Are DCs really that much "riskier" than Timeshares?

[puffpuff]

Few things that I'll quote again from my previous post...


HCC targets a usage of 300-320 days. For the longest time, its affiliate member could use 21 days. In addition, the average of all members usage rounds up to 300-320 days historically.

At the new 25 day affiliate, they would be using approx 13 members 320/25. I did not modify the calculations because the change went into effect for the last 5-10% of the member base.

I can preface my post to anything. Or I can add a line as a footer. That does not mean I can post irresponsibily.

It is not being sensitive. It's just a matter to correcting information that is wrong. Like I mentioned before, what comes around goes around. If one sets a tone in the post, be ready to get it back in the same tone.

That said, I am seriously done here. I will lurk but I am done posting in a negative tone. Too much BS flying around.

No more of thread crapping from me. Only info.

Tugers have strong opinons, and that can sometimes be good and backfires other times. The negativeness can be a positive reminder to be caution. Some of us have been more involved than others and it is natural to be easily influennced given the already negative timeshare indusry reputation.

I suggest all posters be more sympathetic and diplomatic to keep the board active.

Sad to see Bourne lurk only. Please reconsider.

 

[PerryM]

Does a condo half empty during the year mean that it is better than a duplicate one used 90% of the year? I’m guessing that’s a tremendous waste of an asset. Maybe to rich folks it makes them smile a little more, I can only guess.

This is why a Point system would be far superior to the week system now being used. Each day has a rental rate that relates to the same number of Points. You don’t buy 4 weeks of usage you buy Points and then decide how to spend them.

We are getting back to the same old problem plaguing the timeshare world “Too many owners chasing too few holiday weeks”. Sounds like some DCs have decided to address this problem by underutilizing their assets. To me that makes no sense at all.


It probably isn't too late for a sharp DC to address this by simply changing to Points. There is no voice of the members, no HOA to worry about.

 

[Elsway]

Does a condo half empty during the year mean that it is better than a duplicate one used 90% of the year? I’m guessing that’s a tremendous waste of an asset. Maybe to rich folks it makes them smile a little more, I can only guess.

This is why a Point system would be far superior to the week system now being used. Each day has a rental rate that relates to the same number of Points. You don’t buy 4 weeks of usage you buy Points and then decide how to spend them.

We are getting back to the same old problem plaguing the timeshare world “Too many owners chasing too few holiday weeks”. Sounds like some DCs have decided to address this problem by underutilizing their assets. To me that makes no sense at all.


It probably isn't too late for a sharp DC to address this by simply changing to Points. There is no voice of the members, no HOA to worry about.

I just bumped into a new club that charges members two days (instead of one) for each day during peak periods (Holiday periods). I guess this is a "crude" form of a point system.

There seems to be no limit to the amount of imagination that these clubs employ to set up and tweak their models. I agree, it is unlikely that the present clubs will adopt a point system. But a point system DC club might not be a bad idea for new entrants.

 

[puffpuff]

This is how some clubs deal with Chrimstmas and New Years. The other holidays are not that bad -

Cresendo - double the points required compare to normal booking points
PE - "lottery" by logarithm
ER - first come first serve
UR - first come first serve
Quintess - rotational
BH - line up, and they give you part back in cash ( "bellepoints") once every three years
HCC- first come first serve, the same holiday every 4 years.

It really does not matter which club. the reality is that it is all jammed during Christmas and New Years. If you can book two years out, or be a bit more flexible in terms of location, most clubs can get you into some property during Christmas and New Years. For those who are not flexible for whatever reason, they will find disappointment, and DC is not the right thing to join.

People joing DC must look at the entire vacation experience over the entire year and balance the good and the bad.

INterestingly, the satisfaction rate of DC members ( in the 90% ) in general so far is way higher than TS in general . Perhaps members are more realistic in their expectations going in. Or they are more affluent and more flexible in travel schedule which fits into a DC model well.

Its becoming very apparant that in addition to accomodation value, ease of use / conceige service of DC, is a key benefit. This is an area less emphasied by TS.

 

[travelguy]

I've found that availability of High Country Club properties is MUCH better than either RCI & II exchanges or HGVC reservations. This is ESPECIALLY true during Holidays except for Christmas and New Years which is difficult for all systems. This is why travelers pay a premium for "fixed" weeks in those Holiday weeks (ex: Perry with his PH purchase).

As a HCC Private member, I have the first shot at all Holidays and have no problem getting Christmas or NY if I want. The HCC Affiliate and Associate members have second shot at Holidays. Note that if Holiday travel is important then the membership fee increase from Affiliate or Associate to Private Membership is $20 - $30K. This is about the premium paid for ONE fixed Week 51 or 52 at an upscale timeshare and allows a priority reservation for any Holiday. IN ADDITION, the Private membership also comes with an extra 3 to 4 1/2 WEEKS of travel.

High Country Club is very open with their members on discussions about anything to improve the Club's policies and procedures. I have been discussing a points based reservation system with them. One of my concerns with the points based system is that HCC cannot sell unreserved inventory due to partial week reservations allowed with systems such as HGVC. However, I agree that there are a number of reasons that a points based reservation system could work with a DC.

Here is some information that I received from HCC when I discussed reservation systems with them recently.


Hi Doug,

I understand that there may be some consumers that view our reservations policies, in particular the way we deal with holidays, as restrictive. Currently, HCC allows major holidays to be booked by Members on a long term basis once every three years. Once the holiday falls within 90 days of the time the reservation is made, all properties are available on a first come-first serve basis. Some clubs only restrict 1 or 2 major holidays and have various ways members are able to book those holidays. The initial perception by some may be that our holiday policy is more restrictive and limits our members ability to reserve peak holiday time. I strongly disagree and ask you to consider the following:

1. Our holiday policy was developed after endless discussion and debate and we have come to the conclusion that by restricting a member to book a holiday once every three years we are giving them a strong comfort level that they will have the ability to book that time at least once every three years. Currently, over 75% of our holidays remain open on our reservation system. In fact, 50% of Spring Break and 50% of Thanksgiving is still open and 4 homes are available for Christmas. Other holidays have even more availability. If those holiday periods were not restricted, I sincerely believe 95% of all holidays would have been booked at 12:01am the year before the holiday.
2. By removing restrictions on peak holiday times, a member could be presented with a situation where they were never able to reserve a property during a desired peak holiday time for the life of their membership. If, for example, a member wanted to travel over Spring Break, they would be competing with the entire membership base for that time. Once every three years is better than never.
3. The fact the long term restriction on holidays and the availability it creates also presents ample opportunity for people to book a peak holiday time on a more short term basis within 90 days. It is not unlikely that a member could book a specific holiday year after year within 90 days due to the fact that we are continually adding new properties that may fall within the 90 day window.
4. Members benefit by the growth of the club. Removing restrictions on holiday time could create a situation where, once they joined, all of the holiday periods would be booked solid. This would negatively impact members because sales drives the opportunity for them to experience a growing portfolio of destinations.

Our goal at HCC is to create the maximum flexibility to our Members without jeopardizing there long term happiness with the club. We believe our policies create realistic expectations with our members that may on the surface appear to be more restrictive. We strive daily to make our company better and if there are better ways to do things, we are open to discuss ideas and implement changes if they would benefit our members. Lively debate is what makes our company and business in general better and we appreciate the opportunity to share the reasoning behind our policies.

Thanks.

Christian V. Kirschner
President & CEO

 

[Elsway]

This is how some clubs deal with Chrimstmas and New Years. The other holidays are not that bad -

Cresendo - double the points required compare to normal booking points
PE - "lottery" by logarithm
ER - first come first serve
UR - first come first serve
Quintess - rotational
BH - line up, and they give you part back in cash ( "bellepoints") once every three years
HCC- first come first serve, the same holiday every 4 years.

It really does not matter which club. the reality is that it is all jammed during Christmas and New Years. If you can book two years out, or be a bit more flexible in terms of location, most clubs can get you into some property during Christmas and New Years. For those who are not flexible for whatever reason, they will find disappointment, and DC is not the right thing to join.

People joing DC must look at the entire vacation experience over the entire year and balance the good and the bad.

INterestingly, the satisfaction rate of DC members ( in the 90% ) in general so far is way higher than TS in general . Perhaps members are more realistic in their expectations going in. Or they are more affluent and more flexible in travel schedule which fits into a DC model well.

Its becoming very apparant that in addition to accomodation value, ease of use / conceige service of DC, is a key benefit. This is an area less emphasied by TS.

Actually, ER only allows "Elite" members to book Christmas and New Years. The Elite membership costs $425,000/$29,900 for 45 days per annum. Executive members paying $325,000/$19,900 for 25 days per annum cannot book Christmas or New Years (except on a space available basis, which seems like a remote possibility). And the entry-level membership, 15 days for $225,000/$12,900 does not allow for any advanced reservations on any holidays.

ER also charges a rather steep fee for "friend and family" useage - an added $10,000 deposit and 20% markup on annual dues. ER does this to help avoid having members use their full allotment of days, thus lowering overall occupancy - thus increasing property availability and reducing the wear and tear (physical depreciation) on properties and furnishings. Clubs which ignore this (friends and family) aspect of membership, risk having higher occupancy rates than they have modeled, IMO.

I am not suprised that HCC members would be more satisfied with their purchase than timeshare owners, in general. It really is a superior proposition - unless/until club failures persist.

 

[Steamboat Bill]

I personally think HCC holiday reservation system is the fairest of all the systems as it prevents any one owner from "hoging" certain weeks and allows us all to cycle our holiday vacation schedule.

I "used" to think a day use system for HCC (like ER) would be better than a weeks based system (like Marriott), but I changed my mind.

A day system would cause tremendous havoc in the system as some people would always grab weekends and leave Mon-Thu unused. The weeks system simply makes us plan our schedules sat-sat for an entire week. If you want to use less, no problem, the unit will sit unoccupied.

HCC has only one property that allows a 3 or 4 night use and that is NYC and it is still fixed on what 3 or 4 nights can be used. I am sure they will continue this if they add Las Vegas or Chicago.

 

[BocaBum99]

15 days for $225,000/$12,900 does not allow for any advanced reservations on any holidays.

What a smokin' great deal. Quarter Million bucks and you are lucky to get any holiday week.

 

[smbrannan]

I’m not a mathematician but there must be some kind of sensitivity analysis that can start to put a hard number on the risk factor on failure for the DC industry. Of course the inverse would be a percentage of confidence of years ahead for robust growth with little worry about failure.

It's impossible to answer this question unless you sign a NDA and look at the financials. But if you sign an NDA, then you certainly shouldn't post your findings about the DC here.

My gut feel is that a DC is similar to a small hotel operator, with a more stable revenue base due to the contractual annual dues. With 50% leverage, a company like this might be considered to be similar to companies rated "BB" by the debt rating agencies. If it uses more leverage it could be in the "B" range. According to S&P, BB companies face "major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation", while for B companies [FONT=Arial, Helvetica, sans-serif][FONT=Arial, Helvetica, sans-serif]"adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the obligation".

If you look at a 5 year horiizon then, historically, BB companies have failed about 10-12% or the time while B companies have failure rates in the 22-28% range.

This suggests that if you think your DC membership will last 5 years, the odds of losing your deposit is somewhere between 1:5 and 1:10.

Of course, these numbers are averages - if you think the DC industry is on the verge of great things, then the odds of failure are much lower. But if we head into a recession or economic slowdown, the odds could be worse.
[/FONT][/FONT]

 

[Elsway]

It's impossible to answer this question unless you sign a NDA and look at the financials. But if you sign an NDA, then you certainly shouldn't post your findings about the DC here.

My gut feel is that a DC is similar to a small hotel operator, with a more stable revenue base due to the contractual annual dues. With 50% leverage, a company like this might be considered to be similar to companies rated "BB" by the debt rating agencies. If it uses more leverage it could be in the "B" range. According to S&P, BB companies face "major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation", while for B companies [FONT=Arial, Helvetica, sans-serif][FONT=Arial, Helvetica, sans-serif]"adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the obligation".

If you look at a 5 year horiizon then, historically, BB companies have failed about 10-12% or the time while B companies have failure rates in the 22-28% range.

This suggests that if you think your DC membership will last 5 years, the odds of losing your deposit is somewhere between 1:5 and 1:10.

Of course, these numbers are averages - if you think the DC industry is on the verge of great things, then the odds of failure are much lower. But if we head into a recession or economic slowdown, the odds could be worse.
[/FONT][/FONT]

Unfortunately, not all of the clubs will provide audited financial disclosures - so it is not possible to assess credit quality.

Exclusive Resorts is the leader in the industry. ER will not provide financial disclosures - not even to current members. There are no nondisclosure agreements, no refundable deposits - just a "trust me".

When I spoke with ER, I asked point blank: "How do I know that you will not pay a special $100 million dividend to your investors tomorrow, and use mortgage debt to fund the dividend?" The answer: You don't know - we don't promise that we won't...and we don't disclose financial information.

Placing a membership deposit with ER is the equivalent of making an unsecured loan to an entity which provides no financial disclosure, no covenants against making dividends to investors, and limited operating history. Without financial disclosure we can't know whether our loans are rated BBB or BB or B or CCC - this makes me a bit uncomfortable.

HCC may be the industry leader in terms of financial disclosure. Many Tug members have had favorable things to say about HCCs transparency. Although I am not sure if HCC has provided updated/audited financial statements.

 

[Steamboat Bill]

Exclusive Resorts is the leader in the industry. ER will not provide financial disclosures - not even to current members. There are no nondisclosure agreements, no refundable deposits - just a "trust me".

HCC may be the industry leader in terms of financial disclosure. Many Tug members have had favorable things to say about HCCs transparency.

That surprised me about ER.

 

[BocaBum99]

That surprised me about ER.

Hedge funds also work on the "trust me" approach. Amazingly enough, it works well for them.

Just everyone once is a while you hear about a spectacular bust.

 

[Steamboat Bill]

Hedge funds also work on the "trust me" approach. Amazingly enough, it works well for them.

Just everyone once is a while you hear about a spectacular bust.

In Boca Raton...we here this more than "once in a while"....it seems almost every week, some stock/hedge/real estate scam artist gets busted for ripping people off. I, unfortunatly, meet new people in Boca Raton with a "guilty until proven innocent" when it comes to dealing with people involved in the financial sector.

So far, my "scam artist radar" has not been alerted with any member of the DC industry.

 

[Elsway]

Hedge funds also work on the "trust me" approach. Amazingly enough, it works well for them.

Just everyone once is a while you hear about a spectacular bust.

I have been involved in hedge fund management for the past 6 years - a relatively small portion of my 21 years in professional investment management (moved from mutual fund manager to to a hedge fund shortly after my World Trade Center office got blown away on 9/11/2001.)

I can say, unequivocally, that the level of due diligence which is accorded to hedge fund investments ranks far beyond that which is typical of those who invest in high-end DCs (I use the term "high-end" to distinguish the typical DC from HCC - the HCC members on this board seem to have done a pretty good job of analysis, etc...)

As a hedge fund manager, I have my background checked on a routine basis....I spend dozens of hours with prospective investors....they make (sometimes unannounced) visits to our main office...and they travel (at their expense) to our remote offices (including India) to see first hand that we have the resources which we claim...they send in network exports to look at our equipment

The notion that the wealthy have throw away money and don't conduct proper due diligence is not supported by my experience. We try to show them the dining room...they go as far into the kitchen as we will allow.

In other words, "trust me" doesn't get a hedge fund manager past first base...unless they have an incredible record or results...IMPO (the "P", in this case, stands for "professional").

 

[BocaBum99]

I have been involved in hedge fund management for the past 6 years - a relatively small portion of my 21 years in professional investment management (moved from mutual fund manager to to a hedge fund shortly after my World Trade Center office got blown away on 9/11/2001.)

I can say, unequivocally, that the level of due diligence which is accorded to hedge fund investments ranks far beyond that which is typical of those who invest in high-end DCs (I use the term "high-end" to distinguish the typical DC from HCC - the HCC members on this board seem to have done a pretty good job of analysis, etc...)

As a hedge fund manager, I have my background checked on a routine basis....I spend dozens of hours with prospective investors....they make (sometimes unannounced) visits to our main office...and they travel (at their expense) to our remote offices (including India) to see first hand that we have the resources which we claim...they send in network exports to look at our equipment

The notion that the wealthy have throw away money and don't conduct proper due diligence is not supported by my experience. We try to show them the dining room...they go as far into the kitchen as we will allow.

In other words, "trust me" doesn't get a hedge fund manager past first base...unless they have an incredible record or results...IMPO (the "P", in this case, stands for "professional").

If I had a spare $1M that I had to invest into a Hedge Fund and I had a choice of any Hedge Fund in the World. I would put that money into a fund managed by Jim Cramer before spending hundreds of hours performing due diligence on dozens of other funds that had superior sounding investment strategies.

If all of my millionaire and billionaire friends had recently put money into this fund, that would also help justify my decision to invest.

At the end of the day, such an investment is a bet on the hedge fund manager. So, yes, Hedge Funds are "Trust Me" businesses. Not only that, but I believe they are the penultimate "Trust Me" business. As a fund manager yourself, I find it hard to believe that you won't acknowledge that point.

If investors merely used analysis and due diligence to pick hedge funds for investing, then their sales and marketing strategies would look more like full service brokerage firms. They don't. They operate on referral and networks of investors. So, it's all about reputation and trust.

 

[Steamboat Bill]

Elsway and BocaBum99

Let's focus on Destination Clubs, Fractionals, PRC, etc. rather than hedge funds....ok

Thanks!

 

[wbtimesharer]

Elsway and BocaBum99

Let's focus on Destination Clubs, Fractionals, PRC, etc. rather than hedge funds....ok

Thanks!

DC weeeergin here. I am trying to get a grip on the DC's even though I don't have a couple hundred big ones to toss at them. I and my rowdy friends tend to hang out at the honky tonk timeshares.

I keep reading the advice of the players in DC's, Steamboat being one, that these are completely heads and shoulders a better use of a person's money than a normal timeshare. Here are my questions:

1) Are DC's exchangeable with all other timeshares and do they exchange in RCI, II etc? Does it go both ways or do DC's rule kind of like Disney properties?

2) It appears that DC's sell for 10 - 20 times what TS sell from the developer while it appears you get access to 4 - 6 weeks more access. Is that the case?

3) Are the ratio of MF/Purchase Price similar to those in timesharing?

4) I have heard that these clubs will buy back from owners. Is that a 100% or do they give only a % of the purchase price? Is this a constant in the DC market?

5) Aside from staying in mansions, what type of amenities are provided that are above and beyond those of the upscale TS such as Disney, Marriot, Hilton, etc?

Thanks in advance for any and all info.

Bill

 

[PerryM]

DC weeeergin here. I am trying to get a grip on the DC's even though I don't have a couple hundred big ones to toss at them. I and my rowdy friends tend to hang out at the honky tonk timeshares.

I keep reading the advice of the players in DC's, Steamboat being one, that these are completely heads and shoulders a better use of a person's money than a normal timeshare. Here are my questions:

1) Are DC's exchangeable with all other timeshares and do they exchange in RCI, II etc? Does it go both ways or do DC's rule kind of like Disney properties?

2) It appears that DC's sell for 10 - 20 times what TS sell from the developer while it appears you get access to 4 - 6 weeks more access. Is that the case?

3) Are the ratio of MF/Purchase Price similar to those in timesharing?

4) I have heard that these clubs will buy back from owners. Is that a 100% or do they give only a % of the purchase price? Is this a constant in the DC market?

5) Aside from staying in mansions, what type of amenities are provided that are above and beyond those of the upscale TS such as Disney, Marriot, Hilton, etc?

Thanks in advance for any and all info.

Bill

As someone who leans towards timeshare ownership versus DC membership let me say that at some point we will be DC members. It’s really up to two things: 1) Super cheap, introductory pricing of a new DC 2) The DC industry grows up.

I can answer several of your questions:

1) DCs do NOT exchange with any exchange company – that is 180 degrees out of phase of what they offer. Heck, many require the primary member to be there if the in-laws use the condo (I believe)

2) DCs really target an audience that has disdain for timeshares. That’s ok, just realize that there probably won’t be activities for the kiddies and no lazy river and no tennis courts for the little ones, no mini-golf for the family. Now that is not to say that some DCs don’t have some of this but the idea of the DC is a “Step above” timeshares. The DC really only let’s you pick out 1 or 2 holidays a year, if at all, and the rest is non-holiday usage. Timeshares allow you to vacation at as much holiday times as you have money to spend.

3) If you use ALL the time you can with a DC membership your MF is in-line with timeshares. However, that’s a lot of vacation time – 30 days or so a year. If you have just 2 weeks a year to vacation the DC MFs will make your eyes water.

4) Marriott will act as your real estate broker and charge 40% commission to sell your Marriott week (if resort is sold out). DC’s offer you 80% back on your original membership fee and that’s assuming that you can get out. The industry standard is 3 new members in before you are allowed to take your 20% loss. There are NO guarantees that you can get out and NO protection by the DC that they have the funds to repay you.

5) I’ll leave that to DC owners

Although you might come to the conclusion that I hate DC’s I love the concept – it’s just the DC industry’s current implementation of a DC which is highly leveraged with NO consumer protection laws and NO protections for your refundable deposit that has me upset with an industry that cares so little about their customer.

Someday we will be DC members! I have no doubt about it. My hope is that some DC somewhere is listening to potential customers and would like to address the industry's shocking lack of respect for potential customers.

 

[Elsway]

That surprised me about ER.

Me too.

ER has about 2700 members, 150 people on their waiting list, and they are adding new members at a rate of 60 per month - despite the fact that they have been struggling with availability of properties during peak demand periods.

Q: What incentive does ER have to improve their financial disclosure?
A: Virtually none at the present time.

 

[NeilGoBlue]

4) Marriott will act as your real estate broker and charge 40% commission to sell your Marriott week (if resort is sold out). DC’s offer you 80% back on your original membership fee and that’s assuming that you can get out. The industry standard is 3 new members in before you are allowed to take your 20% loss. There are NO guarantees that you can get out and NO protection by the DC that they have the funds to repay you.

5) I’ll leave that to DC owners

Although you might come to the conclusion that I hate DC’s I love the concept – it’s just the DC industry’s current implementation of a DC which is highly leveraged with NO consumer protection laws and NO protections for your refundable deposit that has me upset with an industry that cares so little about their customer.

Someday we will be DC members! I have no doubt about it. My hope is that some DC somewhere is listening to potential customers and would like to address the industry's shocking lack of respect for potential customers.

Thanks Perry from saving me from all that typing!

Though Perry's overall points have merit, there are some exceptions.

Bellehavens is an equity model where the members own the real estate and if you leave the club, they will return 90% (vs the industry standard of 80%)

Also, Bellehavens and Crescendo protects the member's deposits through their equity models.

Regarding 5:

Most DC's offer unbelievable conceirge sevice. I can't speak to the high end timeshares you were referring to, but I don't think they are up to the standards below.

Here is an example of the concierge services that Most DC's offer (though I can only speak from experience regarding Bellehavens.

I talked to my destination host who will meet me at the property the day that I arrive. Within about 5 minutes I requested the following things.

1) I want a private chef for tuesday night (my daughter is at the age where she can't sit for more than ten minutes, so instead of going out, we'll eat in)

2) I would like a Shiatsu Massage at the house at 10am on wed.

3) My father would like a local paper delivered every morning.

4) I would like two tee times on the resort course. One for Wed morning and one for thursday afternoon.

5) Please make sure there is a high chair, crib, and several baby gates in the house.

6) I fill out a grocery list and they will have the fridge and the pantry stocked (usually in past vacations, we spend the first night going out to a store to pickup all the food for the vacation)

The response I got? Consider it done!

The amenitites are too much to even mention. Some DC's have houses stocked with golf clubs, jet skis, even hummers. It's a totally different world than a timeshare (and more expensive!)

 

[wbtimesharer]

Thanks Perry from saving me from all that typing!

Though Perry's overall points have merit, there are some exceptions.

Bellehavens is an equity model where the members own the real estate and if you leave the club, they will return 90% (vs the industry standard of 80%)

Also, Bellehavens and Crescendo protects the member's deposits through their equity models.

Regarding 5:

Most DC's offer unbelievable conceirge sevice. I can't speak to the high end timeshares you were referring to, but I don't think they are up to the standards below.

Here is an example of the concierge services that Most DC's offer (though I can only speak from experience regarding Bellehavens.

I talked to my destination host who will meet me at the property the day that I arrive. Within about 5 minutes I requested the following things.

1) I want a private chef for tuesday night (my daughter is at the age where she can't sit for more than ten minutes, so instead of going out, we'll eat in)

2) I would like a Shiatsu Massage at the house at 10am on wed.

3) My father would like a local paper delivered every morning.

4) I would like two tee times on the resort course. One for Wed morning and one for thursday afternoon.

5) Please make sure there is a high chair, crib, and several baby gates in the house.

6) I fill out a grocery list and they will have the fridge and the pantry stocked (usually in past vacations, we spend the first night going out to a store to pickup all the food for the vacation)

The response I got? Consider it done!

The amenitites are too much to even mention. Some DC's have houses stocked with golf clubs, jet skis, even hummers. It's a totally different world than a timeshare (and more expensive!)

So essentially DC's are timeshare's for the elite. That seems reasonable. While its a great dream to strive for, my guess is that 90 - 95% of Tuggers wouldn't even be able to play in that field realistically. I will say this, over the last 2 years timesharing has been a revenue generator for me with around a 10% annual return on investment. I wonder if that is possible within the confines of a DC ownership. It would be interesting to get feedback from DC owners on whether they use or rent since it appears there really isn't much of an exchange market established.

Just being curious. Good thing my name isn't George.

Bill

 

[caribbeansun]

Since you can't resell your membership on the open market and you can't rent your time at a DC I fail to see how a rate of return can be generated on a DC in their current form.

So essentially DC's are timeshare's for the elite. That seems reasonable. While its a great dream to strive for, my guess is that 90 - 95% of Tuggers wouldn't even be able to play in that field realistically. I will say this, over the last 2 years timesharing has been a revenue generator for me with around a 10% annual return on investment. I wonder if that is possible within the confines of a DC ownership. It would be interesting to get feedback from DC owners on whether they use or rent since it appears there really isn't much of an exchange market established.

Just being curious. Good thing my name isn't George.

Bill

 

[NeilGoBlue]

So essentially DC's are timeshare's for the elite. That seems reasonable. While its a great dream to strive for, my guess is that 90 - 95% of Tuggers wouldn't even be able to play in that field realistically. I will say this, over the last 2 years timesharing has been a revenue generator for me with around a 10% annual return on investment. I wonder if that is possible within the confines of a DC ownership. It would be interesting to get feedback from DC owners on whether they use or rent since it appears there really isn't much of an exchange market established.

Just being curious. Good thing my name isn't George.

Bill

Is it possible? Yes, very possible... not guaranteed but very possible (tho 10% is high). But, you'd be a fool to buy them based on a return.

 

[Elsway]

Is it possible? Yes, very possible... not guaranteed but very possible (tho 10% is high). But, you'd be a fool to buy them based on a return.

This is also true of timeshares, in general.

 

[PerryM]

My little game I play...

One thing that a timeshare can do that a DC can’t is to generate rental income. I don’t believe there is one DC out there that allows members to use eBay and auction off their reservation.

Something I do that has great appeal to me personally is to rent reservations and then use that money to pay off the imaginary loan I made to finance that timeshare. This year we should add 3 of our timeshares to the completely paid off list – including my 7% finance charge to myself.

Once a timeshare has paid for itself and is FREE you only need to worry about the MF. However when you consider the rental income, in real dollars, to the MF, another couple of years and I will have totally free usage of the timeshare, including MF for about 6 future years.

So how do you put a percentage of ROI on something like that? I don’t pretend to know. It is just a great feeling to beat the system.

I know I can’t do that with DCs and is one of the reasons the threshold to buy a DC is so much higher in my mind – I need to put up real money and pay MFs that are real money and I can’t play my little game.

Anyway that’s how I view timeshare investments – the goal is to make their purchase FREE and annual usage FREE for as long as possible. Would I make more money by keeping the money in the stock market - sure. Would I get the satisfaction of snowboarding down a hill and know that I paid NOTHING for the timeshare and NOTHING for the MF and heck NOTHING for the lift tickets. This just puts a smile on my face that I can't get rid of.

P.S.
So why not add a stipulation to the sales contract that if you want to sell your membership and the DC can't buy it back at the agreed to price that the member can sell it resale for whatever they can get for it? Allow 3 months or so, but if the DC can't buy back the membership allow some recourse to the member.

Same with rentals - make it contingent on something. Want out and 3 months go by - start to rent your weeks to the public and recoup your MFs at least.

Sounds like some kind of protection is available via the free markets - maybe the DC industry should lessen their grip incase they can't fulfill their own agreements. Just a thought.