Why arent more independent resorts Dual Affiliated (rci and ii)

[jp10558]

So I wanted to go back to Vistana (which I gave back to Marriott), I can book on hotel. Com and booking.com with a 4 day cancel window. Why with Timeshare company, same rooms, do I need to have a 60 day window? This is why RCI for me is useless. Same with II, which had a better cancel policy but not as good as the hotel site, crazy. Also since I’m not paying on reserves, it’s 300 less than my maintenance fee.
MY HGVC besides giving me free RCI also gets me GPX (grandfathered in). If I had to pay for RCI would not do it. Even considering dropping II, hotel sites are easier and better for last min cancels.

I guess you didn't give me enough info, but looking on booking.com I'm seeing a 2BR at Vistana Resort in Orlando (Guessing what Vistana) for $1765 for a week in January. That's a lot more than most II exchanges or Getaways to the same place, so why wouldn't I use II and save $400 to $800 if I was pretty sure I was going?

 

[jp10558]

I guess you didn't give me enough info, but looking on booking.com I'm seeing a 2BR at Vistana Resort in Orlando (Guessing what Vistana) for $1765 for a week in January. That's a lot more than most II exchanges or Getaways to the same place, so why wouldn't I use II and save $400 to $800 if I was pretty sure I was going?

And quoting myself here - I wonder if you could split the difference with some travel insurance assuming you could get an agent to build a policy for that. I do feel like there might be a market there as that's a lot of upcharge from Booking / the resort to make up the 4 day cancellation. If I was worried, I'd love to spend $50 or so for a cancel any reason up to 4 days before kind of policy.

 

[bizaro86]

I'm going to disagree here, you still should consider the purchase cost. You might have made a bad deal, but it still is part of your cost calculation.

If I buy a 2012 corolla for $50k, my cost of driving it going forward shouldn't include the fact that I got scammed out of $40k.

It's reasonable to amortize the value of something across It's usage, but in the case of a timeshare purchased retail that might be worth $1500 after getting bought I really think that amortization should be off the $1500 not the $40k. The up-front purchase mistake is a sunk cost, and choosing not to make otherwise good exchanges because someone overpaid upfront doesn't make any sense imo.

 

[TerryCanuck]

If there were only one exchange company, the US government could reasonably claim that the company had a monopoly. I belong to HICV, where some resorts are II and some are RCI. I own more at least one resort in each and can use either II or RCI.

 

[Bailey#1]

Redington Ambassador the south side is in interval international and the north side is rci.

 

[jp10558]

If I buy a 2012 corolla for $50k, my cost of driving it going forward shouldn't include the fact that I got scammed out of $40k.

It's reasonable to amortize the value of something across It's usage, but in the case of a timeshare purchased retail that might be worth $1500 after getting bought I really think that amortization should be off the $1500 not the $40k. The up-front purchase mistake is a sunk cost, and choosing not to make otherwise good exchanges because someone overpaid upfront doesn't make any sense imo.

Ahh, I was thinking in comparisons vs not buying retail, whether that's renting, using VRBO or hotels, or resale. I.e. as a prospective purchaser. Which is how I say the math doesn't math for retail purchases. Yes, once you own, you have to let go of sunk costs in figuring out what you should do for new trades, using etc. I usually include my resale costs amortized for how long I've owned because I like to give a realistic cost to compare against. Otherwise sometimes we end up with comparing things potential new owners could no longer get.

That said, at some point you have to decide what you're comparing, and from that lens for exchange companies, I don't think purchase costs enter into it at all. Well, except in so far as like HGVC doesn't trade in II and MVC doesn't trade in RCI. Actually, like Brian said, I don't really get the exclusive deals except from the companies that the corporate umbrella includes the exchange. There must be some sort of really good kickback to HGVC to have them only use RCI.

 

[Susan2]

It seems to me that few replies directly answer Brian's original question, which I interpret as "What is stopping so many resorts from becoming dual-affiliated with RCI and II?"

I think it's a very good question. Someone mentioned "more work for the staff," but how much extra work, if any, would it involve? I own at two small resorts who were invited to become affiliated with the other exchange company, and I do not believe there was any real work involved -- other than reviewing the contract.

Can we hear from board members and managers at resorts about that? I think some managers/boards may be afraid of losing benefits with either RCI or II for their members, but I have never heard of any benefits actually lost (as they might be if the resort switched affiliations, rather than becoming dual-affilliated). I cannot imagine any other rationale, except not knowing how to go about it.

 

[davidvel]

If I buy a 2012 corolla for $50k, my cost of driving it going forward shouldn't include the fact that I got scammed out of $40k.

It's reasonable to amortize the value of something across It's usage, but in the case of a timeshare purchased retail that might be worth $1500 after getting bought I really think that amortization should be off the $1500 not the $40k. The up-front purchase mistake is a sunk cost, and choosing not to make otherwise good exchanges because someone overpaid upfront doesn't make any sense imo.

That is faulty financial reasoning. Whatever you paid for it is amortized over the useful/expected life, not what it is worth the day after you drive it off the lot. This is called depreciation.

Pretending each year's week does not include the sunk acquisition cost is denying reality. That cost is part of the annual cost. For TSs, I use 30 years, others use 20-25.

 

[davidvel]

We find both RCI and II fairly useless, RCI especially. Why is this? Two main reasons with a solution in reason 3 below 1) So lets say you buy a week at a developer for say $40,000. They give you the spiel of being able to easily exchange into all other RCI/II properties because your timeshare is special. So after spending $40,000 on your special timeshare, you soon find out your not that special after all and you have practically beg to get the specific week you want and the time you want. That is not very special indeed. May get it.....or not. Plus there are high exchange fee's involved. 2) There are these things out there called Hotels that you can book at the place and time of your choosing without issue. Many of the Hotel companies such as Marriott, Hilton, Wyndham and many others have units with full kitchens, laundry and separate living and sleeping quarters. The price works out about the same as your timeshare after paying the yearly maintenance and that initial $40,000 that could of been invested making a few thousand in dividends every year, plus that money is in your account and not the timeshare companies account. 3) The MOST important reason. How do you take advantage of II to get around the system and go to places at a relatively low price? With a little forward planning you can nab a Getaway week at some real nice places. This is especially true in places with lots of timeshares such as Orlando or Branson. A whole week at about the same price as half the maintenance fee for the unit. Some locations you can get for three weeks for the price of the yearly maintenance for just one week. The best deals seem to be at about 6 months before the date of the stay with good inventory. You can of time book weeks back to back for months at a time.
How do we work it all? We travel/live mainly overseas full time 365 days a year, and visit the US for one month a year for business and getting stuff handled. We tend to stay in a place at least a month to three months, and also lived in one place in Latin America for 5 years. Next year we will be in Asia for 3-5 years.
We are IHG Diamond Ambassadors, Wyndham Diamond. We have 500k Wyndham Access points which we use for our month visit while in the US.
Use those II Getaway weeks as they can be a bargain with prior planning

We recently traded into a week at 2BR MOC Lahaina/Napili towers, Mountain/Garden view using our Shadow Ridge gold studio for this trade. On Marriott.com this room costs about $4,800. The total cost to us is about $850.

This one of the most premium timeshare resorts in all the islands. It is not a Fairfield Inn or the like. I challenge you to find a comparable "hotel" for under $150 a night, all in.

 

[rickandcindy23]

I own at Marriott Desert Springs I and II. DSV1 is dual affiliated (RCI and II) but DSV2 is only affiliated with Interval. I've never understood why DSV1 is dual affiliated. Perhaps there are some legacy owners who would know. I think that there are only nine Marriott timeshares that are dual affiliated (according to Google AI) and I think that they are some of the older legacy TS.

I've toyed with the idea of joining RCI but have never followed through. I like exchanging into other Marriotts, Westins, and Hyatts. My perception is that Wyndham or Worldmark TS are nice but perhaps a notch below the former.

Your perception of anything in RCI is correct on Wyndham/WorldMark. RCI has the Hiltons, which are fantastic options, but Hilton charges fees. Why would I pay $175 in fees to stay at Hilton on I-Drive or SeaWorld, when I can stay at Marriott and not pay $175. It's stealing, pure and simple. RCI exchange fees are $299. We pay $199 for exchanges Marriott-Sheraton-Westin.

That's $274 additional dollars to trade into a Hilton, and Marriott is better anyway.

 

[bizaro86]

That is faulty financial reasoning. Whatever you paid for it is amortized over the useful/expected life, not what it is worth the day after you drive it off the lot. This is called depreciation.

Pretending each year's week does not include the sunk acquisition cost is denying reality. That cost is part of the annual cost. For TSs, I use 30 years, others use 20-25.

If someone steals $25k from you the same day you buy a TS should you amortize that money against your timeshare stays?

 

[davidvel]

If someone steals $25k from you the same day you buy a TS should you amortize that money against your timeshare stays?

Of course not, that is bizarre. If you want to cope and pretend the cost of your annual usage does not include what you paid for your interval, that is your prerogative. But it surely is not a financially sound analysis.

 

[bizaro86]

Of course not, that is bizarre. If you want to cope and pretend the cost of your annual usage does not include what you paid for your interval, that is your prerogative. But it surely is not a financially sound analysis.

I mean, I've never bought a developer TS, because that is an objectively bad financial decision.

 

[easyrider]

Interesting is Worldmark has the dual affiliation with RCI and II. With RCI you can use Worldmark as one of your affiliated resorts or you can use the Worldmark RCI portal that is linked to the Worldmark website and use only Worldmark as the exchange. With II you call an Interval / Worldmark number. I've had decent luck with both exchange companies using Worldmark.

UVCI has a dual affiliation but the better UVCI resorts trade in II while the older resorts trade in RCI.

Bill

 

[easyrider]

I mean, I've never bought a developer TS, because that is an objectively bad financial decision.

I agree but more buyers purchase at full price than at resale for a timeshare. To me, a resale buyer, when comparing prices at nothing to developer prices , I do agree with your point of the lost money when buying full price. Really, the lowest price paid should be the marker. So $0.00, lol.

Bill

 

[dioxide45]

If someone steals $25k from you the same day you buy a TS should you amortize that money against your timeshare stays?

What if the depreciation is only $5000 at the beginning. Perhaps you buy a car for $25,000 that is only worth $20,000 the second you drive it off the lot? Is your baseline for amortizing annual cost only based on $20,000 because you ignore initial depreciation? What about a TV you paid $1000 for but then sold later on Facebook Marketplace for $250? It was probably only worth half the price you paid if you were to turn around and resell it the day after you bought it.

 

[davidvel]

I mean, I've never bought a developer TS, because that is an objectively bad financial decision.

It doesn't matter who you bought it from, just how much YOU paid to calculating your annual usage cost.

I frankly don't understand why this is so foreign and confusing. It is basic financial analysis.

 

[easyrider]

It doesn't matter who you bought it from, just how much YOU paid to calculating your annual usage cost.

I frankly don't understand why this is so foreign and confusing. It is basic financial analysis.

It's reasonable to amortize the value of something across It's usage, but in the case of a timeshare purchased retail that might be worth $1500 after getting bought I really think that amortization should be off the $1500 not the $40k. The up-front purchase mistake is a sunk cost, and choosing not to make otherwise good exchanges because someone overpaid upfront doesn't make any sense imo.

The point being that some people overpay so it does matter who you buy it from. Its called a sunk cost trap which is when money that has been spent can't be recovered. Timeshares fall into this category when purchased from a developer. So valuing the timeshare at its fair current value which in the above example is $1,500 and not $40,000 would be used as the real amortization calculation because it represents the real value. The $38,500 is a loss and isn't part of the calculation. The $1,500 and the maintenance fee would be the cost of use going forward in the above scenario.

This is basic business economics. You can argue it anyway you want but you can't add a loss to to the calculation because it doesn't represent the fair market value. Using fair market value is a core business principle.

Bill

 

[davidvel]

My calculation is not valuing the timeshare. It has nothing to do with fair market value. The calculation is intended to determine one's annual cost for usage so it can be fairly compared to other methods of getting the same week. This allows a reasonable comparison of points purchased retail/resale, same with weeks, or renting from marriott.com for example.

Because people pay wildly different prices for the same thing, you cannot just ignore the upfront cost and say that someone who paid $100,000 for a week or points and someone who paid $20,000 for the same thing have the same annual cost.

Again the purpose is not to value the timeshare. I'm not sure why people want to pretend they didn't pay what they paid to acquire their timeshare in the annual cost calculation, maybe it is a cope to deal with how much they overpaid, maybe they just want to pretend their annual cost is much lower than it is because they recognize how much lower other people are paying, or maybe they just bought the salesperson's math.

 

[easyrider]

Because people pay wildly different prices for the same thing, you cannot just ignore the upfront cost and say that someone who paid $100,000 for a week or points and someone who paid $20,000 for the same thing have the same annual cost.

That seems simple enough but with some people paying $100,000 and others paying $20,000, the annual costs are spread too wide. Using a fair market value eliminates this. In your scenario the cost of buy in would mean the higher paying owner would charge a higher rent than the lower paying owner. We both know that a fair market value is used to determine the rent. Basically, the $80,000 more that the higher payer paid is lost. It's call a sunk cost.

I get the individual based math you are doing as well but that doesn't mean that the higher cost is anything other than lost to the lower cost regarding business transactions. All you are doing is identifying the loss which in your scenario was $80,000.

Bill

 

[davidvel]

That seems simple enough but with some people paying $100,000 and others paying $20,000, the annual costs are spread too wide. Using a fair market value eliminates this. In your scenario the cost of buy in would mean the higher paying owner would charge a higher rent than the lower paying owner. We both know that a fair market value is used to determine the rent. Basically, the $80,000 more that the higher payer paid is lost. It's call a sunk cost.

I get the individual based math you are doing as well but that doesn't mean that the higher cost is anything other than lost to the lower cost regarding business transactions. All you are doing is identifying the loss which in your scenario was $80,000.

Bill

You just love to be wrong, its an obsession. It is not about the fair market value or what rent would be charged. It is not about a business transaction. It is intended to accurately calculate the owner's actual cost of annual use, so the costs different methods of purchasing and reserving can be fairly compared. Nothing more nothing less. You cannot ignore the purchase price in doing so, period.

In your world, the annual use cost of your vehicle would not include the purchase price and would only include ongoing expenses like gas, maintenance, insurance and repairs. As if you magically received the vehicle for free.

Of course different owners are going to have different costs per year. That is the whole point of the calculation, to see what the differences are.

 

[easyrider]

You just love to be wrong, its an obsession. It is not about the fair market value or what rent would be charged. It is not about a business transaction. It is intended to accurately calculate the owner's actual cost of annual use, so the costs different methods of purchasing and reserving can be fairly compared. Nothing more nothing less. You cannot ignore the purchase price in doing so, period.

In your world, the annual use cost of your vehicle would not include the purchase price and would only include ongoing expenses like gas, maintenance, insurance and repairs. As if you magically received the vehicle for free.

Of course different owners are going to have different costs per year. That is the whole point of the calculation, to see what the differences are.

What you are trying to do when comparing costs to others is absolutely meaningless in every way other than to calculate what you spent. It doesn't matter if you paid $100,000 for a timeshare and others paid nothing because the fair market value is used for combining all people that bought the product. You can't rent your $100,000 timeshare for any more than the person who paid nothing.

What you are actually calculating is your loss in a business sense.

As an individual you are calculating your own cost. When you calculate your cost at $100,000 and compare it to a $0.00 buy in you have a loss. This is the sunk cost.

Bill

 

[WorldT]

The topic of this thread was "Why arent more independent resorts Dual Affiliated (rci and ii)".

Should we create another thread for best cost basis to use for financial analysis?

I like to know which resorts trade on both. I had a Colonies at Williamsburg that traded on both. I split my four bedroom and deposit a two bedroom in each exchange. Of course that doesn't answer the original question.

 

[easyrider]

The topic of this thread was "Why arent more independent resorts Dual Affiliated (rci and ii)".

Should we create another thread for best cost basis to use for financial analysis?

I like to know which resorts trade on both. I had a Colonies at Williamsburg that traded on both. I split my four bedroom and deposit a two bedroom in each exchange. Of course that doesn't answer the original question.

If you feel like starting a new thread about analyzing methods of costs regarding timeshares you certainly can. It would be interesting to see the different perspectives of those that paid too much versus those that paid nothing.

I had answered the original topic many posts ago.

Bill

 

[TUGBrian]

i havent seen an answer to the original question yet?

though I have reached out to II for their official answer on exactly what is required for an independent resort to become affiliated as there are far more rci affiliated resorts, than ii ones.