Maui Resort Property Tax increase significantly?

[DanCali]

I agree Lisa - I don't know why anyone would sell their WKORV week, take a $25K loss, and then turn around and buy at WKV! Talk about throwing good money after bad! If/when I decide to get out, I will be done with Starwood!

Those are two separate decisions.

(1) Sell WKORV and take the loss, whatever it happens to be?

(2) Buy WKV?

I understand you think buying WKV is unwise. But why? Is it because you think Platinum season there is too expensive? Is it just a matter of price or you wouldn't even take one free because it's Starwood?

How about a decision to sell WKORV? Hanging on to it because one incurs a loss is more of a psychological thing and less of a rational decision... If you think Starwood is that bad, you can still exit and get a reasonable price. If you think Starwood still has merits (which I do), then my claim is that owning WKV has many more merits than WKORV... personally, I'd even settle for the dreaded highway view if it means paying half of the MFs (but that's easy for me to say having had a stake in an IV unit to begin with...).

 

[jarta]

DanCali, ... "Why do you think nobody is considering that? It's definitely something I'm even more than considering And I'm probably not the only one..."

From the reactions, maybe you are the only one.

Can't fathom why, if you really like going to WKORV-N and hate the MFs, you wouldn't trade even up for WKV to continue access and loer carrying costs. Maybe you and I are nuts. ... eom

 

[DanCali]

DanCali, ... "Why do you think nobody is considering that? It's definitely something I'm even more than considering And I'm probably not the only one..."

From the reactions, maybe you are the only one.

Can't fathom why, if you really like going to WKORV-N and hate the MFs, you wouldn't trade even up for WKV to continue access and loer carrying costs. Maybe you and I are nuts. ... eom

HA! I guess we finally found one issue we agree on...

 

[jerseygirl]

Dan -- I think you place way to much faith in the concept that WKV is not going to have huge maint fee increases in the future. Granted, they won't have the tax situation, but I think Starwood has proven, time and time again, that controlling costs is not a priority. In fact, I'd go so far as to suggest that their past behavior suggests quite the opposite.

Separate subject -- I don't know if anyone follows the HGVC threads but someone made what I think might be a very prolific statement there today. A relatively new poster was asking about the potential for Hilton to change the rules as they relate to resale purchases. This was part of the response:

3. HGVC must allow resale, if they dont, they will wind up with a ton of forclosure units and this will ultimately cause a negative impact on their product. Why would anyone buy retail when they know that they will never be able to sell it through resale. I believe this will cause the market to crash.

You can see the whole thread here, but I think we've discussed tons of reasons for the huge maintenance fee increases, but I don't think I've really thought about the impact of "voluntary vs. mandatory" on the deliquency and foreclosure rates until today. Good food for thought on the impact the policies have on maintenance fee rates at voluntary resorts.

http://tugbbs.com/forums/showthread.php?t=114653

 

[DeniseM]

How about a decision to sell WKORV? Hanging on to it because one incurs a loss is more of a psychological thing and less of a rational decision...

Try to find one post where I ever claimed to be rationale!

Is it just a matter of price or you wouldn't even take one free because it's Starwood?

Under the current management and their policies, I have zero interest in buying more Starwood timeshares.

I am also a view snob - I would be very unhappy to trade in and get the dreaded Highway view... I'd rather not go at all.

 

[Hole19]

WKV is abbreviation for.....???

 

[DeniseM]

Westin [Kierland] Villas - for a complete list of the many acronyms we like to throw around, see the list in Starwood Owner Resources, at the top of the forum.

 

[RLOGO]

WKV is abbreviation for.....???

Westin Kierland Villas. The Starwood Owner Resources sticky above has a list of abbreviations.

Denise,

Beat me to it again.

 

[Hole19]

Thank you DeniseM and RLOGO!! I was hoping there was a place to learn the acronyms!

 

[LisaRex]

Westin Kiernan Villas

Silly, Denise. She means Westin KIERLAND Villas.

 

[DeniseM]

Sorry - I was holding a screaming baby and typing with one hand!

 

[Ken555]

I am also a view snob - I would be very unhappy to trade in and get the dreaded Highway view... I'd rather not go at all.

FWIW, I'm at WKORV-N this week in building 7, high floor, with a great ocean view. And I'm here with an II SVR trade. It might have to do with when I place my trades, or that the resort isn't at capacity, but I have yet to have a highway view. Last Sept I was at WKORV on another II trade, and was in building 2 with an OV. Ironically, I've had great results with the II trades - in fact, they may have actually been in better units than when I visited using my SO's.

 

[DeniseM]

I agree Ken - you have a great chance of getting a good view, but I am locked into the school schedule & my husband's rather inflexible schedule, and we usually have to go 4th of July week or another prime time, so I'm not willing to chance it. That's why we bought 2 OF weeks on Kauai.

 

[DanCali]

Dan -- I think you place way to much faith in the concept that WKV is not going to have huge maint fee increases in the future.

I actually think WKV also had large fee increases over the years (I think it's about 50% increase since 2004 - certainly in line with Starwood's internal CPI metrics...) and I can only hope they don't get out of control.

I do however think that resale values will remain more stable at WKV in general and here is why:

I view the resale value composed of two components. The first is the value you get from using the VOI relative to "comparable" accomodations (hotels, direct rentals, VRBO etc.) This is why many timeshares in Orlando have low valuations - because MFs are not low enough compared to alternatives. As MFs rise compare to comparable alternatives, this component of the resale price drops. We saw this recently with 30% WKORV resale price declines due to the tax increase.

The second component to the resale value is the value you get from the option of "trading up". This component of the price explains why mandatory resort SVV (2BR Lockoff with MFs = $1600) still sells for $3K-$4K while comparable accomodations at voluntary resort SVR (2BR MFs = $900) have zero resale value. With SVV you can trade into a 1BR in Hawaii or possibly into a 2BR at HRA in the summer or fall.

Now you can start thinking how MF increases affect resale values in various places. For example, everything else unchanged, an MF increase at WKORV will lower resale values at WKORV for reasons discussed above. But what is less obvious is that it can actually increase resale values at WKV because the option to trade to Hawaii can now be perceived to be more valuable. Conversely, an increase in MFs at WKV would reduce resale values at WKV both because usage is less attracive and the option to trade to Hawaii may be perceived less attractive.

Arguably, the most desired (and expensive in terms of MFs) resorts WKORV/N, HRA, WSJ are not bought to be traded internally so the option to trade is not that valuable. The main value is from usage. Increasing MFs erode the resale value (our equity). At resorts like WKV and SVV, the option to trade internally has substantial value, at least the way the market prices it. I would in fact argue that there is no value in buying SVV to use... the entire resale value of SVV is based on the option to trad within SVN becuase comparable SVR, which has much lower MFs, cannot be sold for even $1. Even at WKV I would maintain that most or all of the resale value comes from this option. Otherwise why would SDO sell for 10% of WKV price? WKV has 50% higher MFs offset by a nicer resort but if WKV was voluntary it would probably sell at similar prices to SDO in the respective season.

So if MFs at WKV continue to go up it affects its resale value negatively, but that should be offset at least in part if MFs at other resorts also go up... Putting it a different way - if MFs at WKORV and WKV go up 50% over the next few years they will be $3800 at WKORV and $2000 at WKV; my argument is that WKORV will lose a lot more in resale value (both in percentage and dollars) than WKV. Of course if fees are in a death spiral and SVN ultimately implodes none of this matters...

 

[James1975NY]

I actually think WKV also had large fee increases over the years (I think it's about 50% increase since 2004 - certainly in line with Starwood's internal CPI metrics...) and I can only hope they don't get out of control.

I do however think that resale values will remain more stable at WKV in general and here is why:

I view the resale value composed of two components. The first is the value you get from using the VOI relative to "comparable" accomodations (hotels, direct rentals, VRBO etc.) This is why many timeshares in Orlando have low valuations [......................................................]

Very well said.

 

[zinger1457]

FWIW, I'm at WKORV-N this week in building 7, high floor, with a great ocean view. And I'm here with an II SVR trade. It might have to do with when I place my trades, or that the resort isn't at capacity, but I have yet to have a highway view. Last Sept I was at WKORV on another II trade, and was in building 2 with an OV. Ironically, I've had great results with the II trades - in fact, they may have actually been in better units than when I visited using my SO's.

Was at WKORV-N two weeks ago, traded in using staroptions. Asked for an ocean view and was given an ocean front, building 8. There seemed to be a lot of guest staying just for the weekend, there was a noticeable drop off in people at the resort during the week days.

 

[Hole19]

Oddly enough we are owners at WKORV and went to WKV to see family in June 2009. We booked 8 months in advance and by no means were we "upgraded". Had a partial view of a golf course fairway but nothing spectacular. I think it was building 7. We were sort of off to the side and they were re-paving the parking lot while we were there. I guess I just find it funny that a WKV member can come to Maui and get OF and we go to Arizona and get the leftovers. June in AZ isn't exactly prime-time!
I'm happy for anyone who has a great view and wonderful vacation but the "system" seems to be a little out of whack!!

Honestly, glad you had a great trip Zinger!!

 

[jerseygirl]

Dan -- you are absolutely correct but that's not new information. It's been that way since seenet published his original article that clarified Voluntary and Mandatory resorts, circa 2003. And, since that date, maintenance fees at WKV have risen dramatically and resale prices have dropped dramatically ... so have those people who have been buying for years using your same justification/rationale really come out ahead? I can see WKORV with unbranded timeshares with maintenance fees under $500 -- in fact, I've given two weeks as wedding gifts for about $600/week.

Is it easier to trade in with SOs? Of course. But, there's a hefty cost associated with it. I'm simply pointing out that history indicates that those costs will only increase at a rate much greater than other timeshare systems. (Of course, past performance is no guarantee of future performance,, but IMO, the long-term outlook for Starwood properties is not good unless some dramatic changes occur.) If someone absolutely has to have prime-time (e.g., 4th of July) at WKORV/N, they need to buy WKORV/N. If not, they can trade in with properties that cost MUCH less than WKV, both on an upfront and ongoing basis. Your point regarding Harborside is somewhat valid as it is most assuredly easier to get in with SOs than on an exchange, but even then -- summer SO trades are very rare, and the same weeks that are historically available with SOs generally end up in II as well. I don't think there's a long-term SVN-member alive who would advise anyone to buy WKV/SVV to get into Harborside every year ... unless that buyer is always willing to go in January (cold), early May, hurricane season, or the dead weeks between Thanksgiving and Christmas. And, again, those same weeks have historically been available via II (I know that for sure, as I have picked up at least one every year since about 2004).

 

[Ken555]

I don't think there's a long-term SVN-member alive who would advise anyone to buy WKV/SVV to get into Harborside every year ...

Um... me?

unless that buyer is always willing to go in January (cold), early May, hurricane season, or the dead weeks between Thanksgiving and Christmas.

Oh, never mind.

And, again, those same weeks have historically been available via II (I know that for sure, as I have picked up at least one every year since about 2004).

Nice. When I'm not traveling in a large group (which is most of the time) and head to Harborside, I like to stay for 9-10 days. Using StarOptions rather than II actually is less expensive, based on my MF for WKV, vs using one of my other weeks via II (of course, a less expensive resort will net lower costs than my SVR weeks). In any case, this is where SOs can make a difference. For example I was there last May in a small 1-bed (corner unit) and it only cost 55,000 SOs for 9 nights.

 

[jarta]

Hole19, ... "Had a partial view of a golf course fairway but nothing spectacular. I think it was building 7. ... off to the side and they were re-paving the parking lot while we were there. I guess I just find it funny that a WKV member can come to Maui and get OF and we go to Arizona and get the leftovers."

I don't understand the "partial" golf course fairway view from Building 7 at Kierland. All there is is a golf course view directly across 2 fairways for every one of the units in Building 7 - with single family homes behind the fairways and the mountains far in the distance.

Perhaps you were in the smaller 1-br where the balcony was set back in the building and the view is not as broad in scope. But, you were not discriminated against. All small 1-brs at Kierland have the set back balcony and, in part, it is done to avoid the effects of the broiling Phoenix sun during summer and make the units retain the coolness of the air-conditioning.

The repairs at the parking lot would not have affected your view. None of the balconies look at the parking lot. They look the other way.

However, for obvious reasons, there are no ocean views at Kierland. In one of the buildings toward the center of the grouping, you (and the balconies) look at the pool. All the rest have views directly across 2 golf course fairways. Most people prefer the golf course views to the pool view. To each his own, though.

If placed in Building 7 (or 6) you were placed in the newest part of the resort. I would not consider the newest section "leftovers." Sorry you felt that way.

The only "upgrade" anyone gets is a higher or better view of the mountains in the distance. Personally, I like the NE mountain views and the location of Building 3 (close to the adult pool, main office and snack bar, but a longer walk to the parking lot). However, I've stayed at and liked both 7 and 6. My only criticism is that they are the buildings farthest from the pool area. ... eom

 

[jerseygirl]

Nice. When I'm not traveling in a large group (which is most of the time) and head to Harborside, I like to stay for 9-10 days. Using StarOptions rather than II actually is less expensive, based on my MF for WKV, vs using one of my other weeks via II (of course, a less expensive resort will net lower costs than my SVR weeks). In any case, this is where SOs can make a difference. For example I was there last May in a small 1-bed (corner unit) and it only cost 55,000 SOs for 9 nights.

Good point -- SOs allow you to stay for "non-traditional" timeshare timeframes. But, again, there's a cost if you're using a resort (i.e. a Starwood resort) with higher maintenance fees than another resort that can be used to trade in during traditionally low-occupancy weeks. And --- you're making part of my argument for me since you didn't need anywhere near 148,100 SOs!

If a consistent Starwood preference period was in effect, I might change my position (just a little ). I saw there was some good news on that front today with the latest WKORV bulk bank, but it's sure been missing lately (like a lot of Starwood policies -- lack of consistency!).

 

[grgs]

Your point regarding Harborside is somewhat valid as it is most assuredly easier to get in with SOs than on an exchange, but even then -- summer SO trades are very rare, and the same weeks that are historically available with SOs generally end up in II as well. I don't think there's a long-term SVN-member alive who would advise anyone to buy WKV/SVV to get into Harborside every year ... unless that buyer is always willing to go in January (cold), early May, hurricane season, or the dead weeks between Thanksgiving and Christmas. And, again, those same weeks have historically been available via II (I know that for sure, as I have picked up at least one every year since about 2004).

I may have just lucked out, too. But with my WKV options I was able to book the following at Harborside for this year:

16 days in mid June-early July in a small 1 bedroom

AND

7 days in late June-early July in a small 1 bedroom

Given the talk of how difficult this exchange was, I was pleasantly surprised. I think 23 days at Harborside is an outstanding use of my WKV unit and well worth the mf (works out to less than $60/day). I originally only planned to book the 16 day reservation, but then realized I had enough SOs left for another week. So I called the following weekend and was lucky to get the second reservation. I'm happy to say my sister-in-law and her family will be using the second unit.

But I do agree with you that it would be highly unlikely that I could make this trade regularly. I'll just be grateful for my good fortune this time out.

Glorian

 

[DavidnRobin]

Given recent posts - it appears that WSJ and HRA are getting easier to exchange into.

I have rented, stayed, and SVN exchanged our WKV 1Bd Plat/Prem weeks - all good values.

 

[Ken555]

I think 23 days at Harborside is an outstanding use of my WKV unit and well worth the mf (works out to less than $60/day).

SUPER use of WKV SOs! Congrats, Glorian!

 

[jerseygirl]

Glorian -- that's a great trade. Good for you!

David -- I think you're right that things are easier right now ... probably due to the economy, but I hope it lasts. I too was able to get a Harborside trade with SOs recently ... and it was after the 8-month mark, but I attributed it to the fact that I was asking for Labor Day week, when all the NE kiddies are back in school and hurricanes are a risk. I called religiously a couple of months ago, trying to change our late May week to a late June/early July week, at 9:00 on the dot. I never had the luck that Glorian had. I found availability once -- but the rep said she couldn't hold it until she processed my May cancellation and it would likely be gone by the time she finished processing the cancellation. Since I was afraid I would lose my May reservation (stuck between a rock and a hard place!), I didn't take it. Moral of the story -- those with available SOs have an edge over those trying to change a reservation. We're renting the May weeks instead as we are going to Hawaii for 2 weeks to celebrate dd's college graduation, and then heading to St John for 2 weeks (with 48 hours or so in Florida as a stopover). Have you decided if you're using your week 23? If so ... would love to meet ... I'll buy you and Robin a drink! Perhaps we could even share the costs of a charter and go island hopping! I've been in touch with these guys --- you only get the basics (i.e., no bathroom on the boat, BYOB and food), but they get wonderful reviews and their price is terrific!

http://www.lionindasun.com/aboutCharter.html