Resale Open Season restriction question.

[BillW]

Tried posting this in HGVC Facebook page and much wailing and gnashing of teeth discussion but no factual answers. Hoping my fellow TUGers can help.

Was told by sales rep (I know, they lie) that resale purchases after April of this year do not get to use Open Season? My sister is interested in purchasing resale and trying to confirm one way or another. I am a resale owner and know I can currently but trying to determine if they’ve instituted the rumored restriction in real life. The attached 2023 program guide page seems to indicate that they are reserving the right to do so. Anyone who purchased after April able to look at the booking app and see If open season shows available? Thanks!

Bill

 

[HuskerATL]

No limitations... same as retail except they won't get you in Max and most won't count toward Legacy Elite. HGV uses a lot of "mays" in their guidelines for CYA.

Don't ever listen to sale's folks about resale. They either have no idea or will intentionally mislead you because it does not personally benefit them if you buy resale.

 

[brp]

Don't ever listen to sale's folks about resale. They either have no idea or will intentionally mislead you because it does not personally benefit them if you buy resale.

It is very possible to overplay the "may receive limited HGVClub benefits" part to make it sound like a done deal without actually lying. Spin. and it can definitely work on those who don't kow better.

Cheers.

 

[ljmiii]

Tried posting this in HGVC Facebook page and much wailing and gnashing of teeth discussion but no factual answers. Hoping my fellow TUGers can help....

As others have said, HGVC salesreps have spouted 'only direct can' or 'starting tomorrow...so you need to buy today' nonsense since time immemorial.

That said...something you don't want to hear. At base, when you buy a HGVC deed, direct or resale, what you are buying is the right to use the villa at the resort and season you purchased once a year (or every other year). EVERYTHING else is dependent on the continued existence and munificence of HGVC.

 

[BillW]

As others have said, HGVC salesreps have spouted 'only direct can' or 'starting tomorrow...so you need to buy today' nonsense since time immemorial.

That said...something you don't want to hear. At base, when you buy a HGVC deed, direct or resale, what you are buying is the right to use the villa at the resort and season you purchased once a year (or every other year). EVERYTHING else is dependent on the continued existence and munificence of HGVC.

Agree with all you said and understand all, just trying to see facts on ground today. I think they’re hesitant to change it. They’d like to quash resale but know uproar, and possibly lawsuits, will ensue once/if they do change it.

 

[brp]

Agree with all you said and understand all, just trying to see facts on ground today. I think they’re hesitant to change it. They’d like to quash resale but know uproar, and possibly lawsuits, will ensue once/if they do change it.

Hard-pressed to imagine that changes to resales after a certain date will generate any successful lawsuits. Inasmuch as they can, legally, even change things for past purchases, as noted above, resales going forward would be easy. DVC did it, several times, with no successful legal backlash, AFAIK. Of course there was wailing and gnashing of teeth, but that will always happen when something changes.

No good reason for them not to change rules going forward. Fortunately, they haven't.

Cheers.

 

[HuskerATL]

Agree with all you said and understand all, just trying to see facts on ground today. I think they’re hesitant to change it. They’d like to quash resale but know uproar, and possibly lawsuits, will ensue once/if they do change it.

They will never quash resale. They need it for MFs, club fees, and spending at properties. If they really wanted them, they would take them via ROFR, but they very rarely do. They can't sell them and need owners paying fees. This has been a comment but sale's folks for decades. Look in the investor presentations and at the slide with comments about the importance of club fees and MFs .. Top two continual funding streams that they share with investors.

 

[HuskerATL]

Do a search on this forum and see how many times questions like this have come up. Many.

 

[brp]

They will never quash resale. They need it for MFs, club fees, and spending at properties. If they really wanted them, they would take them via ROFR, but they very rarely do. They can't sell them and need owners paying fees.

Not sure I completely follow, Let's say that the restrict resale to be unattractive. Then the original owner still has the proper and, unless you (or they) expect a lage percentage of those to default, they're still paying the MFs. Likely fees as well as they will still try to use it until they can sell.

Cheers.

 

[HuskerATL]

Not sure I completely follow, Let's say that the restrict resale to be unattractive. Then the original owner still has the proper and, unless you (or they) expect a lage percentage of those to default, they're still paying the MFs. Likely fees as well as they will still try to use it until they can sell.

Cheers.

I was referring to continuing to allow resale, as the OP stated.

For ongoing benefits, could they create a multi-tier system to reduce benefits to those that buy resale? Sure, but it really doesn't benefit them. They want owners using the system and OS is a last minute chance to have paying customers versus empty rooms. I doubt they would ever change it. The reality is that almost all weeks being sold are resale since almost all the resorts were sold out years ago. They are just selling resale as retail now.

 

[dayooper]

Not sure I completely follow, Let's say that the restrict resale to be unattractive. Then the original owner still has the proper and, unless you (or they) expect a lage percentage of those to default, they're still paying the MFs. Likely fees as well as they will still try to use it until they can sell.

Cheers.

They will absolutely get a large percentage of resale owners defaulting. The reason most buy (retail and resale) is for use as points. If that’s taken away, many will default and the HOA’s will take the hit. We know it, HGVC knows it as do the salesman. Could it happen? Absolutely! Will it? I’m probably not.

If they really wanted to stop resale, all they would have to do is jack up the fees enroll the resale in club. That would stop most resales except for the very desirable deeds.

 

[brp]

For ongoing benefits, could they create a multi-tier system to reduce benefits to those that buy resale? Sure, but it really doesn't benefit them. They want owners using the system and OS is a last minute chance to have paying customers versus empty rooms. I doubt they would ever change it. The reality is that almost all weeks being sold are resale since almost all the resorts were sold out years ago. They are just selling resale as retail now.

Good points. They could put some limits, like limiting which resorts can be booked, or other disincentives, without hurting themselves, I think. It worked for Disney primarily, I believe, because these units hold value and even appreciate, which is uncommon in the TS world. HGVC don't have this dynamic, but they could still make retail attractive relative to resale without hurting themselves, I believe.

Cheers.

 

[brp]

They will absolutely get a large percentage of resale owners defaulting. The reason most buy (retail and resale) is for use as points. If that’s taken away, many will default and the HOA’s will take the hit. We know it, HGVC knows it as do the salesman. Could it happen? Absolutely! Will it? I’m probably not.

Except that existing resale owners would still be able to do this. They would change the rules going forward, as DVC did. So future resales could not do this, but thgat would be known. The existing resale folks could do as they do now.

Cheers.

 

[HuskerATL]

Good points. They could put some limits, like limiting which resorts can be booked, or other disincentives, without hurting themselves, I think. It worked for Disney primarily, I believe, because these units hold value and even appreciate, which is uncommon in the TS world. HGVC don't have this dynamic, but they could still make retail attractive relative to resale without hurting themselves, I believe.

Cheers.

I think folks would dump them and/or new resale wouldn't sell, except in the few high demand locations, so they would be screwed. They know it because it would be very easy to take them via ROFR.

We need to pull Judi into this conversation and ask her in her 30 years of selling resale, how many times comments from sale's folks like this have come up.

 

[dayooper]

Except that existing resale owners would still be able to do this. They would change the rules going forward, as DVC did. So future resales could not do this, but thgat would be known. The existing resale folks could do as they do now.

Cheers.

I agree with that. I thought the discussion was eliminating points for all resales (which salesman have been threatening for years).

One point about resale that doesn’t get mentioned is HGVC considers resale part of their exit plan. They know many of their deeds have enough value to at least be given away. We who purchase (or take on for free) HGVC deeds are a big part of owners getting rid of their deeds. My 2 deeds were owned by the original owners for at least 15 years, but were done with them. I took them off of their hands and gave them a bit of money in the process. It’s why you don’t hear much about the lack an exit program with HGVC here.

 

[Talent312]

The sales weasel is lying. How do you know? His lips are moving.
SAY... "If in fact resales are so restricted... It wouldn't make sense
to buy from you, knowing I'll find it nearly impossible to sell. It
makes more sense to buy resale with the diminished value baked-in."

 

[Zenichiro]

I think the question needs to be answered. Has anyone bought resale since April and can you still see Open Season?

I would point point out that currently, Open Season is not available for the former DRI properties. So I could see it being plosable that this feature could end at some point. Or that the sales people are just mixing facts to try to FOMO people into buying from the resort vs purchasing resale. I do know that since DRI was purchased, the sales team is really loving mixing facts, good and bad, between the two systems.

I personally do not believe things will change for resale anytime soon but I guess time will tell.

 

[HuskerATL]

OS will be coming to DRI/HVC Max folks though. Someone asked this question on FB and a person commented that they have bought resale since April and have OS.

 

[BillW]

I think the question needs to be answered. Has anyone bought resale since April and can you still see Open Season?

Thanks Z, that is what I'm looking for. I see Husker's comment in next reply that it's been stated on FB, but I can't find that anywhere.

 

[HuskerATL]

Thanks Z, that is what I'm looking for. I see Husker's comment in next reply that it's been stated on FB, but I can't find that anywhere.

It might be your FB post and Jon Cole commented that he just bought resale and has OS.

 

[BillW]

It might be your FB post and Jon Cole commented that he just bought resale and has OS.

View attachment 78651

Thanks, hadn’t seen that. I’ll ask Jon when he bought.

 

[HuskerATL]

The latest investor slides were posted to the HGVC owners FB group and someone pulled out this slide which is one reason resale continues.

 

[ernststarhemberg]

That's been what has confused me about resale deeds being shunned. Sure the timeshare company loses out on the financing component (the interest stream of which is certainly significant), but they still get the maintenance fees, club dues, and other operating revenue from guests (onsite bars, restaurants, etc.) in perpetuity.

Per the 2022 HGV annual report, they reported $235m in interest income, with a financing profit margin of 61.4%. Resort and Club Mgmt revenue was $534m with a management profit margin of 69.9%. Overall HGV net profit margin was almost 9.2%. Needless to say HGV had a very decent year.

Resale or otherwise, they should want people who are willing to pay the fees and patronize the resorts with minimal hassle.

 

[brp]

Resale or otherwise, they should want people who are willing to pay the fees and patronize the resorts with minimal hassle.

I just look at the fact that others - DVC, DRI, I believe Marriott and I don't know about the rest - have implemented restrictions on resale purchases and found a way to make this work. Is there something fundamentally different about HGVC?

Cheers.

 

[HuskerATL]

That's been what has confused me about resale deeds being shunned. Sure the timeshare company loses out on the financing component (the interest stream of which is certainly significant), but they still get the maintenance fees, club dues, and other operating revenue from guests (onsite bars, restaurants, etc.) in perpetuity.

Per the 2022 HGV annual report, they reported $235m in interest income, with a financing profit margin of 61.4%. Resort and Club Mgmt revenue was $534m with a management profit margin of 69.9%. Overall HGV net profit margin was almost 9.2%. Needless to say HGV had a very decent year.

Resale or otherwise, they should want people who are willing to pay the fees and patronize the resorts with minimal hassle.

I don't think corporate is complaining. It is the sale's folks because it only hurts them so they continually try to mislead owners about them