Will Marriott penalize resale owners?

[tombo]

If the goal is to kill the resale market, and arguably that what all the rumors are all about, then Marriott could easily do so without doing a single thing! I mean instead of 60% resales to current sales price how about 15%?

The ‘ol FairField now Wyndham folks face this – buy a $35k Wyndham week and by the time you get to your car it’s worth $5k. Wyndham sells a boat load of timeshares every day. Marriott could easily do this too – by not doing a single thing.

How?

Simple, Marriott would stop exercising the ROFR and watch resales fall to 15% of current sales and then buy them for peanuts.

So if you guys want to worry about Marriott killing the resale market this way leaves no fingerprints – no bad press – no class action lawsuits – just do nothing.


What shall we worry about next?

Marriott is not trying to kill resales, they are simply trying to make as much money as they can without regards to what it does to owners. ROFR raising resale prices is a joke. Westgate has ROFR and their resale prices are in the tank. Pahio/Wyndham is exercising ROFR and you can buy a 1 bed room Kauai week for under $500. Marriott's prices are as high as they are because of the quality of the accomodations and the locations of their resorts, not because of ROFR.

ROFR doesn't raise resale prices, it is simply another way for Marriott to make money. If Marriott needs some inventory they ROFR to have more inventory to sell. If someone buys a Marriott week for $1000 then Marriott steals it from the buyer for $1000, not one penny more. Stealing a week for the exact price it has already sold for doesn't increase the selling price, it just changes who owns it for the same exact price it already sold for. If Marriott would set a minimum price or offer to buy weeks for x dollars then they would actually be keeping prices high. Marriott won't bid on auctions which would raise the price or buy your week for a guaranteed price, but they will steal a week that sold cheaply so they can make a big profit selling it themselves.

The fact that so many weeks have sold for low prices recently but weren't ROFR'd by Marriott shows that they simply don't need the inventory at many locations in this economy. If ROFR was designed to prop up prices they would ROFR all low prices at all resorts, not pick and choose when and where they will ROFR. To believe that ROFR was set up to help owners resale prices is insane. When a week sells on e-bay for x dollars, and Marriott steals it using ROFR for the same price, please tell me how much they raised the price for that owner. The answer is the owner got the same thing he would have gotten if Marriott didn't have ROFR. The only winner there is Marriott who had weeks or months to decide if they could use that week in their inventory for the price it already sold for. If Marriott doesn't need the inventory the buyer gets it, if the price is higher than Marriott wants to pay the buyer gets it, if it is good for Marriott the buyer is out of luck.

In my opinion ROFR actually hurts resale prices because many people won't bid on them after they have had one or more sales they purchased stolen from them by Marriott. The less buyers there are making offers on the resales, the less the weeks sell for.

 

[PerryM]

What's that smell?

Marriott is not trying to kill resales, they are simply trying to make as much money as they can without regards to what it does to owners. ROFR raising resale prices is a joke. Westgate has ROFR and their resale prices are in the tank. Pahio/Wyndham is exercising ROFR and you can buy a 1 bed room Kauai week for under $500. Marriott's prices are as high as they are because of the quality of the accomodations and the locations of their resorts, not because of ROFR.

ROFR doesn't raise resale prices, it is simply another way for Marriott to make money. If Marriott needs some inventory they ROFR to have more inventory to sell. If someone buys a Marriott week for $1000 then Marriott steals it from the buyer for $1000, not one penny more. Stealing a week for the exact price it has already sold for doesn't increase the selling price, it just changes who owns it for the same exact price it already sold for. If Marriott would set a minimum price or offer to buy weeks for x dollars then they would actually be keeping prices high. Marriott won't bid on auctions which would raise the price or buy your week for a guaranteed price, but they will steal a week that sold cheaply so they can make a big profit selling it themselves.

The fact that so many weeks have sold for low prices recently but weren't ROFR'd by Marriott shows that they simply don't need the inventory at many locations in this economy. If ROFR was designed to prop up prices they would ROFR all low prices at all resorts, not pick and choose when and where they will ROFR. To believe that ROFR was set up to help owners resale prices is insane. When a week sells on e-bay for x dollars, and Marriott steals it using ROFR for the same price, please tell me how much they raised the price for that owner. The answer is the owner got the same thing he would have gotten if Marriott didn't have ROFR. The only winner there is Marriott who had weeks or months to decide if they could use that week in their inventory for the price it already sold for. If Marriott doesn't need the inventory the buyer gets it, if the price is higher than Marriott wants to pay the buyer gets it, if it is good for Marriott the buyer is out of luck.

In my opinion ROFR actually hurts resale prices because many people won't bid on them after they have had one or more sales they purchased stolen from them by Marriott. The less buyers there are making offers on the resales, the less the weeks sell for.

If a developer wants to “recycle” their product they need two things:

1) A ROFR
2) A profit motive

I believe that a developer who views recycled inventory as a money maker results in a support level which benefits ALL owners. Marriott and Disney are great examples.

This does NOT mean that these developers care a whit about the owners just that they can make some money with ZERO risk and little cost. Why all timeshare developers don't recycle is something I can’t comprehend.

The economy cycles up and down all the time. The developers' recycling efforts match these cycles. If the developer sees soft sales they lower their ROFR and if they need recycled inventory they raise the ROFR. Just like gasoline, it's supply and demand that drive prices up and down; not sinister plots by shadowy characters.

This applies to hard to get inventory too – a Week 52 ski week has a resale price much higher than 60% of Marriott’s current sales price – it’s about 80% and the developer can “flip” that week fast so they make it up in volume.

But the evidence is overwhelming with regards to the ROFR – without it the developer has no interest in resales and thus resales becomes enemy #1; just look at Wyndham and WorldMark.

Imagine a car manufacturer who refused to sell their recycled cars – the resale price would collapse and the word would spread that the total cost to own their car would be astronomical compared to a manufacturer who recycled their cars.

When a bottom-fisher snaps up a low-ball Marriott on eBay it is in everyone’s interest for Marriott to step in and keep the week “in the family”. Our bottom-fisher will swim on to another rotting carcass and if that developer doesn’t recycle our bottom feeder will have a great dinner.

That’s what bottom-feeders do – find a rotting meal and hope a bigger fish doesn’t steal it; I sure don’t feel sorry for them – they will just find another smelly meal.

 

[tombo]

Perry's quote

"Imagine a car manufacturer who refused to sell their recycled cars – the resale price would collapse and the word would spread that the total cost to own their car would be astronomical compared to a manufacturer who recycled their cars."



Oh what a great analogy. Imagine if you bought a Ford truck, paid for it, maintained it for several years, and decided it was time to sell it. You go to the dealership and ask them to buy it from you and they say that they don't buy cars back from previous owners (which is what Marriott says) unless it is a particularly popular model. So you run ads in newspapers and advertise on the internet at your expense for months all the while replacing tires, changing oil, etc. Finally you find a buyer for $5000 for your truck. Now Ford says hold on there, let me see if we can make a profit on the truck at $5000. If they decide it is good for Ford you have to sell it to them for $5000, if they don't want it you can sell it to your original buyer if they still want it. If Chevrolet and Dodge didn't have ROFR on their cars who would you buy from?

I worked in the auto industry for 10 years and I assure you that auto manufacturers do not recycle their cars. Once you buy a car it is yours to do with as you please. You can sell it to a friend for $1 and the manufacturer has nothing to say about it because it is your car you paid for. The used (recycled) cars on dealers lots are trade ins or lease turn ins, and they are there for profit and no other reason. Right now you couldn't give an Excursion to a Ford dealer to recycle because they can't sell it due to high gas prices. In fact there is a lot more profit in used cars than there is in new cars because the person trading in their car gets way below market value for their vehicle. If you go to trade in your car I can assure you that the dealership will get it much cheaper than they will sell it for or they won't trade. I never trade in my cars, I sell them myself so I can get more money than any dealership would ever have given me.

Other than timeshares I can't think of another high dollar item that you purchase and own that the original seller can tell you whether you can sell it for a particular price or not. Somehow the developer having control over what you purchased has been spun into a great thing for the buyer. If I buy it, pay MF's on it, and have a deed it is mine and I should be able to sell it to anyone I want for any price I want.

I would love to sell you a house, a car, or any other high dollar item and put ROFR on it. I assure you that I don't want it to make your resale higher, I want ROFR so I can have the opportunity to buy it cheap if I think I can make a profit on it, but I will have no obligation to buy it if it seems like a bad deal for me. Where can a guy get a deal like that?

 

[PerryM]

Our last car was a used BMW M3 – for my son. I bought resale from a dealer and because of their screw ups bought it for 10k below what they initially asked for it. Everyone at that dealership knows me to this day….

Here are some used BMWs – the BMW dealers actively look for BMWs coming off 3 year leases and outbid folks at the auctions all the time. BMW dealers are actively supporting the resale price of their product. Everyone knows what the dealers are asking – they prop up the market.

The dealers have a sort of ROFR on the 3 year leases that make up most of the sales here in St. Louis – they get to buy them at the auctions at very high prices since they then can offer “BMW certified pre-owned car” and tack on $5k+ when they sell them. They, of course, know they control the resale price of those BMWs – so do folks at the auctions – the private resale lots who must outbid the dealers and who can’t tack on $5k for a 2 hour inspection.

The ROFR is a friend to everyone but that bottom-feeder and when they know a ROFR is involved the first question they ask is “At what price is Marriott buying this week?” – they must beat it if they want that week.

But if Marriott sees less demand they simply lower their ROFR and patiently wait for the next firesale to occur. The ROFR is everyone’s friend – even that bottom-feeder who will eventually get tired of having their meal yanked out of their mouth and up their offer. They will be thankful when they eventually sell their unit and Marriott stands ready to prop up the market for them.

 

[tombo]

Our last car was a used BMW M3 – for my son. I bought resale from a dealer and because of their screw ups bought it for 10k below what they initially asked for it. Everyone at that dealership knows me to this day….

Here are some used BMWs – the BMW dealers actively look for BMWs coming off 3 year leases and outbid folks at the auctions all the time. BMW dealers are actively supporting the resale price of their product. Everyone knows what the dealers are asking – they prop up the market.

The dealers have a sort of ROFR on the 3 year leases that make up most of the sales here in St. Louis – they get to buy them at the auctions at very high prices since they then can offer “BMW certified pre-owned car” and tack on $5k+ when they sell them. They, of course, know they control the resale price of those BMWs – so do folks at the auctions – the private resale lots who must outbid the dealers and who can’t tack on $5k for a 2 hour inspection.

The ROFR is a friend to everyone but that bottom-feeder and when they know a ROFR is involved the first question they ask is “At what price is Marriott buying this week?” – they must beat it if they want that week.

But if Marriott sees less demand they simply lower their ROFR and patiently wait for the next firesale to occur. The ROFR is everyone’s friend – even that bottom-feeder who will eventually get tired of having their meal yanked out of their mouth and up their offer. They will be thankful when they eventually sell their unit and Marriott stands ready to prop up the market for them.

First of all, the BMW you are so proud of because you bought it for 10K below it's value wouldn't have become yours if BMW had ROFR. The dealership and you would have come to an agreement and BMW would have ROFR'd it right out from under you. When you get a car for 10K under value you are proud of your deal, if someone buys a Marriott week cheap they are bottom feeders who shouldn't be part of the "Marriott family". I guess that bottom feeders sneak into the best of families.


Once again automobiles are in my area of expertise. Any BMW car on the used lot of a BMW dealership acquired from any source (factory sale or not) is a "BMW certified pre-owned car". It is nothing more than marketing. If the car was owned by a drug dealer and involved in a high speed chase prior to the dealership acquiring it from a government auction, it becomes a "BMW certified pre-owned car" once it hits a BMW dealer's lot. Yes they do inspect them in the repair shop before putting them out for sale, but they do the same thing with their used Lexuses,Toyota's, and other cars they trade for. It is a great marketing terminology for used cars, and Ford, Chevrolet, etc all have certified pre-owned cars on their lots too. If you believe all the things that car salesmen tell you you will be disappointed, just not nearly as misled as you will be after trusting the word of timeshare salesmen.

The BMW dealers are simply bidding against other BMW dealers for the lease turn ins because the only people allowed to bid on lease and rental car turn ins are BMW franchise dealers( unless the rules have changed in the last 5 years since I left the industry). They have closed auctions as does Ford, GM, etc. These are called program cars because they were in a factory program where they were leased to individuals or corporations and returned to the manufacturer at the end of the rental period. BMW itself never places bids on program cars because they have owned them the whole time.The lease cars and rental cars (Hertz etc) were rented from BMW by the lesees for an agreed upon period of time. When the rental period is up the owner (BMW) sells their vehicles at an auction. If Marriott is leasing (renting) you your week then I could see their argument for having the right to buy it back if they want it because like BMW they own it. However I though Marriott actually sold you a week with a deed which should relieve them of all ownership rights. BMW can't exert any control over what an owner who purchased his car does with it or what he sells it for because the owner owns it. People who lease are simply renting. Apparently at ROFR resorts you are a renter.

The dealers at the factory auctions are simply trying to get the car for the cheapest price they can by bidding until they get to a point that the price is too high to guarantee them a profit selling the used car. Hmm, that sounds like e-bay, people bidding until no one wants to bid anymore making the sale price the actual fair market price. BMW dealers must be bottom feeders too. I don't think that Marriott has ever entering into a bidding war on e-bay raising the sellers prices by raising the winning bid. They simply steal the week after the auction is over if they like the price.

As far as "bottom feeders", Marriott is the lowest bottom feeder of all. They see an agreed upon finalized sale at a price they can profit on, and steal it for their bottom line without ever making an offer on an owners investment or raising a sale price. Marriott buys resale weeks cheaper than any other "bottom feeder" ever has. The "bottom feeder" who place the winning bid is the one who raised the owners sale price, not Marriott. If I was an owner selling I would thank the "bottom feeder" for offering me more than anyone else would. Marriott weeks sell constantlly on e-bay, and I can assure you that no one is trying to bid the price up so it passes ROFR, they are trying to win the bid for as cheap as they can. You seem to think it is great to keep it in the "Mariott family" by having Marriott ROFR it. The person who won the bid would have been a new member of the Marriott family if their purchase wasn't stolen from them. Apparently savvy buyers aren't allowed to be part of the "Marriott family", only those who pay more than Marriott itself feels that a week is worth should be welcomed in to "family".

 

[PerryM]

In conclusion...

I realize that some here find the ROFR an evil plot by the developers. I, personally, don’t see it that way – I view the ROFR the reason Marriotts sell, resale, for 60% of the every increasing Marriott sales price and Wyndham’s lack of the ROFR resales sell for 15% of the ever increasing Wyndham sales price.

It’s really that simple.

Name a developer who has high resale prices and I believe 100% of the time a ROFR is involved; I could be wrong. That does NOT mean that low resale prices don’t have a ROFR which is exercised at low prices – each developer has their own unique business plan.

The only person impacted by a ROFR is our bottom-feeder (I’m a proud member of that family) we low-ball an offer and there is a good chance it will be snatched away from us. So, we simply raise our offer – the logical consequence of the ROFR!


In conclusion:
Anyway, to answer the OP’s question “Will Marriott penalize resale owners?” the answer is NO; they have too much profit at stake to do something that stupid.

 

[timeos2]

Frame this post by Tombo

First of all, the BMW you are so proud of because you bought it for 10K below it's value wouldn't have become yours if BMW had ROFR. The dealership and you would have come to an agreement and BMW would have ROFR'd it right out from under you. When you get a car for 10K under value you are proud of your deal, if someone buys a Marriott week cheap they are bottom feeders who shouldn't be part of the "Marriott family". I guess that bottom feeders sneak into the best of families.


Once again automobiles are in my area of expertise. Any BMW car on the used lot of a BMW dealership acquired from any source (factory sale or not) is a "BMW certified pre-owned car". It is nothing more than marketing. If the car was owned by a drug dealer and involved in a high speed chase prior to the dealership acquiring it from a government auction, it becomes a "BMW certified pre-owned car" once it hits a BMW dealer's lot. Yes they do inspect them in the repair shop before putting them out for sale, but they do the same thing with their used Lexuses,Toyota's, and other cars they trade for. It is a great marketing terminology for used cars, and Ford, Chevrolet, etc all have certified pre-owned cars on their lots too. If you believe all the things that car salesmen tell you you will be disappointed, just not nearly as misled as you will be after trusting the word of timeshare salesmen.

Tombo - You have it so perfectly figured out it's scary. Thank you for a clear, unemotional and factual look at both ROFR and the concept that somehow once you purchase a week of timeshare (or anything else) the seller somehow retains a right to tell you what you can and can't sell it for or to whom. We need Judge Judy on just one of these cases to put them to and end once and for all. Can't you hear her "You wait until the sale is agreed to and then step in to grabit? THAT'S OUTRAGEOUS!"

Those who think ROFR and other meddling with legitimate resales helps owners in any way or fashion are truly living in a dream world. Price control never works - free markets have to operate freely to thrive.

 

[timeos2]

ROFR at a penny or less is still a penny or less

I realize that some here find the ROFR an evil plot by the developers. I, personally, don’t see it that way – I view the ROFR the reason Marriotts sell, resale, for 60% of the every increasing Marriott sales price and Wyndham’s lack of the ROFR resales sell for 15% of the ever increasing Wyndham sales price.

It’s really that simple..

Perry - It's not Wyndhams lack of ROFR that has torpedoed the resale value it's the FUD, intentional moves to degrade resales and Wyndham greed. If they had ROFR they would simply grab the resales @ $.01 with glee. It wouldn't do a thing to prop up resale prices if they held on to all their other purposeful actions to devalue resale prices. Heck, think about it. The way they do it now they SHOULD have ROFR and grab up all those penny points & resell them. They'd make twice what they make now selling the actual properties they built.

ROFR is a nightmare for anyone except the greedy developer that inserts it. Need an example? Look to Wastegate.

 

[tombo]

I hate ROFR from any timeshare, not just Marriott. I obviously feel that it is bad for owners lowering sale prices by reducing the number of people bidding on a week for sale. You think that buyers have to have the week and lose sleep worrying about it passing ROFR. Most people don't feel that passionatelly about owning a particular vacation week. I bid rationally with a maximum bid price and I don't raise my price in the heat of battle. If it goes for more than I am willing to pay, no problem.

Same thing with ROFR. If they ROFR my week at my purchase price I won't offer to pay more, I give it to them. They should have had to outbid me to own the week but thanks to ROFR they get the week for the price I set. From now on I won't even make an offer on a week at that resort which I would like to buy because it isn't worth the headache. That leaves weeks for sale receiving fewer offers from myself and others disgusted with the ROFR process. I am sure the seller would be thrilled with ROFR if they knew that I would have paid them more than their top offer if not for ROFR. However, Marriott does enjoy ROFR'ing it for a cheaper price thanks to me not bidding the price up higher.

I have also been the seller at an ROFR resort. After considerable time, money, and effort I finally find a buyer and we agree upon price. He said "I almost didn't make you an offer because last time I did the resort ROFR'd it." He was the only person who made me an acceptable offer in months and he almost didn't make the offer thanks to ROFR. Of course the resort ROFR'd this week out from under him too and he told me he would never make an offer on another week from the developer at any price. The next seller won't have a chance to sell their week to him because ROFR has soured him on the whole organization. The buyer who got me out of my week I wanted to sell (because of huge MF increases) didn't get to own the week. I owned it and I should have been able to sell it to who I wanted for any price I wanted. The resort never helped me on MF's, never helped me find a buyer, but they sure helped themselves to my week at a good price after I FINALLY found a buyer. I hate ROFR and won't buy from any resort the has it in their contract anymore.

We have hijacked this thread and I apologize to all for getting off on this tangent. I hate ROFR, some don't. We will have to agree to disagree.

 

[AwayWeGo]

That's Just It -- There Are No Guaranteed High Resale Prices.

Name a developer who has high resale prices and I believe 100% of the time a ROFR is involved; I could be wrong. That does NOT mean that low resale prices don’t have a ROFR which is exercised at low prices – each developer has their own unique business plan.

No timeshare company I know of ( -- not that I know all that much anyway -- ) always has high resale prices across the board, ROFR or no ROFR mox nix.

All ROFR does, when the timeshare company chooses at its own whim to exercise ROFR, is let the timeshare company snap up the low-price resales. They're still low resale prices -- just ask the seller who gets his or her resale timeshare snapped up that way.

ROFR just makes it so that everybody else -- all us regular walking-around bargain hunters -- will have to pay high(er) resale prices; it does not make it so that the resale units sell for higher prices -- only that the timeshare company snaps them up when the prices are low.

ROFR is a 1-way street. The timeshare company gets to buy low. The timeshare owners do not automatically get to sell high.

Just because I have to pay high prices for resales doesn't mean that all owners are receiving high prices for resales -- because the timeshare company snaps up the lowballs so that the general public can't.

From the perspective of the individual timeshare owner, ROFR = ROFL.

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

 

[GeNioS]

I'm with Perry....the seller gets the same amount either way....why would a seller even care about ROFR? Why do I care if I get the check says "Marriott" or some other guys name (except I'm pretty sure the "Marriott" check will clear).

It's funny to see buyers trying to take up the case that sellers should be concerned about it. It is bottom-feeding. Don't get me wrong...I'd like to do a little bottom-feeding myself after paying too much for the first two weeks I bought. But if try to buy one and Marriott takes it instead, I don't have any place to complain. In fact, I'll take some comfort that Marriott is doing something about keep values high.

P.S. I'm glad you guys brought up the car analogy. Imagine a car manufacturer who refused to sell their recycled cars. Yeah, about that....you don't actually have to imagine that. It's happened. It's called the electric car. And there's nothing Judge Judy can do about that one either.

 

[AwayWeGo]

Still Not Getting It.

Marriott is doing something about keep values high.

If so, it's not via ROFR.

The ROFR gimmick does no such thing.

Resale timeshares still sell low, but thanks to ROFR only the timeshare company gets to buy them low.

The fact that you & I can't ever buy'm low in no way means that the values remain high -- only that the ROFR 1-way street shuts out every walking-around lowball buyer while doing nothing for the lowball seller.

If that is incorrect, I'd appreciate some kind of explanation or illustration or explication or enlightenment as to how ROFR keeps resale timeshare values high.

From all I've been able to learn about it here on TUG-BBS, ROFR = ROFL plain & simple.

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

 

[tombo]

I'm with Perry....the seller gets the same amount either way....why would a seller even care about ROFR? Why do I care if I get the check says "Marriott" or some other guys name (except I'm pretty sure the "Marriott" check will clear).

It's funny to see buyers trying to take up the case that sellers should be concerned about it. It is bottom-feeding. Don't get me wrong...I'd like to do a little bottom-feeding myself after paying too much for the first two weeks I bought. But if try to buy one and Marriott takes it instead, I don't have any place to complain. In fact, I'll take some comfort that Marriott is doing something about keep values high.

P.S. I'm glad you guys brought up the car analogy. Imagine a car manufacturer who refused to sell their recycled cars. Yeah, about that....you don't actually have to imagine that. It's happened. It's called the electric car. And there's nothing Judge Judy can do about that one either.

Please explain how receiving the same amount from Marriott that you would have received from the original buyer raised the value by using ROFR. If it sold for $1, and Marriott ROFR'd it for a dollar, it still sold for a dollar. My math isn't that great but if Marriott matches the price weeks have already sold for, then they haven't raised the sale price one cent.

Why should sellers be concerned? If you are trying to sell your week because of ridiculously high MF increases, job loss, etc, and there are many buyers who won't even make an offer on your week because they feel it is a waste of time thanks to ROFR, you have reason to be concerned. Many here on TUG (myself included) will no longer make offers or bid on ROFR resorts. My offer or bid would have been higher than anyone else had offered you so that I could buy the week. However, thanks to ROFR myself and many others don't offer you anything. This reduces the number of offers and amount of offers you receive for your week. You are stuck with the week, paying MF's you can't afford and hoping someone,anyone offers you something to get you out of your week. When someone finally makes you an offer, Marriott who wouldn't offer you a dollar for the week decides to take it from the person who got you out of your week you didn't want. Everytime they ROFR a week they are probably alienating a resale buyer you might need if you ever want to sell your week.

As a seller I don't want a single buyer out there to feel that there is a reason to not offer me more than my current highest offer. I want them to up the bid and make higher offers secure in the knowledge that the best offer I receive will be the proud owner of my week. That doesn't happen if the current high bid is $2000 and they feel that Marriott will never let them have the week for that price. I want them to offer $2500 or more because that is how much money I will get for my week. When the offer isn't made because a buyer doesn't feel it will pass ROFR, I only get $2000, which is of course better for Marriott and worse for me the seller. This is how ROFR actually lowers sale prices and makes it much more difficult for a seller to sell their week. ROFR is only good for the Developer!

 

[JimC]

I realize that some here find the ROFR an evil plot by the developers. I, personally, don’t see it that way – I view the ROFR the reason Marriotts sell, resale, for 60% of the every increasing Marriott sales price and Wyndham’s lack of the ROFR resales sell for 15% of the ever increasing Wyndham sales price.

It’s really that simple.

Name a developer who has high resale prices and I believe 100% of the time a ROFR is involved; I could be wrong. That does NOT mean that low resale prices don’t have a ROFR which is exercised at low prices – each developer has their own unique business plan.

The only person impacted by a ROFR is our bottom-feeder (I’m a proud member of that family) we low-ball an offer and there is a good chance it will be snatched away from us. So, we simply raise our offer – the logical consequence of the ROFR!


In conclusion:
Anyway, to answer the OP’s question “Will Marriott penalize resale owners?” the answer is NO; they have too much profit at stake to do something that stupid.

I believe high resale prices are possible when the timeshare is high quality and there is a ROFR exercised by the developer. DVC (Disney) has resales that are much higher than MVCI's as a percentage of developer price. It is a high quality brand and the developer has used its ROFR as a part of its pricing and own resale needs.

DVC needs inventory to sell additional contracts to existing and new members in resorts that have been previously sold out. Its use of ROFR has evolved depending on what new resorts it is marketing, its need for inventory to meet demand at existing resorts, the expiration date of the contracts and the overall demand for the particular resort. It will continue to evolve its use of ROFR as its contracts mature.

While its product and strategy is different, DVC is still an example of ROFR working well for both developer and seller. Marriott uses its ROFR differently to meet its different strategic needs; while helping to keep the market price higher than it would be otherwise.

 

[PerryM]

No timeshare company I know of ( -- not that I know all that much anyway -- ) always has high resale prices across the board, ROFR or no ROFR mox nix.

All ROFR does, when the timeshare company chooses at its own whim to exercise ROFR, is let the timeshare company snap up the low-price resales. They're still low resale prices -- just ask the seller who gets his or her resale timeshare snapped up that way.

ROFR just makes it so that everybody else -- all us regular walking-around bargain hunters -- will have to pay high(er) resale prices; it does not make it so that the resale units sell for higher prices -- only that the timeshare company snaps them up when the prices are low.

ROFR is a 1-way street. The timeshare company gets to buy low. The timeshare owners do not automatically get to sell high.

Just because I have to pay high prices for resales doesn't mean that all owners are receiving high prices for resales -- because the timeshare company snaps up the lowballs so that the general public can't.

From the perspective of the individual timeshare owner, ROFR = ROFL.

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

Disney.......(the above post came in while I messed around with as short an answer as vBulliten will allow)

 

[AwayWeGo]

R. T. U., Shmarrteeyoo.

Disney.

Can't buy DVC -- can only rent (i.e., lease), longish term (i.e., RTU).

Those Disney RTUs, BTW, are like musical chairs. Each year that goes by chops 365 days off the remaining RTU term. If I own DVC with an idea of selling while there's still some value, I need a crystal ball to divine what sell-by date is too soon & which is too late.

The operational shelf life is known, but the remaining value life is semi-murky.

Then again, RTU timeshares have their own built-in exit strategies, so that's something to be said for RTU timeshares that can't be said for deeded timeshares.

So it goes.

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

 

[tombo]

And Disney would have high resales without ROFR because of the resorts themselves. People are assuming that ROFR is why the resorts with higher resale values remain high. Simple fact is that the resorts with higher resale value are what the developers want to ROFR. Who would want to ROFR a dog that they can't resell? Marriott has many of their own resorts they won't ROFR anymore. Why quit ROFR'ing at some of your locations if ROFR'ing is all it takes to prop up those falling prices? Why are marriott resale prices falling now? Why is Marriott ROFR'ing less often and at lower prices? Doesn't marriott care about keeping prices high anymore?

To say that DVC, Marriott, and HGVC have good resales values because of ROFR is like saying that gold has higher resale value than lead because jewelers will buy gold back from you. Gold is worth more than lead retail or wholesale which is why jewelers buy it from you, not to keep the price of gold high. Mercedes are worth more than Fords retail and used. None of those have ROFR, they simply bring higher prices because of quality and brand. Marriott , DVC, and HGVC are the top of the timeshares and ROFR has nothing to do with it. These will always bring the best prices and they would still bring higher resale prices if there wasn't any ROFR. People pay more for the quality, benefits, and features which the big 3 offer. Please quit believing the marketing lies that ROFR is good for owners. Cigarette companies used to say that smoking was good for you. Don't suspend reality for good marketing.

ROFR is only good for the developers!

 

[PerryM]

Taking it from all sides....

Can't buy DVC -- can only rent (i.e., lease), longish term (i.e., RTU).

Those Disney RTUs, BTW, are like musical chairs. Each year that goes by chops 365 days off the remaining RTU term. If I own DVC with an idea of selling while there's still some value, I need a crystal ball to divine what sell-by date is too soon & which is too late.

The operational shelf life is known, but the remaining value life is semi-murky.

Then again, RTU timeshares have their own built-in exit strategies, so that's something to be said for RTU timeshares that can't be said for deeded timeshares.

So it goes.

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

RTU should have been the model ALL fee simple, deeded timeshares, should have adopted way back in the 1960’s when timeshares first were cooked up.

Disney will simply allow folks nearing the end of the lease to re-up again – for 20 years probably. I’ll bet a Krispy Kreme that the cost will be in line with existing leases and allow owners 20 more years of vacations.

At that point the buildings will be 60+ years old and time to tear them down and build new ones and resell the leases again.

Just what does a traditional timeshare do at the end of its life? Who knows? Disney will be more forthright than the other 90% of timeshares out there – they have no termination clauses that I know of. At 30+ years special assessments start appearing and its hard to resell an old, aging timeshare near the end of it's life - what will they command on the resale market? Who knows. The owner at the end of life of the resort could be in a really bad situation - major assessments and no market to sell their old timeshare.

Much of this is moot since many of us will be leaving this earth and going to that big timeshare in the sky. I’m 61 years old and a 40 year lease means little over a fee-simple ownership “for the rest of my life”…..

And Disney would have high resales without ROFR because of the resorts themselves. People are assuming that ROFR is why the resorts with higher resale values remain high. Simple fact is that the resorts with higher resale value are what the developers want to ROFR. Who would want to ROFR a dog that they can't resell? Marriott has many of their own resorts they won't ROFR anymore. Why quit ROFR'ing at some of your locations if ROFR'ing is all it takes to prop up those falling prices? Why are marriott resale prices falling now? Why is Marriott ROFR'ing less often and at lower prices? Doesn't marriott care about keeping prices high anymore?

To say that DVC, Marriott, and HGVC have good resales values because of ROFR is like saying that gold has higher resale value than lead because jewelers will buy gold back from you. Gold is worth more than lead retail or wholesale which is why jewelers buy it from you, not to keep the price of gold high. Mercedes are worth more than Fords retail and used. None of those have ROFR, they simply bring higher prices because of quality and brand. Marriott , DVC, and HGVC are the top of the timeshares and ROFR has nothing to do with it. These will always bring the best prices and they would still bring higher resale prices if there wasn't any ROFR. People pay more for the quality, benefits, and features which the big 3 offer. Please quit believing the marketing lies that ROFR is good for owners. Cigarette companies used to say that smoking was good for you. Don't suspend reality for good marketing.

ROFR is only good for the developers!

The ROFR was great for me 5 times - I got 60% to 80% of the current Marriott sales price and that equates to BE in 5 years of timeshare ownership. I thank the ROFR everytime I exchange into the Maui Ocean Club with my Gold Summit Watch...

 

[AwayWeGo]

And Not Only That . . .

Marriott , DVC, and HGVC are the top of the timeshares and ROFR has nothing to do with it.

What about the Hyatt timeshares ?

( I got semi-scolded 1 time for commenting about Hyatts when all I am is just a non-ROFR bottom-feeding bargain hunter with no clue about the upscale timeshares. )

ROFR is only good for the developers!

Or, as some few of us prefer expressing it, ROFR = ROFL.

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

 

[tombo]

The ROFR was great for me 5 times - I got 60% to 80% of the current Marriott sales price and that equates to BE in 5 years of timeshare ownership. I thank the ROFR everytime I exchange into the Maui Ocean Club with my Gold Summit Watch...

And you would have received the same 60 to 80% if ROFR didn't exist. Don't equate high resale values with ROFR. High resale values come from high demand, high quality resorts. Marriot has several that don't fall into that category and despite the magic of ROFR have low resale values. I would say that without ROFR the average resale Marriott price would actually be higher because of more people bidding on them.

I have noticed that Marriott weeks for rent on Red Week seem to rent for a higher rental price than almost any other developer's weeks. I am sure that it has nothing to do with the resorts themselves, the high rental prices come courtesy of ROFR. I have noticed that most of the highest rental units have RORF so Marriott, DVC, HGVC, etc are keeping rental rates high with ROFR. I guess thr Right of First Rental lets them steal rental weeks from the original renter keeping those rental prices high too. ROFR is also good for arthritis, impotence, and getting stains out of shirts. Thank goodness developers invented ROFR!

 

[taffy19]

And you would have received the same 60 to 80% if ROFR didn't exist. Don't equate high resale values with ROFR. High resale values come from high demand, high quality resorts. Marriot has several that don't fall into that category and despite the magice of ROFR have low resale values. I would say that without ROFR the average resale Marriott price would actually be higher because of more people bidding on them.

I have noticed that Marriott weeks for rent on Red Week seem to rent for a higher rental price than almost any other developer's weeks. I am sure that it has nothing to do with the resorts themselves, the high rental prices come courtesy of ROFR. I have noticed that most of the highest rental units have RORF so Marriott, DVC, HGVC, etc are keeping rental rates high with ROFR. I guess thr Right of First Rental lets them steal rental weeks from the original renter keeping those rental prices high. ROFR is also good for arthritis, impotence, and getting stains out of shirts too. Thank goodness developers invented ROFR!

The real smart bottom feeders will keep on bidding. I have read it here on TUG. It may still hurt the the seller if the general public will give up after one or two bids as they may not bid anymore so you are right that there will be less buyers for your timeshare.

I have a feeling that rental prices are high because the resorts rent them out at much higher prices yet. When you own in the highest season, when schools are out, you do well with renting so far but if the economy is down, you may rent at a reduced rate or not at all. It is a gamble so don't buy for renting timeshares out unless you pick them up for pennies on the dollar so you can get out in a hurry even if you give them away. You can't do this with platinum resorts UNLESS YOU HAVE DEEP POCKETS.

 

[JimC]

RTU should have been the model ALL fee simple, deeded timeshares, should have adopted way back in the 1960’s when timeshares first were cooked up.

Disney will simply allow folks nearing the end of the lease to re-up again – for 20 years probably. I’ll bet a Krispy Kreme that the cost will be in line with existing leases and allow owners 20 more years of vacations...

Disney offered an extension on Old Key West in 2007 -- its original timeshare property with a 2042 expiration. The extension is an additional 15 years to 2057 -- essentially making it a 50 year lease again. The cost was $15 per point, now it is $20 per point.

 

[JimC]

And you would have received the same 60 to 80% if ROFR didn't exist. Don't equate high resale values with ROFR. High resale values come from high demand, high quality resorts. Marriot has several that don't fall into that category and despite the magic of ROFR have low resale values. I would say that without ROFR the average resale Marriott price would actually be higher because of more people bidding on them....

I agree that a quality product/brand is important to resale value. However, I strongly suspect that DVC's active use of ROFR has kept its resale price higher than it would be without it. I sense the same with Marriott.

 

[GeNioS]

If so, it's not via ROFR.

The ROFR gimmick does no such thing.

Resale timeshares still sell low, but thanks to ROFR only the timeshare company gets to buy them low.

Yeah...the timeshare company gets to buy them low...but the timeshare company is then immediately taking the selling price up to full retail. Perhaps the "value" is artificial...but it's still a value.

Not only does ROFR help keep values high, but the only flaw in the system is that they don't use it every time. If Marriott exercised ROFR on every property selling for $1 less than their retail price, and no one could get their hands on one without paying it, much like diamonds the prices and values would stay high. Does it favor the developer....yes. Will Marriott make $10,000 more to add to their billions? Who cares....as a buyer, and it doesn't matter what...cars, boats, houses, etc., you want to know that everyone buying the property paid about what you did.

Did I pay too much for my wife's diamond? Yes. Is the value kept artificially high because the diamond monopolies limit the supply? Yes. But now that I bought her one, I'm in the game. I don't want DeBeers to flood the market and make that diamond worthless. I'm hoping they continue to limit the supply so that it holds it's value. Yes....value. And they've done a damn good job.

Obviously people that don't own a diamond would LOVE to have them flood the market. They don't care about my value. They just want one cheap. I'm in a different place.

 

[hotcoffee]

Yeah...the timeshare company gets to buy them low...but the timeshare company is then immediately taking the selling price up to full retail. Perhaps the "value" is artificial...but it's still a value.

Not only does ROFR help keep values high, but the only flaw in the system is that they don't use it every time. If Marriott exercised ROFR on every property selling for $1 less than their retail price, and no one could get their hands on one without paying it, much like diamonds the prices and values would stay high. Does it favor the developer....yes. Will Marriott make $10,000 more to add to their billions? Who cares....as a buyer, and it doesn't matter what...cars, boats, houses, etc., you want to know that everyone buying the property paid about what you did.

Did I pay too much for my wife's diamond? Yes. Is the value kept artificially high because the diamond monopolies limit the supply? Yes. But now that I bought her one, I'm in the game. I don't want DeBeers to flood the market and make that diamond worthless. I'm hoping they continue to limit the supply so that it holds it's value. Yes....value. And they've done a damn good job.

Obviously people that don't own a diamond would LOVE to have them flood the market. They don't care about my value. They just want one cheap. I'm in a different place.

I was absolutely NOT going to get involved in the ROFR discussion, but I was unable to control myself on this one. If Marriott were to ROFR 100% of the resales, then sooner-or-later no one would ever bid on Marriott resales.

My concern that led to the creation of this thread was the potential for Marriott to destroy my ability to sell my timeshare if a downturn in life were to force me to sell. I suspect that manyTUGGERs are in the same boat as I am - getting up there in age. Who knows when we might not be able to take these expensive vacations anymore. I dread the thought of having to pay yearly MFs on a timeshare that I am unable to use and cannot sell.