Do more resorts equal higher prices?

[1Kflyerguy]

The recent announcement about the new resort on Maui got me wondering. Does having more resorts available drive prices up? Various HGVC salespeople over the years have urged me to buy now, as prices on all resorts will go up as soon as they announce new resorts…

Obviously that is great way for a salesperson to create a sense of urgency where none might otherwise exist.

In the big picture it makes sense, a resort network with 50 properties has a lot more appeal than a network of 10. On the other hand I suspect the vast majority of timeshare buyers focus on one or two resorts, and may like the idea of options, but probably won’t pay more for them.

I have not owned my TS long enough to have seen any trends. Has anyone seen anything in the past that support the claim that new resorts drive up prices at the existing resorts? Or is that just sales speak to drive a sale today?

 

[cubigbird]

Sales fluff. That's how sales work-create a sense of urgency to buy today. Statistically if your prospect walks out without buying, the probability of a sale drops considerably, and they know this. The whole market (and world) functions in supply and demand. If they build more properties and demand stays the same, prices go down. The only way for prices to go up are to limit supply and increase demand. For example look at airline consolidation and the elimination of routes and ultimately seats. "Access to more destinations" is a disguise of them manipulating that supply and demand.

 

[JSparling]

I don't have any actual information or knowledge...but in my opinion the Maui announcement will make HGVC as a whole more desirable. Therefore, our ownerships are now worth more. How much more? Probably not much. But adding a location like that has got to make HGVC more desirable, right? Adding another Vegas or Orlando property probably doesn't do much. But Maui should.

I'm under contract on two separate resale weeks and I wonder if the sellers have any seller remorse now that this Maui announcement was made. Maybe they would have liked to own when Maui was an option? Or maybe they think they could have sold for more? Likely not in either case but I'm glad I got the contracts in before the announcement and I'm glad I will have many more points to use in Maui and everywhere else.

 

[tschwa2]

Developers prices are always going up and the may use the excuse of new resorts to do so. New resorts esp. in NY and Hawaii are priced higher. It doesn't mean resale prices are going to be higher due to the new resorts. Salesforce will use any tiny excuse and twist it into a reason that you need to buy now, today.

 

[rfc0001]

The whole market (and world) functions in supply and demand. If they build more properties and demand stays the same, prices go down.

I'll use DVC as an example where this isn't the case. Let's use the new Poly DVC as a hypothetical example. Poly is already a highly desirable hotel resort (sell's out regularly), and DVC will be the only way to stay @ the bungalows, and will have the majority of lake views. So, the addition of Poly will make someone who previously always stayed at Poly (therefore didn't see a benefit of DVC) to now want to buy into the DVC system. They are going to want to do this as cheaply as possible, so that drives up demand for lower cost DVC properties (e.g. SSR). Poly will also drive up the price of Poly DVC, since that comes with the ability to book at Poly @ 11 mos instead of 7 -- which will be the only way to get the bungalows. This drives up Poly resale prices, therefore average resale prices. So, it is quite possible to increase demand while increasing supply, if the property being added will have more demand than the supply it's adding. For HGVC, I think the same situation exists with the addition of Maui -- people who want to stay at Maui historically have not been interested in HGVC (more likely Marriott). Now, HGVC is more valuable to them. Likewise, Maui will be in high demand for other HGVC owners as well, so will attract more new and resale buyers than HGVC did previously.

 

[theo]

If they build more properties and demand stays the same, prices go down. The only way for prices to go up are to limit supply and increase demand.

Planet Timeshare is a relatively complicated place and I'm not convinced that this broad generalization is accurate. One size simply does not fit all.
Frankly, I think that the overall economy has a whole lot more to do with timeshare prices (both developer and resale) than any and all new construction.

For starters, there are numerous assorted "chains", various pure points (no direct property affiliation / ownership) systems, as well as many small (often older) independent facilities which are not affiliated with any "chain", yet whose values are currently on the rise anyhow in a number of places with which I'm familiar.

I don't foresee much new timeshare construction occurring in too many places (although I admittedly possess no knowledge about the timeshare picture in Hawaii) --- and supply and demand and pricing will always fluctuate anyhow (irrespective of new construction), moving right in step with the overall economy health and climate.

 

[1Kflyerguy]

Seems everyone agrees this is mostly just sales talk to drive urgency.. That is pretty much what i thought as well.