Will Marriott penalize resale owners?

[PerryM]

Moot hoot!

Those are very good points I never thought of. After your enightenment I can see why so many owners are supporters of ROFR. If they didin't buy their week for $5000, they don't want anyone else to be able to get one for that price either. It is not that Marriott stopped the $5000 sale from ocurring using ROFr (which marriott can't do), it is the satisfaction of knowing that no one else got to own it for that price. They feel satisfaction that the $5000 sale will be snatched up by Marriott and resold as new for $25,000 or more.

Perry you said:
"I can’t think of a scenario where the ROFR causes prices to fall – I have yet to see this happen."
I have already told you of 3 different e-bay bids in the last month or so that I would have bid $500 to $1000 more than the winning bid on any one of these auctions if there was no ROFR. Those 3 owners lost $500 to $1000 each since the final bid price is all they received whether Marriott ROFR'd or not. These are specific examples of ROFR lowering sale prices, and I own over 20 timeshare weeks so buying 3 more weeks is nothing for me. The fact that I cost those 3 owners $500 to $1000 each because I didn't bid due to ROFR is not a scenario, it is fact.

The fact that ROFR is in the paperwork is why I don't own a week in what I consider the best timeshare organization there is. The reason I keep watching them on e-bay is every now and then I think I might bid and hope it passes ROFR. However ROFR is why I don't own a Marriott and never will bid on one again. I say again because I won 2 different weeks on e-bay and spent all the time doing the closing paperwork and sending my money to find out weeks later that I wouldn't own either week. Now I will never bid again and i will not raise the sale price for the owners wanting every dollar they can get.

Another great Perryism:
"The ROFR is just like smoking bans – it curtails folks from doing foolish things that impact others. The argument “I have the right…” is moot as soon as that activity harms others in unintended ways."
ROFR has never stopped a single owner from selling their week for a low price, and smoking bans have never stopped a single person from smoking. Your analogies are getting weaker. Have another margarita and get back to me. :whoopie:

Isn’t all of this just a moot point and that no one really gives a hoot? There isn’t anything we can do, there isn’t anything that Marriott will do differently.

The ROFR is an integral part of Marriott ownership and if folks feel that it hurts them there are other developers – Wyndham comes to mind. There you can buy for 15 cents on the dollar resale and owners who bought direct lose 85 cents on the dollar – sounds good to me… They don't have a ROFR and owners hold firesales 24/7.

 

[tombo]

There are currently 45 Marriott timeshares on e-bay for sale 24/7 at fire sale prices. Marriott ROFR hasn't stopped a single fire sale from occuring.

 

[PerryM]

There are currently 45 Marriott timeshares on e-bay for sale 24/7 at fire sale prices. Marriott ROFR hasn't stopped a single fire sale from occuring.

Just makes Marriott richer.... few of those "buyers" will become owners and eBay make a tidy profit too.

Times are tough for lots of folks and they do all kinds of foolish things - someone will profit from those foolish decisions. I'd rather see Marriott stay strong at the resort than an outsider get a firesale deal.

That's my view point - others have theirs. Makes little difference since Marriott controls it all.

 

[AwayWeGo]

Confession Is Good For The Soul.

I'd rather see Marriott stay strong at the resort than an outsider get a firesale deal.

That clears it up quite a bit, no ?

That piece of information gets filed under the heading Suspicions Confirmed.

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

 

[taffy19]

Lowering your offer is one option. Many of us who buy a lot of timeshares simply refuse to make any offer at all at a resort that has ROFR. Contrary to many people's belief here, buyers don't have to buy marriott weeks at any price, and we don't feel obligated to raise our price. We simply don't make any offer at all thanks to ROFR. Marriott's are great timeshares, but even on TUG, only about 25% of TUG members own Marriott. 75% of TUG members seem happy without a Marriott week.

I don't want to own at any resort that has ROFR because I want to be able to sell my week I paid for in full, to anyone I want ,for any price I want. If I want to sell my week to my secretary or neighbor for $1, I own it, pay MF's on it, and I'll be damned if any resort will tell me who I can sell my week to or at what price.

I have seen plenty of E-bay bids recently where I would have bid higher than the winning bid if not for ROFR. Tell the owners who received lower prices for their weeks thanks to me not bidding the price higher how happy they should be with ROFR. There are 3 diffferent Marriott e-bay sales in the last month that I would have bid $500 to $1000 more than the winning bid if there was no ROFR. That is 3 examples where ROFR lowered the sale price from me alone not bidding. How many others like me aren't making offers thanks to ROFR lowering the price received by many owners on many sales?

Marriott makes you fill out everything so they can be sure it was a legitimate sale, not just a fake sale to get them to buy an owner's week. You can do a fake sale to get them to ROFR though. I know someone who did it and dumped a Westgate that way. If you can't sell your Marriott week, fill out paperwork for say $10,000 with your neighbor buying it. if Marriott ROFR's you got rid of your week. If they don't tell marriott that your buyer backed out while waiting for them to ROFR. Then wait a while and send them a different buyer for $9000. Repeat until successful. If you do it this way, ROFR might actually be good for buyers. Beat them at their own game and actually make ROFR work for you. Then when you get out never buy a week from any resort that has ROFR.

Some TUG people would bid on these timeshares anyway and if Marriott buys it from under them, they will try again. It didn't cost them a dime but time if you make a smart offer with the right contingencies. I don't see your logic here but that makes less competition for the people who do and want to own that resort, Marriott or otherwise.

We learned the ropes too late but have enough timeshare weeks already and keep enjoying them a little longer, I hope.

 

[tombo]

Dumping a vacation expense when you are suffering financially couild never be construed as a foolish thing. I woulld love to sick Dave Ramsey on you. Call Dave and say that you are broke, unemployed, getting a divorce, but you aren't sure if you should take a firesale offer for your Marriott week. Tell him that it might hurt the resale value of other owners. You would be crucified.

I don't understand how you rejoice in Marriott getting richer on the backs of owner's in financial distress. Individual's getting a good deal is bad? Marriott getting a good deal is good? Heck, Marriott got a great deal when they sold the week originally. Now it is time for the average Joe to get a break. I am sure that Marriott will appreciate your loyalty if you are ever between a rock and a hard place. Your repo letter will be in the mail.

 

[dioxide45]

Dumping a vacation expense when you are suffering financially couild never be construed as a foolish thing. I woulld love to sick Dave Ramsey on you. Call Dave and say that you are broke, unemployed, getting a divorce, but you aren't sure if you should take a firesale offer for your Marriott week. Tell him that it might hurt the resale value of other owners. You would be crucified.

Dave would probably say how foolish you were to buy in the first place, resale or retail. Though your statement is true about hurting the resale value of other owners. You really should be watching Suze Orman though

 

[McFail]

Dumping a vacation expense when you are suffering financially couild never be construed as a foolish thing. I woulld love to sick Dave Ramsey on you. Call Dave and say that you are broke, unemployed, getting a divorce, but you aren't sure if you should take a firesale offer for your Marriott week. Tell him that it might hurt the resale value of other owners. You would be crucified.

I don't understand how you rejoice in Marriott getting richer on the backs of owner's in financial distress. Individual's getting a good deal is bad? Marriott getting a good deal is good? Heck, Marriott got a great deal when they sold the week originally. Now it is time for the average Joe to get a break. I am sure that Marriott will appreciate your loyalty if you are ever between a rock and a hard place. Your repo letter will be in the mail.

.

Perry is being, well, Perry. Just as he is entitled to want Marriott to have success, you are entitled to worry about the little guy. This thread is not really about either topic. Maybe it is time to move on.

 

[davidvel]

It didn't cost them a dime but time if you make a smart offer with the right contingencies. I don't see your logic here but that makes less competition for the people who do and want to own that resort, Marriott or otherwise.

You cannot say that it does not cost a buyer money when they are ROFR'd. Time is money. Someone plunks down $5K-$20K to be held by some unknown title company waiting for ROFR to be waived, while they cannot bid on other units on the market. Then after all this time and stress, they find out Marriott bought it out from under them. Some argue this will make them bid more to beat the ROFR, but this is not how markets work. People bid the market price (ie., what a seller will take...) and will become soured in the future, leaving the market (lowering overall purchase demand).

Further any real estate professional will tell you that a ROFR on any kind of property acts as a cloud on title and lowers the purchase offers--this is a given in the industry. (Uncertainty does not give a potential purchaser confidence.) This is compounded in the Marriott TS market as (nearly) all units have ROFR. Imagine you are buying a house in a particular city and the original developer has ROFR on all houses in that city. You put in a offer, it is accepted, but have to wait 30-45 days to find out if you lose out to developer. Meantime, you are out of the market for that time, and cannot actively bid on other properties. Ask any real estate economics expert if an ROFR on a property increases its marketability and sale price.

 

[tombo]

You cannot say that it does not cost a buyer money when they are ROFR'd. Time is money. Someone plunks down $5K-$20K to be held by some unknown title company waiting for ROFR to be waived, while they cannot bid on other units on the market. Then after all this time and stress, they find out Marriott bought it out from under them. Some argue this will make them bid more to beat the ROFR, but this is not how markets work. People bid the market price (ie., what a seller will take...) and will become soured in the future, leaving the market (lowering overall purchase demand).

Further any real estate prefessional will tell you that a ROFR on any kind of property acts as a cloud on title and lowers the purchase offers--this is a given in the industry. (Uncertainty does not give a potential purchaser confidence.) This is compounded in the Marriott TS market as all units have ROFR. Imagine you are buying a house in a particular city and the original developer has ROFR on all houses in that city. You put in a offer, it is accepted, but have to wait 30-45 days to find out if you lose out to developer. Meantime, you are out of the market for that time, and cannot actively bid on other properties. Ask any real estate economics expert if an ROFR on a property increases its marketability and sale price.

Great response, and exactly why I will never bid or make an offer on a resort that has ROFR.

 

[Pit]

The impact of ROFR will likely be debated on TUG until eternity. For those with time to kill and an analytical interest in ROFR, study the following paper. It's not light reading, but does offer insight.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=621181

Reader's Digest version:

We have shown that granting the ROFR to a special buyer reduces the selling price of the object in a second-price auction: the seller is always worse off when a buyer has been granted the ROFR.

In other words, don't put yourself in the position of owning property on which someone else holds a ROFR. Unless, of course, you will never sell the property (in which case ROFR never comes into play).

 

[davidvel]

For those with time to kill and an analytical interest in ROFR, study the following paper. It's not light reading, but does offer insight.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=621181

What does that guy know?

 

[PerryM]

ROFR helped me

The impact of ROFR will likely be debated on TUG until eternity. For those with time to kill and an analytical interest in ROFR, study the following paper. It's not light reading, but does offer insight.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=621181

Reader's Digest version:



In other words, don't put yourself in the position of owning property on which someone else holds a ROFR. Unless, of course, you will never sell the property (in which case ROFR never comes into play).

Anyone can write a paper and have it published – who knows what qualifications these folks have and if it even is written by some high-school kids. But it is an opinion outside of the parties here – I’ll accept that.

I look at what the status quo is in timeshares and the timeshares with the highest resale percentages all seem to have ROFRs and the lowest resale percentages seem to have NO ROFRs.

The ONLY way to get a more definitive answer is to have a group and split it into 2 parts – one with a ROFR and one without a ROFR and watch the results. I’m not sure such a trial is even possible. If anyone can find such a test I will accept their verdict!

Until then I’ll go with my gut feeling that the ROFR benefits the owners, the developers, and causes the buyers to raise their prices to above the ROFR level. Theoretical papers can probably be found to bolster both sides.

But again, this entire discussion is theoretical – the ROFR exists for Marriott resorts and it isn’t going away; and to top it off we all agreed to the ROFR. As a seller I used it to force the buyers into raising their offers on my 3 of my 5 Marriotts I sold. Without that ROFR I doubt that my offers would have been no where near the levels that I sold. My weeks were high demand holiday weeks that were sold out but Marriott was still selling non-holiday weeks. Thanks ROFR.

So to keep from answering bottom-feeders simply state in your listing that the ROFR by Marriott is around $xx,xxx and that offers below that will probably be snapped up by Marriott. Also point out that anyone selling a Marriott that does not advise buyers of this fact are dubious at best!!! (If the ROFR is in effect)

Use the ROFR to your advantage.

 

[taffy19]

You cannot say that it does not cost a buyer money when they are ROFR'd. Time is money. Someone plunks down $5K-$20K to be held by some unknown title company waiting for ROFR to be waived, while they cannot bid on other units on the market. Then after all this time and stress, they find out Marriott bought it out from under them. Some argue this will make them bid more to beat the ROFR, but this is not how markets work. People bid the market price (ie., what a seller will take...) and will become soured in the future, leaving the market (lowering overall purchase demand).

Further any real estate professional will tell you that a ROFR on any kind of property acts as a cloud on title and lowers the purchase offers--this is a given in the industry. (Uncertainty does not give a potential purchaser confidence.) This is compounded in the Marriott TS market as (nearly) all units have ROFR. Imagine you are buying a house in a particular city and the original developer has ROFR on all houses in that city. You put in a offer, it is accepted, but have to wait 30-45 days to find out if you lose out to developer. Meantime, you are out of the market for that time, and cannot actively bid on other properties. Ask any real estate economics expert if an ROFR on a property increases its marketability and sale price.

You mean that you put $5,000 to 20,000 deposit down when most timeshares don't even cost that much re-sale? I was under the impression that the balance is paid when escrow is ready to close. Is that different with re-sale purchases as we have never done one yet? Most people, who buy timeshares for use and enjoyment, are not in the business of buying multiple timeshares one after the other unless you have many vacation weeks. How many people fall in that category? I would think very few unless you are self-employed dealing in timeshares for rent or buying and selling for your timeshare business. For you, it may be money wasted but not for the average person with a small deposit. What is the average deposit anyway to make an offer?

PS. Sooner or later you will be very limited in what you can buy because more timeshare developers are putting this clause in their contract now and even some condo developments too if they can get away with it.

 

[davidvel]

You mean that you put $5,000 to 20,000 deposit down when most timeshares don't even cost that much re-sale?

Just to make it clear my post was not about me but the market in general.

For you, it may be money wasted but not for the average person with a small deposit.

Not sure what you mean by money wasted, but my post was in response to a person who said that (to paraphrase)-it's no skin off a buyer's back if they are ROFR'd by Marriott. Purchases of resale weeks generally require most or all of the purchase price prior to receiving ROFR notice. If one doesn't care about tying up thousands of $$ and being unable to bid on other properties for weeks on end, they aren't worried about what is a good deal.

 

[taffy19]

Purchases of resale weeks generally require most or all of the purchase price prior to receiving ROFR notice. If one doesn't care about tying up thousands of $$ and being unable to bid on other properties for weeks on end, they aren't worried about what is a good deal.

I had no idea that you have to pay most of the money in advance before you get your ROFR clearance by the resort. I thought you only pay a small deposit when you make an offer which is the norm when you buy real estate. A timeshare purchase isn't real estate so that must explain why you have to pay more.

If people only knew this in advance that you aren't buying real estate, they wouldn't be so upset but what you buy is the use of the property with the Marriott, Hyatt, Starwood or Hilton name attached to the resort which means a certain standard so this is why they control the HOA as well as the maintenance company too which makes it more expensive than smaller independent developers with fewer amenities and no brand name attached to it.

I still see all the big timeshare developers taking more rights away from the owners so they can sell them as extra perks to people who buy direct from the resort which will hurt re-sale values. They sell the concept of leaving your timeshare to your estate after you pass on and the word "sale" is never mentioned during a presentation.

 

[ricki999]

In reference to tying up funds,

In my experience, Marriott has responded quickly to ROFR, usually within 1 week of the contract submission.

It has been my observation that sellers requiring full funds to be deposited prior to a ROFR determination by Marriott are not usually the actual title holders of the property, but are likely acting as a middle person, and possibly using a double closing to handle the sale.

http://en.wikipedia.org/wiki/Double_closing

I have a suspicion that some delays in ROFR determinations are actually caused by the seller delaying submission. Possibly because there is more than 1 contract in play. Another contract that Marriott and the actual buyer may not have an opportunity to see.

 

[PerryM]

In reference to tying up funds,

In my experience, Marriott has responded quickly to ROFR, usually within 1 week of the contract submission.

It has been my observation that sellers requiring full funds to be deposited prior to a ROFR determination by Marriott are not usually the actual title holders of the property, but are likely acting as a middle person, and possibly using a double closing to handle the sale.

http://en.wikipedia.org/wiki/Double_closing

I have a suspicion that some delays in ROFR determinations are actually caused by the seller delaying submission. Possibly because there is more than 1 contract in play. Another contract that Marriott and the actual buyer may not have an opportunity to see.

THIS IS A GREAT POINT!

If you are the buyer and a ROFR is involved INSIST that the ROFR eMail be sent to Marriott and a CC to you and DO NOT send ANY money until the ROFR has been retuned.

This is something that must be discussed BEFORE you bid or make an offer. Notify the seller that you, the buyer, are second in line and that there is no reason to pay money until the primary buyer, Marriott in our case, decides what to do.

If the seller won't do this move on to the next seller.

Much/Most of the time the seller hasn't a clue what a ROFR is and needs to be educated. If a reseller is involved they will strong arm you into coughing up money that will simply get tangled up if Marriott exercises the ROFR. Demand the money go into an escrow account while the ROFR is being decided. You control the purse strings...

 

[davidvel]

A timeshare purchase isn't real estate so that must explain why you have to pay more.

If people only knew this in advance that you aren't buying real estate, they wouldn't be so upset but what you buy is the use of the property with the Marriott, Hyatt, Starwood or Hilton name attached to the resort which means a certain standard so this is why they control the HOA as well as the maintenance company too which makes it more expensive than smaller independent developers with fewer amenities and no brand name attached to it.

In California a Marriott timeshare is real estate. You receive a fractional deed to a condominium unit restricted and benefitted by CC&Rs and a timeshare declaration. Marriott simply has management and licensing contracts with the HOA and must abide by those recorded docs.

 

[Pit]

Anyone can write a paper and have it published – who knows what qualifications these folks have and if it even is written by some high-school kids. But it is an opinion outside of the parties here – I’ll accept that.

The primary author is a professor in the management school at UCLA (not a high-school kid). Just as important, it is a sceintific study of ROFR from a disinterested, third-party. If you have uncovered a flaw in their analysis, please share it with us. Otherwise, I see no reason to discard their results.

I look at what the status quo is in timeshares and the timeshares with the highest resale percentages all seem to have ROFRs and the lowest resale percentages seem to have NO ROFRs.

Correlation does not imply causation. Resale prices are determined by supply and demand, not ROFR. Where resale percentages are weak, it is not due to lack of ROFR. It is the result of the developer taking steps to devalue resale weeks. An example is excluding resale weeks from premium reservation or exchange privileges. A clear example of this can be seen by comparing Starwood mandatory and Starwood voluntary resales. Resale percentages at mandatory resorts are much higher than at voluntary resorts due to the exclusion of voluntary resales from their internal points program (SVN).

Marriott resales do well because they offer a nice product that is in demand. This would still be the case in the abscence of ROFR (again Starwood mandatory resorts offer a good reference), and ROFR will not protect owners from devaluation if Marriott limits resale reservations to 6 months. Resale prices will drop in spite of ROFR, and Marriott will simply exercise ROFR at the lower price point. Nice for Marriott, but not for owners. Thus, ROFR offers no price protection to owners, it simply allows Marriott to sit in the catbird seat.

The ONLY way to get a more definitive answer is to have a group and split it into 2 parts – one with a ROFR and one without a ROFR and watch the results. I’m not sure such a trial is even possible. If anyone can find such a test I will accept their verdict!

Until then I’ll go with my gut feeling that the ROFR benefits the owners, the developers, and causes the buyers to raise their prices to above the ROFR level. Theoretical papers can probably be found to bolster both sides.

I've seen no scientific study concluding ROFR is good for the timeshare owner. I realize this view doesn't agree with your gut, but the sage advice is to follow the money, not your gut. The UCLA study demonstrates that the money flows to the developer at the expense of both sellers and other buyers.

This is not to say an individual seller can never benefit from ROFR. I'm certain there are examples of buyers who overpaid because of ROFR, but the net effect is detrimental to sellers and buyers.

Casino gambling offers a good analogy. In any casino, you can find some players that were lucky enough to come out ahead. But in the aggregate, the money flows to the casino, by design. So it is with ROFR.

 

[davidvel]

Nice for Marriott, but not for owners. Thus, ROFR offers no price protection to owners, it simply allows Marriott to sit in the catbird seat.
. . .
The UCLA study demonstrates that the money flows to the developer at the expense of both sellers and other buyers.

But that's exactly what Perry likes so much! Marriot makes more $$, and the "bottom feeders" (bargain hunters?) are kept out!

 

[PerryM]

I'm for the Marriott owners, like me

The primary author is a professor in the management school at UCLA (not a high-school kid). Just as important, it is a sceintific study of ROFR from a disinterested, third-party. If you have uncovered a flaw in their analysis, please share it with us. Otherwise, I see no reason to discard their results.



Correlation does not imply causation. Resale prices are determined by supply and demand, not ROFR. Where resale percentages are weak, it is not due to lack of ROFR. It is the result of the developer taking steps to devalue resale weeks. An example is excluding resale weeks from premium reservation or exchange privileges. A clear example of this can be seen by comparing Starwood mandatory and Starwood voluntary resales. Resale percentages at mandatory resorts are much higher than at voluntary resorts due to the exclusion of voluntary resales from their internal points program (SVN).

Marriott resales do well because they offer a nice product that is in demand. This would still be the case in the abscence of ROFR (again Starwood mandatory resorts offer a good reference), and ROFR will not protect owners from devaluation if Marriott limits resale reservations to 6 months. Resale prices will drop in spite of ROFR, and Marriott will simply exercise ROFR at the lower price point. Nice for Marriott, but not for owners. Thus, ROFR offers no price protection to owners, it simply allows Marriott to sit in the catbird seat.



I've seen no scientific study concluding ROFR is good for the timeshare owner. I realize this view doesn't agree with your gut, but the sage advice is to follow the money, not your gut. The UCLA study demonstrates that the money flows to the developer at the expense of both sellers and other buyers.

This is not to say an individual seller can never benefit from ROFR. I'm certain there are examples of buyers who overpaid because of ROFR, but the net effect is detrimental to sellers and buyers.

Casino gambling offers a good analogy. In any casino, you can find some players that were lucky enough to come out ahead. But in the aggregate, the money flows to the casino, by design. So it is with ROFR.

Supply and demand I know – it’s all in the minds of the buyers and sellers.

If anything Marriott should send a simple eMail to ALL Marriott owners explaining the ROFR – and suggest that selling their Marriott for peanuts will result in the buyer shoved aside and Marriott takes over – if Marriott wants that week.

They should also suggest that selling their Marriott for 60% of the current Marriott price will result in more money in the owner’s pocket.

But Marriott won’t do such a thing since there are foolish Marriott owners hell bent on holding their own firesale.

This is an education problem and NOT a supply and demand problem since there really isn’t a free market here with the ROFR – that’s what the ROFR papers I’ve read here seem to keep pointing out – I believe them.

So hopefully any Marriott owner stumbling upon this thread should be asking for 60% of current Marriott sales prices – why allow Marriott to buy your unit for less than 60%?

The more Marriott owners know these facts the higher resale prices – this helps ALL Marriott owners. The buyer is never going to get that firesale price anyway. (Unless Marriott sees the week as a dog and doesn’t want it – the bottom-feeders are welcome to those weeks – they pay the same MF as the Platinum Plus owners. Woo Hoo)


The ROFR benefits Marriott owners FIRST and the developer SECOND and the bottom-feeders LAST.

P.S.
This issue is so clear to me that I can't believe other Marriott owners would oppose the ROFR.

If every Marriott owner asked for 60% of current Marriott sales the ROFR would NOT be an issue.

The ROFR is aimed squarely at the week-kneed Marriott owner hell bent on selling their unit for less than 60% - simply up your asking price and the ROFR will work for you and enrich your family's well being.

But if you're in a financial bind and need a few bucks go ahead and sell it for less than 60% and you will have your sale. Marriott will make a profit and the bottom-feeder is left to swim for another firesale.

Who can ask for more than that?

(Well we bottom-feeders of course) Why are we so concerned with them - screw them.

P.P.S.
From reading a dozen ROFR papers from academia I think they are doing studies on a different ROFR than what we Marriott owners enjoy. In the scholarly papers I never see them describing a well know ROFR sale price that is known to ALL parties, if they had the foresight to do a little research. They seem to concentrate on an unknown price level that is known ONLY to the 3rd party.

For this reason I'm ignoring all those papers - until I can find one where the ROFR "trip wire" price is known to all 3 parties. Any reseller worth their salt knows of the Marriott 60% level and it's been documented on TUG a thousand times.

Let's not mix apples and oranges in this analysis.

 

[AwayWeGo]

Who's To Say What's Good For The Owners? (Some Place Great Value On Intangibles.)

I've seen no scientific study concluding ROFR is good for the timeshare owner.

Well, it does keep out the bargain-hunting bottom-feeder riffraff, because with ROFR the only way to buy in is for big bux. Who's to say that's not good for the timeshare owner, in an abstract sort of way ?

The real question is how much it's worth to the owners in dollars & cents to make sure all other owners get fleeced to approximately the same degree.

Unfortunately, ROFR doesn't jack up the prices individual timeshare owners receive on resale. That's just a superstition the timeshare sellers have had wondrous success in spreading.

All ROFR does is give the timeshare company the exclusive right to snap up the lowball resales -- so that the timeshare company can resell the resales for big bux. If that's good for the timeshare owner, it's good only in a rarefied & abstract way, which goes right along with the warm intangible glow of knowing nobody bought in on the cheap.

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

 

[vacationtime1]

The ONLY way to get a more definitive answer is to have a group and split it into 2 parts – one with a ROFR and one without a ROFR and watch the results. I’m not sure such a trial is even possible. If anyone can find such a test I will accept their verdict!

It is really hard to do any experiment in the World of Timeshare where we have insufficient information in lots of areas, starting with the lack of public awareness that there is a resale market. That results in the insufficient data which PerryM describes.

But there is one situation close to PerryM's desired test case: Desert Springs I vs. Desert Springs II/Shadow Ridge. All are Marriotts, all are in the Palm Springs area, and all are basically similar.

DSI has no ROFR; DSII and SR have it.

DSI has slightly larger units, is closer to the Marriott Hotel, and has use privileges at the hotel; DSII and SR do not have hotel use privileges. However, DSI is older. I sure there are other differences, but I believe they are minor.

I don't track sales in these projects closely, but my impression is that DSI generally sells for a couple of thousand dollars more.

 

[Pit]

Perry, the problem with your logic is that buyers determine what a unit is worth, not the seller. The seller can ask for 60%, 100%, or the moon, but the buyer decides what its worth.

Robert has cited an example of ROFR in action. Perhaps ROFR is the reason DSII/SR owners sell for thousands less than DSI owners. In auction sales, attracting more bidders is the key to higher sale prices. ROFR drives away would-be bidders, accounting for the lower sale prices.

Stick with eBay. Research into various different auction websites revealed that eBay attracted almost 60 percent more bidders and 30 percent higher prices than identical items on Yahoo’s online auctions. Unable to keep up, Yahoo shut down its US auction site last month. But in countries where Yahoo is dominant, it enjoys similar results.

http://www.csmonitor.com/2007/0716/p13s02-wmgn.html?page=4