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Re: To MS Schreier (by Armando R.):

Hi,

For the purposes of this discussion, I will limit my analysis to deeded properties. While it has been established long ago that the purchase of a deeded time share units is not to be considered an investment in the conventional sense, it also should not be considered a worthless asset either. Unfortunately, the post-purchase experience and economic environment as noted by several writers, bloggers, owners and "insiders" is the direct result of the fundamental problem with the TS industry itself - i.e. it never concerned itself with resales - only new sales at high prices. So effectively no viable, reasonable or equitable resale market was established. What developed is a disgraceful situation and a haven for scammers.

In this month's TST, my letter was published in which I propose a somewhat novel, if not controvertial idea. Simply stated, wouldn't it be beneficial to all parties if developers themselves supported their products by establishing a "certified" buy-back procedure? If we remember that the majority of quality top-tier resorts are owned by giant hospitality and entertainment chains, the resale programs they establish could be modeled much the same way auto manufacturers support their products through their finance companies. If this model were to be established, a buyer purchasing from the developer would know what the "residual value" of the real estate purchase is at predetermined future dates. This would establish the market value and support pricing that reflects the value inherent after depreciation. The net result is that there would be a new market and a "certified" market of prior owner units. The price differential between both products would be in the amenities offered and value added bonuses that can only be available through a direct purchase through the developer. I do not intend this to be an endorsement for developer sales only, I do believe that this has the potential to solve most of the problems that now exist when current owners wish to dispose of their units. Reasonable?