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Re: Diamond Resorts enormously increases the cost of Maintenance/Reserves on their resorts. (by Steve M.):

johnb2353 wrote:

Don,

I cannot answer whether there is a correlation to overselling timeshares and an increase in maintenance fees. It would seem to me that more owners means more revenue, and that the opposite should be the case -- that the fees would not have to rise. The legal basis for deeding back my timeshare was that I could not access it. The property was so oversold, I would call many months in advance and even then, would not find availability. They were also renting the units on the open market which reduced availability even more. My timeshare was not with Diamond. But these problems are throughout the industry.

John

There is definitely a correlation - and that is that as they oversell the properties, they run into the problem that you can not stay when you want to. This leads to disgruntled owners who stop paying the maintenance fees, and in some cases, their mortgages. This then leads to shortages in the funds needed to maintain the property, so they raise the maintenance fees to the owners who are paying. --You are being punished for the overselling by the Time Share.

It is worse with point system units, as they can sell far more points for usage than they can ever accommodate in any way. Some resorts sell more points than there will ever be rooms to use them, which should be illegal, but isn't in some states. But it is equivalent to selling the same house to three different people and walking away with the money.

Unless they are breaking the law in most states, you will find that the units being rented are not effecting the availability of rooms. While this sounds illogical, the simple fact is that the rooms that were not sold by the developer, are not part of the time share float systems, and therefore were never available to you to use, with or without rental programs. The developers rent out the rooms to cover the cost of maintenance fees they owe to the HOA for those unsold units. Where the real scam comes in on this is that when the developer sells you a unit that is floating or on points systems - they nearly always will give you a deed to a low or middle season unit, not the high season unit that they are teasing you with. That leaves them the higher demand rooms in high demand weeks to rent out, increasing their asking price and profit. You then find out that while those higher season weeks may be theoretically available to you, you will seldom be able to use them, unless you book the first week of the year. If your resort has time shares that renew each month, instead of on one fixed day each year; then it will prove impossible to ever get the high season weeks, unless you are lucky enough to renew the week after you want, and book a year in advance.

Having said all that - I am in a points system, with three units. I have been able to book most, if not all of my stays each year, but do so by planning a year in advance, and making my reservations the same month I pay the fees, so that I have a better chance of booking the room and week I want. When necessary, you may be able to prepay next year fees, and book the stay before it is available to any other owner.