Actual resale market data 2001 vs. 2011

[Carolinian]

I just finished running a comparision of resales for timeshares in two OBX towns, comparing resales from August through December 2011 with the same months a decade before in 2001. I used Kill Devil Hills and Nags Head because all of the timeshares in both are sold out resorts and run by member-controlled HOA's with the developer out of the picture, and thus no distortion from developer activity. I had already done the 2011 numbers to compare with the same months of 2007 before the economic meltdown, and just added the 2001 numbers, to get a picture of things back when the resale market for timeshare worked and there was no PCC activity to speak of and the changes at exchange companies had not yet impacted those who owned to exchange.

The Outer Banks is a good place to run the analysis since their Land Transfer Tax tables are a lot easier to pull the data out of than Register of Deeds data in counties that do not have a local Land Transfer Tax. Also, unlike state tax stamps in use in most counties where a buyer can give any number he wants as to sale price often even verbally, the process in Dare County is more insistent on real numbers and utilizes sworn affidavits, subject to perjury charges for falsification, to back that up, so the numbers are more accurate.

I have thrown in the 2007 numbers too, since I already had run those.

The results are broken down between Prime Red weeks, Pink weeks, white weeks, and blue weeks, with number of resales in each category and average price.

category 2001 2007 2011

Prime Red 24 - $7,293; 33 - $7,177; 15 - $8.020

Pink 21 - $2,250; 50 - $2,323; 47 - $2,322

White 14 - $1,563; 10 - $1,125; 5 - $240

Blue 25 - $493; 18 - $519; 20 - $490

(regrettably this system does not keep these in straight columns, making them harder to read)

One cavaet is that to make this an apples and apples comparision, I did not include two resorts, Sea Ranch II in KDH and Bodie Island Beach Club in NH which were in operation in 2001 but not in 2011. Both succumbed to the same problem, or more specifically the same management company. Both had very severe damage from Hurricane Isabelle and very extensive rebuilding. The management company that handled both interpreted a contract clause to take a big slice of the insurance proceeds for itself, then used general resort funds to pay the balance to the contractors, which left both resorts with operating shortfalls. That led to attacks by former developers to take back the resorts and court battles, as well as the resorts having to close down while those battles were fought. Adding these two resorts in would add 6 prime, 7 pink, 2 white, and 2 blue resales in 2001, and not really impact average prices much.

Overall, what this data shows is that the OBX timeshare resale market has not really changed that much either as to volume or price. Other regions may have had different experiences, but that can be ascertained on facts not speculation, and especially not eBay-based speculation, since the eBay market is dominated by the PCC's. Ebay used to work like a charm in 2001 to sell even blue weeks, but since the PCC's arrived in force it has been a different story completely.

 

[ronparise]

Interesting data and enough for an appraiser to tell me what market value is for this area, and to tell me that there has been no significant change over the years.

but I fail to see how your data leads you to any conclusion about ebay and the PCCs. because you dont tell me which of the sales are ebay sales.

FYI there have been 4 outer banks units offered for sale on ebay during the month of May. but no sales...so at least this month ebay has had no impact...But if we assume that these 4 will sell sooner or later, and if we assume that 4 a month is about right. That would mean that ebay probably accounts for half the sales in your data set..Hardly insignificant in turnms of the number of sales, but clearly no impact when it comes to the dollar value of those sales

You cant have it both ways. You cant say the value of timeshares on your beloved Outer Banks has held up over the years, and at the same time blame ebay and the PCCs for their decline.

 

[ace2000]

I'll also add that this is a completely different market segment than the large majority of timeshare units.

How many red week timeshares go for over 8K? Really your test is interesting, but it doesn't prove anything.

 

[Carolinian]

There was one time I waded through the issue of identifying eBay sales, and it involves looking up the deed for each timeshare resale transaction on the Register of Deeds website and seeing who prepared the deed. If it says a party did, which is often a fiction, then one must look at who the deed was returned to.

With that information, I then apply my local knowledge as to the local attorneys who represent the HOA's and are usually referred by HOA's to members selling. I recognize the local attorney who handles closing for the local timeshare broker. I treated any deed preparer from a national closing company as a likely eBay sale, although I recognize some probably aren't as I know Tuggers sometimes use them in their own private sales, but with them there is no way to tell the difference. PCC's are most of eBay sales these days, and they all use their own out of state closing company, so I simply looked at the number of deeds represented by such companies, and they were less than 5%. That included any that purported to be drafted by parties to the deed but were returned to such national closing companies.

The methodology is really quite simple but fairly time consuming to do, which is why after doing it on one sample I was looking at, I have not gone back and done it again. However, in watching eBay, I have not seen the number of OBX weeks offered change much, so there is no reason to do so.

Interesting data and enough for an appraiser to tell me what market value is for this area, and to tell me that there has been no significant change over the years.

but I fail to see how your data leads you to any conclusion about ebay and the PCCs. because you dont tell me which of the sales are ebay sales.

FYI there have been 4 outer banks units offered for sale on ebay during the month of May. but no sales...so at least this month ebay has had no impact...But if we assume that these 4 will sell sooner or later, and if we assume that 4 a month is about right. That would mean that ebay probably accounts for half the sales in your data set..Hardly insignificant in turnms of the number of sales, but clearly no impact when it comes to the dollar value of those sales

You cant have it both ways. You cant say the value of timeshares on your beloved Outer Banks has held up over the years, and at the same time blame ebay and the PCCs for their decline.

 

[ronparise]

There was one time I waded through the issue of identifying eBay sales, and it involves looking up the deed for each timeshare resale transaction on the Register of Deeds website and seeing who prepared the deed. If it says a party did, which is often a fiction, then one must look at who the deed was returned to.

With that information, I then apply my local knowledge as to the local attorneys who represent the HOA's and are usually referred by HOA's to members selling. I recognize the local attorney who handles closing for the local timeshare broker. I treated any deed preparer from a national closing company as a likely eBay sale, although I recognize some probably aren't as I know Tuggers sometimes use them in their own private sales, but with them there is no way to tell the difference. PCC's are most of eBay sales these days, and they all use their own out of state closing company, so I simply looked at the number of deeds represented by such companies, and they were less than 5%. That included any that purported to be drafted by parties to the deed but were returned to such national closing companies.

The methodology is really quite simple but fairly time consuming to do, which is why after doing it on one sample I was looking at, I have not gone back and done it again. However, in watching eBay, I have not seen the number of OBX weeks offered change much, so there is no reason to do so.

So Ebay has no impact on the OBX contrary to what you have said before and repeat here "Ebay used to work like a charm in 2001 to sell even blue weeks, but since the PCC's arrived in force it has been a different story completely".

 

[Carolinian]

So Ebay has no impact on the OBX contrary to what you have said before and repeat here "Ebay used to work like a charm in 2001 to sell even blue weeks, but since the PCC's arrived in force it has been a different story completely".

It just means that eBay is no longer a good method to sell anything. A prime week on the OBX will sell on eBay for $2K+ but that is substantially under the rest of the market. A blue week will not sell on eBay at all. But they are selling through other venues. The fact that eBay is no longer a good vehicle for selling does not impact the ability to sell elsewhere or the price elsewhere.

 

[Saintsfanfl]

It just means that eBay is no longer a good method to sell anything. A prime week on the OBX will sell on eBay for $2K+ but that is substantially under the rest of the market. A blue week will not sell on eBay at all. But they are selling through other venues. The fact that eBay is no longer a good vehicle for selling does not impact the ability to sell elsewhere or the price elsewhere.

This makes absolutely no sense. eBay has not changed, the entire timeshare market has changed. eBay is just an avenue to buy and sell. eBay is not some mysterious place where things are drastically cheaper than anywhere else. The nature of a no reserve auction has a way of appearing to sell something cheaper than it otherwise would but how long would it take to sell it for a higher price? These other venues list hundreds of properties but not too many are actually moving.

 

[Carolinian]

This makes absolutely no sense. eBay has not changed, the entire timeshare market has changed. eBay is just an avenue to buy and sell. eBay is not some mysterious place where things are drastically cheaper than anywhere else. The nature of a no reserve auction has a way of appearing to sell something cheaper than it otherwise would but how long would it take to sell it for a higher price? These other venues list hundreds of properties but not too many are actually moving.

Facts are funny things, and that is what this thread is about. Care to show any real data from any specific timeshare market that supports your assertions? Actual data on sales is what is needed, and all sales in a particular region, not just one venue. When you can tell if a property has actually moved is when a deed gets recorded. Period. That is fact, not speculation. The data from the Outer Banks shows that at least there, the entire timeshare market has NOT changed. If you say the entire timeshare market has changed somewhere else, and it well might have, then please show the data to prove it, and all the data, not just the tiny eBay piece of it.

As to eBay changing, yes it did. I had a front row seat and watched it during the time I had the resale portfolio on my HOA board. The change in eBay is why we moved away from it to other venues. The change did not track with any overall economic factors. It tracked with the arrival of the PCC outlets in force.

I would love to see some solid data from other areas that either confirms the same trend as shown on the OBX or shows that such trends differ from place to place. Please research instead of shooting from the hip.

 

[lindner]

Facts are funny things, and that is what this thread is about. Care to show any real data from any specific timeshare market that supports your assertions? Actual data on sales is what is needed, and all sales in a particular region, not just one venue. When you can tell if a property has actually moved is when a deed gets recorded. Period. That is fact, not speculation. The data from the Outer Banks shows that at least there, the entire timeshare market has NOT changed. If you say the entire timeshare market has changed somewhere else, and it well might have, then please show the data to prove it, and all the data, not just the tiny eBay piece of it.

As to eBay changing, yes it did. I had a front row seat and watched it during the time I had the resale portfolio on my HOA board. The change in eBay is why we moved away from it to other venues. The change did not track with any overall economic factors. It tracked with the arrival of the PCC outlets in force.

I would love to see some solid data from other areas that either confirms the same trend as shown on the OBX or shows that such trends differ from place to place. Please research instead of shooting from the hip.

But if there is a large difference in price between eBay and other venues, say on the order of $2000, then certainly someone would start buying the eBay ones and sell in the other venues (a profit of $2000 would easily pay for closing costs and other expenses).

 

[Carolinian]

But if there is a large difference in price between eBay and other venues, say on the order of $2000, then certainly someone would start buying the eBay ones and sell in the other venues (a profit of $2000 would easily pay for closing costs and other expenses).

That would require a lot of localized knowledge of other venues, or more likely someone working just one localized market that they knew.

When I started reading about the $1 prime weeks on eBay, I started watching for summer OBX weeks, but soon found that even on eBay, those went at ~$2K+, not $1 but still a good deal compared to the broad market. My thought was not reselling so much as renting. But given the excessive closing costs with dodgy closing agents that are endemic to the PCC outlets on eBay adding to risk, and probably having to fight for a legally prepared deed, I decided the hassle factor was just too much.