Rental woes during Covid-19 [MERGED]

[Fasttr]

For those of you with little (or not so little) side rental businesses with your timeshare weeks, how brutal has the current environment been on your ability to rent this year? What are your plans for unrented weeks, since depositing in II and renting those moving forward is not allowed by II.

The points rental business seems to have pulled back also as there are currently very few postings on VPE. Curious how that is affecting those that purchased Grand Residence fractionals with the idea of renting out points to pay for majority of their sizable maintenance fees.

Tough times for sure.

 

[StevenTing]

In times like this I wish all of my weeks were enrolled. The flexibility of points, even using holding points, is proving superior. I’d rather have holding points with a 120 day search rather than a week deposited in II.

Since the wife and I are hoping that Hawai’i opens back up before June, we’re taking a big risk. I’ve pretty much written off my weeks this year but also know I can deposit between 14-60 days, even though not ideal.

 

[PamMo]

I'm very thankful I was able to rent all of my February Maui weeks, which went without a hitch before Covid-19 changed the landscape. I feel I was crazy lucky. It eases the pain of losing rentals for my summer Harborside @ Atlantis weeks, which I don't think I'll be able to rent. I'm hoping I'll be able to use those weeks for vacations later this year or next, but who knows how long this pandemic and tail will last? I had to cancel four weeks of personal vacation in Mexico, so I have a LOT of banked weeks to use in the next two years. Crazy times indeed.

 

[dioxide45]

For those of you with little (or not so little) side rental businesses with your timeshare weeks, how brutal has the current environment been on your ability to rent this year? What are your plans for unrented weeks, since depositing in II and renting those moving forward is not allowed by II.

The points rental business seems to have pulled back also as there are currently very few postings on VPE.

Tough times for sure.

I don't rent, but based on other threads on the topic, everything is great until it all goes bad. I was always tempted to wade in to the rental game but never got in as it seemed risky even in good times. Obviously no one really predicted the full impact of what something like this would bring.

 

[dioxide45]

I should point out though that VPE point rentals should not be impacted by this. As once you transfer the points the owner has fulfilled their obligation. The renter can't come back and try to get a refund. It's too bad that margins on point rentals aren't higher like they can be on weeks.

 

[Fasttr]

I should point out though that VPE point rentals should not be impacted by this. As once you transfer the points the owner has fulfilled their obligation. The renter can't come back and try to get a refund.

That’s a good point, however there is likely a pull back in demand now due to Covid-19 concerns.

 

[dioxide45]

That’s a good point, however there is likely a pull back in demand now due to Covid-19 concerns.

Very true. Finding renters in the next year or so will be harder. Most won't rent at all. I think the main problem is that renters thing that owners are like Marriott and can offer free refunds. They don't understand that there is a price you pay when you rent a week cheaper from an owner than when you book through Marriott.com with more liberal cancellation policies. Renters now want the best of both worlds.

 

[JohnB]

Rental cost per point hasn’t changed much on Vacation Point Exchange over the past month, which has surprised me given the decrease in travel. Any Tuggers out there who have rented their points or rented from others? Am curious what people may actually be paying in today’s market and is anyone renting 2020 points?

 

[frank808]

In times like this I wish all of my weeks were enrolled. The flexibility of points, even using holding points, is proving superior. I’d rather have holding points with a 120 day search rather than a week deposited in II.

Since the wife and I are hoping that Hawai’i opens back up before June, we’re taking a big risk. I’ve pretty much written off my weeks this year but also know I can deposit between 14-60 days, even though not ideal.

Since I live here and use weeks, covid19 has not altered our plans l. Still like the use of weeks over points because of skin. Though I would also like the rest of my weeks to be enrolled in DC program.

As a chairmans level, I have 24 months to use current points. Can I transfer 2020 points to another member in 2021?

Now might have to see what I will be doing with 65k DC points for 2021.



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[dioxide45]

As a chairmans level, I have 24 months to use current points. Can I transfer 2020 points to another member in 2021?

Banked points can't be transferred. So if you move 2020 points in to 2021, they are yours.

 

[VacationForever]

I don't rent, but based on other threads on the topic, everything is great until it all goes bad. I was always tempted to wade in to the rental game but never got in as it seemed risky even in good times. Obviously no one really predicted the full impact of what something like this would bring.

Well said. I had maybe a 2-second fleeting thought of doing so at one point in time and decided quickly I did not need stress in my life. We do have more than we can use and rented out 2 weeks this year and 2 weeks next year to the same renter. The renter used 10 of the 14 nights before having to fly back to Canada because of their border closing. Moreover the Indian Wells tennis tournament was cancelled which was the whole reason for her trip. She gave me no hassle at all. I reached out to her after the trip and she did not sound upset and said she is looking forward to going back next year.

 

[frank808]

Banked points can't be transferred. So if you move 2020 points in to 2021, they are yours.

Thanks

So if I transfer points to someone and they are chairman level, do they have 2 years to use transferred points?

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[csalter2]

Thanks

So if I transfer points to someone and they are chairman level, do they have 2 years to use transferred points?

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i would say no because you can only move a set of points once. So once you transfer the points, that’s the first move. They cannot move those points to the next year as that would be a second move for the same set of points.

 

[dioxide45]

Thanks

So if I transfer points to someone and they are chairman level, do they have 2 years to use transferred points?

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i would say no because you can only move a set of points once. So once you transfer the points, that’s the first move. They cannot move those points to the next year as that would be a second move for the same set of points.

Correct. You can't transfer banked points and someone can't bank transferred points.

 

[TXTortoise]

As Stephen noted, having enrolled weeks would be a significant benefit. While the margins are minimal compared to renting a Hawaii week, the ability to fully transfer the risk to the other party in a rental transfer is huge benefit. Renting out a week for next year means either an ironclad, full pandemic exclusion, but more likely means having to hold all the funds just as a contingency for a forced full or partial refund.

The seasonal nature of the virus is one of the big questions for winter rentals, and of course it remains to be seen what will happen in the Southern Hemisphere, e.g., India, Africa, etc. that will keep the virus spreading or morphing.

 

[Sandy VDH]

If the virus were truly seasonal type only then why would it be spreading across NZ and Australia etc. where it is currently summer.

I don't think we are going to catch a "seasonal" break.

 

[rickandcindy23]

Renting has been tough in recent years, anyway, with Airbnb and other rental sites proving more popular than Craig's List or Redweek or TUG ads. Advertising on those sites can be difficult and require a lot of explanation of why we cannot rent Wed-Wed., etc.

We have a pretty crazy bunch of Wyndham points that our daughter has been renting for us for about 13 years. We also have a lot of Myrtle Beach weeks to rent this year. I don't want all of those Myrtle Beach deposits in II. It would be overwhelming. We do take 12 weeks of vacation per year, and our kids use a about 8 weeks for their personal vacations (they are on our deeds and our II account). I am going to rent some Myrtle Beach weeks at cost or below cost later in the summer.

I may deposit a few prime weeks into Hawaiian Timeshare Exchange. I can usually find a couple of weeks with htse that I can use, and depositing some of the SBP makes sense for me. I just hope the late summer proves to be a good time for people to go to Myrtle Beach, even September-October dates might rent for cost. I love the flexibility of depositing the weeks even on 12/31, not that I would do that.

We will probably sell some weeks we have in RCI Points that will not stay in points with a transfer to a new buyer. That is a shame, but that is just how it is. I will also be selling a few Marriott weeks that are proving to be so-so traders, especially now that my SBP weeks are pulling Marriott resorts with priority. No need for those weeks, even though they are platinum. I need to re-assess everything we own. It's important for my sanity.

 

[LUVourMarriotts]

I rented my MOW week for August of this year, back in September. I'm starting to worry about what will be happening around that time.

 

[Steve Fatula]

If the virus were truly seasonal type only then why would it be spreading across NZ and Australia etc. where it is currently summer.

I don't think we are going to catch a "seasonal" break.

It's actually not summer there. It's fall. Highs today in Sydney, for example, 71 degrees F, Melbourne 59 (the 2 largest cities by far). It is not known if we will catch a break or not yet. It doesn't mean 0 cases anyway, it means harder to spread.

 

[vol_90]

It's been a tough rental market this year. I have had 14 of my 18 rentals between March and May cancelled. I did reach out to the remaining 4 this week who are all holding out hope for Aruba weeks over the Memorial Day weekend. Fortunately all my weeks are enrolled and was in a 100% borrowed point position. With my evacuation from my work location I came to MKO March 24th. Will likely be here into June using over 30,000+ points in the 120 day holding account. Not the preferred scenario but could be much worse.

I was able to cancel a couple of the reservations along with my planned Aruba trip before the 60 day period. Already have 8 new reservations posted on Redweek along with 5 January 2021 Hawaii posted a couple of months back (using borrowed 2022 points). Holding out belief that I will be able to rent as long as the price posted is the lowest of all rentals for the same week.

 

[Marathoner]

Having a business - any type of business - means that you are taking some form of risk. Although that risk can be minimized by knowledge and experience, it can't be eliminated entirely. On top of that, the vast scope and magnitude of this global pandemic is unprecedented, creating a situation which was beyond anyone's business planning expectations. On the other side of the equation, there will be opportunities to pick up prime weeks and points at prices even better than during the aftermath of the Lehman collapse - if you are ok of running a timeshare business with the associated downside risks.

 

[TXTortoise]

Holding out belief that I will be able to rent as long as the price posted is the lowest of all rentals for the same week.

Unfortunately, I expect we'll see a "race to the bottom" as everyone just tries to rent to cover MF or less. Nature of a commodity market I suppose.

Will be interesting to see what Marriott lists for once they open rates for Jan-Feb on Maui. Not seeing anything at the moment.

 

[jmhpsu93]

Unfortunately, I expect we'll see a "race to the bottom" as everyone just tries to rent to cover MF or less. Nature of a commodity market I suppose.

Will be interesting to see what Marriott lists for once they open rates for Jan-Feb on Maui. Not seeing anything at the moment.

I just booked several days at Ko Olina in January of 2021 and had to buy a cash reservation for one night to bridge everything, over $1K for a 2BR Ocean View for one night. I'm going to jump on a waitlist and hope for the best or I might have to just stay a couple of nights there or come back to Oahu some other time.

 

[ocdb8r]

Unfortunately, I expect we'll see a "race to the bottom" as everyone just tries to rent to cover MF or less. Nature of a commodity market I suppose.

I suspect there is a strong likelihood we end up in a situation where many rentals are less than MF. I followed the market very closely during the previous downturn and we there were plenty of examples of below MF rentals. This situation has the potential to deal a double blow to timeshares as we will see both a severe economic contraction AND a decreased demand for travel due to concerns over the virus. This, combined with a likely increase in MF due to owner defaults (which also significantly increased during the last downturn), will make for a very difficult couple of years.

The one possible upside, is that these lockdowns are having a significant psychological impact on people and I suspect anyone that is financially able to travel and not at high risk will be desperate to get away as soon hotels/resorts/airlines are back online.

 

[emeryjre]

Renting Timeshares is a business like any other. There are good times and there are bad times. This particular bad time came out of left field and left many unprepared.

I refunded all my renters for mid march to mid april and hope that they will remember me when it comes time to travel again. I am fortunately able to absorb the cost at this point in my life and will not suffer a life changing moment. I am sure that is not true for everyone.

Since most reservations were made using a credit card, I did not want charge backs in my account that will effect my ability to do business in the future

I would like to see what travel insurance will look like going forward. My rental contracts all had stipulations that the renter should obtain rental insurance to protect themselves from loss. Unfortunately, I did not see any type of travel insurance that would have covered the renter in this pandemic situation. A new thread examining the state of travel/renters insurance would be of interest to me.

The bad part for us, is that we are not getting relief from anywhere. I have been researching SBA loans, but have not found a loophole that would allow me to get a loan/grant for this business.

If you look at the models that project out to end of the crisis, they vary from very hopeful to doomsday, so no real answers there.

Going forward, people will travel if they feel safe and not at risk of catching the virus. When will that happen? If we had that crystal ball answer, it would be very easy to plan for the future as to when to get reservations to offer as rentals. Will July be far enough out, or will the travel ban still be on?

Will Interval International ease up on restrictions preventing renting II reservations. Will Vistana ease up on renting reservations made with staroptions at non home resorts. These are going to be important questions for the future.

Since I am an owner of Marriott and Vistana units only, I can not comment on what other Timeshare system restrictions are hindering the ability to rent.

Not sure about rentals below MF's. I guess it will depend on how many owners become newbie rental agents. I do anticipate that there will be an increase in owner defaults. It will be a great time for Marriott to pick up units for the points Trust.