New rules on upgrading resales !!!

Hi everyone,
my SVO rep gave me some bad news yesterday:
SVO is reportedly implementing new rules by the end of this week !!
Until now, SVO would give you "credit" when you upgrade a resale with them for whatever the original owner had paid for that unit. From now on, they say they will give credit for what YOU have paid for that resale (usually substantially less).
That is in addition to the new $20K minimum "new monies" they need to get when upgrading (in continental US)....!
Has anybody heard the same thing ????
The rationale would be that SVO is trying to push more "direct" developer purchases as opposed to resales....
I have an email into SVO management to give them some feedback on yet another puzzling change....(looks like they make it a habit to pull the rug from under our feet and change the rules on the fly....!)

I have not heard that (yet).

My rep did tell my about the 20k/40k new money about 2 weeks ago.

How do they know how much you paid??? Katherine

That's ok. You can put any amount of money you want to on the documents when you buy a week resale. I sold a week recently and the guy at the closing company put $10 on the paperwork. Obviously, I didn't sell it for that.

SDKath said:

How do they know how much you paid??? Katherine

Click to expand...

Good question. Now we know why they were so curious about what we paid for our five resales when we attended our owners' update yesterday. When we told them we paid between $75 and $1,701 each for our Sheraton traders, they didn't even mention the concept of a trade-in. The moral of the story -- for those who want to do a requalification -- is not to tell them how much you paid for your resale purchases and just negotiate a credit.

They did mention the $20,000/$40,000 of new money on a developer purchase in order to requalify a resale purchase; that has been policy for nearly two years; see
http://www.tugbbs.com/forums/showthread.php?t=56532

Our salesperson was disarmingly honest when we asked why all future resorts would be voluntary; she said that Starwood wanted to depress resale values and thus control the resale market. But she couldn't answer our follow-up as to why Starwood never exercises ROFR.

This is just yet another reason not to go for Elite status at all. And, it makes those mandatory sales even better for those of us who don't care about Elite. Even so, I don't like how SVN manipulates their own system.

Agree with these comments,
bottom line, there will be some "manipulation" going on around actual prices paid for the resales...
but I really think (and reps agree on this) that they will not successfully manage to control the resale market....

Welcome to STARKWOOD
'a better way for you to see what we want you to see'
'your soul will be replenished by our control'


{TV series 24 reference...}

It seems to me that Starwood has multiple programs depending on who you talk to, check out this thread:

Complimentary SVN enrollment thread

Jim

SDKath said:

How do they know how much you paid??? Katherine

Click to expand...

Right of First Refusal.

ROFR'd at Westin Mission Hills

Last week, I was bummed to find out that Starwood did not waive ROFR for a platinum plus week at Mission Hills.

I really had no immediate plans to upgrade, requal, etc.

I just wanted to use the resort and occasionally trade in II.

Still batting zip on Starwood's board,
Grace

SPjunkie said:

Hi everyone,
my SVO rep gave me some bad news yesterday:
SVO is reportedly implementing new rules by the end of this week !!
Until now, SVO would give you "credit" when you upgrade a resale with them for whatever the original owner had paid for that unit. From now on, they say they will give credit for what YOU have paid for that resale (usually substantially less).
That is in addition to the new $20K minimum "new monies" they need to get when upgrading (in continental US)....!
Has anybody heard the same thing ????
The rationale would be that SVO is trying to push more "direct" developer purchases as opposed to resales....
I have an email into SVO management to give them some feedback on yet another puzzling change....(looks like they make it a habit to pull the rug from under our feet and change the rules on the fly....!)

Click to expand...

I've heard something similar. What I heard is that the "new rule" regarding the amount of resale credit given toward an upgrade has not yet been officially set, but that it will be somewhere between developer price paid and resale price paid (possibly a percentage of developer price paid). I've also heard that it will go into effect by the end of the week.

-tim

gvdelizo said:

Last week, I was bummed to find out that Starwood did not waive ROFR for a platinum plus week at Mission Hills.

I really had no immediate plans to upgrade, requal, etc.

I just wanted to use the resort and occasionally trade in II.

Still batting zip on Starwood's board,
Grace

Click to expand...

If the deal is dead, would you please post the week and the price? It is such an unusual data point (Starwood seldom exercises ROFR) that many of us would be curious.

vacationtime1 said:

If the deal is dead, would you please post the week and the price? It is such an unusual data point (Starwood seldom exercises ROFR) that many of us would be curious.

Click to expand...

Hmmm, that's strange. I didn't think there was such a thing as Platinum Plus week at WMH. The weeks are platinum, gold or silver with platinum including weeks 51 and 52. Could you let us know the details? This would frankly be the 1st or 2nd ROFR reported on this board EVER from Starwood.

Are you sure you are not thinking of a Marriott week, where Platinum Plus does exist for the Palm Desert properties and is usually NY and Xmas...?

Katherine

gvdelizo said:

Starwood did not waive ROFR for a platinum plus week at Mission Hills.

Click to expand...

Do you mean that SVO exercised their ROFR? Meaning - SVO rebought the unit at the offered resale price?
If so - what was the unit-week type and at what price?
This could be an important data point for WMH owenrs/buyers.

SPjunkie said:

Agree with these comments,
bottom line, there will be some "manipulation" going on around actual prices paid for the resales...
but I really think (and reps agree on this) that they will not successfully manage to control the resale market....

Click to expand...

Why does this make a difference ? the non mandatory resort are worth next to nothing and the places like WKV and WMH and SVV are still 30-40% of what the resorts sell them for. So the only thing that I could think of is the mandatory resorts should go up a little in value. + is Starwood building any new places ?

silkey21 said:

Why does this make a difference ? the non mandatory resort are worth next to nothing and the places like WKV and WMH and SVV are still 30-40% of what the resorts sell them for. So the only thing that I could think of is the mandatory resorts should go up a little in value. + is Starwood building any new places ?

Click to expand...

It makes a huge difference in your out of pocket expenses. If your SBP was purchased for $250 and you got $15,000 worth of credit toward an upgrade, you are much better off financially than if Starwood only gave you the resale value credit of $250! It could mean tens of thousands of dollars for those of us who are still trying to do the whole upgrade/retro thing.

Katherine

SDKath, ... "It could mean tens of thousands of dollars for those of us who are still trying to do the whole upgrade/retro thing."

I thought you were "DONE -- REALLY." lol!

And, aren't you glad you are? Others who try to get to 5* Elite will now find it more costly because they didn't appreciate - or care about - the 5* Elite benefits and that Starwood could abruptly close the cost loopholes that TUG members are familiar with. But, we have certainly been speculating about Starwood's ability to close loopholes like ROFR or the base allowed for upgrading or the ability to retro at all (next to go?) over the last 1.5 years.

Enjoy those Platinum upgrades at the St. Regis Monarch Beach! It seems you made an effective, pragmatic decision based on what you learned here at TUG. ... eom

SDKath said:

It makes a huge difference in your out of pocket expenses. If your SBP was purchased for $250 and you got $15,000 worth of credit toward an upgrade, you are much better off financially than if Starwood only gave you the resale value credit of $250! It could mean tens of thousands of dollars for those of us who are still trying to do the whole upgrade/retro thing.

Katherine

Click to expand...

understood, but what effect does it have on the actual resale prices ?

silkey21 said:

understood, but what effect does it have on the actual resale prices ?

Click to expand...

Mandatory resorts ALWAYS have a higher resale value than Voluntary resorts. A simple example would be the prices of SVR (Voluntary) and SVV (Mandatory). Take a look at that.

Mandatory resorts sell for more because SVN transfers with the sale. By selling only Voluntary in the future, Starwood contends that they will make more developer sales because people will buy from them to get SVN.

I agree that it's likely that Mandatory resale prices will most likely increase. I also think it's likely that Voluntary resale prices will decrease as more units become available. That's the effect this decision will make on resales IMO.

-tim

gvdelizo said:

Last week, I was bummed to find out that Starwood did not waive ROFR for a platinum plus week at Mission Hills.

I really had no immediate plans to upgrade, requal, etc.

I just wanted to use the resort and occasionally trade in II.

Still batting zip on Starwood's board,
Grace

Click to expand...

I'm highly suspicious of this. Starwood prepares a ROFR document that they send to the closing company on properties that have ROFR. Did the closing company send you a copy of this document? I think maybe something else may have happened here (seller cold feet??). If I were you, I would ask for a copy, and if that doesn't work, call SVO Portfolio Services at (800) 743-7654 to inquire about the ROFR paperwork. I will give you names of who to speak to at SVO PS if you PM me.

-tim

Starwood has been -- as you say -- "manipulating its own system" for years now. They are only interested in the bottom line, not their owners

Cathyb said:

Starwood has been -- as you say -- "manipulating its own system" for years now. They are only interested in the bottom line, not their owners

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Every company is interested in the bottom line. There is nothing wrong with that. It's only a problem when you personally find yourself in a negative situation with them. If that happens more than once, you are likely going to say "forget it" and go with another company. There are too many choices in travel to be forced to deal with poor customer service.

Jarta: I am done! I swear. :hysterical: Never mind that DH asked me last night why we didn't buy a week 52 at Riverfront! He wants to ski for NY.

Silkey: I bet resale prices will stay low because MOST buyers have no idea how to retro/upgrade. However, when you buy, you are going to have to really carefully look over the documents to make sure that the "price" is what you want it to be, not the $1 you paid for the week on eBay. We are a rare bunch here on TUG. I am sure Starwood hates us for finding all the little loopholes.

And now they are actively slamming doors to keep people from doing the upgrades and retro's. Unfortunately, they don't realize that they are creating a downward spiral. Then again, maybe they do. Because in reality no one is going to pay full price for their units. By preventing these upgrades from occuring, they are are chasing away their best and most frequent customers.

It's like when a restaurant starts to go under. What do they do? They raise prices so they can make more money to account for less customers and less profit. What happens? Even more customers leave. Business goes down even more. So the restaurant cuts portion sizes to save more money. More customers leave. Eventually, restaurant closes and customers are having nice meals somewhere else.

Starwood is pretty much cutting portion sizes right now....

Katherine

tlpnet said:

I'm highly suspicious of this. Starwood prepares a ROFR document that they send to the closing company on properties that have ROFR. Did the closing company send you a copy of this document? I think maybe something else may have happened here (seller cold feet??). If I were you, I would ask for a copy, and if that doesn't work, call SVO Portfolio Services at (800) 743-7654 to inquire about the ROFR paperwork. I will give you names of who to speak to at SVO PS if you PM me.

-tim

Click to expand...

I agree - I am considering this WMH ROFR as it didn't happen unless TUG receives a reasonable response explaining what happen.

Cathyb said:

Starwood has been -- as you say -- "manipulating its own system" for years now. They are only interested in the bottom line, not their owners

Click to expand...

Starwood is not really building new resorts, once they sell out of what they are building what are they going to sell ?. Also I understand increasing the retro prices, but what difference does it make for them how much they will give you back on your unit. Example now you would buy 2 cheap units on Ebay with one you would do the upgrade and the other one they retro. With the new way you would buy one unit on Ebay and one unit from Sheraton and have the ebay retro'd in to the system. Is my way of thinking wrong ?