Platinum Pricing on Ebay Going Lower?

[Beefnot]

Is it me or does it seem that platinum Marriotts weeks on ebay are going lower?

 

[GregT]

Is it me or does it seem that platinum Marriotts weeks on ebay are going lower?

No, it's not you -- I've noticed the same and think it will continue as MFs keep going up. Plus, alot of potential Marriott purchasers (like me) won't bid on anything because it's outside of the new system .

Starwoods Platinums that are Voluntary are selling for $1. Effectively, resale Marriotts are now Voluntary because they are outside of DClub and I think people will mostly be buying them when they want to use them.

We will see -- and a reasonable buying opportunity if you buy where you want to go and can tolerate the increasing MFs.

All the best,

Greg

 

[Beefnot]

I for the life of me just don't get the whole DClub thing, or the Starwood Mandatory/Voluntary thing for that matter. Got too convoluted trying to sort out this trust vs. legacy thing. Wyndham's point system I was able to comprehend more. As long as I can use or exchange an old school week, I'll just roll with that.

Tough for me though to bid on something when I might be catching a falling knife. I might just need to sit on the sidelines and just watch longer.

 

[1965]

greg T:

when you use the term "voluntary" referring to Marriott and Starwood
Can you pls explain what this really means?

 

[GregT]

greg T:

when you use the term "voluntary" referring to Marriott and Starwood
Can you pls explain what this really means?

It's a Starwood term -- they have Voluntary and Mandatory properties. Starwood has its own points system and when you buy a week from them (Direct from the developer) you receive the ability to redeem your week for StarOptions. You can either 1) reserve your week and occupy it or 2) you can redeem your week for StarOptions (ie the points) and book a reservation at a different property.

However, Voluntary properties do not have the ability to transfer the StarOptions/points to a resale purchaser -- you only transfer the ability to use the actual week (and/or trade the week through II).

Mandatory properties retain the ability to trade for StarOptions when resold. Accordingly, a resale purchaser gets both the value of owning the week and the option to book another property in the system using StarOptions.

The impact on Starwood pricing has been significant -- most Voluntary properties (where the ability to use points doesn't transfer) sell very very inexpensively on eBay. Mandatory properties, on the other hand, retain some residual value because of the StarOptions.

Marriott has effectively introduced this concept into its system -- where all weeks are now like the Voluntary weeks. A new resale is limited to either customary usage, or trading through II. Only legacy week owners (pre June 20 2010) have the opportunity to use points, and that ability is lost if that week is resold.

I think it is going to further harm the resale value of Marriott weeks just as Starwood voluntary weeks have been sold. In my opinion, we'll continue to see the correlation between higher MFs leading to lower prices. This doesn't bother me because I have no interest in selling and I never viewed these as an investment. If I am right, then this continues to support the TUG thesis of buy where you want to go.

All the best,

Greg

 

[suzannesimon]

Are the Starwood Voluntary weeks the newer resorts? Was it simply a change in policy and all the newer resorts became Voluntary and the old resorts were Mandatory?

 

[GregT]

Are the Starwood Voluntary weeks the newer resorts? Was it simply a change in policy and all the newer resorts became Voluntary and the old resorts were Mandatory?

There are only a few Mandatory properties (five I think), and they were the earlier properties.

I believe all of the newer properties are Voluntary. When Starwood began selling Westin Princeville a couple years ago, I understand there was disappointment that it was not Mandatory (because it has high MFs). It's resale value has decreased much faster than Westin Kaanapali (which is a mandatory property).

Now, there is possibly a Maui/Kauai thing in the price discrepancy, but my personal opinion is that it is also related to the Voluntary nature of the Princeville property.

Best,

Greg

 

[dioxide45]

Greg, It seems that there is a perceived value in the point system with Starwood? People are willing to pay more to be in the system than be on the outside. If the low resale prices at Marriott are an indication, it seems that there is also a perceived value in the Destinations Club program.

I find this strange, both for Marriott and Starwood, as people who work outside of the system still have great success with getting the weeks and exchanges they desire through II. Given the many unfavorable opinions on DC by many here, I would expect that the perception of value in DC would be low. However, given the recent resale prices, and if related to DC, the opposite would be true.

Perhaps it is now because DC is the new sales pitch and when people go out to look at resale, all they see are weeks that can't be enrolled. The sales people aren't pushing weeks and want point sales, so they are not going to talk favorably of the resale weeks available on the cheap on the resale market. We need to remember, not everyone is as savvy as those of us here on TUG.

I am curious what other people's thoughts are on this.

 

[m61376]

I think that someone new to the timeshare world is regaled by the sales presentation of using points to book wherever you want to go, and no longer restricted to booking at a single home resort during a specific time period and even for a specific size. Flexibility and the option of infinite possibilities are advertised, and the poor resale buyer is stuck only being able to reserve a limited number of weeks at a single resort. If you didn't understand the implications of the new program, which would sound more appealing? Even the average Marriott owner probably thinks that not being able to enroll a week is a big issue, as well as an unenrolled week would entail a second II membership should they wish to trade it.

I do think the parallel to Starwood's voluntary resorts is a good one, although I think belonging to the Starwood program is more of a benefit, and thus the inability of voluntary weeks to use Staroptions a bigger detriment. I think the greater uniformity of Starwood's program between many resorts makes it both more user friendly and more valuable.

The economy started the prices in a downward spiral, and the perceived devaluation from being excluded from the newest and best that MVCI has to offer- the DC program, has added fuel to the fire, so to speak. A prospective buyer has to weigh all the negativity that they are being fed as to why points are so much better than weeks, they have to look at high MF's and weigh that against depressed rental rates (again, partially due to the economy) and perhaps overcome a reticence to part with thousands of dollars in the current economic climate. Purely luxury discretionary purchases are hard for many to justify these days, especially when they can achieve the same lifestyle through other means (via easily obtainable rentals).

I don't think prices will turn around until rental rates begin to climb, since the Marriott sales-pitch is not likely to change. When travel demand increases rental rates will creep up, and I would expect resale prices to stabilize and hopefully show a similar pattern. If not, I don't think the timeshare model will be able to sustain itself.

 

[larryallen]

Yes, values continuing to go down. Plus, if things happen to Marriott like they have for Westin in Maui (MF's went from $900 to $2,500 in about 5 or 6 years) prices will drop further. It's a big liability right now.

 

[Beefnot]

Yes, values continuing to go down. Plus, if things happen to Marriott like they have for Westin in Maui (MF's went from $900 to $2,500 in about 5 or 6 years) prices will drop further. It's a big liability right now.

Holy sheez, are you serious? If the developer is artificially depressing MFs in order to increase their TS sales revenue, and then subsequently let the MFs float upward (and quickly), that seems downright unethical.

 

[GregT]

A big part of the Westin's MF increase was property taxes. MOC had big big increases for property taxes (from Maui) but Westin's were even more.

I saw a post on it at one point that explained it, but I don't recall the reason now. Something like MOC was taxed as condo but Westin was taxed as a hotel, or something like that.

Either way, Hawaii property taxes are high and timeshare owners are viewed as targets. MOC has actually done an excellent job in managing to keep the Operating Expenses reasonable, but the property taxes are out of their control. They've appealed (and won) to the county authorities, but I think MFs in Hawaii will always be high.

But it's a beautiful place. Today I am loving my Marriott timeshare!

Best,

Greg

 

[scrapngen]

A big part of the Westin's MF increase was property taxes. MOC had big big increases for property taxes (from Maui) but Westin's were even more.

I saw a post on it at one point that explained it, but I don't recall the reason now. Something like MOC was taxed as condo but Westin was taxed as a hotel, or something like that.

Either way, Hawaii property taxes are high and timeshare owners are viewed as targets. MOC has actually done an excellent job in managing to keep the Operating Expenses reasonable, but the property taxes are out of their control. They've appealed (and won) to the county authorities, but I think MFs in Hawaii will always be high.

But it's a beautiful place. Today I am loving my Marriott timeshare!

Best,

Greg

Made me smile! "Today I am loving my Marriott timeshare!" Could add that to your signature!!

 

[ocdb8r]

Greg, It seems that there is a perceived value in the point system with Starwood? People are willing to pay more to be in the system than be on the outside. If the low resale prices at Marriott are an indication, it seems that there is also a perceived value in the Destinations Club program.

I find this strange, both for Marriott and Starwood, as people who work outside of the system still have great success with getting the weeks and exchanges they desire through II. Given the many unfavorable opinions on DC by many here, I would expect that the perception of value in DC would be low. However, given the recent resale prices, and if related to DC, the opposite would be true.

Well, there are a couple of wrinkles in the Starwood system that makes the ability to reserve with StarOptions very important. One is that Harborside Atlantis and Westin St. John are nearly impossible to get via an II trade. I don't think there are any Marriott resorts that have the same level of difficulty of these two SVO resorts (at least not yet). Second, Starwood maintains complete control over deposits into II, and thus inventory is often much better using StarOptions. Marriott owners can still reserve a specific week and deposit that week (providing prime inventory to other exchangers). In fact, you want to reserve the highest demand week you can and deposit it into II so you have the highest trade power. This doesn't happen with Starwood.

This sort of problem could migrate over to the Marriott system. Take Maui owners, for example. The points they get to exchange are so high, it may mean less and less of them use II for exchanges (depleting II inventory and making DC Club more attractive). The same can be said for new resorts which will be 100% owned by the DC Club.

Obviously the small size of the Starwood network amplifies the problems described above.

 

[timeos2]

Holy sheez, are you serious? If the developer is artificially depressing MFs in order to increase their TS sales revenue, and then subsequently let the MFs float upward (and quickly), that seems downright unethical.

Wyndham destroyed the value of resale in their otherwise outstanding - and reasonably priced - system. That after killing the value of fixed weeks by making them a poor stepchild. So to make money at new sales they will do virtually anything. It appears to be happening again in other name brands such as this one.

 

[siberiavol]

I agree with Greg's thoughts about dropping prices. There are several other reasons that might affect some purchases including the big drop in condo prices which become an alternative to some. Rental prices for timeshares at many locations appear to have dropped and there it is very easy to find condos to rent through VRBO.

Another factor is buyers are NOT AFRAID OF MISSING a good deal. If they miss an opportunity to buy XYZ they THINK it will be easy enough to get it in a month or two. I think a potential buyer needs to be aware that perceptions can change. Right now the negatives are obvious but some of the reasons we bought timeshares in the first place are still valid

For example I own a silver Barony Beach. I have traded to Four Seasons Aviera several times. I have traded into Marriott platinum season many times. If you don't want to trade you can use it for spring break. My point is that it is a good week yet it can be bought on $EBAY for a $1.

At some point if several start selling at $1500 or $2000 people remember or find out these were sold through the developer at at $12000-15000. $2000 looks pretty cheap and then $3000 seems like a bargain. Hey $4000 is a third of the developer cost.

Don't forget that we are not assured that rental rates will remain cheap for ever. Things change. I believe people will look back on this period and wonder why they didn't buy not why they didn't totally get out of timeshares.