• The TUGBBS forums are completely free and open to the public and exist as the absolute best place for owners to get help and advice about their timeshares for more than 30 years!

    Join Tens of Thousands of other Owners just like you here to get any and all Timeshare questions answered 24 hours a day!
  • TUG started 31 years ago in October 1993 as a group of regular Timeshare owners just like you!

    Read about our 31st anniversary: Happy 31st Birthday TUG!
  • TUG has a YouTube Channel to produce weekly short informative videos on popular Timeshare topics!

    Free memberships for every 50 subscribers!

    Visit TUG on Youtube!
  • TUG has now saved timeshare owners more than $23,000,000 dollars just by finding us in time to rescind a new Timeshare purchase! A truly incredible milestone!

    Read more here: TUG saves owners more than $23 Million dollars
  • Wish you could meet up with other TUG members? Well look no further as this annual event has been going on for years in Orlando! How to Attend the TUG January Get-Together!
  • Sign up to get the TUG Newsletter for free!

    Tens of thousands of subscribing owners! A weekly recap of the best Timeshare resort reviews and the most popular topics discussed by owners!
  • Our official "end my sales presentation early" T-shirts are available again! Also come with the option for a free membership extension with purchase to offset the cost!

    All T-shirt options here!
  • A few of the most common links here on the forums for newbies and guests!

Will resale values recover, and when?

vckempson

TUG Member
Joined
Aug 14, 2010
Messages
980
Reaction score
3
Location
Sparta, NJ
Many threads disuss the reasons for low resale prices. Ultimately it's as simple as "Supply & Demand". I'm curious, though, about the correlation in pricing cycles between timeshares and residential real estate. Does anyone know if the resale prices for timeshares peaked in 2007 like residential stuff?

Residential real estate runs a full cycle, peak to trough to peak again, around 17 - 20 year. So, from the bottom to the top is typically 8 - 10 years. If that's true and we bottomed last year, for argument's sake, we'd see our next peak around 2020, give or take a couple years.

That expectation only holds water, though, if the two markets are hight correlated. Do they really mirror each other and are they similarly subject to the same demographic changes as residential real estate. My inclination says yes, but I'm curious what others think.
 

Ridewithme38

TUG Member
Joined
Jul 14, 2010
Messages
3,325
Reaction score
4
Location
Long Island, NY
I think comparing Vacation Week Ownership to full home ownership is like Comparing the Sales of Butterfingers to the sale of staple food like Bread and Milk
 

bogey21

TUG Member
Joined
Jun 8, 2005
Messages
9,455
Reaction score
4,666
Location
Fort Worth, Texas
It is wishful thinking to believe that there will be a substantial increase in the value of most TimeShare Weeks. There are exceptions but IMO the "ownership" model has been replaced by a "rental" model.

George
 

ace2000

TUG Member
Joined
Dec 17, 2006
Messages
5,032
Reaction score
152
This question gets asked again and again. It is always a good question though. Some used to say that they've already dropped to $1, how much lower can they go? Well, I guess we all found out.

As long as MFs keep rising above the inflation rate, then we have not hit bottom yet. Currently, there is no monetary value in owning a timeshare week at many resorts and renting is a far better option. Why get trapped into these things? (with a few exceptions to the rule)
 

vckempson

TUG Member
Joined
Aug 14, 2010
Messages
980
Reaction score
3
Location
Sparta, NJ
I understand the responses and the dynamics in the market. My real curiosity is about the correlation in pricing cycles between TS's and residential real estate. If they are correlated then the TS resale market would have peaked in 2007.

So, when did TS resale prices peak? Can anone tell me that? I was out of the market and didn't follow it from 2005 till 2010 and am trying to find out that information.

Thanks.
 

theo

TUG Review Crew: Veteran
TUG Member
Joined
Mar 21, 2007
Messages
9,115
Reaction score
2,404
Location
New England Coast
IMHO, there are NO valid "across the board" generalizations...

My real curiosity is about the correlation in pricing cycles between TS's and residential real estate. If they are correlated then the TS resale market would have peaked in 2007.

So, when did TS resale prices peak? Can anone tell me that? I was out of the market and didn't follow it from 2005 till 2010 and am trying to find out that information.

My belief, which I am cannot substantiate with collected facts and / or figures, is that no such firm "correlation" exists --- at least in the limited timeshare "markets" with which I am personally most familiar.

For example, I have for many years now owned a number of fixed Snowbird weeks in coastal SW FL, where I sit now typing this reply. At four specific different resorts here with which I am long familiar, I have seen little or no change in resale prices for Snowbird weeks in at least about the past decade now. In recent years however, it's no secret that most residential real estate prices in this area have plummeted precipitously downward, to say the least --- and may not yet have even "hit bottom".

That being said, there are certainly more of the aforementioned timeshare weeks being offered for resale by their owners in recent years, but the resale prices have changed very little, if at all. It is my personal belief that the increase in timeshare resale availability is actually related more to a "generational shift" than to any other factor, by which I mean that I see that many older, long-time owners are simply no longer able or willing to travel here. In some instances, their children and ill-behaved grandchildren are now here instead. In as many (or more) instances, those weeks are now being offered for sale (and sold) --- but not at any perceptible reduction in historical resale prices.

This is certainly a very limited and specific microcosm market view, to be sure, but I can say with the certainty of tomorrow's sunrise that you certainly will not find the correlation you seek between residential real estate and timeshare prices in coastal SW FL. :shrug:

P.S. I know a fellow who has just purchased a resale fixed week 11 at HGVC Seawatch in FMB for just under $14k. While that week is certainly not worth $14k (...not to me, anyhow) this figure is $1.5k more than he paid for a resale week 12 at that same facility 5 years ago. This is admittedly a limited example in a finite, niche market; but it is nonetheless clear evidence of the inaccurate nature of any "ALL properties" statements or conclusions.

P.P.S. I don't own at HGVC Seawatch myself, so I am not subtly "waving any flags" for it here.
 
Last edited:

ronparise

TUG Member
Joined
Feb 10, 2011
Messages
12,665
Reaction score
2,140
like you I wasnt around to know what timeshare prices were in 2007, or in the years before, but I suspect the the prices have been down, down and down since the 1960s when they were created..I doubt that there is any connection between timeshares prices and home values.
 

Patri

TUG Review Crew: Veteran
TUG Member
Joined
Jun 6, 2005
Messages
7,097
Reaction score
4,864
I think comparing Vacation Week Ownership to full home ownership is like Comparing the Sales of Butterfingers to the sale of staple food like Bread and Milk

Butterfingers, well, actually Hershey's Chocolate, is a staple.
 

tombo

Tug Review Crew: Rookie
TUG Member
Joined
Aug 16, 2007
Messages
3,224
Reaction score
2
Location
Mississippi (but a Bama fan)
Resale prices were much higher in 2005, and 2006, 2007, and even in 2008 on ALL properties. E-bay sales for off season weeks would sell for $500 and up at virtually any resort. Dollar sales with free closings and free MF's DID NOT EVER HAPPEN a few years ago. Any Hawaii week at any resort would sell for well over $2000 and most over $3000. Redweek and myresort network sales went for $1000's and sold quickly in many cases.

The worst Bronze season at the least favorite Marriott resort would sell for $5000 or $6000 and if you were high bidder Marriott would get it from you using ROFR. Now Marriott off season weeks sell for a couple of hundred dollars or less and Marriott does not want them if they sell for a dollar. I bought a Marriott summer week for a steal (at the time) at $2000. I was lucky to sell it a year later for $1000 even though it was a platinum week.

2 bed 2 bath oceanfront Kauai Beach Villas weeks sold resale for $5000 to $8000 in 2008. I have seen the same weeks sell for under $500 numerous times in the last few years. Many weeks I used to buy for around $1500 by sniping last second on e-bay 3 years ago are selling for $1 to $500.

I can not tell you for sure if the prices will ever recover (I personally doubt they wiil), but I can tell you for sure that the resale prices were much higher across the board a few years ago.
 
Last edited:

ace2000

TUG Member
Joined
Dec 17, 2006
Messages
5,032
Reaction score
152
Butterfingers, well, actually Hershey's Chocolate, is a staple.

The sad part of it all is that Butterfinger candy bar is worth more than a couple of my timeshares... :)
 
Last edited:

eal

TUG Review Crew: ELITE
TUG Member
Joined
Jun 6, 2005
Messages
1,912
Reaction score
0
Location
Nanoose Bay Canada
Timeshare prices are more closely correlated with the state of the economy - when people feel they have some extra cash to spend on vacations they will shop for timeshares - when money is tight they won't be buying.
 

e.bram

Guest
Joined
Jun 6, 2005
Messages
3,206
Reaction score
143
Location
Fort Lee, NJ
Also, despite the economy all the other costs associated with vacationing have increased. I mean travel, car rental , eating out, entertainment, etc. Making the cash available for accommodations less and the accommodation cost less of a factor.So the value of the TSes where most people have to travel to has gone down.Since i do not see travel costs going down, I don't see TS values going up.
 

theo

TUG Review Crew: Veteran
TUG Member
Joined
Mar 21, 2007
Messages
9,115
Reaction score
2,404
Location
New England Coast
A rare point of agreement...

...all the other costs associated with vacationing have increased. <snip> Since i do not see travel costs going down, I don't see TS values going up.

It is extremely rare that I believe or agree with much of anything that e.bram says or theorizes, but the logic of this particular statement seems both soild and entirely credible.
 
Last edited:

vckempson

TUG Member
Joined
Aug 14, 2010
Messages
980
Reaction score
3
Location
Sparta, NJ
My belief is that as the national housing markets go, so goes the resale TS market. I'm not sure that I see any factors mentioned here that suggest otherwise. Both are overbuilt with excess supply and very little demand. Eventually, demand will pick up. Once the supply is soaked up, prices should start improving to something more than $1 with free closings.

And while a $1 timeshare seems to be a worse bottom than the real estate market, the total dollars lost is minor compared the lost values on homes since 2007. When the economy is booming, when people are flush with cash, they dream of bigger homes. Everyone starts moving up the ladder, thus pushing prices upwards. I'm not sure how that's any different than timeshares.

The one big unknown, for both housing and TS's is the impact that aging boomers will have on demand and prices. That's yet to be seen. As for the economy, and people having cash for luxuries like TS's and bigger homes, good times will come again. They always do. It's just a matter of when.
 

massvacationer

TUG Review Crew: Veteran
TUG Member
Joined
May 10, 2008
Messages
737
Reaction score
1
Location
MA
I believe that I am seeing a SLIGHT bounce-up in the prices for Wyndham Points Contracts on eBay. Nothing huge, but some big sellers have returned to requiring buyers to pay Closing, Transfer and some maint fees on purchases. A year or so ago it was very common to buy for just a very low purchase price ( sellers were paying everything else). Also, less contracts are on the market at any given time (50-70 versus 140-200)

I'm not sure if this is anything permanent or perhaps just a temporary thing.

Does anyone else see anything similar?
 

ace2000

TUG Member
Joined
Dec 17, 2006
Messages
5,032
Reaction score
152
My belief is that as the national housing markets go, so goes the resale TS market. I'm not sure that I see any factors mentioned here that suggest otherwise.

I think just about everyone that answered you said that they do not see the coorelation between the national housing market and resale pricing. There are way too many other factors involved.

Ebay has had a big influence on timeshare pricing, but haven't seen too many houses listed there. The other factor is the MFs involved. Again, with the increase in MFs over the last five years, you've got a totally different animal. For most timeshares, it is very difficult to recover your MFs. This has changed lately even for the worse. I agree more with the others and strongly disagree with your premise stated above.
 

vckempson

TUG Member
Joined
Aug 14, 2010
Messages
980
Reaction score
3
Location
Sparta, NJ
I think just about everyone that answered you said that they do not see the coorelation between the national housing market and resale pricing. There are way too many other factors involved.

Ebay has had a big influence on timeshare pricing, but haven't seen too many houses listed there. The other factor is the MFs involved. Again, with the increase in MFs over the last five years, you've got a totally different animal. For most timeshares, it is very difficult to recover your MFs. This has changed lately even for the worse. I agree more with the others and strongly disagree with your premise stated above.

Ultimately, the extent of correlation is a statistical measurement, not a matter of opinion. And I still do not understand the fundemental differences between the two markets. So instead of ebay, the residential markets have forclosed homes coming out the wazoo. REO's both influence and dictate what's happening in prices. People on fixed incomes unable to pay higher and higher real estate taxes here in NJ increase selling demand. Potential first time homeowners are scared of the market and don't want to move away from renting.

From a pricing standpoint, I'm not sure you can deny the correlation. Correlation doesn't imply similar contributing factors, just similar price movements. The evidence would suggest they are correlated. They've certainly both tanked since 2007 for a virtual 100% correlation. Whether that held up over previous full cycles, I don't have enough data. But if they both peaked in 2007, then the run up and crash downward certainly correlated 100%.

If there is pricing evidence to suggest that they aren't correlated I'm interested in hearing that. Theo's information would suggest otherwise but that's in SW Florida during snowbird season. I'm not sure that's representative of the market as a whole.
 

Beefnot

TUG Member
Joined
Oct 1, 2011
Messages
3,779
Reaction score
62
Location
Los Angeles, CA
You can do your own quasi-empirical analysis by searching on any one of the branded timeshare forums here on TUG. There are plenty of threads over the years discussing what they've paid, and you can see how it trended over time. Better yet, check the ROFR Marriott database that TUGger dioxide45 maintains in order to get a sense. My guess is that there is very little correlation between the TS peak and housing peak. I could be wrong.
 

strandlover

TUG Member
Joined
Mar 14, 2010
Messages
227
Reaction score
0
Location
Canada
Will resale values recover, and when: A two-headed monster

I have seen an uptick in sales of beachfront summer weeks. This probably correlates with a slowly improving economy, better education on timeshare resale purchases, and relatively low supply. I feel that this segment can only go upward from this point forward. The caveats are reasonable maintenance fees and proper due diligence.

Blue weeks are doomed. They will never recover: there is simply too much supply. You can get them for 4-5 TPUs in RCI or a few hundred bucks on last call. Traditional rental properties are also in over-abundance, contributing negatively to this situation.

I look at this kinda like sports collectibles. 1990 baseball cards will always be worthless. On the other hand, my 1960 Mickey Mantle is a keeper.
 

ace2000

TUG Member
Joined
Dec 17, 2006
Messages
5,032
Reaction score
152
Ultimately, the extent of correlation is a statistical measurement, not a matter of opinion.

Only if they are coorelated. Which they are not. The whole resale environment is so different today than it was five to ten years ago, that it really doesn't matter what coorelation you may find. Just my opinion.
 

persia

newbie
Joined
Nov 18, 2007
Messages
1,179
Reaction score
6
Location
Carlingford, NSW
I think there has been some recovery in price, at least in Wyndham points, which are what I watch. Some point sellers are actually pocketing a small amount of money rather than having to pay closing and transfer costs on a $1 sale. I don't think they'll ever recover to the $5 to $10 a thousand they used to command (These points cost $220 a thousand from the developer), but you never know.
 

ampaholic

TUG Member
Joined
Aug 25, 2010
Messages
2,309
Reaction score
2
Location
Spokane
Only if they are coorelated. Which they are not. The whole resale environment is so different today than it was five to ten years ago, that it really doesn't matter what coorelation you may find. Just my opinion.

There may be a phantom correlation between the resale housing market and the resale timeshare market or there may not be ... it matters little.

I remember some deep end of the pool stuff from business school about how what drives supply and what drives demand can be different or can be coincidental - but what matters is the balance between supply and demand.

The supply of timeshare intervals is always growing since they never go away (unlike bananas and jet skis) - whereas the demand waxes and wanes depending on many factors.

Lately the demand is slipping as baby boomers decide to divest their timeshares and younger "buyers" are hurting for liquid assets to invest (in timeshares anyway) - creating a slump in the demand curve.

Supply is stable with some growth (dvc @ aulani comes to mind) and is slowing - but it it unlikely to shrink to match the slump in demand.

My prediction is that it will take at least 7 to 10 years for the demand slump to ease and demand to start growing into the supply.

YMMV
 
Last edited:

winnipiseogee

TUG Member
Joined
Jan 17, 2012
Messages
346
Reaction score
13
Location
New Hampshire
Personally I think TS resales will start to rise in the next couple years but only on the decent resorts that aren't charging exhorbinant MFs.

One part of the argument that has been missed is the impact of the economy on hotel rates nationwide. I was reading in the WSJ that hotel rates from the peak to the bottom dropped approx 40% on average. So, the week in Hawaii with MF of 1500 looked great when hotel rates for that same room were $2,500 but when the hotel rates dropped to $1500 then everyone asked "Why own the timeshare?" As hotel rates go back up (and by every indication they have already started to) TSs will start looking decent again.

The other issue is that most MF contracts I have read limit the property manager to a specific profit margin. If I'm Starwood, Marriott, Hilton and my hotel rates go down significantly then I need a way to remain profitable. How do I do that? I allocate more of my costs to the time shares and pass things along as MFs.

As the economy recovers, hotel rates will rise, developers will want to start making money selling TSs so my guess is that the economics of TS ownership will get better.

Will TSs ever be worth more than 20% of what someone paid the developer? Probably not but my guess is that the decent ones will start trading on ebay for a few thousand a week.

I know that I am trying to find a couple red weeks at a basic RCI goldcrown near our house (they allow unlimited use of the amenities). Everything says I should pay more than $1 a week but I've been looking for almost a year and I have paid $1500 for one week and I'm about to pay $1000 for a biannual. Maybe prices have already started to rise...
 
Top