RCI Points Timeshare TUG Mathematicians need your help

I am currently an owner of a 98000 RCI Points Grandview at Las Vegas timeshare and as my husband is planning on retiring soon so we want to add to our points.

On Thursday two ebay auctions from the same seller ended on Grandview timeshares. Both had closing costs and 2013 maintenance fees paid by the seller and both had first usage in 2014.

The first one was 122000 points and sold for $3350.

The second one was 98000 points and sold for $1725.

Therefore the additional cost for 24000 more RCI Points yearly was $1625.

Both have a yearly maintenace fee of $699 or .00573 for the first one and .00713 per point for the second.

This is where I get stuck. How many years would it take to make up the difference in the initial cost when you take into account the maintenance fee cost per points savings. This is where I get confused

Any help with the mathematics of how to calculate this would be appreciated.

Price Difference/1625
Maintenance Fee Difference/0.0014
Annual Points/122000
= Break Even 9.51 Years

That does not apply any value to the additional 24,000 points available each year for the same maintenance fees $ 699

In those same 9.5 years you would get almost 2 more years worth of points at no additional cost

I look at this a little differently. Im willing to spread my cost to purchase over 10 years (you may line a different number number, but 10 works for me) I dont want to know the break even point. I want to know my annual cost (mf plus the purchase price amortized over 10 years) from day one and if that number is a good one, (and if I have a little mad money in the bank) Ill bid, if not I wont

These two contracts would have cost $5075 if you had been the successful bidder. Amortized over 10 years the annual cost is $508

The mf for the 2 weeks is $1398

So my annual cost is $1906 or divided by 220000 (the number of points purchased) less than 9/10 cent per point

Its conventional wisdom that a penny a point is a good number to shoot for so I think someone got a good deal here.

Thanks for the replies

Thank you Ron and David for your quick replies. It gives some different ways to look at the costing. The 122000 one is back on ebay. I guess the sale for $3350 did not go through.

In your humble opinions would you buy a second timeshare at the same resort or is it a better idea to go to a different one in the case of a special assessment or increased management fees and priority in RCI Points in their family of resorts?

Chilcotin said:

Thank you Ron and David for your quick replies. It gives some different ways to look at the costing. The 122000 one is back on ebay. I guess the sale for $3350 did not go through.

In your humble opinions would you buy a second timeshare at the same resort or is it a better idea to go to a different one in the case of a special assessment or increased management fees and priority in RCI Points in their family of resorts?

Click to expand...

If ARP isn't a concern, I always choose a different resort. Those pesky "special assesments" scare the crap outta me!

I'm a little back and forth on this one myself.. Widening an ownership portfolio is a good tactic to spread risk. I, however, commonly recommend that buyers stick to what they know and enjoy using. Satisfaction with the product is the reason they are considering buyig more!

Nevertheless, there are a few issues you'll want to consider as having the entire portfolio tied to one resort could be problematic.

1) Research your annual budget to determine what amount of abandonment and unpaid m. fees are impacting the budget and also look at the amount that is currently held in reserve to ensure that reserves are being properly funded. As an owner you should already receive this documentation. There are likely some Tug discussions that touch on what funding levels are considered normal for standard reserves and replacements.

2) Look at the overall maintenance and amenity level of the property. Is it equal to or greater than that offered by competing resorts in the area? If not, there is a risk that RCI's award rating for the property could be reduced in the next few years (this would reduce the number of RCI points you receive each year).

3) Canadians always have to deal with currency fluctuations. The value of one currency against the other can have a drastic impact on what your realized annual costs are- either positive or negative.

4) Liquidity..... If things don't turn out as you expect, will you be able to liquidate your holdings in a timely manner...

I hope this is helpful!

Since you already have a points account, you can also get a weeks account without paying an additional RCI fee. You may want to look into getting a supplemental weeks trader. While I still find a points account useful for some inventory, other exchanges are much better with weeks.

Thanks once again everyone for your suggestions. I keep learning more and more each day