Maintenance Fee Increases - What should we do to bring these down?

[DRH90277]

I've watched maintenance fee statements come in and the increases are high. It seems we should mount a campaign to bring these expenses down like a business would. How confident are we that our BOD's are capable of stepping forward to protect our interests by suggesting changes? I don't think we can rely on MVC to reduce "our" expense when their fees are tied to ever increasing costs.

Any suggestions?

 

[JIMinNC]

In my opinion, what we are seeing with timeshare maintenance fees is reflective of what's going on in the economy at large and is not specific to MVC or even timeshares more broadly. Our Hilton Head condo HOA fees increased 16% year-over-year. Our HOA fees at our primary residence in the Charlotte area are rising 10% for 2024. Fix inflation at the national level and timeshare maintenance fee increases should slow as well.

 

[Norcal5]

Funny that Disney went up 6-8%. Are they not subject to the same pressures? Hyatt wasn’t that bad either.

 

[DRH90277]

Funny that Disney went up 6-8%. Are they not subject to the same pressures? Hyatt wasn’t that bad either.

Part of it might be employee costs and staffing levels - Maybe we could be the third happiest place on earth.....

 

[cubigbird]

I don’t think Disney is 6-8%, only a few maybe but most are much lower. Same with Hilton. I think the real reason why we are here is most owners take the “you can’t fight city hall” approach and just say “don’t waste your time.” The developer knows this.

An HOA in Florida (with fully funded reserves) where we have a rental property made a ZERO % HOA dues increase YOY for 2024. I think “it’s just inflation” and “it’s Florida” and “It’s labor cost” are just excuses to justify it. Financial constraint and discipline by boards CAN absolutely be implemented. There’s just too much conflict of interest on the part of the timeshare company and no incentive to do so.

 

[DanCali]

I've watched maintenance fee statements come in and the increases are high. It seems we should mount a campaign to bring these expenses down like a business would. How confident are we that our BOD's are capable of stepping forward to protect our interests by suggesting changes? I don't think we can rely on MVC to reduce "our" expense when their fees are tied to ever increasing costs.

Any suggestions?

The main problem is that MVC has probably gained control over the BODs via the Trust. MVC dumps weeks in the trust for 13 years (excess inventory, ROFR, foreclosures), owners buy points, owners pay MFs, and MVC retails the voting rights for weeks in the trust. Eventually they vote for the BOD they want, and the BOD will look after their interests, which often diverge from actual owners' interests. For example - higher management fees - yes/no?

So to answer your question, unless I am totally off base, my confidence is 0%...

And owners defaulting on MFs leads to foreclosures, which leads to more weeks acquired cheaply by MVC, which leads to more profitability and more voting power. I still like our weeks but wouldn't touch trust points with a 100 foot pole. We're seeing the result on something that was in the works for over a decade, and "inflation" seems like a phony excuse. 33% at NCV in 2 years is not inflation... it's obscene.

Here are the DVC 2024 MF increases... Compare that to MVC in Orange County, FL (Orlando) and Orange County CA (NCV vs. Disneyland):

2024 Disney Vacation Club Annual Dues

The 2024 Disney Vacation Club Annual Dues amounts have been released. Learn what and when you'll need to pay your 2024 DVC Annual Dues!

dvcfan.com

 

[timsi]

Ironically, what was initially conceived as a position of strength for Marriott may now reveal itself as a notable vulnerability when you look closer. Do not the trustees of a real estate trust, like the trustees in any trust, bear a fiduciary duty to the trust beneficiaries? Among their responsibilities: duty of loyalty, duty of care, duty to inform and communicate, duty to avoid conflicts of interest, duty to act impartially, and the duty to prudently manage assets. In a real estate trust, these duties specifically pertain to the management, acquisition, and disposition of real estate assets held within the trust. How can Marriott effectively balance responsibilities to both the owners of the trusts and its obligations as a public company?

 

[Dean]

Funny that Disney went up 6-8%. Are they not subject to the same pressures? Hyatt wasn’t that bad either.

Disney historically has higher fees to start with so they should have more room to absorb some of the increase. Also, they may have funded the reserves better which means they didn't have to adjust as much. In addition they've not been nearly as c/w refurbishments which should also give them more flexibility.

 

[dioxide45]

Disney historically has higher fees to start with so they should have more room to absorb some of the increase. Also, they may have funded the reserves better which means they didn't have to adjust as much. In addition they've not been nearly as c/w refurbishments which should also give them more flexibility.

If Disney is the trend setter on labor costs in Orlando, I would expect their fee increases to be at least a year or two before the other resorts. If you look at DVC 2022 vs 2023 they are more in the 5%-8% range. Still way below where Marriott and Sheraton were in Orlando those years.

Also what is c/w?

 

[Dean]

If Disney is the trend setter on labor costs in Orlando, I would expect their fee increases to be at least a year or two before the other resorts. If you look at DVC 2022 vs 2023 they are more in the 5%-8% range. Still way below where Marriott and Sheraton were in Orlando those years.

Also what is c/w?

Consistent with

 

[Hindsite]

Get active with your resort owner board, is what it takes. Some resorts seem better or more inclined to keep fees down, others not so much. The drivers for cost increases vary by resort, so you need to understand the numbers and raise questions with the owner board and management team. You need to be doing that year after year to have any meaningful impact or credibility.
There are always factions driving one position or another among resort ownership. Some will drive lowest cost at any cost and the resorts can become drab. Others will be constantly clamouring for extras that increase fees. Many, may not feel motivated as they see their ownership gives them value.
Not all resort management teams will be of the highest quality and that can vary over time as well.
There is no campaign needed, just get involved and support your BoD and the management team to do the best they can for the resort. Sure MVC corporate has a vested interest in raising their income, but I've never got the sense from the management teams that I've spoken to that they don't work hard to do the best they can with what they have.
They are really good at ignoring uninformed adversarialism, as lots of people huff and puff and then get bored and give up, so avoid that if you want to actually improve things.

 

[wuv pooh]

Disney historically has higher fees to start with so they should have more room to absorb some of the increase. Also, they may have funded the reserves better which means they didn't have to adjust as much. In addition they've not been nearly as c/w refurbishments which should also give them more flexibility.

I would also think that sharing facilities with resort hotels for most of their properties would also give them more flexibility to share costs wherever they think is most appropriate. Vero Beach is probably a better comparison. Plus the units are just so damn cheap. My Saratoga unit this year did not even have real kitchen cabinets, just half cabinets and facades. Of course design choices like that are cheaper but I prefer real finishes in a high end product.

 

[Dean]

I would also think that sharing facilities with resort hotels for most of their properties would also give them more flexibility to share costs wherever they think is most appropriate. Vero Beach is probably a better comparison. Plus the units are just so damn cheap. My Saratoga unit this year did not even have real kitchen cabinets, just half cabinets and facades. Of course design choices like that are cheaper but I prefer real finishes in a high end product.

Sounds like a studio. DVC has routinely ha lower quality in some aspects. It's been a while since I've dug into the yearly financials but when I have it has appeared the split use model has been less favorable to the DVC component and more so to the hotel component mostly by how they share the outside costs like transportation. They also tend to have smaller units not unlike a high end resort area like HI or Aruba, excluding OKW. For VB it depends on whether one has a subsidized ownership or not, same for Aulani.

 

[wuv pooh]

Sounds like a studio. DVC has routinely ha lower quality in some aspects. It's been a while since I've dug into the yearly financials but when I have it has appeared the split use model has been less favorable to the DVC component and more so to the hotel component mostly by how they share the outside costs like transportation. They also tend to have smaller units not unlike a high end resort area like HI or Aruba, excluding OKW. For VB it depends on whether one has a subsidized ownership or not, same for Aulani.

No, unfortunately that was a 2 bd. Fake cabinets, fake tile for a backsplash, no stone for countertop, cheapest non wood durable floor, small TV, etc. I am sure it is good for maintenance, but not my cup of tea.

 

[LUVourMarriotts]

I'd like to hear anyone who is on a BOD at a MVC location to let us know their thoughts on this. We must have at least some members of different BOD here on TUG. I recently spoke to a BOD president and he provided me with several reasons why MF's will only continue to increase with barely any BOD capability to slow the increase. Our conversation was not just about now, but also, what's it going to be in 5 years, 10 years, etc. He only had concern that this MVC model at many resorts are not sustainable as a product. Sure, there are MVC locations where MF's are still a great value over staying as a cash renter. But several are not.

 

[Dean]

No, unfortunately that was a 2 bd. Fake cabinets, fake tile for a backsplash, no stone for countertop, cheapest non wood durable floor, small TV, etc. I am sure it is good for maintenance, but not my cup of tea.

The 1 & 2 BR there have small kitchens as do most of the newer resorts. The fake cabinets/drawers were in areas that are not generally used well such as over the sink. They are functional for the way most would use a unit at Disney IMO. The studios on the other hand are subpar in their furnishings and set up.

 

[rickandcindy23]

I don't know what fake cabinets and countertops you are talking about. The floors seem to be luxury vinyl, which are very durable and not cheap. We put it in our basement and at the townhouse when we finished it. Beautiful flooring.

Marriott/Vistana is a cut above everything else in Orlando, except when I have a chance to book something else, I wouldn't book Vistana in Orlando, I would book Villages, but only if I couldn't get Marriott.

 

[Dean]

I don't know what fake cabinets and countertops you are talking about. The floors seem to be luxury vinyl, which are very durable and not cheap. We put it in our basement and at the townhouse when we finished it. Beautiful flooring.

Marriott/Vistana is a cut above everything else in Orlando, except when I have a chance to book something else, I wouldn't book Vistana in Orlando, I would book Villages, but only if I couldn't get Marriott.

For SSR there are 2 locations that I am aware of in the kitchen where there is just a facade and not a cabinet. It's the area over the fridge which most locations don't use anyway. I forget the specifics for the other one.

 

[wuv pooh]

I don't know what fake cabinets and countertops you are talking about. The floors seem to be luxury vinyl, which are very durable and not cheap. We put it in our basement and at the townhouse when we finished it. Beautiful flooring.

Marriott/Vistana is a cut above everything else in Orlando, except when I have a chance to book something else, I wouldn't book Vistana in Orlando, I would book Villages, but only if I couldn't get Marriott.

Not trying to be antagonistic, just my opinion, and a reason why it is cheaper.

Here is the kitchen I was in:

The cabinets above the fridge and microwave are facades. The backsplash is 1/4" plastic glued on, not tile. The drawers are 1/4 - 1/2 depth, the uppers are half depth. The countertop is I don't know. It is not granite, marble, or quartz. Prep space is low, fewer SF of counter. Compared to my Manor Club kitchen, this is probably half the cost?

For me, a kitchen is a big deal and I enjoy having a kitchen on vacation that is nicer than my kitchen at home. Others might not care, but it was just a constant annoyance to me whenever I tried to cook. It is also significantly cheaper to maintain and update, which is one way to cut down on maintenance fees, and DVC was quoted as doing a better job.

 

[Dean]

Not trying to be antagonistic, just my opinion, and a reason why it is cheaper.

Here is the kitchen I was in:

View attachment 84843​

The cabinets above the fridge and microwave are facades. The backsplash is 1/4" plastic glued on, not tile. The drawers are 1/4 - 1/2 depth, the uppers are half depth. The countertop is I don't know. It is not granite, marble, or quartz. Prep space is low, fewer SF of counter. Compared to my Manor Club kitchen, this is probably half the cost?

For me, a kitchen is a big deal and I enjoy having a kitchen on vacation that is nicer than my kitchen at home. Others might not care, but it was just a constant annoyance to me whenever I tried to cook. It is also significantly cheaper to maintain and update, which is one way to cut down on maintenance fees, and DVC was quoted as doing a better job.

Not antagonistic at all. IMO the kitchen is less of an issue for MOST people for WDW than for other locations but there are exceptions like you. Thankfully there are other options. Personally I enjoy both on and off property for different reasons. Those very shallow drawers and limited numbers are a much larger issue IMO. It's part of the price of being on property esp for the cheaper options. As I've said before, in many ways OKW & SSR are moderates within DVC partly because of location but not completely. The 1 & 2 BR are infinitely better than the studios IMO, esp compared to MVC studios.

 

[Nonnie Capurro]

I've watched maintenance fee statements come in and the increases are high. It seems we should mount a campaign to bring these expenses down like a business would. How confident are we that our BOD's are capable of stepping forward to protect our interests by suggesting changes? I don't think we can rely on MVC to reduce "our" expense when their fees are tied to ever increasing costs.

Any suggestions?

Like everything else in life prices go up every year. It is what it is!

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[DRH90277]

Like everything else in life prices go up every year. It is what it is!

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I'm not so naive as to accept your answer. Serious people in business find ways to minimize the impacts of increasing prices one way or another. Management accountability and initiative is an essential part of controlling and reducing costs. Perhaps, we need to change the perception that we will accept whatever they bill for MF's. Technological advances should also be reducing headcount and costs.

I know I could do without the concierge desk at most properties as most of them could double at the front desk. Oh, I forgot, who would be able to capture guests for sales presentations masked as information seminars?

 

[rickandcindy23]

I have been worried that Marriott will start charging exchangers a per-day fee like Hilton and Diamond have been doing for years. If it saves on MF's, that could help, BUT it would probably pad the pockets of Marriott and not help owners one bit.

The fees Hilton/ Diamond and other resorts are charging are a turnoff for me, so I don't advocate them doing it.

 

[Hindsite]

I know I could do without the concierge desk at most properties as most of them could double at the front desk. Oh, I forgot, who would be able to capture guests for sales presentations masked as information seminars?

Do you know that the concierge (marketing desk) are paid for by maint fees, in full or part?
In many resorts there is a jumble of different funding routes, which cover, sales and marketing, owner maint fees and MVC businesses (restaurant, marketplace, golf and spa).
I have observed that it continues to surprise "owners" how little they actually "own" and what they actually pay for via their maint fees.
When cries of "I pay too much in maint fees for the terrible restaurant service" are met with, "you don't pay for it via your maint fees" stunned silence is often the response.

 

[dioxide45]

I'm not so naive as to accept your answer. Serious people in business find ways to minimize the impacts of increasing prices one way or another. Management accountability and initiative is an essential part of controlling and reducing costs. Perhaps, we need to change the perception that we will accept whatever they bill for MF's. Technological advances should also be reducing headcount and costs.

I know I could do without the concierge desk at most properties as most of them could double at the front desk. Oh, I forgot, who would be able to capture guests for sales presentations masked as information seminars?

As far as I know, the concierge is paid by marketing/sales. If they aren't, they should be. Any wisp of asking you to sign up for an "owner update" means owners shouldn't cove the cost. If marketing and sales wants to also call themselves a concierge as a way of sucking in their pray, I am okay with that as long as owners aren't paying for it.