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How to calculate buying a package for the desired $4-$5/k---please explain

#1 Cowboys Fan

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I have seen posters refer to looking for a package that is "...$4-$5/k".

Obviously this formula includes 1) Original Cost 2) Closing Costs 3) Maintenance Fees and 4) Taxes.

What other costs go into this calculation?

Let's assume someone buys 154,000 points for $1000 + 400 closing costs at Daytona, or Vegas (or use another if you wish).

Please plug in some other numbers to help me to understand how they would influence the desired $4-$5/k formula.

Thanks,
Pat
 

scottmindib

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Hello,

It's pretty easy to figure out if the Wyndham package is within range of what you want or not after you do a few of the calculations a couple of times. Here it is:

154K pt annually - $1000 bid price plus $500 closing = $1500 total investment
$1500 / 154,000 pts = ~ $.01 per point which is pretty good for points right now with them going for between .5 and 1.5 cents per pt.

The bigger issue to look at is what are the dues at the resort annually.

Take your total price of dues per year and divide that by your total points in K per year and that will give you your average cost per K points

ex. - I just bought a package of 154K pts per years and the dues are $630 per year. - $630 / 154K = $4.09 / K which is pretty darn good .

Of course you want to be as low on that MF ratio as possible so you are getting the most bang for your buck.

If you pay a low price for your points but they average over $6/K for the MF's then over the life of your account you are going to owe more than someone who is more towards the $4/K range. Make sure you calculate this out whenever looking at buying a package.

Remember - Top 2 GOALs when looking at purchasing Wyndham pts -
1) Pay as low a total of up front fees as possible for the most points as possible.

2) Calculate out the average dollar / K of MF's and try to get it as low as you can.

Hope that helps.

Scott
 

GeNioS

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For my money, having tracked several options, paying $1000 for 154k points is paying too much....just wait for one to come along that no one bids and you can have it with your one bid for $1 to $99. As I mentioned on another thread, for my 84k points, I paid $10.50 with $299 total costs...total cost $310.

Personally.....I don't think at "free" you need to do too much math anymore. Just buy a small package....at 84k points I don't really care if I'm paying an extra $1.50/1,000 in maintenance fees...what is that....$126/year? And that's billed monthly so we're not even talking two Big Mac combos a month difference. If $126/year is going to make a difference to me, no offense but I don't have any business buying right now.

Once you're in, rent the additional points you need at that $4-5/1000 level.

Others can chime in as they have a lot more experience than I do....everything I learned about timeshares I didn't learn in kindergarten. I learned it here. Just thought I'd throw out the thought process on my recent purchase.

Instead of worrying about maintenance fee ratios, at the current price of "free" I was more interested in finding the right resort, exchange system, number of points, etc. Is there a resort you want/need the priority reservation window? Do you have a preference of II or RCI for exchanges? For my money, those questions far outweigh the relatively small difference in maintenance fees, especially at the 84k point level.

I don't want to say that maintenance fees aren't important, and if all things are equal than obviously take the one with less. But I found that once I decided to "lock myself in" for less points (and therefore lower maintenance fees) and rent the difference, I was much more comfortable with the situation, stopped worrying about all the math, and moved forward.
 

scottmindib

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For my money, having tracked several options, paying $1000 for 154k points is paying too much....just wait for one to come along that no one bids and you can have it with your one bid for $1 to $99. As I mentioned on another thread, for my 84k points, I paid $10.50 with $299 total costs...total cost $310.

Personally.....I don't think at "free" you need to do too much math anymore. Just buy a small package....at 84k points I don't really care if I'm paying an extra $1.50/1,000 in maintenance fees...what is that....$126/year? And that's billed monthly so we're not even talking two Big Mac combos a month difference. If $126/year is going to make a difference to me, no offense but I don't have any business buying right now.

Once you're in, rent the additional points you need at that $4-5/1000 level.

Others can chime in as they have a lot more experience than I do....everything I learned about timeshares I didn't learn in kindergarten. I learned it here. Just thought I'd throw out the thought process on my recent purchase.

Instead of worrying about maintenance fee ratios, at the current price of "free" I was more interested in finding the right resort, exchange system, number of points, etc. Is there a resort you want/need the priority reservation window? Do you have a preference of II or RCI for exchanges? For my money, those questions far outweigh the relatively small difference in maintenance fees, especially at the 84k point level.

I don't want to say that maintenance fees aren't important, and if all things are equal than obviously take the one with less. But I found that once I decided to "lock myself in" for less points (and therefore lower maintenance fees) and rent the difference, I was much more comfortable with the situation, stopped worrying about all the math, and moved forward.


I don't want to start an argument here but I couldn't disagree more with this line of thinking.

Let me present my case by example:

Even if you get a small package of lets say 77-84K points for even $1 you still are going top pay $500 in closing costs ($399 closing fee and $100 Wyndham transfer fee). So that is a total of $500 upfront for an 84 K package with lets say $6 / K of dues per year = $504 / year in MF. This 84 K points will only get you several days in a 2 bedroom or a week in a 1 bedroom per year. You are paying $500 up front and over $500 per year in MF's for 84 K pts.

As opposed to - I just bought 154K pts for a total up front cost of $1000 and yearly dues of $630. This averages out to $4.09 per K in dues per year. I am paying $130 more per year for almost double the points.
You want as many points as possible for the least up front fee and you definitely want the lowest MF's possible.

You want to avoid the thinking that because the dues are less then it is better for me. Always, Always think average dollars / 1K points for MF's.

If you buy a smaller package in the beginning and have a high MF ratio you are stuck with those MF's and if you ever wanted to upgrade to a bigger point package no one will take them from you because the MF ratio is very high.

You should always look at the bigger picture in things and look down the road as well. 88K pts will not get you much in the way of a stay at any of the resorts and you will most likely want a bigger package so you can stay in a larger unit for at least a week or possibly longer in a smaller unit.

Wait, Wait , Wait until a bigger pts package comes up (154K) and only bid up to the amount that you think is a great deal. Keep doing that until you win one.

Also, if you buy a small package and want to add on later you will pay $500 in closing costs every time you buy another pts package.

You can rent from people but you will have to try to find the owners , negotiate , and work through their time frames as you want to rent. Also, you can only rent as many points per year as you own which will limit you.

Remember as well, Wyndham is charging a $129 guest certificate fee for owners who rent their points. SO unless you rent from a VIP owner the person renting to you may want you to cover this fee.

Just make sure you think long and hard about the entire Wyndham experience.
1) How much will you realistically be traveling per year?
2) Decide how many points that you want
3) Pay only what you want and don't go over that amount
4) Decide if you want to rent from people or not on a regular basis
5) Buy a package that if and when you go to sell it in the future (and no one knows exactly how long they will ever hold on to their points) will be worth something.

Scott
 

bnoble

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I happen to agree with the "$/K" line of thinking. I also like to compare with just a single number, so I tend to take 8% of the acquisition costs for opportunity/amortization and add that to annual costs to give me a baseline number for total costs per K.

That said, there are a couple of minor clarifications. At present, I believe there is no limit on the points you can transfer in from another owner, only on the points you can rent from Wyndham. Also, a points transfer does require a "transaction", but does not require a "guest certificate."
 

BocaBum99

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I don't want to start an argument here but I couldn't disagree more with this line of thinking.

Let me present my case by example:

Even if you get a small package of lets say 77-84K points for even $1 you still are going top pay $500 in closing costs ($399 closing fee and $100 Wyndham transfer fee). So that is a total of $500 upfront for an 84 K package with lets say $6 / K of dues per year = $504 / year in MF. This 84 K points will only get you several days in a 2 bedroom or a week in a 1 bedroom per year. You are paying $500 up front and over $500 per year in MF's for 84 K pts.

As opposed to - I just bought 154K pts for a total up front cost of $1000 and yearly dues of $630. This averages out to $4.09 per K in dues per year. I am paying $130 more per year for almost double the points.
You want as many points as possible for the least up front fee and you definitely want the lowest MF's possible.

You want to avoid the thinking that because the dues are less then it is better for me. Always, Always think average dollars / 1K points for MF's.

If you buy a smaller package in the beginning and have a high MF ratio you are stuck with those MF's and if you ever wanted to upgrade to a bigger point package no one will take them from you because the MF ratio is very high.

You should always look at the bigger picture in things and look down the road as well. 88K pts will not get you much in the way of a stay at any of the resorts and you will most likely want a bigger package so you can stay in a larger unit for at least a week or possibly longer in a smaller unit.

Wait, Wait , Wait until a bigger pts package comes up (154K) and only bid up to the amount that you think is a great deal. Keep doing that until you win one.

Also, if you buy a small package and want to add on later you will pay $500 in closing costs every time you buy another pts package.

You can rent from people but you will have to try to find the owners , negotiate , and work through their time frames as you want to rent. Also, you can only rent as many points per year as you own which will limit you.

Remember as well, Wyndham is charging a $129 guest certificate fee for owners who rent their points. SO unless you rent from a VIP owner the person renting to you may want you to cover this fee.

Just make sure you think long and hard about the entire Wyndham experience.
1) How much will you realistically be traveling per year?
2) Decide how many points that you want
3) Pay only what you want and don't go over that amount
4) Decide if you want to rent from people or not on a regular basis
5) Buy a package that if and when you go to sell it in the future (and no one knows exactly how long they will ever hold on to their points) will be worth something.

Scott
The flaw in your logic is that it is easier to rent Wyndham Points for LESS than $4.09/1000 points than it is to find a package such as the one you have described that you can buy for $1500 all in.

And, over time, it will become even easier as Wyndham continues to increase fees and the oversupply of rental points increases.

For instance, 154k in your example would cost you $630 in annual fees. You can rent that exact same reservation for $600 INCLUDING the $99 guest fee from a generous mega renter. So, the non-owner who didn't put up any capital can get it cheaper than the owner can in your example.

The disparity gets even worse when booking a reservation less than 60-days out where a platinum VIP can get it even cheaper. I think this is the primary reason why Wyndham added the $99 guest fee. They have done such a good job at devaluing ownerships that the megarenters were profiting too much from the collapse in both resale and rental points.
 
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scottmindib

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Boca Bum- Could you please give me the name of a person who will rent for $4 / K out the door and I will just donate my TS back to anyone for free who wants it.

The only thing here is that Wyndham has just raised their rental prices to $10 / K which is going to push people to rent outside of Wyndham. This will only increase the demand for points on rental sites which ultimately drive prices up.

It is best to own your own points with very low dues than to try to seek out phantom $4 / K renters who I have never seen before. I did get someone to rent to me for $5 / K this year but no one would go near $4 / K and I searched far and wide.
 

basham

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There is only one real marketplace for rental points from other owners and that is http://forums.WyndhamOwners.org

There have been posts there offering points at the $4/K, whether they are still available or not I don't know.

You could search and enquire.
 

GeNioS

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Stating a differing opinion isn't starting an argument. I'm happy to read it.

You should always look at the bigger picture in things and look down the road as well.
Just a few thoughts:

* There are no guarantees that the resort you buy with your lower fees today will have lower fees in the future.
* There is no question that mathematically your case is better. But we're talking about $10's and $100's...not thousands.
* Rental points are less expensive than maintenance fees in most cases..correct me if I'm wrong.
* Even in your case of $4.09/1000...If I can rent points at $4.25/1000, I'd rather pay the extra .16 and be obligated for less. If there was a way to pay Wyndham a $50 membership fee with NO points, I'd do that and rent all of them.

I think the keyword is obligation. I'm very happy to pay a few extra fees here and there to have less obligation. To me, that is the big picture. I'm still paying much less than hotel rates for much more space. But if maintenance fees jump I'm obligated for less of them.

I would be interested. How many Wyndham resorts have maintenance fees that are less than $4.25/1000?
 

bnoble

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Likewise, there are no guarantees that the point rental market will continue at its current rate. But, today's information is all we have to go on. Given that, being patient for a low MF deed---and even paying a few dollars more to acquire it---may be smart in the long run.

I'm not 100% convinced that the point rental market has stabilized. We've seen some panic selling by a few megarenters. Others have left the market entirely. But, since Wyndham changed the last set of policies, we haven't yet seen the next 10-month window prior to peak time. The tale won't be fully told until we see what happens with regular owners looking to book Christmas '09, Easter '10, or maybe even Summer '10.

I also think the smart megarenters will adjust their business models to the new reality, because selling for many isn't an option. I've already seen evidence of a few doing just that, but I suspect more will follow. As they do, they will find ways of making profit. Such opportunities exist. I recently rented a week that brought in $8.25/K---and that was with a lowball price. True, the days of easy pickings might be over, but there are still weeks out there with a good booking/value spread.
 

Jya-Ning

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$4-$5 /K I believe is total MF + club membership due, and as low as possible.

If you read people refer it as purchase price, you need to go back and see what that includes.

Generally when you purchase, it is Purchase cost + closing cost + SA (if there) + whatever discount you think is fair to the MF you need to pay for existing points that will end in less than 13 month when you get all transferred) - whatever seller's incentive, or gain in MF.


Most people use this equation
Purchase Price * (a reasonable %) + MF < a comparison value


To deterime what will be the max purchase price they want to bid. This will be their value

Than you look at the market you are in, and offer the min of your value and the market current offer.

The only thing that will be keep constant is the purchase price. All other can be changed.

Most people if they plan on use the one for their travel lodging they purchase, and plan to use it every year (or every other year if it is EOY contract), use the hotel cost for the duration they estimate the points can give them times a discount factor (just in case they over estimate). If you can find stuff constantly meet your need from priceline, that will be the price line range.

If they plan to just let the point expired every other years, but they will use it when they don't let it expired, the comparison price will be the lodging cost you can find divide by 2 times a safety factor.

If you plan to do rent out by transfer the points, for a while, the price is around $5/k up or down, so most time, I am using $5/k as comparison.

If you plan to do it as Brian did, and very sure it is about 8.5/k, the comparison will be 8.5 /( 1 + whatever a reasonable return you want).

The a reasonable % should be factor in how you get rid of them, what your outlook, when you plan to get rid of them, and how did you get your purchase money.

you can use 2% to 20% as you like. Some people are very good at making money from money, they will use 50%. Some people are very good at buy low and selling high, they can have 0% there. I usually found I am in the lossing end, so I am satisfied with 10%.

Than you come out your value.

Your value has nothing todo with what market offer.

If you are using eBay, you need to check eBay's complete listing to find out the past offer, you need to get a feeling how many get out in a day, and how many actually get a chance to get bid in the day from these listing. Factor in from long term history the season, ...

Than you look at the current offer in eBay, and make a reasonable assumption what the avg. price will be now.

And you should bid on the min. of your value against your estimate the avg. price will be.

If you just can not won, you probably estimate the market wrong.

If you valued it, and found you always can get, you overestimate your value.

Good luck.

Jya-Ning
 

rickandcindy23

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There aren't many under $4.25. I used to think Smoky Mountains was the absolute best purchase to make, but the fees are going up 13% next year. That's about 40 cents per 1,000, making them slightly higher than $4.25. So I am starting to think that buying them for less than $4.50 per 1,000 in MF's is okay, if they are a steal.

Some of the Fairfield Bay packages at $3.60 per 1,000 for now. Heaven only knows how that will go up. :rolleyes: Angelfire in New Mexico is under $3.00.
 

BocaBum99

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Boca Bum- Could you please give me the name of a person who will rent for $4 / K out the door and I will just donate my TS back to anyone for free who wants it.

The only thing here is that Wyndham has just raised their rental prices to $10 / K which is going to push people to rent outside of Wyndham. This will only increase the demand for points on rental sites which ultimately drive prices up.

It is best to own your own points with very low dues than to try to seek out phantom $4 / K renters who I have never seen before. I did get someone to rent to me for $5 / K this year but no one would go near $4 / K and I searched far and wide.
Send me a PM and I'll show you how to get 1M Wyndham points today for $4/1000. And, send me what you own, I may take your free Wyndham if it has more than zero value.
 

Timeshare Von

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I must admit, I was more than happy to acquire (for free) my sister's 77k point package at Myrtle Beach. I think my MF's for 08 worked out to $529 for the year . . . more than my fixed week 2BR unit at Flagstaff ($508). When I consider that my RCI membership would cost me between $70 and $89/year, my real MF cost is down to $440-$450 . . . a fair bargain in my book.

For my first year of owning the 77k points I rented them out . . . and for next year I've rented from someone on the Wyndham forum cited above so that I could get a week in New Orleans.

I think that the 77k points is a perfect sized package to tinker with, which can be flexible to work for us in many scenarios . . . especially since we own other Wyndham fixed weeks and a Hawaii floating week that is non-affiliated (an independent t/s resort).
 

bnoble

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How many Wyndham resorts have maintenance fees that are less than $4.25/1000?
I don't think any of the UDIs are, but I could be wrong. The absolute lowest fees, as far as I know, are larger prime-season units (usually lockoffs) from fixed-week resorts that are converted. The idea is that fixed weeks carry the same MFs no matter what the season; only the FSP fee scales. So, prime season fixed weeks have relatively low annual costs per K, but the quiet season weeks are absolutely dreadful.

I have a High (not Prime) 2BR lockoff at the Waterfalls section of Sea Gardens. If memory serves, it works out to be around $3.80/K, give or take a nickel. (It was higher, but went down when the HOA managed to get Florida to reassess the property for tax purposes.) Tom Cornelius had a Prime week at the same resort in his resale inventory, when last I looked.
 
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