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How Screwed Are Timeshare Owners Now?

How Screwed Are Timeshare Owners Now?

Old Mar 20, 20, 12:37 pm
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How Screwed Are Timeshare Owners Now?

After all, they own a fractional share of real estate. The real estate still needs servicing (debt service, essential upkeep and maintenance, perhaps service for the few that show up). The ancillary revenue is not happening (i.e., restaurants, bars, empty unit rentals, etc.) If forced to shut, or whatever, they still own a part of the real estate.

I can't see this ending well. The maintenance fees were already skyrocketing in places. Add in the number of owners that won't be able to pay the debt service, let alone the maintenance for the properties. Kind of like a bad HOA situation, except at least you get a residence for 365 or 366 days a year out of that one.

This one hadn't occurred to me until this morning. I can see the poopoodoodookaka really hitting the fan on this one. And for those looking to buy a resale on the cheap (which is the only way to buy one), make sure you know how cheap cheap really is.
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Old Mar 24, 20, 8:43 am
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Topiic not really related to a flyer forum but I guess if you stretch it out ...maybe...

Anyway, timeshare resorts bills are paid by the maintenance fees which are paid whether there is anyone there or not. The Marriott in Las Vegas has no restaurants and does fine. The Jockey Club in Vegas has no restaurants and is fully sold out to owners. ( I stay at both...mostly the Marriott) Concept is totally different than hotels that have to rely on people staying there AND ancillary service income.

Appropriate title would have been " How screwed are hotel owners now?"

Worse case for TS owners is that you can't go when you are scheduled....but..you can bank your week for another time in the future. It is not lost and they do not need you to stay there.
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Old Mar 24, 20, 9:44 am
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Originally Posted by boucharda View Post
Topiic not really related to a flyer forum but I guess if you stretch it out ...maybe...

Anyway, timeshare resorts bills are paid by the maintenance fees which are paid whether there is anyone there or not. The Marriott in Las Vegas has no restaurants and does fine. The Jockey Club in Vegas has no restaurants and is fully sold out to owners. ( I stay at both...mostly the Marriott) Concept is totally different than hotels that have to rely on people staying there AND ancillary service income.

Appropriate title would have been " How screwed are hotel owners now?"

Worse case for TS owners is that you can't go when you are scheduled....but..you can bank your week for another time in the future. It is not lost and they do not need you to stay there.
(So, I suppose there shouldn't be any hotel forums either on FT? ) Had I wanted to talk about hotels, I would have.

Sold out to owners is all well and good in a world where everyone can afford their maintenance fees and are making their mortgage payments. The top end Marriott and Disney properties, and a few others, should do just fine. Most timeshares aren't in that boat, so to speak. Thousands upon thousands of people, prior to this crisis, are already in default, and even more thousands upon thousands can't even sell their shares for a small fraction of what they paid.

When you own 1/52nd of a property, and say, 35/52nds aren't pulling their weight, and another 35/52nds of the remainder of the units aren't pulling their weight, either, ♫ the sun won't come out ... tomorrow ... bet you're bottom dollar, there ain't sun.♫
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Old Mar 24, 20, 11:40 am
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I had a friend buy a couple timeshares during the financial crisis in 2008. (Basically took them over pennies on the dollar on the secondary market.) They were places he wanted to go a few times and the "maintenance fee" was a decent value compared to renting a 2-bedroom apartment on VRBO or whatever.

If the market for them gets that bad here, I could see picking one up. (I don't have a real need for two!) I honestly know very little about timeshares - it's typically not my style of travel - so I'd have to do more research into how easy it is to just walk away from one if you're tired of it and it doesn't have any resale value.
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Old Mar 24, 20, 5:08 pm
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Originally Posted by pinniped View Post

If the market for them gets that bad here, I could see picking one up. (I don't have a real need for two!) I honestly know very little about timeshares - it's typically not my style of travel - so I'd have to do more research into how easy it is to just walk away from one if you're tired of it and it doesn't have any resale value.
Resale values can be as low as 10% of purchase price, or less. And when you own real property, generally you just can't legally "give it away" - the deed has to be accepted by the grantee. Your unpaid fees will then cloud the title, as well as subject you to collection action. (And a leasehold interest is still an interest in real property, just for a fixed time.) Kind of like the Haunted Mansion at Disneyland, but the door never opens. Or is it more like the Hotel California?

Here's are examples of a lower end Waikiki property on the resale market. It is a leasehold (as are many Hawaii properties, and most if not all Mexico properties). (Some are going for $1 plus costs of sale.)
https://www.timeshare-hawaii.com/pro...on-club-12264/
https://www.timeshare-hawaii.com/pro...on-club-12283/
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Old Mar 25, 20, 8:48 am
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Originally Posted by pinniped View Post
I had a friend buy a couple timeshares during the financial crisis in 2008. (Basically took them over pennies on the dollar on the secondary market.) They were places he wanted to go a few times and the "maintenance fee" was a decent value compared to renting a 2-bedroom apartment on VRBO or whatever.

If the market for them gets that bad here, I could see picking one up. (I don't have a real need for two!) I honestly know very little about timeshares - it's typically not my style of travel - so I'd have to do more research into how easy it is to just walk away from one if you're tired of it and it doesn't have any resale value.
Originally Posted by Eastbay1K View Post
Resale values can be as low as 10% of purchase price, or less. And when you own real property, generally you just can't legally "give it away" - the deed has to be accepted by the grantee. Your unpaid fees will then cloud the title, as well as subject you to collection action. (And a leasehold interest is still an interest in real property, just for a fixed time.) Kind of like the Haunted Mansion at Disneyland, but the door never opens. Or is it more like the Hotel California?

Here's are examples of a lower end Waikiki property on the resale market. It is a leasehold (as are many Hawaii properties, and most if not all Mexico properties). (Some are going for $1 plus costs of sale.)
https://www.timeshare-hawaii.com/pro...on-club-12264/
https://www.timeshare-hawaii.com/pro...on-club-12283/
In the investment real estate circle, we call buying a timeshare "raising alligators". There is no problem as long as you are feeding them, once you stop feeding them, they will come and bit you.

TS, CCIM.

If you can get something in decent shape, physically and financially at a location where you will visit regularly for sure, then it might make sense.
There had been cases of owners wanting and needing to get out that the buyer is paid to take over the financial commitment as long term legal/credit cost of walking away might be an issue.
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Old Mar 25, 20, 9:34 am
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Many years ago (before even the 2007-09 events), my wife and I got enticed with some offer to attend a presentation. Went to the presentation where the big boss thought we were likely buyers and took it on himself to do the selling to us. Took us about 2 minutes of discussion to agree it wasn't for us (and much less time to get shuffled down the back stairs exit). Went home to look at resales and, IIRC, comparable units in the same place were selling for 4-8 on the $. I believe this was in late winter or early spring just about the time before annual fees are due - est time to buy, apparently.

I look forward to seeing how much one could get paid to take it away.
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Old Mar 25, 20, 9:43 am
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Question why post here ?

Originally Posted by boucharda View Post
Topiic not really related to a flyer forum but I guess if you stretch it out ...maybe....
Why post your query here ??
You will find much better & more salient advice on TUG!
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Old Mar 25, 20, 11:59 am
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Originally Posted by Antonio8069 View Post
Why post your query here ??
You will find much better & more salient advice on TUG!
Agree. Go to tugbbs.com.
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Old Mar 25, 20, 12:08 pm
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Originally Posted by tentseller View Post
If you can get something in decent shape, physically and financially at a location where you will visit regularly for sure, then it might make sense.
There had been cases of owners wanting and needing to get out that the buyer is paid to take over the financial commitment as long term legal/credit cost of walking away might be an issue.
That's interesting and good to know. It's not as simple as just saying "I'm finished with it. Marriott, take it back and sell it to someone else." I hadn't considered there'd be a bunch of transfer fees, but I guess that makes sense considering the developers have an incentive to make the secondary market less enticing than buying direct if they can. Price may be lower, but it sounds like hassle and fees are higher (?).

Last edited by pinniped; Mar 25, 20 at 12:21 pm
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Old Mar 25, 20, 2:16 pm
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Originally Posted by Eastbay1K View Post

When you own 1/52nd of a property, and say, 35/52nds aren't pulling their weight, and another 35/52nds of the remainder of the units aren't pulling their weight, either, ♫ the sun won't come out ... tomorrow ... bet you're bottom dollar, there ain't sun.♫
Sorry, math does not add up correctly:

1/52+35/52+35/52=71/52 which would mean all the property owners combined would be more than whole.

Also, my knowledge is from friends and family who have owned timeshares so I don't understand this well:

1. My BIL owned 3 weeks and except for the first time, has never stayed at the properties he owns 1 week of
2. He has stayed multiple weeks at a timeshare location near my house in the past when he came to visit my late MIL who was living with SIL and my wife and I (splitting time at both locations) before she passed.
3. He paid into a company that allowed him to exchange these weeks with properties throughout the world, so then who actually owned these properties?

I believe this should be moved into a different forum such as Non-hotel Lodging Services including Airbnb and VRBO.

https://www.flyertalk.com/forum/non-...rbnb-vrbo-757/
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Old Mar 25, 20, 2:30 pm
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Originally Posted by teddybear99 View Post
Sorry, math does not add up correctly:

1/52+35/52+35/52=71/52 which would mean all the property owners combined would be more than whole.
My math was an example of one unit, and then an assumption that perhaps (as I said "say") 35/52 of that one unit, and 35/52 of the remainder of the units ... i.e., about 67% of the owners aren't supporting the entire property complex.


As far as who owned the properties, it depends on the company. If one has fee title, then it is all yours. If a leasehold interest, it is the property right for the leased time period. Changing weeks, properties, etc., is a contractual right but doesn't change the ownership. The points only programs are a different creature.
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Old Mar 25, 20, 2:42 pm
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Originally Posted by Antonio8069 View Post
Why post your query here ??
You will find much better & more salient advice on TUG!
Well...I didn't post a query...I posted a comment based on personal experience.. I was not looking for advice

I would NEVER buy, or suggest anyone buy, a TS from the developer. Dumbest thing anyone can do. As was mentioned above many resales are available at a mere fraction of original cost. If you like the resort and the maintenance fee is reasonable for a week stay there then it might be a reasonable purchase on the resale market which would be a major discount from the developer price...
There are MANY crappy timeshare resorts out there and those are definitely not worth the effort but, with a little research and actual visits you can find the decent ones.
My two TS (LAS and SXM) have worked well for me for at least 20 years but upfront costs were basically zero which was a big factor

Lots of generalizations about TS and some REALLY deserve the bad press but there are some decent ones out there
...and...in no way can ANY TS be considered an investment...that should definitely not be a reason for purchasing
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Old Mar 25, 20, 3:22 pm
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Originally Posted by boucharda View Post
Well...I didn't post a query...I posted a comment based on personal experience.. I was not looking for advice

I would NEVER buy, or suggest anyone buy, a TS from the developer. Dumbest thing anyone can do. As was mentioned above many resales are available at a mere fraction of original cost. If you like the resort and the maintenance fee is reasonable for a week stay there then it might be a reasonable purchase on the resale market which would be a major discount from the developer price...
There are MANY crappy timeshare resorts out there and those are definitely not worth the effort but, with a little research and actual visits you can find the decent ones.
My two TS (LAS and SXM) have worked well for me for at least 20 years but upfront costs were basically zero which was a big factor

Lots of generalizations about TS and some REALLY deserve the bad press but there are some decent ones out there
...and...in no way can ANY TS be considered an investment...that should definitely not be a reason for purchasing
And the purpose of my OP was not for the principal merits or lack thereof regarding timeshare purchase, but the economics of them when the property's economy collapses.
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Old Mar 25, 20, 3:38 pm
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Can Marriott timeshare owners sell their Florida timeshare ownership stake to a buyer that is a third-party corporate entity?
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