and it is possible that if scrutinized properly, many of these clauses would not hold up in the same way as if they had been negotiated between two well-informed and equal businesses. This clause, where the developer may claim they can get free rooms paid by others, is merely one example. Certainly, there's also the matter of representation and the extent to which the developer exerts control over the board member election process, leaving us with minimal influence in the overall decision-making. ...

Again I'm asking, on what basis do you think that if challenged legally, Marriott Vacations Worldwide would come out on the losing side? What legal precedent has been set to support your opinion?

It's not only contract law that's in play. The governing docs are written in compliance with a multitude of state and federal regulations related to real estate, condominium development, time-sharing overall and HOA/BOD formations, and they're supposedly given at least a cursory review before permits are issued to go ahead with the project and/or start selling the product. And again, they're not written with only the developer/manager protections in mind - if legislation requires that something be included in the docs then it's in there, and that includes protections for owners/members!

Over the years on TUG we've seen instances where owners/members challenge Marriott and win, sometimes even without involving lawyers. The most recent involved a single Vistana - or Westin maybe? - resort, which its unique contradictory rules superseded the standard Abound rules that Marriott tried to impose after the Abound integration. Owners let Marriott know through email/phone calls that they were wrong, Marriott looked things over, agreed, and pulled back their standard rules so that single resort's unique rules remain in play.

We've also seen many, many more instances where people go on fishing expeditions to try and find something, anything, to bring a class action suit against Marriott, railing with no legal basis against the perceived unfairness of big business taking advantage of the little people and demanding that Marriott kowtow to owner demands. As Dean said, a few times that's resulted in Marriott severing the management affiliation with individual resorts - without any admittance of wrongdoing but simply because the situation isn't worth the profit. (To answer your question, I think they'll take this tack every single time it's worth it for them and if eventually it means severing a large chunk of their portfolio, they'll get out of the game altogether.) A few other times - Aruba Ocean Club's Special Assessment for extensive building repairs comes to mind - Marriott made concessions again without any admittance of wrongdoing and contributed monies it wasn't required to contribute to offset the owners' costs.

IMO there's good reason why the instances where Marriott has conceded are so few and far between - and that's because they strive to be in compliance with regulations and the governing docs. Why wouldn't they when their licensing would be in jeopardy if they didn't?! Along the way when they're challenged they don't take either extreme of complete obstinance against or capitulation with owner/member demands, and they sometimes concede more than is legally required. They have earned their very good reputation in the industry among competing companies as well as owners/members. That's enough for me, maybe not for you? But your problem doesn't seem to be with Marriott at all, instead with the lack of laws that give you the particular protections that you want from an industry that doesn't give those protections to anybody! Write your congresspersons - you'll likely have better luck with them than you will with Marriott.

 

[SueDonJ]

... In my perspective, there are numerous vulnerabilities in this process that make it unsustainable over the long term. ...

About this one thing: it's a constant that's been said about timeshares since the very first timeshare was offered to the very first buyers, and it hasn't come true yet.

Marriott Vacation Club was introduced under the Marriott Int'l umbrella on 4/17/84 with the purchase of what became the Monarch resort on Hilton Head Island. The segment was spun off and became Marriott Vacations Worldwide in 2011. So, 39 years Marriott's been in the timeshare game and there's no indication that it will be getting out of the game anytime soon. What do you consider "long-term" ??

 

[AlmostRetired]

Marriott Vacation Club was introduced under the Marriott Int'l umbrella on 4/17/84 with the purchase of what became the Monarch resort on Hilton Head Island. The segment was spun off and became Marriott Vacations Worldwide in 2011. So, 39 years Marriott's been in the timeshare game and there's no indication that it will be getting out of the game anytime soon. What do you consider "long-term" ??

I agree with you 100%, Marriott is not getting out of the game. They will have to change the rules once again.

I am a little more cynical on the past changes. The change from deeded weeks to trust points was motivated by the fact that Marriott could not compete with resale. A resale purchased week had the same use value, trade value and MF. The only difference was the exchange to Reward Points and starting in the early 2000's, the difference was less meaningful and on the road to almost meaningless. The move to Trust points was an attempt to change the playing field and they did so successfully. It gave them a way to monetize many of the silver and bronze weeks they had in their portfolio. The flexibility value proposition resonated with many legacy owners, new owners and owners who purchased resale after 2010. I believe the cost of a trust point for new purchases and the MF cost per trust point for both new and existing trust point owners will be soon reaching the point of overshadowing the flexibility value. People who are in a position to vacation taking advantage of privilege level for 60/30 day discounts can extent the flexibility value. Adding Vistana my have bought some time but I would not be shocked if Marriott is already thinking through the next iteration of "timesharing". Will it be 3 years or 5 years, I have no clue but it will happen and it will be a lot shorter than from 1984 to 2010.

 

[sponger76]

The change from deeded weeks to trust points was motivated by the fact that Marriott could not compete with resale.

I don't think they were THAT worried about the resale market. They are always able to find people to buy if they have something desirable to sell. The vast majority of the population is not on TUG and/or does not know about the resale market. Plus the resale market simply does not exit if nobody ever buys retail to start with. And since people did buy retail, the developer already got their upfront purchase money, and they're still getting their cut of the MFs whether the payer bought retail or resale. They're not competing against resale in the sense that it would be competing against themselves since resale is stuff they already sold. It's like how Sony's not worried about you selling your used tv on eBay or Craigslist, because they already made their money from selling it to you. They're just going to sell more new tvs to you or someone else even though the secondhand market exists. And they don't even get ongoing MFs, from either retail or resale tvs.

I suspect it had much more to do with trying to solve the problem of all the low season and/or less desirable resort weeks they had on their books and were having a hard time selling. Rather than trying to convince someone to purchase a mud week at a mountain resort or a week at a beach resort in the middle of winter after the primetime weeks were all sold, they blended the leftovers all together to enable them to sell the idea of more choices and flexibility. You can go to the beach or the mountain! And it doesn't have to be exactly 7 nights! They just don't tell prospective buyers that to use those points on desirable locations/times, the system depends on owners of those desirable weeks to elect to put them into the mixer each year, since those weeks were pretty much all sold before the points system was created.

 

[SueDonJ]

Moderator Note: This thread is now the 'official' discussion thread for the 2024 MF's, with several posts from the MF's sticky thread merged here. As always, feel free to send me a PM or Report any other posts that you think belong here. Thanks!

 

[SueDonJ]

I agree with you 100%, Marriott is not getting out of the game. They will have to change the rules once again.

I am a little more cynical on the past changes. The change from deeded weeks to trust points was motivated by the fact that Marriott could not compete with resale. A resale purchased week had the same use value, trade value and MF. The only difference was the exchange to Reward Points and starting in the early 2000's, the difference was less meaningful and on the road to almost meaningless. The move to Trust points was an attempt to change the playing field and they did so successfully. It gave them a way to monetize many of the silver and bronze weeks they had in their portfolio. The flexibility value proposition resonated with many legacy owners, new owners and owners who purchased resale after 2010. I believe the cost of a trust point for new purchases and the MF cost per trust point for both new and existing trust point owners will be soon reaching the point of overshadowing the flexibility value. People who are in a position to vacation taking advantage of privilege level for 60/30 day discounts can extent the flexibility value. Adding Vistana my have bought some time but I would not be shocked if Marriott is already thinking through the next iteration of "timesharing". Will it be 3 years or 5 years, I have no clue but it will happen and it will be a lot shorter than from 1984 to 2010.

I don't think they were THAT worried about the resale market. They are always able to find people to buy if they have something desirable to sell. The vast majority of the population is not on TUG and/or does not know about the resale market. Plus the resale market simply does not exit if nobody ever buys retail to start with. And since people did buy retail, the developer already got their upfront purchase money, and they're still getting their cut of the MFs whether the payer bought retail or resale. They're not competing against resale in the sense that it would be competing against themselves since resale is stuff they already sold. It's like how Sony's not worried about you selling your used tv on eBay or Craigslist, because they already made their money from selling it to you. They're just going to sell more new tvs to you or someone else even though the secondhand market exists. And they don't even get ongoing MFs, from either retail or resale tvs.

I suspect it had much more to do with trying to solve the problem of all the low season and/or less desirable resort weeks they had on their books and were having a hard time selling. Rather than trying to convince someone to purchase a mud week at a mountain resort or a week at a beach resort in the middle of winter after the primetime weeks were all sold, they blended the leftovers all together to enable them to sell the idea of more choices and flexibility. You can go to the beach or the mountain! And it doesn't have to be exactly 7 nights! They just don't tell prospective buyers that to use those points on desirable locations/times, the system depends on owners of those desirable weeks to elect to put them into the mixer each year, since those weeks were pretty much all sold before the points system was created.

I agree with both of you to some extent, that the evolution of the Points system was more motivated by the unsold inventory held by Marriott than it was by a robust external resale market, and that they're always forward-looking to the next iteration. But I think there's another thing that should be considered a driver for Marriott's points system and that's the success of Disney Vacation Club. There were rumors for years before the Destination Club was introduced on 6/20/10 that a points system was coming - and I'm sure I'm not the only one who let Marriott know at every opportunity during that interim that a marriage of DVC's points system and Marriott's extensive resort portfolio would be the ideal timeshare!

 

[Ralph Sir Edward]

Everybody seems to be missing the big change that the point system brought about. It was not about the off weeks that couldn't be sold. It was recapturing the resale market, as much as could be done without breaking their own rules.

The 800 pound gorilla was the fee to transfer point ownership. Unlike week ownership, in which Marriott got a one time profit from the initial sale; with points, every time the points get resold, Marriott get 3 dollars a point for the transfer (which is separate from the actual transfer paperwork fees). Roughly 25% of new sales value, without any overhead (no sales force, no advertizing, no offering sampler weeks at Marriott's cost, not even transfer fees, which are billed separately). Pure profit that wasn't available on the weeks model.

That's the big gain to the profit model. . .

 

[AlmostRetired]

I don't think they were THAT worried about the resale market. They are always able to find people to buy if they have something desirable to sell. The vast majority of the population is not on TUG and/or does not know about the resale market. Plus the resale market simply does not exit if nobody ever buys retail to start with. And since people did buy retail, the developer already got their upfront purchase money, and they're still getting their cut of the MFs whether the payer bought retail or resale. They're not competing against resale in the sense that resale is stuff they already sold.

I suspect it had much more to do with trying to solve the problem of all the low season and/or less desirable resort weeks they had on their books and were having a hard time selling. Rather than trying to convince someone to purchase a mud week at a mountain resort or a week at a beach resort in the middle of winter after the primetime weeks were all sold, they blended the leftovers all together to enable them to sell the idea of more choices and flexibility. You can go to the beach or the mountain! And it doesn't have to be exactly 7 nights! They just don't tell prospective buyers that to use those points on desirable locations/times, the system depends on owners of those desirable weeks to elect to put them into the mixer each year, since those weeks were pretty much all sold before the points system was created.

No one will question the value of TUG. I point to it all the time on FB. I disagree on the impact that resale had on Marriotts business of selling trust points. Before TUG, there was an established significant player in the resale market as early as 1995. The player was called Marriott and they had a resale department out of Orlando supported by a call center, salesman trained in resale, offering Marriott financing and offering bonus reward points upon purchase. I had all of the benefits of purchasing new including exchanging for reward points. I purchased my first resale from a salesman named Wayne Williams in 1995. I attached the one sales sheet that I kept because I bought unit 3846 week 29. I purchased directly from an owner with Marriott as the middleman getting a 25% commission paid by the seller. The asking was 14500, I paid 13,000 so it was negotiable. I had similar sheets from from Harbour Club, Heritage, Sunset, Royal Palms, Sabal Palms, Cypress Harbour, Desert Springs Villas, Summit Watch, Manor Club and Streamside. My wife and I discussed a second unit but didn’t want to spend much, so we bought a non Marriott called Resort World of Orlando at auction found by using my Netscape browser on the internet. It was my first trader and I paid 2000.

I kept in touch with Wayne Williams until he died some time before 2008. Marriott had a significant resale business developed over time as did timeshare reseller companies. In fact the resell companies were eating the lunch of Marriott’s resale business. This was not my opinion but Wayne’s opinion the last time I spoke with him before he died.

Marriott is successful by paying people to develop business strategies ahead of inevitable challenges. So while Marriott owned a lot of non platinum weeks which was a challenge, they also had at least 15 years experience in the resale business. In my opinion, Marriott read the tea leaf's on the continued impact of the resale market . I am not suggesting that flexibility was not a value proposition. I will say the for me and I am sure I am not alone, when I travel with my kids, a full week is the minimum. In any case, I go back to my opinion, resale played a big role in the need to develop a new strategy.

I think in the next few years, a new strategy will be required because flexibility will not be worth the cost.

 

[jmhpsu93]

Just another random data point to add to the MF discussion here. I regularly track the resale ads / auctions on Ebay and right now there are 41 active auctions, which is more than double what I usually see.

I know this is "Maintenance Fee Season" and we usually see an uptick in resale activity on the sale sites, but I think this is a result of the big increases in MFs for 2024.

 

[cubigbird]

Just another random data point to add to the MF discussion here. I regularly track the resale ads / auctions on Ebay and right now there are 41 active auctions, which is more than double what I usually see.

I know this is "Maintenance Fee Season" and we usually see an uptick in resale activity on the sale sites, but I think this is a result of the big increases in MFs for 2024.

I suspect the big wave of resales to hit the market are yet to come. Not all 2024 bills have posted yet. I wouldn’t be surprised to see 2024 be a record year of resales on the market. It’ll be good for Marriott exercising ROFR as it will push resale prices down.

 

[dougp26364]

Just received our estimate for Ocean Pointe. According the the letter, fully finding the reserve will result in a 21% increase. If owners waive the fully finding requirement, they still anticipate an increase of 10-15%.
Hopefully the trust will be able to absorb all the defaults I anticipate if this continues.

 

[Superchief]

Just received our estimate for Ocean Pointe. According the the letter, fully finding the reserve will result in a 21% increase. If owners waive the fully finding requirement, they still anticipate an increase of 10-15%.
Hopefully the trust will be able to absorb all the defaults I anticipate if this continues.

This is getting ridiculous. Last year's increase was 30%. Nobody can justify continued increase like this. There have to be areas where expenses can be cut. This will force many people to sell their weeks.

 

[dougp26364]

This is getting ridiculous. Last year's increase was 30%. Nobody can justify continued increase like this. There have to be areas where expenses can be cut. This will force many people to sell their weeks.

IMHO, it’s been out of hand for years. If they don’t get a handle on expenses quickly, my fear is they’ll have a huge issue with owner defaults.

 

[Superchief]

Just received our estimate for Ocean Pointe. According the the letter, fully finding the reserve will result in a 21% increase. If owners waive the fully finding requirement, they still anticipate an increase of 10-15%.
Hopefully the trust will be able to absorb all the defaults I anticipate if this continues.

This explanation was included with the proposed budget. It appears that the option to reduce the reserve below fully funded will not be allowed after 2024 unless the law is modified.

'In years past the fully funded amount has been significantly higher than the range recommended by the Board of Directors. For 2024 you will notice the fully funded amount is $1,214.78 per unit week whereas the Board of Director’s recommended range is $800 - $1,150 per unit week. Unless both SB-4D and SB-154 are amended by the Florida legislature, the budgets adopted for 2024 and 2025 will be the last budgets approved with the option of waiving fully funding of Reserves, based on the requirement thereafter that Reserves be fully funded. After December 31, 2024, Owners of an owner-controlled association may not vote to waive or reduce Reserve funding for items included in the SIRS or use reserve funds that are reserved for items included in the SIRS for any other purpose.'

On a positive note, the reserves can no longer be used for other purposes, so that should reduce wasteful spending on GM pet projects. The total MF increase will be 21% in the 'fully funded' proposed budget, but I noticed the management fee would increase by 31%. This seems excessive. I expect a lot of Florida timeshares will be sold in the next year unless the FL legislature modifies the fully funded requirement.

 

[dioxide45]

This explanation was included with the proposed budget. It appears that the option to reduce the reserve below fully funded will not be allowed after 2024 unless the law is modified.

'In years past the fully funded amount has been significantly higher than the range recommended by the Board of Directors. For 2024 you will notice the fully funded amount is $1,214.78 per unit week whereas the Board of Director’s recommended range is $800 - $1,150 per unit week. Unless both SB-4D and SB-154 are amended by the Florida legislature, the budgets adopted for 2024 and 2025 will be the last budgets approved with the option of waiving fully funding of Reserves, based on the requirement thereafter that Reserves be fully funded. After December 31, 2024, Owners of an owner-controlled association may not vote to waive or reduce Reserve funding for items included in the SIRS or use reserve funds that are reserved for items included in the SIRS for any other purpose.'

On a positive note, the reserves can no longer be used for other purposes, so that should reduce wasteful spending on GM pet projects. The total MF increase will be 21% in the 'fully funded' proposed budget, but I noticed the management fee would increase by 31%. This seems excessive. I expect a lot of Florida timeshares will be sold in the next year unless the FL legislature modifies the fully funded requirement.

I believe they will no longer be able to not fully fund the reserves for certain items. Those being items that are part of the Structural Integrity Reserve Study (SIRS).

8 Elements That Make Up SIRS

1. Roof
2. Structural Systems
3. Fireproofing & Fire Safety
4. Exterior Painting & Water Proofing
5. Plumbing
6. Electrical Systems
7. Windows & Exterior Doors
8. Other elements over $10,000 that have an impact on the structural integrity of the building

 

[pedro47]

About this one thing: it's a constant that's been said about timeshares since the very first timeshare was offered to the very first buyers, and it hasn't come true yet.

Marriott Vacation Club was introduced under the Marriott Int'l umbrella on 4/17/84 with the purchase of what became the Monarch resort on Hilton Head Island. The segment was spun off and became Marriott Vacations Worldwide in 2011. So, 39 years Marriott's been in the timeshare game and there's no indication that it will be getting out of the game anytime soon. What do you consider "long-term" ??

The first two (2) Marriott timeshare resorts on Hilton Head Island were Spicebush at Sea Pines and Swallowtails at Sea Pines. Those two (2) resorts were later dropped from the Marriott's Vacation Club because they did not meet Marriott's Vacation Club high standards.

 

[dougp26364]

This explanation was included with the proposed budget. It appears that the option to reduce the reserve below fully funded will not be allowed after 2024 unless the law is modified.

'In years past the fully funded amount has been significantly higher than the range recommended by the Board of Directors. For 2024 you will notice the fully funded amount is $1,214.78 per unit week whereas the Board of Director’s recommended range is $800 - $1,150 per unit week. Unless both SB-4D and SB-154 are amended by the Florida legislature, the budgets adopted for 2024 and 2025 will be the last budgets approved with the option of waiving fully funding of Reserves, based on the requirement thereafter that Reserves be fully funded. After December 31, 2024, Owners of an owner-controlled association may not vote to waive or reduce Reserve funding for items included in the SIRS or use reserve funds that are reserved for items included in the SIRS for any other purpose.'

On a positive note, the reserves can no longer be used for other purposes, so that should reduce wasteful spending on GM pet projects. The total MF increase will be 21% in the 'fully funded' proposed budget, but I noticed the management fee would increase by 31%. This seems excessive. I expect a lot of Florida timeshares will be sold in the next year unless the FL legislature modifies the fully funded requirement.

So one way or another, all Florida timeshare owners are going to see at least one major increase in their MF’s. Since Abound trust point fees had a significant increase, I’m guessing the trust will be voting to go ahead with fully funding the reserves.

I doubt this will cut into the BOD and GM’s pet projects at Ocean Pointe. The anticipated increase without fully funding is projected to be 10-15%. They’ll still get their share. I had always felt the average 5-6% increases were out of line with reality. Now with inflation they’re really getting out of hand. A 3 bedroom MF is looking at $3,300 under the fully funded provision. At a average of 10% it will be $6,600 in 7 years. Factor in the defaults we’re bound to see and the future looks rather bleak.

If I compare this to my Las Vegas Grand Chateau week, it makes no sense for me to continue to own OP. GC offers more Abound points, a lock off unit that trades as a full 1 bedroom with a MF of $2,300. Perhaps it’s time to dump Ocean Pointe and purchase another Grand Chateau week? It’s become nearly impossible for us to reserve our home week at Ocean Pointe for the first week of December unless I book that week using Abound points. I’m seeing no advantage of holding a deed at this resort anymore.

 

[SueDonJ]

The first two (2) Marriott timeshare resorts on Hilton Head Island were Spicebush at Sea Pines and Swallowtails at Sea Pines. Those two (2) resorts were later dropped from the Marriott's Vacation Club because they did not meet Marriott's Vacation Club high standards.

All three, Spicebush, Swallowtail and Monarch, plus several private homes, were established/developed by American Resorts Group, Inc and sold as a package to Marriott, Int'l in 1984, which became the Marriott Vacation Club segment under the umbrella. Spicebush and Swallowtail later separated when the MVCI brand standards were challenged. I don't know what happened with the individual homes - I wonder if those are the properties adjacent to Grande Ocean that have rights to GO's amenities??

Anyway, that's why I say Monarch was the first, although technically it was only one of the first.