What's Better: Right To Use or Deeded?

[jeannine1101a]

I searched the boards and can't seem to find an answer to this one, so I apologize if I am just missing it.

I am interested in a property that is RTU for 34 years. What are the positives and negatives of leasing for x number of years instead of owning, besides the obvious that I won't be able to pass on to my child?

Thanks.

JB

 

[JillChang]

my thoughts is how long I have to live! I definitely will not use all 34 years, I don't think I will live that long!!! Of course, it is an advantage to be able to pass it on to kids, but, realistically, how likely is that! As we moved into different decades, our perspective and views will change dramatically, what is desirable now may not be desirable 30 years later or vice versa!

I think if the price is right after you average it out the remaining of the RTU, then it shouldn't be much different than a deeded one. Besides, although you own the deeded units forever, the building and furnishing will not last forever, it will need to be refurnished or renovated. With a deed, you are responsible forever as well! With the RTU, at the end of the period, you are off the hook!

On the other hand, if it is a VERY good property in a location that you know will never have enough supply of timeshare, i.e., NY, then you do want to own a deeded property to ensure you always have a share in it. In places like Mexico, then the same does not apply.

There are pros and cons, depends where and which property you are looking at.

 

[jeannine1101a]

Thanks for answering. The property I am considering is in Antigua. It is a 2 bedroom/2 bath and the price is $10K. I've not bought before, but my friends have been to this location and say it is stunning. I am really tempted...but I don't want to jump before I get all the facts. I've only been studying timeshares for a few months!

Now that you've heard more about the property, any more thoughts?

JB

 

[JillChang]

if you tell the Tuggers the exact property name, you will get lots of feedbacks.

I am not familiar with Antigua timeshare, but I do a search for you on prices if you let me know the details

 

[jeannine1101a]

Thanks. It is the village at st. james club (URL: http://www.sellmytimesharenow.com/details.php?idadd=105362)

I also have a 4 year old who will be going to kindergarten a year from September so I think the week 23, although in June, would be very good for us.

JB

 

[AwayWeGo]

Deeded, Shmeeded.

If a timeshare is RTU for 34 years, then after that you don't need to worry 1 bit about it. The right expires, your interest in it turns into a pumpkin, & that's that -- no muss, no fuss. Might get a bit dicey trying to sell it to somebody else, though, when the RTU years left on it dwindle down to the single digits. And, of course, you still have to keep on paying those fees, right on down to the final year.

A timeshare you own that's deeded in perpetuity is pretty much the same, since nobody will be around that long, except that the resale prospects (yours or your heirs') will not be affected at any time by the imminent expiration of RTU.

The thing is, all I actually own when my name is on a timeshare deed is the obligation to keep on paying those fees year after year. If I don't pay up, I don't get to check in. Case closed.

Psychologically, however, I feel a certain pride of ownership when I'm on site at my resort during my own paid-for timeshare week. And even when I'm not physically there, I still get some vicarious enjoyment as a timeshare owner via TUG, resort newsletters, Yahoo timeshare resort groups, RCI, etc.

Who'd a-thunk?

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

 

[jeannine1101a]

Thanks Alan. I actually live in McLean also! Small world! This is a hard decision, but one that I think will be very good for our family. We are in our early 40s so I think that we will still (hopefully) want to travel in our 70s or at least give the time to others!

 

[Jya-Ning]

Thanks. It is the village at st. james club (URL: http://www.sellmytimesharenow.com/details.php?idadd=105362)

I also have a 4 year old who will be going to kindergarten a year from September so I think the week 23, although in June, would be very good for us.

JB

Week 23 will fall into 1st or 2nd week in June. Check the school. Most School in MD does not close until 3rd week in June.

Jya-Ning

 

[JillChang]

At a quick glance, my gut feeling tells me you can do better than 10k for this timeshare.

I am sure you will get lots of suggestions on this if you keep reading.

 

[MULTIZ321]

Jeannine,

Welcome to Tug! One of the benefits of membership is that you will have access to the Tug Resort Reviews and you will see other reviews for the resort(s) you're interested in. Once you become a member, on the thin red toolbar toward the top of your Tug screen, you will see the "Tug Resort Databases" hyperlink - click on that hyperlink to get to the menu for access to the Tug Resort Reviews.


Richard

 

[Jya-Ning]

I am interested in a property that is RTU for 34 years. What are the positives and negatives of leasing for x number of years instead of owning, JB

My 1st born will go to kindergarden in sept next year, too. It affects on how you calculate the cost. If you buy one and try to sell it with intend to buy another one, most people use 10 years. Since resort will more likely needs to refurbish in that frame. So assume you sell it before SA and buy another one newer, what will be your estimate the possible resale value at that time for RTU and deed? For deed, most people will assume it stays similar as today, so you don't have loss there, so for 10 years, your travel cost for deed is
(10 * MF + (property cost) * opportunatiy cost)/10, but for RTU, it will be more like (10 * MF + (property cost) * opportunatiy cost + potential loss on resale)/10. It all depends on how much you plan to spend year in year out on travel lodge.

If you plan to use it until you die or the use right gone, then both will be close to
MF + (property cost) * opportunatiy cost + property cost / life expectation.

Or instead of life expectation, it is the less of 34 and life expectation.

Jya-Ning

 

[JillChang]

My 1st born will go to kindergarden in sept next year, too. It affects on how you calculate the cost. If you buy one and try to sell it with intend to buy another one, most people use 10 years. Since resort will more likely needs to refurbish in that frame. So assume you sell it before SA and buy another one newer, what will be your estimate the possible resale value at that time for RTU and deed? For deed, most people will assume it stays similar as today, so you don't have loss there, so for 10 years, your travel cost for deed is
(10 * MF + (property cost) * opportunatiy cost)/10, but for RTU, it will be more like (10 * MF + (property cost) * opportunatiy cost + potential loss on resale)/10. It all depends on how much you plan to spend year in year out on travel lodge.

If you plan to use it until you die or the use right gone, then both will be close to
MF + (property cost) * opportunatiy cost + property cost / life expectation.

Or instead of life expectation, it is the less of 34 and life expectation.

Jya-Ning

Jya-ning,

You must be an accountant. This is pure accountant point of view, a pretty good one

I like to add that you also want to consider if you will go to the same property year after year. If not, you might want to consider one that will use the most to buy, or one that has the greatest trading power with low MF.

 

[AwayWeGo]

Timeshares OK For Old Folks.

I think that we will still (hopefully) want to travel in our 70s or at least give the time to others!

Before we bought our 1st (resale) timeshare in Orlando FL, we were not yet grandparents but we expected (& hoped) we would have grandchildren before too long. Plus, our wonderful daughter-in-law was already a Disney & Disney World fan, bigtime.

So when the flash of realization hit us that "used" (resale) timeshare weeks are identical in all practical respects to "new" (full-freight developer price) timeshare weeks, we were all ready to take the timeshare plunge. And pretty soon we did.

Now we're into fixed weeks, floating weeks, points, Last Call, regular exchanges, Instant Exchange, renting out, eBay, & I don't know what-all -- enjoying it just about every day of the week, for a total outlay so far of right about $5,000 (not counting exchange fees, RCI membership, etc., & not offsetting those with any of the timeshare tour freebies or timeshare rental payments we've collected).

The Chief Of Staff & I grew up in McLean VA, went to McLean H.S., & raised 2 sons (now 38 & 35, respectively) who also went to McLean H.S. Our older son & our daughter-in-law & grandson live halfway between our house & McLean H.S. We live 3 blocks from where my mother & dad lived when I was growing up, which also happens to be about 6 blocks from where The Chief Of Staff's folks lived when she was growing up. We've known each other (The Chief Of Staff & I) since we were 13 years old. (We're pushing 64 now.) Our house is a mile or less from the corner of Westmoreland Street & Kirby Road.

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

 

[gmarine]

I searched the boards and can't seem to find an answer to this one, so I apologize if I am just missing it.

I am interested in a property that is RTU for 34 years. What are the positives and negatives of leasing for x number of years instead of owning, besides the obvious that I won't be able to pass on to my child?

Thanks.

JB

It is a great resort to own. This is the first resale I have seen in the 3 years I have owned at SJC. It is very rare to see one up for sale.

Management is excellant and very owner friendly. Maintenance fees are only $450 per year. And include daily housekeeping. The resort is immaculate as are the villas.

You will also get a bonus week from II if you deposit your unit.

If you dont use your unit you will have no problem renting it for 4-6 X your maintenance fee, sometimes more if it is a beachfront villa.

The only thing about the ad that I would question is that it lists a floating unit. I am not aware of any that were sold as floating units. All have been sold as fixed units during fixed weeks. There are beachfront,middle hill, and upper hill villas with beachfront being the most expensive followed by middle then upper hill.

Also be aware that the resort does have ROFR (Right of First Refusal) on sales so it is possible that the resort will buy back the unit rather than let you buy it for that price.

As far as getting them to lower the price, it would depend on the villa location. Beachfront the price is good. Hillside it isnt that great of a price.

If the owner says it is a floating unit make sure you call the resort and have them confirm how the usage works.

 

[susan1738]

I agree with JillChang

I agree that I would buy someplace where it would be likely that I could/would go every year if I wanted to, that has low MF. The last 4 TS that I've bought have met that criteria, and I'm pretty happy with them.

 

[jules54]

JB,
Don't buy anything until you do alot of research. In buying resale you have already saved alot of money. I don't think it matters if it is RTU or deeded. There will always be more resorts being built every year. Also sometimes lifetime if far toooo long when you are paying high maint. fees. I bought my first timeshare on my 40th birthday from the developer and paid top dollar. It was a RTU that was 12 years ago. I have upgraded a few times and still have 15 years left on that contract. I have not been back to that resort since 1999. I only used my home resort 3 times in 12 years. My home resort went into the Fairfield system in 1999 and I have been traveling to different FF resorts since that time.
My second purchase was resale in 1996 super nice resort in southern California. Always gets top reviews and ratings. I stayed at that resort 1 time in the 9 years I owned it. I just sold it in the fall of 2005. Banked the other years and traded to anywhere I wanted and got excellent trades. That resort was deeded for life. Along with that went property taxes and maint. fees doubled during the 9 years I owned. I paid 5,000 for this top-notch resort and sold it for 4,000 after 9 years.
I have used that money to buy more Fairfield pts. which make me a VIP owner in that complicated program. I also bought 4 weeks at a RTU resort in Cabo, MX. the resort is only 3 years old and resale is already available to purchase.These contracts in Cabo expire in 2034. 1 week in Playa Del Carmen, MX at a RTU resort that expires in 2050. The resort in Playa is fabulous. Last but not least I also purchased a week near Daytona Beach that is deeded in an oceanfront resort in a two-bedroom lockoff unit. I have spent my 4,000 plus 1985.00 more. I will use some of my weeks and rent some of my weeks depending on the location. I picked specific resorts for those very reasons and waited until I found them or stumbled across them on ebay.
In the last 14 months I have taken 14 vacations that involved timeshare resorts. 7 of those trips were to Mexico, but not the same city or resort.
Keep in mind in purchasing that Aruba is a long flight and I would assume quite costly. Really consider how much you are paying for the resort to begin with and also the yearly maint. fee. If the fee is 700.00 per year keep in mind that is 100.00 per nite of useage if you bought 1 week.
IMO it does not matter if the property if deeded or RTU if your buying on the resale market and get a good deal. And if you wait and study and research there is always a great deal somewhere. There are hundreds of stunning resorts in the world with dozens more being built yearly. Make sure your purchase will trade well and get you many other places as your family grows and changes you will need to travel alot in the US to see everything.
Good Luck and have fun with it ask tons of questions about everything before you buy.

 

[JillChang]

Jules54,

I just begin timesharing last year and I am beginning to be like you. In this short time I compiled 5 $7,000 including closing costs, sold one last week, and bought another just 30 minutes ago, and I have not yet spent a single night in any timeshare!!!.....This is truly a disease.... I do have fabulous reservation through exchanges already with Sheraton in Xmas, HGVC in NY, and Grand Mayan in March.... Totally addicting.

Personally, I would not buy Antigua, because air is expensive, and I don't see myself going there every year. I also don't see it as a location that can grow with my family. I think a timeshare in U.S. is ideal, you can use it yourself and your growing family, and trade when you want to go Mexico, Hawaii, or Caribbean.

I guess the first thing the op has to learn is the different resorts, clubs, point systems available out there. I have been on Tug for more than 6 months reading it almost every day and I am still learning...

The second thing the op has to learn is how to exchange and trade. I am one of those that totally avoided RCI and exchanged with SFX and I find them fulfilling my every vacation dream.

Keep researching and don't limit yourself. Sign up with TUG and read the reviews, explore other timeshare sale websites that you will come across from reading TUG.

Good luck!

 

[gmarine]

Regarding the price of airfare to Antigua, the most we have paid in our 4 trips is $440 per person from JFK.

 

[JillChang]

Regarding the price of airfare to Antigua, the most we have paid in our 4 trips is $440 per person from JFK.

Wow, that's good.

I am looking at air from Toronto to Acapulco and it is around $900 a person.

 

[Carolinian]

One thing to be concerned about with RTU is that the legal ownership of the land remains with someone else, and they might legally be able to sell it right out from under the RTU timeshare owners. That happened with Indies Suites on Grand Cayman after some hurricane damage for which the resort was underinsured. Of course, the courts finally did step in to give some relief to the timesharers. A deeded resort puts you in a much stronger position.

That said, ownership type is only one of many factors to consider. I have never owned an RTU but I have owned at three resorts in two countries where ownership was represented by shares of stock and one where it was represented by membership in a cooperative. All but one of those resorts were homeowner-controlled, something I much prefer over a resort still controlled by the developer.

 

[myip]

The only problem with RTU is if the resort go bankcrupty, you have nothing. It happens to my resort, Club Vacances Magog. I lost my timeshare....:annoyed:

 

[gmarine]

Wow, that's good.

I am looking at air from Toronto to Acapulco and it is around $900 a person.

Yikes. Even though it's a much longer distance that's still a lot to pay.

I would watch the fares carefully as it gets closer and they should come down unless your going during a holiday week.

 

[JillChang]

Yikes. Even though it's a much longer distance that's still a lot to pay.

I would watch the fares carefully as it gets closer and they should come down unless your going during a holiday week.

March break, March 10 - 17.

 

[jeannine1101a]

Thank you for all of your replies. I may be more confused than ever! The good thing is that I am not really ready to buy, although the villa in Antigua sounds good to me! Airfare is around $400-500 from the DC area where I live, but would probably take 6-8 hours to get there, which may not be ideal.

I didn't know you could just make an offer! I thought you had to just buy at what the price is. I really am learning a lot.

Alan - btw - I live at the other end of Kirby - closer to 123 but probably not more than a mile from you! We used to live at the corner of Westmoreland and Chain Bridge Road!

Thanks again all!

 

[Steve]

I just have to jump in...as I grew up in McLean, Va, too. Born and raised. I lived off Georgetown Pike and graduated from Langley High School...class of 1984.

Alan, you have certainly seen a lot of changes in the time that you have lived in McLean!!! From sleepy little crossroads to chic suburb. It's always interesting to see the new growth when I go back to visit. I was sad to see Evans Farm Inn get sold for development, though. I used to love to go there and feed the ducks when I was a little boy. (Until the big mean swans would come chase me and I'd have to climb up on a farm implement to get away from them...lol.)

Anyway, please excuse this little trip down memory lane...but it's fun that there are a few other McLean natives on TUG.

As for right-to-use vs. deeded, I prefer deeded timeshare weeks. It's really just a pride of ownership thing more than anything else...but I like the feeling I get from being an owner.

Steve