Renting timeshares for income -- better to specialize, or diversify?

[JudyS]

I'd like opinions on this. Suppose one wants to rent out timeshares to generate income, and plans to acquire a lot of timeshares in order to do this. Do you think it's better to concentrate one's ownerships in one system (specializing) or spread them out over several systems (diversifying)?

Here's what I see as the benefits of specializing:
It's much easier to master one system than several. (Mastering the system would include knowing how to acquire weeks cheaply, knowing all the tricks to booking, knowing which weeks rent well, and perhaps other things.)
Some systems provide for economies of scale -- for example, being Wyndham Platinum VP gives big discounts on last-minute bookings.

The benefit of diversifying, of course, is less risk. You don't have to worry that the one system you own will have massive MF fees, change the rules in ways that make renting much less profitable, etc.

Thoughts?

 

[theo]

I'd like opinions on this. Suppose one wants to rent out timeshares to generate income, and plans to acquire a lot of timeshares in order to do this. Do you think it's better to concentrate one's ownerships in one system (specializing) or spread them out over several systems (diversifying)?

Here's what I see as the benefits of specializing:
It's much easier to master one system than several. (Mastering the system would include knowing how to acquire weeks cheaply, knowing all the tricks to booking, knowing which weeks rent well, and perhaps other things.)
Some systems provide for economies of scale -- for example, being Wyndham Platinum VP gives big discounts on last-minute bookings.

The benefit of diversifying, of course, is less risk. You don't have to worry that the one system you own will have massive MF fees, change the rules in ways that make renting much less profitable, etc.

Thoughts?

With the certainty of annual (and annually increasing) timeshare maintenance fees and the uncertainty of future economic conditions, as well as the absence of a solid and reliable "timeshare ownership exit strategy" for lots of owned weeks, I personally wouldn't touch this idea with a ten foot pole. A lot of work, time, money, risk, stress --- and a whole lot of other hoops, hurdles and unknowns. But that's my own admittedly narrow personal viewpoint. YMMV. To each their own.

That being said, there are certainly people (Ron Parise comes to mind) who appear to have jumped into this particular pool with both feet and have not drowned (...yet), so I guess it's certainly possible to succeed if you have the focus and the time and the temperament (...I posses none of the above for any such "landlord" enterprise).

 

[JudyS]

Well, I've been renting out timeshares on the side for almost a decade and still haven't really turned a profit. It didn't help that I started right before the great recession, and paid too much for timeshares that quickly became worthless.

But, I am determined to succeed, or die trying -- preferably in my personal jacuzzi at a nice timeshare.

 

[NTHC]

As one who does this for a living, I would encourage no one to purchase timeshares for the sole purpose of renting. I have seen it happen on multiple occasions and it does not usually come out with the desired results. I actually had a lady a few years ago who "surprised" her husband by using $100k of their retirement to purchase timeshares she planned to rent. The good news, she bought resales, the bad news, she had no idea what she was doing and lost thousands and thousands of dollars.

It is a full time 24/7 job. The market is constantly changing, timeshare companies constantly changing the rules in an effort to make it more difficult to rent, and the buying public is a flaky animal. What is popular one year is not the next.

I have been doing this for 16 years now and I will tell you it is a tremendous undertaking.

That being said....if you are serious about taking this on, you may want to try renting out timeshares for others at first, to get your feet wet. That will give you a chance to find your market, experiment with what works for you, but not have the expenses of just going out and buying a bunch of timeshares.

If you find that it is working, at that point you will know exactly what to buy and where.

I hope others will come along and share their experiences as well, both positive and negative so that you'll be able to make a good decision for yourself. This is for sure an unbelievable format for picking the brains of very savvy people who have years of experience.

JMHO,

Cindy

 

[presley]

I haven't done this, but from what I'll tell you what I've seen from those that I consider successful. They specialize in a location and/or high demand holidays and or one particular system. They know their product extremely well and have been at the properties themselves and are able to answer any questions about the properties.

 

[DeniseM]

There are a very limited number of resorts that are profitable rentals. Maybe 10%.

Generally, the most profitable timeshares are also the most expensive ones to buy. (Except for Wyndham, and that market is really crowded and may be tapped out as competition pushes rental prices lower and lower.)

Have you noticed the people that dump a large number of timeshare on the Bargain Deals forum all at once? Some of them are failed rental companies.

I would not consider this unless you can afford to lose your entire investment.

 

[Saintsfanfl]

It's fine as a side hobby but there are some giant and numerous obstacles to generating big profits. One is the tiny market. Usually with a business more is better but with timeshares there is a limited demand for 100% prepaid vacations with no guarantees or security. The market for owner rentals is too small. It helps to have a visible business rather than it looking like an individual but it is still very limited with the prepay in full and no cancellation requirement. If you specialize in a certain region or the best holidays you can quickly experience saturation when attempting high volume.

Then you start to get into all the things you can't control. Timeshares that go up 5-10% a year in fees without rental inflation at the same pace and it becomes a time consuming management of getting rid of soon to be undesirable units and the hunt to find others to replace them.

It is worlds better to find cheap rental property. Some of the best margins for rental property are the cheapest ones to buy.

 

[JudyS]

Thanks for the replies!

...I have seen it happen on multiple occasions and it does not usually come out with the desired results. I actually had a lady a few years ago who "surprised" her husband by using $100k of their retirement to purchase timeshares she planned to rent. The good news, she bought resales, the bad news, she had no idea what she was doing and lost thousands and thousands of dollars....

$100,000! Yikes At least I knew enough not to risk that kind of money. I hope that wasn't the couple's entire life savings.

Glad she bought resale! Did she lose money by paying too much for the timeshares, buying timeshares that rented poorly, or both?

Also, Cindy, I just sent you an email.

 

[JudyS]

I was typing at the same time as some other posters, so here are my comments on those posts.

Have you noticed the people that dump a large number of timeshare on the Bargain Deals forum all at once? Some of them are failed rental companies.

I have noticed people who dump lots of timeshares on the Bargain Boards, but I assumed they were timeshare liquidators. I suppose some could be rental companies, although few timeshares on the Bargain Board have much rental potential.

It's fine as a side hobby but there are some giant and numerous obstacles to generating big profits. One is the tiny market. ...
Then you start to get into all the things you can't control. Timeshares that go up 5-10% a year in fees ...
It is worlds better to find cheap rental property. Some of the best margins for rental property are the cheapest ones to buy.

Saintsfanfl, sounds like you've given this a lot of thought! Have you done a lot of timeshare rentals?

The main problem with my buying a regular rental property (instead of timeshares), is that I'm not physical capable of doing any of the maintenance, and hiring people to do repairs and maintenance is incredibly expensive. (Timeshares have full time maintenance staff, which is still pricey, but much more efficient than hiring a snow removal and lawn service, plus a plumber here and a roofer there.)

Why can't I do the maintenance myself? Well, these days I can't do much of anything. I know I talk about staying in timeshares, but these days I dream about it more than I actually do it. When I do travel, I need a friend or relative to assist me, need to use a wheelchair, and need to rest at least a full day when I reach my destination.

I haven't been well enough to work in years, don't have any disability benefits, and I'm nowhere near regular retirement age. (I'm 53.) So, I'm trying to come up with some way to support myself in the future. Maybe I should post on TUG Lounge for suggestions.

 

[DeniseM]

I noticed that Redweek sometimes runs an Ad on their webpage for people to work from home as online customer service Reps. I think that would be interesting.

 

[Saintsfanfl]

Saintsfanfl, sounds like you've given this a lot of thought! Have you done a lot of timeshare rentals?

The main problem with my buying a regular rental property (instead of timeshares), is that I'm not physical capable of doing any of the maintenance, and hiring people to do repairs and maintenance is incredibly expensive. (Timeshares have full time maintenance staff, which is still pricey, but much more efficient than hiring a snow removal and lawn service, plus a plumber here and a roofer there.)

I think about these types of things. I have not done a lot of rentals but more here and there. Probably only a handful a year. For me it is easier to flip the units I buy but I am not doing it as a business. It is more of a hobby designed to supplement our vacation expense. I try to only target units where we want to go, are profitable to rent, have added value for exchanging, and can be resold for at least break even.

Regular rental property is much easier as passive income. Pay a management company 10% and let them deal with the maintenance and hassles. This method is ideal for lower value property like mobile homes. You still have to foot the bill for the upkeep but there is little expected or required with lower income property. Not saying it is anyone's cup of tea but I thought it was a much better alternative to high volume timeshare rentals. At least there is the likelihood of building equity. Zero chance for equity building on a load of timeshares.

 

[ronparise]

the best advice is Theo's and its the same advice that i got when I asked the same questions. I ignored it then and I continue to ignore it

and I know what Theo says is true, I havent drowned.... yet. Emphasis on yet. I understand perfectly well that nothing is forever and that if I fail to adjust to some future unknown change Ill fail

To answer your question: specialize. But specializing in one system or another isnt tight enough I think you need to specialize in just a few resorts.

At my favorite resort, I know the manager, and most of the staff and the local restaurants and the details of public transportation and parking fees.etc, etc. and I have several tour books on my desk so I can answer questions as they arise.

That isnt to say I wont help someone set up a vacation anywhere in the system when they call, but I only make speculative bookings at two resorts in the same town. And I further specialize, making reservations for only certain special events

a secondary benefit of doing it the way I do is that I make most of my money for the year by February. and another little bit by July and I can enjoy the resorts myself for the rest of the year.

Also be aware that this is not a get rich quick scheme or even a get rich at all scheme, its a rather low paying job, unless you do it in big numbers. I didn't talk to every megarenter, but one I did talk to early on told me that they target a $200 profit per reservation In my experience thats turned out to be about right, which means to make $100000 you need to do 500 reservations a year thats 2 a day if you work a 5 day week, and consider this number... 500 weekend reservation in Wyndham Land will take about 50 million points which equates to a mf payment of over $20,000 a month.

You mention the Wyndham system and Platinum VIP.. I dont know anyone that makes a business of renting within the Wyndham system that isnt a Platinum VIP or manages a Platinum VIPs account. In fact the folks that make the real money using Wyndham are the points managers, not owners at all

 

[Saintsfanfl]

Ron brings up a good side point. It is nice to get rental revenue early and sometimes before the fees are even due. Late year rentals stink for cash flow. For a Nov/Dec rental it can be a long time before you get the money that was already paid. For this reason high volume week 51/52 rentals can be very difficult due to the cash required.

Are the Wyndham fees that are due monthly for the current year or the following year? If the current year then it is obviously more ideal than the traditional pay in advance.

 

[bogey21]

The main problem with my buying a regular rental property (instead of timeshares), is that I'm not physical capable of doing any of the maintenance, and hiring people to do repairs and maintenance is incredibly expensive.

I have a friend who own a number of condos which he rents out on leases ranging from 12 to 15 months. He pays an Agent 8% to handle everything and tells me he nets between 9% and 10& a year on his rentals. He says the key to what he is doing is that he paid cash for all his condos and thus has no mortgage payments. Because the Agent manages a lot of properties he has people on call to take care of repairs, etc.

George

 

[ronparise]

It is worlds better to find cheap rental property. Some of the best margins for rental property are the cheapest ones to buy.

Thats exactly right.. There was a day I owned over 100 slum properties but even slum properties cost real money, and you have to rent them annually My target was a 25% return

And vacation condos or houses; In my market you pay to own them 52 weeks a year but top rents come in only 4 or 5 months they sit vacant most of the time>

And in all rental properties the toilets only back up at 3 am. Maintenance is a real headache

Timeshares are much better they cost next to nothing, I only reserve the high season stuff, and I only pay for the weeks I need, and I dont maintain them. and at least with wyndham if I dont get one rented, I cancel and get all my points back to try something else... Its all good

And if costs rise faster than income and it no longer works, just sell, If you bought the right stuff to begin with there ought to be someone to buy it... or just walk away. In the case of Wyndham they are taking it back

 

[ronparise]

Ron brings up a good side point. It is nice to get rental revenue early and sometimes before the fees are even due. Late year rentals stink for cash flow. For a Nov/Dec rental it can be a long time before you get the money that was already paid. For this reason high volume week 51/52 rentals can be very difficult due to the cash required.

Are the Wyndham fees that are due monthly for the current year or the following year? If the current year then it is obviously more ideal than the traditional pay in advance.

With Wyndham mf is paid monthly so the benefit of my early year rentals isnt that I get my money back early. In fact it can be cash flow problem,,, I just made my 2017 reservtions so I have to wait up to a year paying mf every month before I see my payday

 

[Egret1986]

Judy, specializing has worked for me.

To answer your question: specialize. But specializing in one system or another isnt tight enough I think you need to specialize in just a few resorts.

At my favorite resort, I know the manager, and most of the staff and the local restaurants and the details of public transportation and parking fees.etc, etc. and I have several tour books on my desk so I can answer questions as they arise.

I specialize in two areas, which are areas where I have lived and vacationed all my life. I am familiar with the resorts, the units, changes taking place at the resorts, and know many of the staff. I maintain a good rapport with many of the frontline staff and Managers at the resorts. I am familiar with restaurants, entertainment, festivals and events, etc. in these two areas. When I'm given questions, I can usually respond very quickly. I can offer up suggestions, etc. Most of my beach weeks are Summer, with only a few in late Spring.

Also be aware that this is not a get rich quick scheme or even a get rich at all scheme, its a rather low paying job, unless you do it in big numbers. I didn't talk to every megarenter, but one I did talk to early on told me that they target a $200 profit per reservation In my experience thats turned out to be about right, which means to make $100000 you need to do 500 reservations a year thats 2 a day if you work a 5 day week, and consider this number... 500 weekend reservation in Wyndham Land will take about 50 million points which equates to a mf payment of over $20,000 a month.

I have been renting and reselling as a profitable hobby since 2006. Things peaked from 2009-2012. Since then, there's lots more competition, higher maintenance fees, tons of special assessments, folks waiting closer to check-in to book, more access to other options, problems with property purchases, etc. These things were not a problem for me like they are today. It requires a lot more hours and a lot more monetary investment to maintain the previous levels.

I understand perfectly well that nothing is forever and that if I fail to adjust to some future unknown change Ill fail.

This in a nutshell.

There has been so much unexpected changes in the last few years related to timeshares and my little business. Change is inevitable. One's ability to adapt to new situations or to be attuned to the fact that it's time to move on are key to having a chance for success at just about anything.

 

[Egret1986]

Judy, you've been given a lot of advice from those that do it or have done it.

Well, I've been renting out timeshares on the side for almost a decade and still haven't really turned a profit. It didn't help that I started right before the great recession, and paid too much for timeshares that quickly became worthless.

But, I am determined to succeed, or die trying -- preferably in my personal jacuzzi at a nice timeshare.

Hi Judy,

"....almost a decade and still haven't really turned a profit." I started in 2006 and it was a learning experience for the first couple of years, determining what worked. I knew that I was a strong proponent of timeshare ownership and taking vacations, I really liked the interaction with vacation-minded folks, and it was an extension of what I enjoyed and liked to talk about. However, I always have had the back-up of a full-time job. In the past, I have envisioned this as something that I could easily do in retirement and enjoy.

If I had not started turning a profit when I did, I would not have stuck with it. Ten years is a long time. I remember when you came back on the boards last year about starting up again with timeshare rentals. You say that you contended with the "great recession". I didn't experience as much impact during that time as I have been over the last couple of years.

"But, I am determined to succeed, or die trying." Judy, determination is a necessary component to any success; however, there are a multitude of things that will also factor in, many beyond your control. Don't make "die trying" a part of your potential business plan.

As one who does this for a living, I would encourage no one to purchase timeshares for the sole purpose of renting. I have seen it happen on multiple occasions and it does not usually come out with the desired results.

It is a full time 24/7 job. The market is constantly changing, timeshare companies constantly changing the rules in an effort to make it more difficult to rent, and the buying public is a flaky animal. What is popular one year is not the next.

I have been doing this for 16 years now and I will tell you it is a tremendous undertaking.
JMHO,

Cindy

It is a full-time job if you're going to be successful and make a living at it. The market is definitely in a constant state of change. Yes, the buying public is a "flaky animal." It's their money. Many rentals are easy, but more and more most take lots more time to complete. Repeat customers are the cream. However, each year you have to wade through a lot more folks and their inquiries and their fickleness and whatever, to complete a rental.

I haven't done this, but from what I'll tell you what I've seen from those that I consider successful. They specialize in a location and/or high demand holidays and or one particular system. They know their product extremely well and have been at the properties themselves and are able to answer any questions about the properties.

I concur with this. Specialize in high demand areas during high demand, low supply times. Know your product extremely well. Folks want an answer to their questions now or many times they will move on to the next person that can provide the information.

The market for owner rentals is too small. It helps to have a visible business rather than it looking like an individual but it is still very limited with the prepay in full and no cancellation requirement. If you specialize in a certain region or the best holidays you can quickly experience saturation when attempting high volume.

Then you start to get into all the things you can't control. Timeshares that go up 5-10% a year in fees without rental inflation at the same pace and it becomes a time consuming management of getting rid of soon to be undesirable units and the hunt to find others to replace them.

Very important to understand this is a limited market, which can become saturated. I've seen this first-hand where I specialize. When I first got into this, I was one of a very few completing rentals in my areas of specialization and it was easy to rent my inventory with little effort....bam, bam, bam. Now, I see many, many regulars listing their units and it requires more work to "hook" that renter if you even do. Maintenance fee increases, older resorts requiring special assessments, unexpected resort acquisitions, competition with other lodging options, the investment and risk, etc. all are factors that should be considered.

 

[newportbeach]

I question the economics of such a large scale business. Assume you are basically working 25-40 hours a week, and want to earn $50,000 a year, and
net profit is $200 a rental. That means you need to own 250 weeks of timeshare.
Now assume you acquire rental timeshares for an acquisition cost of $1,000
for the title, escrow, and timeshare Developer transfer fees. Do you really want to spend $250,000 of cash. No assume you decide to, it will take you 5 years
of taking no salary to recoup your initial investment. Plus figure out that as of Dec 31st you will face $1,000 a week in mf, so oh yes that is another $250,000 you put out and wait up to 12 months to again recoupe.

Unless my math is seriously off, this is not a business plan for most people.
I think what is the typical business plan is over time someone acquires a few
timeshares, pays them off, and then looses the burning desire to return to say
the same 1-2 locations, so these units instead of being dumped or sold off
for very little become a small rental business and perhaps the business acquires
one or two resales a year so a hobby grows into a business without being an
economic back backer.

I found the advice of another above of becoming an agent for other owners to
be a less capital intensive, but I am unsure how to move forward to acquire such owners.

Saving the best for last: Feeling weak and dependent and yet wanting to remain independent while suffering from various handicaps. I would start with the basics such has human interaction. Even something as basic as going to Church in a wheel-chair if necessary is a start. I liked Denise's suggestion of doing
phone work from your house, and often that can be done part time, so
part of the time you can rest a little. I would recommend customer service
over sales because it is better suited for more types of people, although personally I find sales positions are easier to secure.

 

[ronparise]

I question the economics of such a large scale business. Assume you are basically working 25-40 hours a week, and want to earn $50,000 a year, and
net profit is $200 a rental. That means you need to own 250 weeks of timeshare.
Now assume you acquire rental timeshares for an acquisition cost of $1,000
for the title, escrow, and timeshare Developer transfer fees. Do you really want to spend $250,000 of cash. No assume you decide to, it will take you 5 years
of taking no salary to recoup your initial investment. Plus figure out that as of Dec 31st you will face $1,000 a week in mf, so oh yes that is another $250,000 you put out and wait up to 12 months to again recoupe.

Unless my math is seriously off, this is not a business plan for most people.
I think what is the typical business plan is over time someone acquires a few
timeshares, pays them off, and then looses the burning desire to return to say
the same 1-2 locations, so these units instead of being dumped or sold off
for very little become a small rental business and perhaps the business acquires
one or two resales a year so a hobby grows into a business without being an
economic back backer.

I found the advice of another above of becoming an agent for other owners to
be a less capital intensive, but I am unsure how to move forward to acquire such owners.

Saving the best for last: Feeling weak and dependent and yet wanting to remain independent while suffering from various handicaps. I would start with the basics such has human interaction. Even something as basic as going to Church in a wheel-chair if necessary is a start. I liked Denise's suggestion of doing
phone work from your house, and often that can be done part time, so
part of the time you can rest a little. I would recommend customer service
over sales because it is better suited for more types of people, although personally I find sales positions are easier to secure.

RichardL has summed up the opposition to starting a timeshare rental business.pretty well and I bet Ray Kroc and JW Marriott heard the same things when starting their businesses too> How the hell can you make any money selling 15 cent hamburgers or 5 cent rootbeers from expensive retail locations? The investment too large, and the return on that investment too small. Its too much work and too much risk for too little return.(as a little sidebar I worked for Marriott before he put his name on the company, In 30 years he had grown his little 6 stool root beer stand to a chain of family restaurants and one motel near National Airport)



Lets look at RichardL assumptions...because they are wrong

1) timeshares dont cost $1000 per week, My first deal was 3 weeks for $1000,(mf $2000 a year) a month later I answered an ad here on tug for a free fixed week that came to me with the current years fees paid and with a reservation in place. and the seller paid the closing costs. I took that free timeshare and advertised the reservation for rent on Craigs list (also free) for $1000, Encouraged by my success I made 6 reservations with those first 3 weeks and rented 5 of them for $1000 each and enjoyed the 6th one myself...

so after the first year I had recovered my initial investment, paid my maintenance fees, enjoyed a vacation and had $3000 in my pocket. I then proceeded to do it again and again and again> Except for the first $1000 I have funded the growth of my little business with the profits, and I was profitable from the beginning

2) its not a large scale operation. and its not risky, at least not compared to owning vacation homes. Think about it, 250 weeks is the equivalent of 5 vacation rental homes or condos and I dont think anyone would call the owner of a 5 unit apartment building a big operator. And thats the guy that has taken a risk. If that building is as well located as my timeshares, he has over a million dollars invested... not me not with my timeshares.

3) it doesnt take 25 hours a week. Most of my time is spent looking for new opportunities, not actually operating the rental side,

4) and the "best for last" The human interaction thing as important as it is, doesnt pay the bills. And going to church in a wheelchair would just piss me off, I mean what kind of god gets off on giving me legs I cant use. That stuff seems a waste of time and an opportunity to wallow in self pity. Better to spend Sunday mornings updating your ads and interacting with prospective renters,

The op didnt ask us whether going into the rental business using timeshares was a good idea, I think she has already decided that. She asked whether it would be better to specialize or diversify. and she know that their are risks either way. She also seems to know that there is no reward with out some risk. Shes not asking what the risks are, shes asking which risk has the better payoff and is more easily managed. and she wants to hear from folks that have done it, not a bunch of armchair quarterbacks.


And Judy, you have done well to communicate with Cindy.. shes the best

and Cindy, I owe you a phone call, dont I

 

[DeniseM]

A few comments about Ron's advice:

- Ron has high tolerance for risk.

- His comments primarily apply to owning/renting Wyndham points.

- Outside of Wyndham points, it is nearly impossible to buy deeded weeks that that are profitable rentals for less than $1,000.

- Much of what Ron owns is rented for him by account managers, which is why it doesn't take him 25 hours per week.

 

[tschwa2]

I have over 25 weeks. Most are summer weeks to drive to locations that I can either use or give to family and friends if they don't rent plus a few week 52 Florida weeks. I have a few mistakes that I have acquired along the way that I can't get rid of. I make enough to cover the mistakes (MF and then deposit the weeks), pay for a few weeks of exchanges and personal usage (and the MF of the ones that don't rent), and usually a little left over. I could probably sell 1/3 for some profit, give 1/3 away without much difficulty and the final 1/3 would be challenging to impossible to give away even though some of those are money makers on an annual basis. I try to pay my MF's a year in advance of usage, which some require to make the reservation and for the others so I won't be stuck with $20,000 in MF come December.

I have some weeks that are points and some that can be used as split weeks. This is the first year I am keeping a spread sheet of the actual number of transactions I am doing. I probably should keep track of the time spent too, maybe next year.

 

[ronparise]

A few comments about Ron's advice:

- Ron has high tolerance for risk.

- His comments primarily apply to owning/renting Wyndham points.

- Outside of Wyndham points, it is nearly impossible to buy deeded weeks that that are profitable rentals for less than $1,000.

- Much of what Ron owns is rented for him by account managers, which is why it doesn't take him 25 hours per week.

Denise

I think if you re read my post you will see I did t offer any advice at all, in fact giving the op advice is what I'm ranting about. The op didn't ask for advice she asked for an answer to a specific question and she asked for that answer from folks that had some experience to back them up

And to your comments. My best money makers are fixed weeks not part of the Wyndham points system but yes, most of my experience is with Wyndham points and in my opinion and based on my experience it can work for the op. And yes I'm lazy and farm out most of my points to professional travel agency types, the point is that there is enough "juice" for both of us to profit

And to say I have a high tolerance for risk is not true at all I understand the risk every time I cross the street but I look to the left and then to the right and then to the left again before I step off the curb. You may ask why I cross the street at all. And the answer is to get to the other side. Applying that to timeshares I am always evaluating the risk/reward relationship with the goal of minimizing the one and maximizing the other. That's the work here not renting itself

 

[DeniseM]

Ron - You may look before you cross the street, but someone who sleeps on a mattress in the back of a car speeding down the highway is a risk taker.

I stand by my post - in business and life you are willing to take more risks than many people.

 

[grupp]

I started renting a few timeshares back in late 2012. I am the opposite of Ron in that I have made a significant financial investment in higher end timeshares. Guess I was inspired by PerryM and MOXJO7282 back in the day and wanted to diversify from the stock market. I did not have enough money to buy full rental property at the time, so timeshares seemed like a possible alternative with a lower entry cost. I have kept a low profile here, because I know most here would say that I could never do what I have done. I fully understand all the risks and started with a small investment and things just kind of took off from there

As for the original question, definitely specialize. I focus on Marriott and DVC timeshares. I want high demand (oceanfront, ski-in/ski-out) that are drivable, so I avoid Hawaii or international timeshares. Also, I prefer locations that have an event week or a defined high demand period, such as ski weeks, summer beach or spring break. I have added two timeshares outside of Marriott or DVC, both of which have turned out to be losers for me because their lack of rental market.

Even through our approaches are different in many ways, I totally agree with Ron’s points. The actual time I spend on rentals is very minimal and the majority of time is spent looking for the next deal. I enjoy that so does not seem like work and really is just surfing the web while I watch football or basketball on TV.

As for placing the ads, it only takes a few minutes to reactive my Redweek ad. I also own multiple weeks at some resorts, so sometimes I get more than one rental form the ad. Most of my weeks are usually rented within 2-4 weeks after placing the ad and typically 6-8 months before check-in. I probably spend about 30 hours per year on the actually rental itself and do $45,000 in rentals with an average rental price of approximately $2,250.

The last two years many of my rentals have been done through brokers. I am always happy to get an inquiry on one of my ads from StayPC, Concierge Realty or Travel Scowt. I know that they usually already have a renter lined up, are efficient, and handle the paper work. I just sign the agreement electronically and deposit the check when it arrives.

DVC rentals through DVC Rental store are incredible easy. However, with todays DVC resale prices I don’t think you could purchase a contract to make it work financially.

So far it has been very profitable for me. Maybe I will crash and burn some day, but for now I will just enjoy the ride. I would not advise anyone to do what I do, you should find you own path and do what works best for you, but do specialize.