Speculation About Marriott's New Timeshare Structure [merged]

[JimIg23]

Will the poeple who bought direct also have to pay to "buy in" to the new point system? Lets say it is cheaper than for resale owners, but will still cost money. Will those here who bought direct pay, lets say half of what resalers would need to pay, join?

 

[timeos2]

Can't be obligated if you can't dispose of it

All examples usually result in little or no equity when a customer is finished with the usage. Who buys a Bentley when one costs $225,000? Not many people. Folks should not be criticized here for taking the value of usage approach when a residual value or profit was never part of their original purchase decision..

If that was the model then a strong case could be made for selling use values only. But since they do loosely tie it to the concept of real estate by providing a deed there is that residual value, "leave it to your heirs to enjoy" floated. Plus when the seat license ends, the golf membership expires or the car lease is over there is no more obligation on the buyers part (OK, there may be a one time balance due on a car lease).

With a deeded timeshare there is a never ending obligation just as though the buyer purchased a whole condominium or house. There has to be a mechanism to end that obligation in some fashion without trashing the buyers credit. If the resale value has been killed by the original seller that leaves the buyer with no way out. So saying that they sell only the usage with no implied residual value is an inescapable money pit for a potential buyer. Who would buy if they understood that to be the end game?

 

[m61376]

Will the poeple who bought direct also have to pay to "buy in" to the new point system? Lets say it is cheaper than for resale owners, but will still cost money. Will those here who bought direct pay, lets say half of what resalers would need to pay, join?

I think it will depend on how they define "low cost" and how the program works. Who knows, there may be an introductory period to get people on board where they offer it for free, as others have suggested. I know personally if they were to offer it free (let alone for the $5000 they were charging) for owners at Ko'Olina and the other resorts in the Asia Pacific program to join their new points program I wouldn't join at any price. I can only hope that the points program they are developing is different from the Asia Pacific program, but I fear that it will be similar.

I also wouldn't join if, as Fletch suggested, there will be no home resort advantage (which seems to indicate a complete points program rather than an overlay program for trading). I think that will be a huge issue, since most people bought especially the better weeks for use at least some of the time, and I think will hesitate to join anything where they give up that advantage.

As to the other topic which has been discussed - I must admit I am surprised that seemingly so many people here contend they would have bought IF they knew up front that what they were buying had no residual monetary value immediately after purchase. Of course, I realize these aren't real estate purchases in the typical sense. And, just like the buyer of any expensive car recognizes that their purchase devaluates as soon as they drive off the lot, yet they buy anyway, they figure the devaluation is the on-going cost of use. However, to continue the analogy, sales of cars geared for the masses (I am excepting perhaps the high end cars which only the wealthy with lots of discretionary income buy; these are the same people who buy into the luxury travel products such as destination clubs perhaps) are higher for those cars that retain a higher residual value. So, while I know the primary value is usage, I also purchased expecting that there was some retained inherent value.

Latravel- The reason I feel resale owners should be grandfathered is not out of a sense of anything other than fairness. Since people bought with the only limitation that they couldn't trade their unit for points, I don't think the game rules should be changed to penalize them later on. IF Marriott were to penalize resale buyers going forward (and I don't think that's good for anybody because I think plummeting resale values will be bad for the product, as discussed ad nauseum already) those buyers would know they were buying into something vastly different and would make an informed choice as to whether the difference was worth it. But current resale owners bought into a system where the only difference was the inability to trade for points, and at the time many of us made those purchases we felt that we just wouldn't get enough value out of the incentive points being offered to compensate for the price differences.

I truly believe there was a time when buying direct made a lot of sense. Perhaps five plus years ago prices were much lower and Marriott offered lots of up front incentive points. If you received enough points to pay perhaps for a 10K trip (and maybe more) and lower prices up front buying direct was an easy decision. Getting 100K+ points for a $600 MF was a good deal too, so trading for points was a viable option. Fast forward to the past few years, when some of the initial pre-construction pricing at certain properties has now doubled, incentive points 100,000-2000,000 rather than the half million that many of you received, and MF's in excess of $1000 for the same number of points; throw in the devaluation of the points and I think many even happy direct purchasers would rethink whether it always made sense to buy directly. Some would still buy direct just because that's the way they like to buy, some wouldn't buy at all, and some would look at resales as a viable alternative.

And, while we shouldn't condemn a program before we see how it is rolled out, as the saying goes- the devil is in the details. I find it very worrisome that top salespeople are bailing out and leaving Marriott as they hear the details of the new system. If top salespeople see a problem selling the product going forward, what does that tell us? Analyzing their Asia Pacific points program and then Fletch's posts make me feel there is real cause for concern here (and I am not talking resale versus direct- I mean for everybody).

Personally, I bought where I really like to go. So using II for an occasional trade and for Getaways works for me. So regardless of how this turns out I won't lose any sleep over it. But I'd like to see Marriott do right by its owners. For those comfortable with the wait and see attitude, spend some time perusing the Starwood Board to see what could happen. See what happens to MF's as delinquencies start to run rampant....

 

[m61376]

If that was the model then a strong case could be made for selling use values only. But since they do loosely tie it to the concept of real estate by providing a deed there is that residual value, "leave it to your heirs to enjoy" floated. Plus when the seat license ends, the golf membership expires or the car lease is over there is no more obligation on the buyers part (OK, there may be a one time balance due on a car lease).

With a deeded timeshare there is a never ending obligation just as though the buyer purchased a whole condominium or house. There has to be a mechanism to end that obligation in some fashion without trashing the buyers credit. If the resale value has been killed by the original seller that leaves the buyer with no way out. So saying that they sell only the usage with no implied residual value is an inescapable money pit for a potential buyer. Who would buy if they understood that to be the end game?

Great analysis! Although, much to my surprise, there seems to be those here that contend they would buy anyway.

 

[kjd]

Suprised?

If anyone should be surprised it's the buyers (both direct and resale) who thought they were buying a prime piece of real estate because they were given a deed. The little piece of paper doesn't have much of a residual value in many cases. The way most people get out from under continuous maintenance fees is to sell their timeshare for as little as $1.00. That's how many leases used in business end. Some other folks may go the foreclosure route by refusing to pay the annual fees and/or loan payment.

It all adds up to the same thing. Any residual value that you manage to retain is gravy. As far as the "who will buy if they know the truth" argument I note that DVC and others with a point system still have customers. In fact like a car lease, DVC also tells their customers when their usage expires. If a respected salesperson like Fletch is willing to work for DVC they must be doing just fine. It's probably because they are telling the truth to their potential buyers.

There are some misguided folks that still believe they bought a prime real estate investment instead of a license to use. They probably hold these beliefs because they were told that at the time of purchase. I have to say however, that in my direct purchase experience the Marriott sales persons never pitched it to me that a timeshare was an investment. It was always based upon the value of the usage. That's why I have no regrets and continue to enjoy my timeshares without remorse.

Take a look at the sellers on Ebay that list their timeshares at ridiculous prices that never draw an offer. Unfortunately, it takes some folks longer than others to realize that their original reasoning for buying a timeshare was wrong. Maybe that's what is happening here.

 

[rsackett]

If anyone should be surprised it's the buyers (both direct and resale) who thought they were buying a prime piece of real estate because they were given a deed. The little piece of paper doesn't have much of a residual value in many cases. The way most people get out from under continuous maintenance fees is to sell their timeshare for as little as $1.00. That's how many leases used in business end. Some other folks may go the foreclosure route by refusing to pay the annual fees and/or loan payment.

It all adds up to the same thing. Any residual value that you manage to retain is gravy. As far as the "who will buy if they know the truth" argument I note that DVC and others with a point system still have customers. In fact like a car lease, DVC also tells their customers when their usage expires. If a respected salesperson like Fletch is willing to work for DVC they must be doing just fine. It's probably because they are telling the truth to their potential buyers.
There are some misguided folks that still believe they bought a prime real estate investment instead of a license to use. They probably hold these beliefs because they were told that at the time of purchase. I have to say however, that in my direct purchase experience the Marriott sales persons never pitched it to me that a timeshare was an investment. It was always based upon the value of the usage. That's why I have no regrets and continue to enjoy my timeshares without remorse.

Take a look at the sellers on Ebay that list their timeshares at ridiculous prices that never draw an offer. Unfortunately, it takes some folks longer than others to realize that their original reasoning for buying a timeshare was wrong. Maybe that's what is happening here.

My point is if you go in assuming that the entire value in your purchase is in the use and anything else is gravy, you would be better off with a RTU like Disney. At the end of a RTU you just walk away. No need to sell you unit on ebay for $. No need to pay ever larger fees for an obligation that is not worth the investment.

Ray

 

[AwayWeGo]

You Are Correct, Sir.

At the end of a RTU you just walk away.

Easiest exit strategy in all of timesharing, no ?

Same goes for those 3-year (renewable) RTU timeshare leases at Club Trinidad & possibly others that I don't know about.

Meanwhile, if owners still enjoy vacationing at their paid-for timeshares & the annual fees remain acceptable, there's no reason to get glum about future residual values of deeded timeshares.

Plus, if the economy bounces back, those residually worthless timeshare deeds could even become valuable again, who knows ?

BTW, timeshare ownership -- deeded or RTU mox nix -- is not prepaid vacation accommodations any way you shake it. If I get my timeshares el cheapo or even el freebo, I still have to pay those ongoing annual fees every year or they won't let me in when I show up for my "prepaid" timeshare vacation.

It's those ongoing annual fees & occasional special assessments that are the real cost of timesharing. Paying lots or paying a little or paying nothing to get one's name on the deed or the RTU lease is practically mox nix when all is said & done.

-- Alan Cole, McLean (Fairfax County), Virginia, USA.​

 

[rsackett]

I think you misunderstand, Ray. The focus for SueDon and for many of us - and Marriott's primary selling point - was the value being in the usage, with no claims made that the timeshare would appreciate in value. I didn't see any statement in SueDon's post that Marriott was selling only the usage.

Dave, I have never assumed that my timeshares would appreciate in value. The moment I buy a car I assume that if I sell it, it will sell for less than I pay for it. However I do not buy a car with the assumption that anything I can sell it for is gravy.

Many here say they think anyone who looked at their timeshare purchase as an "investment" were miss-informed. I agree if by investment it is assumed a positive return.

However I do look at all my purchases with an informal eye to cost vs benefit. When I make any major purchase, timeshares included, I think about what I will get for what I put in. Whit an "investment" like a timeshare I assume a fair amount of risk, that does not mean that when someone makes a change that changes the residual value of my property that I do not care. I do not consider any value above ZERO of my timeshares to be gravy.

I have heard several people on this board that they make their purchase of a timeshare for the value of use only, and ANYTHING they receive at the eventual sale is gravy. If that is truly how a purchase a RTU would be a better choice.

To me there is a BIG difference in assuming a timeshare will appreciate in value, and not caring about residual value of a purchase.

My first timeshare purchase was direct from Marriott at Horizon in Orlando, I later rescinded. The salesman did say that by purchase should not be looked at as an investment and that if I was to sell it the next day, like a car it would not sell for as much as I paid. In the next breath he showed how the amount Marriott sells the week for has gone up over the last few years, and how it was going up again very soon, implying that a gain in selling price would lead to a increase in equity. I have beed to several TS presentations and a salesman has never stated the if I buy I should assume that my value in purchasing was entirely in use and I should think of anything I get at time of sale of "gravy".

Ray

 

[Latravel]

I think regardless of what we each expected as a rate of return on our purchase, Marriott made their stance very clear at time of purchase. Sales staff were very clear by stating there is no implied value other than a "lifetime of vacations" and time spent with the family. In addition, they made us sign that we understood these points.

So, it really doesn't matter what we each expect when we sell, this is the reality.

 

[GregT]

More speculation: if Marriott institutes a pure points-based program with no home resort advantage, and deposits its remaining unsold inventory into the "points pool", it is possible that instead of destroying the value of the previously-sold deeded timeshares.

I would think that the more desirable properties/seasons won't see the same level of price deterioration (if any) because, as an example, if you want to go to MOC, you'll likely never get in using points, and therefore need to own the deeded unit.

By comparison, Ko Olina could be easier to get into (using points) since there currently exists unsold capacity that will be made available to a points program. However, I can't see resale prices deteriorating for either property as someone who wants to visit Ko Olina routinely will need the deed.

This is a very interesting thread (and we've hit just about everything relevant in timeshares!!! Resale vs. Direct, possible Marriott points system, Wyndham VIP, RCI lawsuit, Perry, Marriott's greed vs. benevolence, Starwood's changes, MFs as true cost of ownership......go TUG!!!)

Good luck to all,

Greg

 

[SueDonJ]

I think where we're getting crossed up is, some of us don't equate putting a premium on usage value with an automatic depreciating zero dollar value of our initial financial investment. Like I've said, I don't expect that we'd have to give our weeks away for a pittance if we put them on the resale market, but neither do I expect that we would get what we paid for them. And as I posted way back somewhere in this thread, I also don't agree with some of you that IF Marriott implements a new points system with higher initiation fees for resale than direct purchases, then the resale values of all Marriott timeshares will be decimated to the extent you expect. Some, sure, but not the catastrophic losses you're guesstimating.

Ray, I did say that "we'd be better off thinking we'd never see our upfront money again..." but that was a worst-case scenario which we adopted after browsing the resale market for some established older Marriott resorts. Perhaps I didn't explain myself very well, but our thinking at the time we purchased wasn't that the worst-case was a given, only that the resale market at the time confirmed what we'd been told - that Marriott doesn't offer any protections to prevent the worst-case scenario. It isn't that we don't care about our investments, it's that we expect the financial risks we took with them are worth the usage rewards.

But that brings me to, what is in a resale deed that's not in a developer-direct deed which makes you resale buyers think that you have a right to expect any dollar value return? We all have deeds that confer exactly the same things to us - a share of a property with usage according to the terms and conditions of the governing docs, and those governing docs make it crystal clear that your Marriott timeshare is not a financial investment. Sure, resale buyers might stand to lose less money on the resale market because their initial dollar investment was probably less than a direct buyer's, but that's the only difference. Especially in this economy, if we're talking about prime weeks that were puchased to use, pretty much nobody's initial dollar investment is going to be protected in the depreciating external resale market.

Is it that we're simply looking at things differently, that some of us are putting more emphasis on usage than the perpetuity benefits of a deed? Maybe that's it. I'm not sure that a deeded timeshare is any more valuable than an RTU, to be honest. (Unless somehow the contracts of a resort are dissolved and the property footprint is sold for eighty-seventeen trillion dollars - but then we'd all be winners! ) An RTU like DVC does appeal to me more for one reason - I would prefer to not have to worry about passing on an annual financial burden to our children. But Marriott didn't have an RTU option for Hilton Head at the time we bought.

And one last thing, hopefully!, about how the value of a timeshare might be explained differently (and incorrectly) in a sales presentation. We bought SurfWatch during the development phase and were shown how the future pricing structure would increase as different phases of the property were completed. But there again, it wasn't presented to us as our investment would appreciate that much, but rather as why there may be a cost benefit to purchase sooner rather than later. And, once more the presentation materials and governing docs did not support an assertion of investment appreciation; in fact it was made clear that future development and/or the associated increasing prices were not guaranteed.

I'm not that naive (not anymore, anyway) - I know that some Marriott salespersons present the product incorrectly. I am on exactly the same page as the rest of you when you say that is wrong and hurts the product. But I also think Buyer Beware should come into play at some point, and all Marriott owners should make themselves aware of what the product actually is! It's apparent to me that there are as many resale buyers as direct buyers who don't know enough about what they've purchased, and have some unrealistic expectations of a protected investment.

 

[littlestar]

Disney is a bit of a different animal though. Most of their units are directly on park properties. As such, Disney has a vested interest in not letting these units go for dirt cheap as that would undercut their hotel business.

I do agree that as far as timesharing goes, they are a pretty good operation, IMHO.

I agree. Disney DVC is a totally different animal than a Marriott timeshare simply because of the parks. When I bought DVC it was "should I buy or should I still pay cash to Disney for onsite moderate and deluxe hotels?" My comparison on whether to buy was strictly Disney's cash rates on their on-property resorts.

You can't compare Marriott timeshares with DVC park resorts. What I base the value of my DVC points on is the Disney resort hotel prices. Marriott does not have a theme park on-site experience that drives their timeshare prices - weeks or points, it just doesn't matter. What Marriott offers is a nice consistent quality condo experience at their various locations - not an immersive Disney resort/park experience. DVC/Disney is unique and in my mind a niche product.

 

[m61376]

Sue- I don't know if your last comment was directed at me, but I certainly didn't have any expectations of my purchases being a protected investment. Even at resale prices (which for premium properties are still substantial) the expectation is that the inherent value will fluctuate with the market (and very loosely with the real estate market perhaps). The primary value is in usage. However, my expectation also is that there would be some inherent value (regardless of how the unit was purchased) and that Marriott would act in such a manner as to not sabotage the inherent value (and, in reality, direct buyers will suffer more should they ever decide to sell if Marriott does decimate the resale market). And, while I was never promised investment returns in the typical sense, I did hear about how the properties keep on selling for more (implying appreciating value) despite all their clauses making buyers acknowledge that there were no implied promises. In Aruba salespeople last year were even using a timeshare moratorium as an excuse to buy, rationalizing to buyers that all the values were sure to increase because of it. So at least some salespeople have more than inferred that there was also an investment aspect, although I concur that a knowledgeable buyer shouldn't be looking at any such purchase as an investment opportunity. So, while perhaps looking at a timeshare purchase as an investment may be a little naive, expecting it to retain some inherent value is, in my opinion, at least a purchase consideration for many, if not most, people.

In fact, a few years back there was a Tug formula suggested for helping people figure out whether or not making a purchase was a sound choice, and one of the criteria was residual value. If you were to put zero in the residual value column it would be hard to justify many purchases, although some people would buy just not to have to be bothered with renting or similar reasoning.

If you need an example as to what can make even formerly expensive timeshares essentially worthless, just peruse the Starwood Board. I am fearful that Marriott will be going down a similar road. Once people perceive that there is little to no inherent value left, it becomes easier to walk away from any obligations associated with the property- ie:MF's. When people simply walk away everyone suffers with skyrocketing MF's. That's what's happening with Starwood and that can happen here if too many people find little to no value in the new plan.

The other issue which pertains to MF's is IF Marriott totally adopts a point program for those that wish to join (as in their Asia Pacific points program and as Fletch indicated that they were anticipating doing)- what happens to the MF's? In the AP program the MF's depended upon the number of points owned (so Bronze owners would get less points but also pay lower MF's). I am wondering how that all equalizes, esp. since there will be weeks owners and points owners at every resort theoretically. Admittedly, I have only a basic understanding of how the points programs work, but I am concerned that the changes may wreck havoc with MF's

 

[dioxide45]

The other issue which pertains to MF's is IF Marriott totally adopts a point program for those that wish to join (as in their Asia Pacific points program and as Fletch indicated that they were anticipating doing)- what happens to the MF's? In the AP program the MF's depended upon the number of points owned (so Bronze owners would get less points but also pay lower MF's). I am wondering how that all equalizes, esp. since there will be weeks owners and points owners at every resort theoretically. Admittedly, I have only a basic understanding of how the points programs work, but I am concerned that the changes may wreck havoc with MF's

If they implement this, how they handle MF could impact a lot of people in a lot of ways and may even deter many from buying in. Currently at their resorts (except FL) the MF+T is the same for all seasons. So if they go to a MF$/point system, it will mean increased MF for people who own high seasons and lower fees for low seasons.

If a resort currently has a $1MM budget and then it has 1MM points allocated to it. Those people who were paying equal amounts of MF will not be equal any more. If a plat week is worth 1000 points, and a gold worth 600, then it means what everyone was paying before was somewhere in between. If they only lowered the fees for the low seasons, then the resort would be short on budget. If they only increase the fees for high seasons, then there would be a surplus.

I see Marriott moving to something more of an overlay program that is only used for exchanges. They won't drastically change the status quo. Assign a point value to each resort/season/view. This will only be used for exchanging. This would mean a platinum owner will pay a lower per point MF than a silver season owner since they have more points but pay the same MF.

 

[kjd]

There's certainly nothing wrong with a little gravy in anyone's life but I think that the DVC or RTU approach is a very good one. It's clear that you are paying for usage with DVC. I'm not sure that you can completely walk away after the end of the contract but I'll confess a lack of knowledge about these arrangements. I seem to recall language in the Marriott sales agreement to the effect that the buyer should not assume that there is any inherent ownership value and that no residual value is implied. I'm sure most of us signed on to that. Maybe someone could expand on that.

While the idea of a point system or a DVC-like system might be a better approach for some individuals you can't escape the fact that it's the brand that's important to most folks. Regardless of what kind of ownership system it may have. An example is that I considered DVC an excellent product and I liked their reservation system but I purchased from Marriott.

What I didn't like about DVC for our situation was:

1. not enough locations where we wanted to vacation,

2. didn't like some DVC locations being within theme parks,

3. wanted more options of ownership with access to MRP and,

4. wanted more emphasis on adult vacations. Somehow we have passed the point of being interested in the mouse and Snow-white.

It all gets back to the TUG sage advice to buy a timeshare where you want to vacation most of the time. So we did. Maybe DVC will eventually build something in Las Vegas but the idea of it wouldn't seem to mesh with their corporate branding. My point is that I think that most new purchasers will buy the brand and location first before considering an ownership system's advantages or disadvantages. I don't think it's a good idea to do otherwise.

 

[TheTimeTraveler]

It's interesting to read people's thoughts on this subject, and I hope the Marriott Corporation is taking notes. The popularity of this subject may eventually exceed the long running Aruba complaint thread!

All I can add is that we know what we have now........ and the new product may or may not be better.

Is Marriott willing to take that gamble at our expense? After all, it will be all of us in essence who end up paying for it.

As long as the product is enhanced, an no one gets hurts in the process (financially or otherwise) then it may be worthwhile

And, then again it may not

I think we'll just have to wait and see!

 

[Pit]

But that brings me to, what is in a resale deed that's not in a developer-direct deed which makes you resale buyers think that you have a right to expect any dollar value return? We all have deeds that confer exactly the same things to us - a share of a property with usage according to the terms and conditions of the governing docs, and those governing docs make it crystal clear that your Marriott timeshare is not a financial investment. Sure, resale buyers might stand to lose less money on the resale market because their initial dollar investment was probably less than a direct buyer's, but that's the only difference. Especially in this economy, if we're talking about prime weeks that were puchased to use, pretty much nobody's initial dollar investment is going to be protected in the depreciating external resale market.

I don't think anyone expects a guaranteed return on any real-estate investment. Likewise, they do not expect their management company to deliberately devalue their investment, just because they can.

None of the governing docs I've read say anything about investment value. The language you're referring to is most likely in the Contract of Sale you signed with Marriott. A resale buyer does not enter into a sales contract with Marriott.

 

[Twinkstarr]

I see Marriott moving to something more of an overlay program that is only used for exchanges. They won't drastically change the status quo. Assign a point value to each resort/season/view. This will only be used for exchanging. This would mean a platinum owner will pay a lower per point MF than a silver season owner since they have more points but pay the same MF.

That's how I see this playing out. Somewhat like the Hyatt system.

 

[m61376]

That's how I see this playing out. Somewhat like the Hyatt system.

Which is what I would have thought it would be like- retaining home resort usage (including booking preference) and points for exchange purposes. However, two things have me wondering- first, that's not how they implemented it in the Asia Pacific program, which I'm guessing was partially a small scale trial and would likely become part of an integrated system. The other, which sort of goes hand in hand with the Asia pacific program, is what Fletch posted.

 

[Venter]

I agree. Disney DVC is a totally different animal than a Marriott timeshare simply because of the parks. When I bought DVC it was "should I buy or should I still pay cash to Disney for onsite moderate and deluxe hotels?" My comparison on whether to buy was strictly Disney's cash rates on their on-property resorts.

You can't compare Marriott timeshares with DVC park resorts. What I base the value of my DVC points on is the Disney resort hotel prices. Marriott does not have a theme park on-site experience that drives their timeshare prices - weeks or points, it just doesn't matter. What Marriott offers is a nice consistent quality condo experience at their various locations - not an immersive Disney resort/park experience. DVC/Disney is unique and in my mind a niche product.

Just out of interest or ignorance - I think I read somewhere that Marriott was planning resorts with the Ritz brand name but also linking up with Nickleodeon for something like a theme park like resort. Did I have my wires crossed at the time?

 

[Twinkstarr]

Which is what I would have thought it would be like- retaining home resort usage (including booking preference) and points for exchange purposes. However, two things have me wondering- first, that's not how they implemented it in the Asia Pacific program, which I'm guessing was partially a small scale trial and would likely become part of an integrated system. The other, which sort of goes hand in hand with the Asia pacific program, is what Fletch posted.

DH laughs about us Starwood owners being "up on the barricades" with our changes!
I can't imagine Marriott doing such a large change with the US/Caribbean/Europe system. It won't be pretty, when you have those plat. owners not having a home resort priority whether they bought resale or direct!

But when I did talk to Marriott about buying direct, I did get some inventory numbers and boy some resorts have a ton of silver or lower weeks available. By going to points, you could convert those and sell them to owners who needed a few more points(ie gold season owner who want to get a platinum week somewhere). And maybe that's what it is about.

 

[m61376]

DH laughs about us Starwood owners being "up on the barricades" with our changes!
I can't imagine Marriott doing such a large change with the US/Caribbean/Europe system. It won't be pretty, when you have those plat. owners not having a home resort priority whether they bought resale or direct!

But when I did talk to Marriott about buying direct, I did get some inventory numbers and boy some resorts have a ton of silver or lower weeks available. By going to points, you could convert those and sell them to owners who needed a few more points(ie gold season owner who want to get a platinum week somewhere). And maybe that's what it is about.

Interesting thought. But there would have to be inventory for all those people who may have bought essentially to combine purchases to use. For it to work, one would have to make the assumption that an equal number of people were buying to combine as were Plat. owners willing to split and get more time; otherwise, there won't be enough Plat. weeks for anyone to book. But you may be right- it is a way of hiding the fact that outside of Flexchange many Bronze weeks are of limited value to most people, esp. in light of ever increasing MF's. Of course, IF MF's remain the same for all seasons, then someone using Gold + Bronze or Silver points to get the equivalent of Plat. points would be paying 2 MF's to do so. IF it works like in the Asia Pacific program, though, you'd pay a set MF per point regardless of where you owned, so MF's are spread across the board. Thus, the Hawaii owner would probably stand to win here and the owners of resorts with lower MF's would likely lose, since the fees would be spread across the board IF there was no real home ownership.

The repercussions of such as system could be quite scary. I wonder how many people here would sign onto a system even for free that worked in such a fashion. Moreover, I wonder how the percentage of people who would favor such a system are skewed wrt ownership (Plat. versus Gold, etc.). Would people be willing to give up their home resort advantage and would they prefer MF's based on the number of points owned?

On one hand, it has the advantage of offering ultimate flexibility, esp. as travel needs change over time. On the other, inventory is no longer controlled, so at certain locations the demand for certain periods may make booking a nightmare.

I know if I had to give up hone resort priority to join I wouldn't, regardless of the cost to join. I wonder how Marriott would calculate MF's under two totally different ownership scenarios.

 

[SueDonJ]

I don't think anyone expects a guaranteed return on any real-estate investment. Likewise, they do not expect their management company to deliberately devalue their investment, just because they can.

But there we're getting back to the perspective argument that's been a part of this discussion - is Marriott considering a higher initiation fee for resale buyers in the rumored exchange plan it may implement in order to deliberately penalize resale buyers, or because it is a way for them to generate increased revenues while lessening the burden of their direct buyers? As well, will the rumored exchange plan actually decimate all resale values to the extent speculated by some?

None of the governing docs I've read say anything about investment value. The language you're referring to is most likely in the Contract of Sale you signed with Marriott. A resale buyer does not enter into a sales contract with Marriott.

There's a provision in the Contract for Purchase and it's an item covered in the Ownership Assurance Checklist amendment to that contract; of course a resale buyer doesn't have that same contract.

However, as has been pointed out, the governing docs apply to a resale purchase and should be available to resale buyers from either the seller or Owner Services. Here and in other threads on TUG direct buyers have copied relevant statements from the docs. In case you missed any of those posts, one from SurfWatch's Description of the Timesharing Plan follows - there are others as well throughout the Timesharing Declaration and Management Contract.

Purchaser should purchase a time sharing interest as a vacation experience and for his or her personal use and enjoyment. Purchaser should not purchase a time sharing interest as an investment for profit upon its rental or resale.

 

[Twinkstarr]

Interesting thought. But there would have to be inventory for all those people who may have bought essentially to combine purchases to use. For it to work, one would have to make the assumption that an equal number of people were buying to combine as were Plat. owners willing to split and get more time; otherwise, there won't be enough Plat. weeks for anyone to book. But you may be right- it is a way of hiding the fact that outside of Flexchange many Bronze weeks are of limited value to most people, esp. in light of ever increasing MF's. Of course, IF MF's remain the same for all seasons, then someone using Gold + Bronze or Silver points to get the equivalent of Plat. points would be paying 2 MF's to do so. IF it works like in the Asia Pacific program, though, you'd pay a set MF per point regardless of where you owned, so MF's are spread across the board. Thus, the Hawaii owner would probably stand to win here and the owners of resorts with lower MF's would likely lose, since the fees would be spread across the board IF there was no real home ownership.

The repercussions of such as system could be quite scary. I wonder how many people here would sign onto a system even for free that worked in such a fashion. Moreover, I wonder how the percentage of people who would favor such a system are skewed wrt ownership (Plat. versus Gold, etc.). Would people be willing to give up their home resort advantage and would they prefer MF's based on the number of points owned?

On one hand, it has the advantage of offering ultimate flexibility, esp. as travel needs change over time. On the other, inventory is no longer controlled, so at certain locations the demand for certain periods may make booking a nightmare.

I know if I had to give up hone resort priority to join I wouldn't, regardless of the cost to join. I wonder how Marriott would calculate MF's under two totally different ownership scenarios.

I can't see Platinum owners in HHI, MB, FL, UT, Spain or the caribbean would be willing to give up home resort priority.

Now it might be different for NCV or Oceana Palms(which also has a huge plat season, first time I have seen week 47 in a platinum season!).

Might make sense for HI owners with high fees and the 1-50 season.

 

[m61376]

Sue- that language merely insulates Marriott from any responsibility as to future fluctuations in value. Similar language is found on stock offerings- but would you buy an IPO if you expected it to be worthless in the future? I think I can speak for virtually everybody and answer no to that question. Similarly, even though Marriott touts the purchase for vacation benefits, the language doesn't infer that there won't be any residual value. Experience has shown people that there was residual value, and I think most people expect that some value will be retained should they ever wish or need to sell. I also think that most people do not expect Marriott to institute rules which might cause any retained value to plummet. I just don't see how that is in any owner's best interests, regardless of how they initially purchased.

Maybe you don't care what your units may be worth, but since life has a way of throwing curves once in awhile, I think most people like to feel that they have inherent value.