Possible “coronavirus sale” later this year?

[letsgobobby]

I have been looking for a platinum Lagoon HHV 2 BR for several years. With the economy booming, there were no ‘steals’ and resales tended to hover between $12k-$14k (a fair price, to be sure - just haven’t pulled the trigger). Now with the coronavirus, I’m wondering if you think there might be an opportunity to make a silk purse out of a sow’s ear in the coming year on two fronts.

First, with the impact COVID is having on Asia and particularly China, I think economic contraction in the region can be expected this year. Less discretionary income should reduce the bid on timeshares especially in Hawaii. The counterargument is that most resales are not going to Chinese tourists, so maybe the resale market doesn’t see much of a dip.

Second, the COVID impact on travel spending is already profound. State Department has now recommended Americans avoid all cruises and consider carefully any airline travel. Alaska, Hawaiian, United, and others are slashing flight capacity. Hotel and restaurant bookings are falling off a cliff. If this continues, would it impact HGVC’s willingness to exercise ROFR?

Obviously I’m not hoping for widespread illness or economic fallout, but if it does come to pass I’d like to be prepared to purchase what I’ve always wanted.

 

[Panina]

I have been looking for a platinum Lagoon HHV 2 BR for several years. With the economy booming, there were no ‘steals’ and resales tended to hover between $12k-$14k (a fair price, to be sure - just haven’t pulled the trigger). Now with the coronavirus, I’m wondering if you think there might be an opportunity to make a silk purse out of a sow’s ear in the coming year on two fronts.

First, with the impact COVID is having on Asia and particularly China, I think economic contraction in the region can be expected this year. Less discretionary income should reduce the bid on timeshares especially in Hawaii. The counterargument is that most resales are not going to Chinese tourists, so maybe the resale market doesn’t see much of a dip.

Second, the COVID impact on travel spending is already profound. State Department has now recommended Americans avoid all cruises and consider carefully any airline travel. Alaska, Hawaiian, United, and others are slashing flight capacity. Hotel and restaurant bookings are falling off a cliff. If this continues, would it impact HGVC’s willingness to exercise ROFR?

Obviously I’m not hoping for widespread illness or economic fallout, but if it does come to pass I’d like to be prepared to purchase what I’ve always wanted.

Economically the Corona virus is affecting investments already. It looks like it will continue as many industries will be affected. Sadly, I believe there will be some good deals.

 

[CaliSunshine]

I think your reasoning is sound.

 

[terces]

I had an offer in on an additional 7000 point unit about a month ago and pulled out of the deal, thinking exactly on the same lines as you. I have heard the TS values got destroyed in the 2008 crisis so will also wait. Also I am not sure that we will even be able to travel a lot until there is a vaccine available.

 

[Talent312]

To play devil's advocate... It's also possible that the peak of travel-fear is now.
Peep may get the idea that they are just as much at risk in their hometown
as they are at a TS resort.

 

[ljmiii]

I have been looking for a platinum Lagoon HHV 2 BR for several years....Now with the coronavirus, I’m wondering if you think there might be an opportunity to make a silk purse out of a sow’s ear in the coming year on two fronts.

I think the immediate travel issues won't affect timeshares directly - they are for most people a 10+ year commitment. Either the COVID-19 virus will be contained or it won't and I highly doubt there will be any travel restrictions in a years time.

However, the economic impact could well be substantial. Anyone who is selling because their finances are shaky will be forced to accept prices they otherwise wouldn't. And as you point out, an HGVC that isn't seeing revenue from new direct purchases isn't likely to be aggressively exercising ROFR.

 

[alwysonvac]

I believe developer sales will take a hit with less folks traveling. So yes, I think this will have an overall impact to HGVC’s willingness to exercise ROFR.

However you also have to find a seller willing to accept a lower price

Good Luck.

 

[brp]

Economically the Corona virus is affecting investments already. It looks like it will continue as many industries will be affected.

Definitely having an impact now and then it just depends upon how much people rely on these investments in the short term. Those with longer time horizons may well not be impacted after this things clears.

However, the economic impact could well be substantial. Anyone who is selling because their finances are shaky will be forced to accept prices they otherwise wouldn't. And as you point out, an HGVC that isn't seeing revenue from new direct purchases isn't likely to be aggressively exercising ROFR.

Certainly anyone who's job or livelihood is impacted will feel this for a fair while, and it could well be substantial. Those whose jobs are not likely to be impacted, and whose investments are not a current means of support may not have issue as things will come back...just not sure when.

Cheers.

 

[Fredflintstone]

I have been looking for a platinum Lagoon HHV 2 BR for several years. With the economy booming, there were no ‘steals’ and resales tended to hover between $12k-$14k (a fair price, to be sure - just haven’t pulled the trigger). Now with the coronavirus, I’m wondering if you think there might be an opportunity to make a silk purse out of a sow’s ear in the coming year on two fronts.

First, with the impact COVID is having on Asia and particularly China, I think economic contraction in the region can be expected this year. Less discretionary income should reduce the bid on timeshares especially in Hawaii. The counterargument is that most resales are not going to Chinese tourists, so maybe the resale market doesn’t see much of a dip.

Second, the COVID impact on travel spending is already profound. State Department has now recommended Americans avoid all cruises and consider carefully any airline travel. Alaska, Hawaiian, United, and others are slashing flight capacity. Hotel and restaurant bookings are falling off a cliff. If this continues, would it impact HGVC’s willingness to exercise ROFR?

Obviously I’m not hoping for widespread illness or economic fallout, but if it does come to pass I’d like to be prepared to purchase what I’ve always wanted.

Smart decision. It’s looking like Cash will be more King than ever, especially if the economic situation continues its slide.


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