Another SDO purchase concern

[apples23]

Just looking at some of the current ebay auctions on SDO (which I was looking for as an II trader)....many aren't receiving bids even at $1.99

I have some serious concerns about resale down the road. Im not looking to make money, but at this rate, it looks like there's a possibility that I might not even be able to give it away in 5 - 10 years if I know longer want it. I'm new to the TS thing, and definitely dont want to get stuck with something.

The manditory units on the other hand, seem to be in much higher demand, with lower risk of resale issues.

Am i being paranoid?

 

[LisaRex]

I share your concerns because I can imagine that if people aren't able to find a buyer, they'll simply not pay their MFs and allow the parent company to foreclose on them. Then who'll hold the bag for the MFs? Ultimately I fear it'll be the remaining owners.

With my MFs nearing $300/night at WKORV-N (a mandatory resort), I'm starting to worry how many years it'll take for the MFs to become so exorbitant that no one will want to buy my villa should I decide to sell.

I'm even wondering if some of these e-bay listings aren't sold by companies on behaof of SVO, Marriott, in order to dump unwanted inventory just to find someone to pay the MFs...

I know that SVO has recently advertised for jobs in their collections department. I wonder what the hit to someone's credit score would be to simply not pay their MFs. I know it's a huge red flag to foreclose on a home, but a TS? I have no idea.

 

[apples23]

Im less worried about WKORV, as presently all of the manditory resorts seem to be in demand.

SDO on the other hand, is presently in low demand. I'm really concerned about trying to get rid of it down the road.

Is anyone else concerned about future resale of voluntary properties vs manditory?

 

[Robert D]

I would be a lot more concerned about paying big $'s for a mandatory resort when prices are spiraling down. Those TS's have a lot farther to fall and most of them have higher maintenance fees. I wouldn't worry about SDO if you get it at the right price but be sure you buy one that is week 1-52 or a platinum week floater, don't touch an off season floater. You should have no problem getting rid of it in the future.

 

[FlyerBobcat]

With my MFs nearing $300/night at WKORV-N (a mandatory resort), I'm starting to worry how many years it'll take for the MFs to become so exorbitant that no one will want to buy my villa should I decide to sell.

In this case, what is the meaning of "a mandatory resort"

 

[DeniseM]

In this case, what is the meaning of "a mandatory resort"

A mandatory resort is one that has Staroptions & SVN membership on a resale. - For lots more info. and a list of the mandatory resorts, see the FAQ at the top of the board.

 

[DeniseM]

Im less worried about WKORV, as presently all of the manditory resorts seem to be in demand.

SDO on the other hand, is presently in low demand. I'm really concerned about trying to get rid of it down the road.

Is anyone else concerned about future resale of voluntary properties vs manditory?

Actually, WKORV has taken a terrible hit. I paid $45K for a 2 bdm. OV and it's now going for less than $30K on the resale market and prices continue to fall.

I also own an SDO unit that I only paid $2K for on the resale market.

I'm not sure what you mean about SDO being in low demand - it's REAL value is as a II exchanger. You can use it to trade into the expensive Starwood properties, for a fraction of the cost. It has a lot of value if use that way.

If I have to dump my WKORV TS someday, OUCH!

If I have to dump my SDO TS someday - not so much ouch.

I would be far more concerned about paying big bucks for a mandatory property in this economy. With timesharing, you really have to see how much value you can get out of using it and not expect to resale it for a profit or even break even. It's kind of like buying a car.

While you are looking at getting the most value out of using a TS, look closely at the MF - the MF's at WKORV are twice as much as SDO. Rising MF's also impacts resale value - since MF's at WPORV are about $2,500, you have to expect that MF's at WKORV will eventually be that high, too. At what point will it become cheaper to rent, than to own a TS? I think we are getting close.

And don't forget to look at the fact that travel to Hawaii is depressed. If people can't afford to go to Hawaii, that will also lower the rental and resale value of a Hawaii TS.

There are a lot of factors to consider.

Good luck!

 

[FlyerBobcat]

Thanks, Denise....
Shoulda' looked there first . Somehow the term just threw me off track...

A mandatory resort is one that has Staroptions & SVN membership on a resale. - For lots more info. and a list of the mandatory resorts, see the FAQ at the top of the board.

 

[apples23]

I totally get the value as an II exchanger, and that's what Im really excited about.

It just seems to good to be true.

There are SDO auction on Ebay right now, that literally have no bids whatsoever.

I'm not concerned about taking a hit on the purchase....im only paying $600 for it (plat 1 bdrm delux)....my concern is whether or not it will be re-sellable in 5-10 years, even at $1.

I keep hearing TS horror stories of ppl getting stuck with units that they can't re-sell, and locked into MFs. The mandatory units, despite the fact that they are suffering on the resale market....are still selling, even if at a loss.

That doesn't seem to be the same case with the voluntaries. There seem to be a number of SVR and SDO units that aren't moving....even at $1. Am I missing something here?

 

[DeniseM]

I understand your concern, but no one has any idea where our economy or the timeshare market will be in 10 years. The TS industry is relatively new, and no one really knows what will happen to these TS's as they get to be 20 or 30 or 40 years old. Some will be renovated, some will be shut down and your ownership will end. You have made a very modest and reasonable first purchase. If the purchase and MF are not a financial hardship for you now or in the foreseeable future, then I don't think you can worry about what will happen in 10 years, because no one knows. If the economy improves, then I would expect TS values to improve. If it gets really bad, all TS's may be worthless.

 

[grgs]

There seem to be a number of SVR and SDO units that aren't moving....even at $1. Am I missing something here?

#1: The economy. Too many units for sale (supply is much, much higher than demand).

#2: Time of year. Many of these weeks start with 09 usage, but it may be too late to reserve a good week (particularly SDO spring weeks).

#3: Many phases of SVR are currently under a special assessment. I think this is hurting prices at phases that are past the SA (eg/ Lakes) as many potential buyers aren't clear what's still forthcoming.

#1 is the biggie, of course. And no one knows when things will turn around.

Glorian

 

[Robert D]

apples23, have you seen completed auctions on Ebay for SDO 1-52 weeks that failed to sell for $1? Don't pay any attention to current auctions that have no bid on them. Most of the bids come within the last minute of the auction and until the auction is completed the prices are meaningless.

 

[apples23]

There are a number of EOY 1-52 and EY Silver seasons that haven't sold for $1, but I haven't seen an annual plat or 1-52

 

[Cathyb]

Denise: Xlnt advice and outlook!

 

[rickandcindy23]

We own a lot of weeks, including a few at SBP, an EOY 2 bed lockoff, and a 2 bed annual that isn't a lockoff.

I wonder where our economy is heading as well, but I think that since the media partly caused the downturn of the economy, with their constant talk of how bad it was getting for the last few years, they will be doing just the opposite in 2009, by talking it up this next year. They have their own motives, but I would bet that by next year at this time, the economy will apparently have made a 180 degree turn around, at least according to the media. Perception is the key, and our economy, and our feelings about it, are guided by the media.

The housing crisis was caused by a greedy mortage insurance company, AIG, and that is real.