I was talking to an acquantiance at a function last week who has 5 timeshares. He said he had turned them in, and received enough credit for two or four(I forgot which) first class airline tickets anywhere, and 4 one week stays and had choice all but a handful of worldwide Marriotts.

This does not make sense to me, as interest and fees for the timeshares (maybe $1500 each) would make this the deal of the century.

I cannot find enough information on Marriott sites, or the timeshare BB to figure out anything about values of turnins, and cost of plane tickets and hotels in points.

Depending on the purchase price of the timeshares, turning all in for one year could produce as much as 625K MR points. That would be enough for a very nice trip.

www.vacationclub.com is the site for Marriott Vacation Club International. www.tug2.net will take you to the Timeshare Users Group BB.


[This message has been edited by DannyMc (edited 03-12-2003).]

More than you ever wanted to know....

To find the Marriott Rewards point value for trading in a year's use, go to Danny's linked site for Marriott's Vacation Club. Click on Resorts (near the top of the page). Select a resort and click Go. Select About the Resort. Select Seasons (in the white portion of the page, near the top). Most resorts list the point value for trading a week in or just below the Seasons table (e.g., Grande Ocean, Custom House, Ocean Pointe, Streamside and Waiohai), although some do not (e.g., Maui and Newport Coast).

If your acquaintance happened to have (for example) five Platinum Plus weeks at Summit Watch, he could exchange this year�s usage of those five weeks for 200,000 points each or a total of 1,000,000 Marriott Rewards points!

But he would have paid a hefty price for those weeks. To purchase ownership of those five weeks from Marriott today would cost a total of about $280,000 to $300,000! Buying a timeshare is generally not a good economic investment. It's certainly not a worthwhile investment just to trade a year's use for Marriott Rewards points.

Example: I can buy a Platinum (summer) resale week at Hilton Head's Grande Ocean today from Marriott for $28,500. I�ll get some one-time incentives with the purchase that might be worth as much as $1,500-$2,000. It will also cost me about $750 for annual maintenance fees and an additional $104 if I want to exchange this year�s week usage for points. I get 125,000 points for exchanging this year's use. (Note: The timeshare must be purchased from Marriott if you want to trade usage for points.)

At about one cent per point (the most typical valuation I have seen), that's a value of $1,250 for the 125,000 points. The maximum valuation I have seen - two cents each - would place the value at $2,500.

For that $2,500 or $1,250 or less value in points this year, I will have paid Marriott $854 ($750 + $104). I will also have paid an extra $6,000 to $7,000 over what I could have purchased the week for, if I purchased it on the free market rather than from Marriott. And I have $28,500 sitting in a timeshare purchase that could be earning something for me once the stock market turns around. Worse, I might be paying non-deductible interest on a timeshare loan from Marriott or another source to finance the purchase.

You can see approximately what a week in any season at any Marriott timeshare resort would cost by going here and clicking on the desired location and then the specific resort. There is a separate link for each resort that shows what the reseller that maintains the site is currently offering the same weeks for � usually 20% to 30% less than the Marriott price.

Make your own calculations. Purchasing a timeshare is not an investment decision. At least it shouldn�t be because the economics aren�t good. Most timeshares sell on the resale market for less than what you pay for them. Substantially less. If you bought from Marriott today and wanted to sell it tomorrow, the best you would net would be about 75% of your purchase price. Marriott takes a 25% commission if you sell through them. And the outside (non-Marriott) resale market won�t pay more than about 70% of Marriott�s asking prices because you can�t offer the points option and other incentives that Marriott can.

Purchasing a timeshare is a vacation lifestyle decision.

Adding....

Simply go to this Marriott Rewards page to see the cost in points for the "Complete Travel Packages" (FF miles and hotel certificate) that provide the best value in using Marriott Rewards points for awards.

If you go out to the Marriott web site and then click on "The Rewards" and then click on "Travel Packages" you will see a chart which lays out for you the various combinations of Reward package deals you can get with points. THe # of points required to take a trip depends upon how many airline miles you need to have per person traveling to get to your desired destination and what category of hotel you want. Most of the large city hotels are level 5 and above. I have three Marriott timeshares (Williamsburg, Barony Beach and Grand Ocean) and I get anywhere from 110,000-125,000 points per unit if I choose to trade the use of my units for Marriott points in any calender year. Please note that you can only use the trade for points option every other year and the maintenance fees at my resorts run approximately 625.00 each

Approximately 12 resorts allow trading for points every year, although a few of those allow every-year points trading only to those who purchased an option to do so under a now-expired offer.

To see an unofficial chart of maintenance fees for most resorts, including a comparison with fees for recent years, click here. The range is from under $200 to approximately $1,200.

I seriously thought about doing this about 3 years ago. In doing my research, I found that one property (I think Monarch on HH) would trade every year for 130K points. Off weeks sold for about $16K at that time. Current yearly fees are about $700/yr.

At that time Marriott still had the 425K Mile award (which I requested many times) and used the miles to go onto United. Four tickets anywhere yielded 240K Miles. You could redeposit the hotel portions of the award for something like 112.5K each, and net the miles for just 200K Marriott miles. Of course, you can even buy some of the miles for only 0.01/mile and that's not bad converting to Airline miles.

Now the equation is not quite as good. You can get 7 day stays plus 120K miles for between 235-270K Marriott rewards points. You can return the hotel stays for a credit of 45K- 55K MRP if you want (assuming they still allow this ...).

So, two weeks would just about equal one award. You'd have to invest about $32K on the timeshare (if you're a good, you should be able to put this on your credit card and get more points), and then pay about $1400/year in fees plus $104x2 to exchange into points.

Value of the award depends on how you view it, but a cat 7 stay at the Paris Marriott is hard to get less than $400 a day, which is a value of $2800. 120K miles is worth what you value them for, but if you regularly buy business class tickets, this could be worth much more then the "standard" $0.025/mile most people use.

Say you wanted a million miles a YEAR to use as you wanted. You'd need about 8 235K awards minimum (yielding 960K miles). 15 Weeks would be enough. That would cost you about $240K plus $12K/year in fees. In return, you'd get 1M FF miles on any airline per year (until they change the program again - which is what prevented me from doing it) and 15 weeks in a cat 1-5 hotel (which you could turn back in for more marriott reward miles - something like 700 K more).

For this, you get enough airline miles to get 10 first class ticket per year to Europe (Assuming you can find them), which could cost you $4K - $8K per ticket. Again, you have to do the math for your specific FF mileage usage.

So simple math (not wanting to do a DCF) You could net about $40K - $12K year = $28K or >>12% annual return on your $240K investment AND have a residual basis on your investment of at least 75% of what you paid for the weeks. Like I said, you'd really have to sharpen your pencil to make sure this is good.

The flexibility of being able to use the actual weeks, trade them for points, trade the for weeks elsewhere and even to sell the timeshare all have value, which realistically would need to be entered into consideration.

Of course, all this assumes that the Monarch deal is still around and that you can re-deposit unused hotel stays at some credit.

Billy

As Danny Mc says, go to www.tug2.net to get the best overview of Marriott timeshare ownership and use of Marriott Rewards points with TS ownership.

What your friend tells you is correct, but should be viewed in the wider context of timeshare ownership over a long period of time.

In my own experience, Marriott TS ownership with unit resort occupancy combined with trades and points usage over a period of years may be a valuable tool for individuals who value annual destination travel and are willing to put some money up front.

Basically you pay a purchase price for ownership of a week at a Marriott TS resort that you may either use or trade for points ( every other year for points in most but not all cases). Owning multiple weeks creates the possibility to trade some weeks for Rewards Points and in the process get more bang for the buck.

How much "bang" you get depends upon your individual goals and ability to craft your Marriott Points into Travel Package Rewards which come with a hotel certificate plus airline miles.

One should keep in mind that when you trade your TS week for Marriott Points, you still pay annual maintainence fees and taxes ( assume about $700 per unit per year -- keep in mind this number varies by resort & season ).

What your friend is talking about is taking this cost and milking more value out of the hotel certificate plus the airline miles. So turning 2 TS units into Rewards points would give one a travel package with a 7 night hotel certificate & airline miles whose value would vary from $2500 to $6000 depending upon the Marriott hotel at which you use the certificate and the kind of airline travel you redeem with the miles. Using my above example of fees, you would subtract $1400 from the hotel/airline ticket value you receive to determine the true valule of what you get.

This is a brief and partially incomplete description of what your friend is talking about. There is a learning curve to the Marriott TS system, and not all individuals place the same value on travel, so the Marriott TS program may not be for everyone. Those who travel a great deal and have flexibility and patience might benefit from it.

But remember, a timeshare purchase is not an investment, it is simply the purchase of future destination travel with the hope/expectation of realizing a cost savings by decreased travel costs over a long period of time

Check out TUG where you will find a robust debate about the pros and cons of the Marriott program and timeshare in general.

Barry