New Buyer: Weeks or Points?

[Password is taco]

New to timeshares (owning not using) and getting up to speed on the different options. So far I think I like Marriott based on the number, variety an quality of locations they have.

So my question, for the experienced owners, is if you were buying into Marriott today, starting from zero, would you buy weeks or points? Based on my poking around this forum, points for an equivalent week is much more expensive but weeks are becoming less valuable from a flexibility perspective with the growth of the points program.

For example, if I wanted to buy a week at Newport Coast, 2 bedroom platinum week, the upfront cost (based on ROFR metric) would be about $8000. The equivalent point contract would require 3,475 points and would cost about $34,750. If I'm reading correctly, the annual maintenance and other fees would be significantly higher for points as well. Am I understanding this correctly?

I'm still learning, but to me the points system make no sense at all from a financial perspective. On the other had, I don't want to buy into the weeks system if I'm not going to be able to use it effectively for trading and what not.

 

[davidvel]

New to timeshares (owning not using) and getting up to speed on the different options. So far I think I like Marriott based on the number, variety an quality of locations they have.

So my question, for the experienced owners, is if you were buying into Marriott today, starting from zero, would you buy weeks or points? Based on my poking around this forum, points for an equivalent week is much more expensive but weeks are becoming less valuable from a flexibility perspective with the growth of the points program.

For example, if I wanted to buy a week at Newport Coast, 2 bedroom platinum week, the upfront cost (based on ROFR metric) would be about $8000. The equivalent point contract would require 3,475 points and would cost about $34,750. If I'm reading correctly, the annual maintenance and other fees would be significantly higher for points as well. Am I understanding this correctly?

I'm still learning, but to me the points system make no sense at all from a financial perspective. On the other had, I don't want to buy into the weeks system if I'm not going to be able to use it effectively for trading and what not.

Other than the fact that there's no real evidence that the points system has materially affected trading, I think you've summed it up quite well: Its next to impossible to economically justify buying points.

 

[jont]

Other than the fact that there's no real evidence that the points system has materially affected trading, I think you've summed it up quite well: Its next to impossible to economically justify buying points.

My advice would be to buy a week at a resort would go to at least every other year. A platinum Newport Coast should be a good trader, but keep in mind that their platinum season is very long and that competition for obtaining a ressie for a prime summer week, from what has been reported here, is fierce. good luck with your decision.

 

[jcjl1]

Not on Resale Points Market

For example, if I wanted to buy a week at Newport Coast, 2 bedroom platinum week, the upfront cost (based on ROFR metric) would be about $8000. The equivalent point contract would require 3,475 points and would cost about $34,750.

You should be able to purchase resale points for about half that, all in.. No restrictions except you must buy in intervals called interests and pay the junk fees. Plenty of info on this board.

 

[Password is taco]

You should be able to purchase resale points for about half that, all in.. No restrictions except you must buy in intervals called interests and pay the junk fees. Plenty of info on this board.

Even at half of that (~$17,000) is way more than the purchase of the equivalent week. Not to mention higher annual/maintenance costs. Maybe there is some additional value for the additional cost? I'm hoping to learn what that is. Also hoping to learn if there are any downsides to owning the week vs owning the points?

 

[Password is taco]

My advice would be to buy a week at a resort would go to at least every other year. A platinum Newport Coast should be a good trader, but keep in mind that their platinum season is very long and that competition for obtaining a ressie for a prime summer week, from what has been reported here, is fierce. good luck with your decision.

Thank you, great advice.

And, Dude, sorry about your rug. It really tied the room together.

 

[Password is taco]

Other than the fact that there's no real evidence that the points system has materially affected trading, I think you've summed it up quite well: Its next to impossible to economically justify buying points.

Good to know. I thought I had heard trading was a bit harder due to reduced inventory, but maybe that hasn't been proven out.

 

[ecwinch]

I heard that during the sales presentation also. Seems like it will only happen when MVCI stops making bulk deposits into II, which as of yet has not happened.

 

[jont]

Good to know. I thought I had heard trading was a bit harder due to reduced inventory, but maybe that hasn't been proven out.

it really tied the room together!

 

[jont]

it really tied the room together!

oops, wrong post. one too many caucasians.

 

[CCR]

I own weeks. I have found that buying a lock out unit is great for trading. My gold season Mountainside has been a great trader pulling Hawaii, NCV, Aruba, etc. Availability in Interval is still good for trading (but school holidays can be a challenge at high demand resorts. I also own NCV and I'm sure that unit could pull some great trades but prefer to use the lock out unit instead in order to get 2 trades (or more) for 1 year of maintenance fees. If you can pick up points on resale that are affordable I do think the Marriott points are very flexible and owners are liking it.

For now I'm happy with my weeks but if Marriott ever offered to let resale owners convert over to points again, I'd definitely consider it.

 

[JIMinNC]

Why not both weeks and points?

With a bundled package of a resale week from Marriott Resales and a matching point purchase, you can minimize the number of Trust points you have to buy and drive the blended cost of legacy and Trust points down to around $7 per point. You then get to play in both the weeks and points systems.

Yes, the cost will still be higher than a pure resale weeks purchase, but the real question then becomes what value do you place on the greater flexibility and options that points offer? If shorter stays of less than 7 nights are important, or the ability to book different unit sizes, views, and seasons depending upon your needs for a specific trip, then weeks can't really do that. We are happy owners of a bundled package and love the flexibility of points. See this post in another thread:

http://tugbbs.com/forums/showpost.php?p=1782234&postcount=8

We love our points, but will also try some II up-trades with our week that came with the package. We think the flexibility was well worth the higher price.

But if you are content with 7 night trips, usually book the same unit size in the same season, and/or are content playing the II trading game, then resale weeks will certainly get you in at a lower price point.

 

[JIMinNC]

Its next to impossible to economically justify buying points.

I disagree. Depending on your needs, and if you use your points wisely, there is significant value in the increased flexibility of points. A couple examples:

-- The 4 night trip I have booked in Hilton Head at Harbour Point for next April during the Heritage PGA week could not have been booked at all with Weeks, but only took 650 points (MF or point rental cost of around $300 or so). Booking that same 4 nights on Marriott.com would have cost around $1500.

-- Our week in Maui next summer in an oceanfront 2BR cost us two years worth of enrolled and Trust points (MF cost of about $2000 per week for a total cost of $4000). I suspect an oceanfront view is unlikely with an II trade, and I've never even seen a 2BR oceanfront for rent on Marriott.com. But other 2BR oceanfront condos in the Kaanapali Resort rent for a minimum of $800 a night, so that is still a significant savings on renting. (I know rentals can be had on Redweek for much less, but renting direct from an owner is not something I am particularly comfortable doing).

The savings from just these two examples recoup almost $3000 of our upfront purchase costs.

 

[mjm1]

For someone just starting out, I like the idea mentioned earlier of buying a package with a traditional unit and points. That provides a nice balance and flexibility.

As noted often on TUG the OP really needs to think about how they like to vacation now and how that could change in the future. We started out vacationing with our kids, so having a 2BR. Now my DW and I vacation by ourselves and take advantage of a more flexible ownership portfolio.

Good luck and let us know what you decide.

Mike

 

[davidvel]

I disagree. Depending on your needs, and if you use your points wisely, there is significant value in the increased flexibility of points. A couple examples:

-- The 4 night trip I have booked in Hilton Head at Harbour Point for next April during the Heritage PGA week could not have been booked at all with Weeks, but only took 650 points (MF or point rental cost of around $300 or so). Booking that same 4 nights on Marriott.com would have cost around $1500.

-- Our week in Maui next summer in an oceanfront 2BR cost us two years worth of enrolled and Trust points (MF cost of about $2000 per week for a total cost of $4000). I suspect an oceanfront view is unlikely with an II trade, and I've never even seen a 2BR oceanfront for rent on Marriott.com. But other 2BR oceanfront condos in the Kaanapali Resort rent for a minimum of $800 a night, so that is still a significant savings on renting. (I know rentals can be had on Redweek for much less, but renting direct from an owner is not something I am particularly comfortable doing).

The savings from just these two examples recoup almost $3000 of our upfront purchase costs.

I understand you have 3375 points (trust and banked) that you said you bought at $7/point. It took two weeks(years) of these points to get your Maui 2BR OF. Upfront cost was 7x3375=23,625. Annual MF for both weeks is appx. 2K.

So assuming 20 years for upfront= $23,625/20=1,181/yr
+ annual MF=2,000
=3,181
x 2 years usage=$6,362 or $908 per night for your OF at Marriott.
I'm not good at math so correct me if it missed something.

 

[JIMinNC]

What was your total buy-in for your hybrid purchase? And what are your annual MF? This will answer the question.

Buy in was around $23K for 3375 points; annual MF on week and points about $2K.

The key is maximizing the value of what you book - use points where they work best and weeks where they work best. For example as I noted above, utilizing the flexibility of points to squeeze multiple weeks or many shorter stays out of the points; or alternatively to combine weeks/points from multiple years to book something that would be difficult or impossible to book via trade or by rental for anything close to the MF cost.

For trips where the point cost/value is less, we can opt to revert to the weeks approach. Because the week we bought with our package is a Silver HHI week, the MF/point cost of that week by itself is not too attractive. As a result, going forward, we will likely wind up using that week in the Weeks system more often than we elect points (and just rent the points we need to replace them at lower MF/point cost). If we can reliably trade that Silver HHI week for Gold HHI (as we understand many Tuggers do), then our $1200 MF on that week would get us a Spring/Fall HHI week that would normally cost us $2500 to $3000/week if we were to rent the same accommodations. If we get lucky and snag one of those late May/early June Gold weeks at Grande Ocean, the value of the accommodations rises to over $4000.

The $3K or so in lodging savings from the two trips I noted in the previous post were net of maintenance fees, so that goes directly to beginning to recoup the up front costs. Future savings from other points or weeks bookings will continue to contribute to that "pay down". If we use our ownership smartly, I think it will be possible to recoup 100% of our initial investment within 10-12 years or so.

 

[JIMinNC]

I understand you have 3375 points (trust and banked) that you said you bought at $7/point. It took two weeks(years) of these points to get your Maui 2BR OF. Upfront cost was 7x3375=23,625. Annual MF for both weeks is appx. 2K.

So assuming 20 years for upfront= $23,625/20=1,181/yr
+ annual MF=2,000
=3,181
x 2 years usage=$6,362 or $908 per night for your OF at Marriott.
I'm not good at math so correct me if it missed something.

No argument with the math, but here is a little more color...

I should note that our MF cost per point is as high as $2K only because the Silver week we own is not an efficient point generator (1625 points for a $1190 MF). As I said just above, in the future we will likely keep this week as an offseason trader in the weeks system and rent points to add to our Trust points for major trips like Maui.

So that $908 you calculated is somewhat overdone because this one time we just opted to use our legacy points since we decided to elect the first two years so we could "exercise" the system a bit before doing point rentals. We also had 750 purchase incentive points that allowed us to grab the OF without dipping into 2017 points. So while your numbers are correct for our 2016 Maui stay, they overstate the real cost we would incur for points reservations going forward.

The Silver week itself only cost us $3300, so I would guess that after two Weeks trades for HHI Gold season (as noted in the post just above), we will be close to fully recouping that upfront cost. I would expect that to occur in 2017 and 2018.

Our 1750 Trust points cost us a little over $19K and annually cost us $0.475/pt in MF (2015). Point rentals will likely cost us about the same as MF but with no upfront cost .

So if you assume that the Silver Week will be "paid for" going forward by weeks trades, and we redo your numbers to consider only the cost and MF on the Trust points and any supplemental Point rentals, the new numbers for cost become:

-- 20 years amortization for upfront points cost = $19,700/20=$985/yr
-- Plus Annual MF on Trust points = $831
-- Total Annual cost of owned points = $1816

x 2 years usage (3500 points) = $3632

Plus rental of 3950 points @$0.48 to book 2BR OF (requires 7450 points): $1,896

Total cost of $5528 or $789/night for a 2BR OF at MOC

Now some examples of high season rental rates at Maui Ocean Club and other Kaanapali condos:

-- 2BR Gardenview Lahaina/Napili Villas $889/nt plus taxes - $1000/night all in
-- 1BR Gardenview Old MOC $599/night plus taxes - $684/night all in
-- 2BR Oceanfront next door at Kaanapali Alii - $1100/night plus taxes, about $1200 all in

Given these prices, even the $908 "all-in" you calculated is probably still a savings over what 2BR oceanfront accommodations in MOC would cost us in 2016 (I've never seen a 2BR OF in the original section in high season on marriott.com, though). But just looking at using pure Trust or rented points, the $789 is a significant savings over renting similar accommodations.

Then, factor in short stays like the PGA golf week in HHI where our direct cost is only about $80/night (not sure how to allocate the upfront purchase cost here since depending upon season, our Trust points can get us 10-12 days at HP) vs over $350 a night for a cash stay at the same property.

So as I look at it, if you buy a minimal number of Trust points to get into the system and then complete the "funding" of your trips with rented points, the economics of the points system can be very, very attractive.

 

[chrono88]

For the flexibility points offer, we have been contemplating purchasing the minimum 1500 points resale and renting the rest of the points that we would want for any given year. That seems to be the most economical way, in my view, because the upfront cost is lower than any bundle package.

 

[jcjl1]

Great Plan!

For the flexibility points offer, we have been contemplating purchasing the minimum 1500 points resale and renting the rest of the points that we would want for any given year. That seems to be the most economical way, in my view, because the upfront cost is lower than any bundle package.

Bingo! A great, flexible option for a newbie!

 

[Fasttr]

I agree with JIMinNC's DC program flexibility arguments, but the way I see it, the only argument one can effectively make where the points program comes financially closer to the weeks program is in its scalability, which is due to the ability to rent additional points.

When using the concept posted by chrono88 in post 18, that of purchasing 1500 points and renting the rest, at some point in the scalability of your usage...perhaps 4 week?, 6 weeks?...it certainly depends on the situation, but certainly "somewhere", the fact that in order to gain access to those additional weeks via the DC, you don't have to pay anything more in upfront costs becomes an advantage. I am of course making an assumption that the cost to rent the points is reasonably similar to the MF's one would have had to pay if they owned the extra weeks (I realize the MF's on the points is a bit higher....but not crazily so). The argument is that I can get at those weeks without having to pay another $2K, $4K, $8K per week (or whatever) in upfront costs to add the weeks.

Totally agree, if one week is your ultimate target....its hard to argue the financial soundness of the pure points play. But for multiple weeks, at some point, the value does come closer to the pure weeks play.

And of course....if you are buying the 1500 points via the resale market, it makes it even a bit more viable of an argument.

 

[JIMinNC]

I agree with JIMinNC's DC program flexibility arguments, but the way I see it, the only argument one can effectively make where the points program comes financially closer to the weeks program is in its scalability, which is due to the ability to rent additional points.

When using the concept posted by chrono88 in post 18, that of purchasing 1500 points and renting the rest, at some point in the scalability of your usage...perhaps 4 week?, 6 weeks?...it certainly depends on the situation, but certainly "somewhere", the fact that in order to gain access to those additional weeks via the DC, you don't have to pay anything more in upfront costs becomes an advantage. I am of course making an assumption that the cost to rent the points is reasonably similar to the MF's one would have had to pay if they owned the extra weeks (I realize the MF's on the points is a bit higher....but not crazily so). The argument is that I can get at those weeks without having to pay another $2K, $4K, $8K per week (or whatever) in upfront costs to add the weeks.

Totally agree, if one week is your ultimate target....its hard to argue the financial soundness of the pure points play. But for multiple weeks, at some point, the value does come closer to the pure weeks play.

And of course....if you are buying the 1500 points via the resale market, it makes it even a bit more viable of an argument.

I think it is important to highlight that the primary economic comparison will be different depending upon the travel goals of each potential buyer.

For the person who desires to travel primarily in traditional timeshare 7-night increments, then the appropriate economic data points to compare are - as you state above - the cost of points (upfront + MF) versus the cost of traditional weeks (upfront + MF). I agree that for this type of buyer, traditional weeks will usually be more economical, until perhaps you get into higher week usage where, as you suggest above, the ability to leverage a small upfront purchase with point rentals begins to pay bigger dividends.

On the other hand, for a person who often desires to travel in shorter increments, the cost comparison to weeks is almost irrelevant because weeks do not work as a way to obtain multiple shorter stays. It's like comparing the cost of a car to the cost of a boat. The car won't let you sail on the water, so comparing cost of ownership of a boat to the cost of ownership of a car is almost meaningless to achieving your goal of sailing on the water.

So for the person who often desires to travel in shorter increments rather than week-long increments, they should be comparing the cost of points ownership (upfront +MF) not to the cost of weeks, but to the cost of daily rentals of comparable accommodations. In other words, how much would it cost you to use cash to book a three-night stay for one trip to a desired location, plus a four-night stay for another trip (or as many nights as you can squeeze out of your points ownership) versus the overall cost of points?

 

[DEScottzz]

So for the person who often desires to travel in shorter increments rather than week-long increments, they should be comparing the cost of points ownership (upfront +MF) not to the cost of weeks, but to the cost of daily rentals of comparable accommodations. In other words, how much would it cost you to use cash to book a three-night stay for one trip to a desired location, plus a four-night stay for another trip (or as many nights as you can squeeze out of your points ownership) versus the overall cost of points?

Another factor on the short stays is that the points required for Sunday through Thursday nights are much less than for Friday and Saturday nights. For folks who use this fact to their advantage, the points can be really cost-effective.

For example, I've booked a one bedroom in the Phoenix resort right after New Years for five nights at 150 points (just under $75) per night.

It appears to me that the nightly rate for the MVC resorts goes down during the week alot more than hotel rates do.

 

[Fasttr]

Another factor on the short stays is that the points required for Sunday through Thursday nights are much less than for Friday and Saturday nights. For folks who use this fact to their advantage, the points can be really cost-effective.

For example, I've booked a one bedroom in the Phoenix resort right after New Years for five nights at 150 points (just under $75) per night.

It appears to me that the nightly rate for the MVC resorts goes down during the week alot more than hotel rates do.

Excellent point.

 

[Fasttr]

It's like comparing the cost of a car to the cost of a boat. The car won't let you sail on the water, so comparing cost of ownership of a boat to the cost of ownership of a car is almost meaningless to achieving your goal of sailing on the water.

THIS was likely invented by a MVC Salesperson as a way of showing you that even the most sound objections can still be overcome by a good salesperson.

 

[Password is taco]

My family typically travels a week at a time. Any less than that just doesn't seem worthwhile given the travel involved. So, considering shorter trips aren't a factor, it sounds like weeks is the way to go. Are there any other factors that make weeks less desirable given the shift in the industry to more points based systems?