Resale Woes.... Orlando Sentinel Article Dec.17,2007

I thought I would share this with the Redweek community. It is good to see an article about the resale problems along with some advice and warnings about how to sell time-share weeks. The article also points out that some resale values retain their value more than others. Check the Marriott resale values.

Here’s the link to the article: Orlando Sentinel Article from 12/17/07 “Resale Woes”

http://www.orlandosentinel.com/community/news/deland/orl-timeshare1707dec17,0,7213824.story?page=1&coll=orl-careerbuilder-navsrvc

There is some good news though. The article points out that Marriott Vacation Club International offers a resale alternative for MVCI owners that have purchased directly from MVCI:

The article states: “Time-share companies spend large amounts on marketing, and many consider the secondary market a source of competition. But that may be changing. Orlando-based Marriott Vacation Club now offers to buy back some, though not all, units from those who want out.

"We have a relatively low percentage of units that are available for resales -- less than 2 percent," said Marriott Vacation Club spokesman Ed Kinney. "Resales are a byproduct of the industry. People have products that don't fit their needs. We know that."

I seriously doubt the truth of this quote from David Siegel: “David Siegel, president of Westgate Resorts in Orlando, said his company warns prospective buyers that time shares are difficult to resell. And Westgate doesn't offer a formal resale program.”

I hope this information will help someone.

Regards, Eric

edit to correct web url link

Marriott has been exercising ROFR (right of first refusal) for many years ... this is nothing new. Some owners like it, others don't ... depends on one's perspective.

jayjay wrote:

Marriott has been exercising ROFR (right of first refusal) for many years ... this is nothing new. Some owners like it, others don't ... depends on one's perspective.

---------------------------------------- I'm not sure, but I don't think this article is referring to ROFR. That is where--if a contract for a resale has already been initiated, Marriott can step in and "buy it back" for the amount agreed upon. Either way the seller gets the money, this just means that the buyer doesn't get to buy. (tell me if I am wrong...This is my basic understanding...)

However, the article reads: "Orlando-based Marriott Vacation Club now offers to buy back some, though not all, units from those who want out."

This indicating that Marriott will buy it back, in some instances, without someone having to make an offer on the timeshare.

Am I totally off in my understanding of ROFR?? Or in the article? Please correct if incorrect :)

ilonar2 wrote:

jayjay wrote:

Marriott has been exercising ROFR (right of first refusal) for many years ... this is nothing new. Some owners like it, others don't ... depends on one's perspective.

---------------------------------------- I'm not sure, but I don't think this article is referring to ROFR. That is where--if a contract for a resale has already been initiated, Marriott can step in and "buy it back" for the amount agreed upon. Either way the seller gets the money, this just means that the buyer doesn't get to buy. (tell me if I am wrong...This is my basic understanding...)

However, the article reads: "Orlando-based Marriott Vacation Club now offers to buy back some, though not all, units from those who want out."

This indicating that Marriott will buy it back, in some instances, without someone having to make an offer on the timeshare.

Am I totally off in my understanding of ROFR?? Or in the article? Please correct if incorrect :)

I'll try to clarify. Marriott does have Right of First Refusal at some of the properties. That helps protect the Marriott resale values. Just like I don't want my neighbor underselling his home, because it affects my equity and resale value.

Marriott also will broker a resale week if the seller purchased originally from Marriott and the Marriott owned inventory is completely sold out. Depending on the initial purchase price and the current retal price, many owners receive enough money to cover their initial investment. Marriott has properties like Heritage Club in Hilton Head, SC with purchasers waitlisted for many months waiting for an owner to resell back through Marriott. The owners like the arrangement and Marriott likes the brokerage commission.

The key is that your resort needs to be sold out and you should use it for about 10 years before selling back through Marriott.

This is the difference between ROFR, reacquired, and Marriott resale inventory.

Regards, Eric

I certainly don't feel that ROFR protects the resell value of any resorts. I don't even bid on these resorts because I don't want my money tied up for two months.

Besides that, the seller doesn't get a dime more than what he would have received from the person that doesn't mind wasting his time, energy and money tryng to buy something he won't end up getting.

The only protection ROFR offers is to the Resort as it pushes most folks into just buying from them, and at a huge premium to the value, I might add.

The resort's resell may hold up better than others, but that is because of the Unit and Location. Some people want the luxury while on vacation and are willing to pay for it.

orvillef2 wrote:

I certainly don't feel that ROFR protects the resell value of any resorts. I don't even bid on these resorts because I don't want my money tied up for two months.

Besides that, the seller doesn't get a dime more than what he would have received from the person that doesn't mind wasting his time, energy and money tryng to buy something he won't end up getting.

The only protection ROFR offers is to the Resort as it pushes most folks into just buying from them, and at a huge premium to the value, I might add.

The resort's resell may hold up better than others, but that is because of the Unit and Location. Some people want the luxury while on vacation and are willing to pay for it.

I agree with you. It would seem some people buy the Marriott NAME and they pay the price, but I can't see that Mariott's could be anymore plush or luxurious than some of the other timeshare resorts out there and for far less money.

We stayed at a Marriott Courtyard Hotel for a wedding once (it was booked by the bride) and we were totally underwhelmed at the plainess of the hotel. We had expected much better quality. We had/have stayed in non high end name hotels that were much nicer than that Marriott.

Hi Orville,

Marriott does not exercise the ROFR very often. It is a benefit of ownership with Marriott to know that Marriott might buy the week from them. Would you be more worried before a pending sale closing if the buyer was a stranger or if the buyer was Marriott? What if you researched to find recent ROFR purchases and the sale price details (all sales are recorded with the government btw), then offered your week for more than you thought you would have gotten before knowing that the Marriott ROFR price would be higher?

The mere fact that Marriott will buy back weeks does help protect the value of Marriott Vacation Club weeks for the owners. Marriott is not pushing MVCI owners into selling their weeks. Do you really believe that Marriott wants to be in the resale business? Of course Marriott will turn a ROFR purchase into a profit if it can. As long as Marriott keeps using the profits to build beautiful new Marriott Vacation Clubs with those profits, it is a win-win for Marriott and the MVCI owners.

Hi Jayjay,

The value of MVCI ownership usually increases because of the 46 high demand locations and growing), high quality amenities, high quality service, Marriott’s commitment to expansion of MVCI, and the Marriott Rewards program. Do you really think you can find more “plush or luxurious than some of the other timeshare resorts out there and for far less money?”

If you would like to compare the “limited-service hotels” like the Marriott Courtyards to the Hilton Hampton Inns or other hotel companies like Quality Inn or Motel 6, perhaps a hotel comparison thread would be appropriate rather than putting that with comments about the Marriott Vacation Club quality. A Marriott Vacation Club is NOT comparable to a Courtyard hotel.

Marriott owners do benefit from the ROFR and separate Marriott resale for owners program.

Regards, Eric

ericf55 wrote:

Hi Jayjay, If you would like to compare the “limited-service hotels” like the Marriott Courtyards to the Hilton Hampton Inns or other hotel companies like Quality Inn or Motel 6, perhaps a hotel comparison thread would be appropriate rather than putting that with comments about the Marriott Vacation Club quality. A Marriott Vacation Club is NOT comparable to a Courtyard hotel.

Since Marriott owns Marriott Courtyard Hotels and Marriott timeshare resorts, I was assuming the high quality would be the same (or it should be). Because of that one negative experience with a Marriott Courtyard we became disenchanted with that brand name.

We have stayed in many Hampton Inns (I wasn't aware they were Hilton owned) and we were very satisfied with the quality, the service, the coziness, the sound proofing of the rooms and the amenities, including free breakfast. We heard absolutely nothing outside of our room or in the hallway.

When we stayed at the Marriott Courtyard we could hear shouting from the pool when we were inside our room and people talking in the hallway. We found that very annoying (evidently poor quality insulation).

No offense, but if I was interested in a high end name brand timeshare I would be looking for a Hilton since (as you stated) they own Hampton Inns.

I really don't want to get in a discussion of how great some people think Marriott timeshares are (they certainly pay the price for a Marriott), but I just believe they're over-rated.

P.S. I hope you're not a Marriott salesperson.

jayjay wrote:

ericf55 wrote:

Hi Jayjay, If you would like to compare the “limited-service hotels” like the Marriott Courtyards to the Hilton Hampton Inns or other hotel companies like Quality Inn or Motel 6, perhaps a hotel comparison thread would be appropriate rather than putting that with comments about the Marriott Vacation Club quality. A Marriott Vacation Club is NOT comparable to a Courtyard hotel.

Since Marriott owns Marriott Courtyard Hotels and Marriott timeshare resorts, I was assuming the high quality would be the same (or it should be). Because of that one negative experience with a Marriott Courtyard we became disenchanted with that brand name.

We have stayed in many Hampton Inns (I wasn't aware they were Hilton owned) and we were very satisfied with the quality, the service, the coziness, the sound proofing of the rooms and the amenities, including free breakfast. We heard absolutely nothing outside of our room or in the hallway.

When we stayed at the Marriott Courtyard we could hear shouting from the pool when we were inside our room and people talking in the hallway. We found that very annoying (evidently poor quality insulation).

No offense, but if I was interested in a high end name brand timeshare I would be looking for a Hilton since (as you stated) they own Hampton Inns.

I really don't want to get in a discussion of how great some people think Marriott timeshares are (they certainly pay the price for a Marriott), but I just believe they're over-rated.

P.S. I hope you're not a Marriott salesperson.

JayJay,

Marriott builds, sells, and manages the Marriott Vacation Club Resorts for the owners by contract with the various resort Homeowners Associations (HOA's). Marriott works with the owners to provide the level of quality that meets the Marriott standards, Interval Intl. 5-Star standards and the HOA budgets.

Marriott also doesn't own most of the hotels. Marriott manages the hotels for the franchisees. It is unfortunate that there was a loud wedding party at the Courtyard hotel that the bride reserved for you. Too bad you'll never be a MVCI owner because a few loud nights at a hotel influences your decision about 46 Marriott Vacation Clubs. Oh well, to each his own choice.

Regards, Eric

ericf55 wrote:

ilonar2 wrote:

jayjay wrote:

Marriott has been exercising ROFR (right of first refusal) for many years ... this is nothing new. Some owners like it, others don't ... depends on one's perspective.

---------------------------------------- I'm not sure, but I don't think this article is referring to ROFR. That is where--if a contract for a resale has already been initiated, Marriott can step in and "buy it back" for the amount agreed upon. Either way the seller gets the money, this just means that the buyer doesn't get to buy. (tell me if I am wrong...This is my basic understanding...)

However, the article reads: "Orlando-based Marriott Vacation Club now offers to buy back some, though not all, units from those who want out."

This indicating that Marriott will buy it back, in some instances, without someone having to make an offer on the timeshare.

Am I totally off in my understanding of ROFR?? Or in the article? Please correct if incorrect :)

I'll try to clarify. Marriott does have Right of First Refusal at some of the properties. That helps protect the Marriott resale values. Just like I don't want my neighbor underselling his home, because it affects my equity and resale value.

Marriott also will broker a resale week if the seller purchased originally from Marriott and the Marriott owned inventory is completely sold out. Depending on the initial purchase price and the current retal price, many owners receive enough money to cover their initial investment. Marriott has properties like Heritage Club in Hilton Head, SC with purchasers waitlisted for many months waiting for an owner to resell back through Marriott. The owners like the arrangement and Marriott likes the brokerage commission.

The key is that your resort needs to be sold out and you should use it for about 10 years before selling back through Marriott.

This is the difference between ROFR, reacquired, and Marriott resale inventory.

Regards, Eric

OK--Thank you for the explanation, but it doesn't really answer my question--I was responding to jayjays response to the article. Was the article referring to to ROFR or just to Marriott buying them back in some instances?

ilonar2 wrote:

OK--Thank you for the explanation, but it doesn't really answer my question--I was responding to jayjays response to the article. Was the article referring to to ROFR or just to Marriott buying them back in some instances?

My opinion that Marriott claims they buy back timeshares (in the above Orlando Sentinel article) is purely public relations BS.

If that's the case then why does Redweek alone have almost 600 Marriott timeshares for sale by owners and that's not counting the thousands of other resale outlets on the internet and land based resale outlets elsewhere? I also don't believe that only 2% of all Marriott timeshares are on the resale market ..... but the article was certainly good publicity for Marriott no matter how much BS was quoted by Marriott's PR department..

If you really believe that Marriot is going to offer you more money than you would otherwise get selling on your own;

Well, don't even bother me with your beliefs about how they help owners who want to sell and how they keep people from the great losses others experience in the timeshare industry.

Just try it. Yes, if that is what the Marriott people are fooling their unsuspecting buyers with these days, it's a good day for Marriott until people start realizing that they've been deceived. No one likes to be deceived.

I think owners of Marriotts may even be in a situation to lose more as they continue to have a hard time reserving their week and continue paying higher maintenance fees.

But hey, if Marriott is willing to buy it from them for say 40% of what they paid and then resale it to another unsuspecting buyer with all the great promises for 120% then I'll buy their stock!!

We are Marriott owners and were recently offered the "opportunity" to purchase a week at the NEW resort to be built in Orlando in 2010.

When we said we would consider it if they would buy our week at a current market resale value (developer cost minus the 40% commission they take) we were told that we would be offered current market minus 60%.

Somehow this just didn't seem like a very good deal to us. From what we have seen in listings, we could sell on resale market for 50% of current market and that is fair.

I don't think Marriott is concerned about resales. Even when it would net them a new sale. Yes, there would have still been a difference we would have had to pay towards the new unit. I would have to agree that it was all a marketing BS session.

Marriott is very bad to do business with. I would avoid Marriott at all costs. Unless you have a lot of time to deal with a "run around".

rick493 wrote:

Marriott is very bad to do business with. I would avoid Marriott at all costs. Unless you have a lot of time to deal with a "run around".

I don't know much about Marriott, but this is not an informative or helpful post, as it completely lacks any facts whatsoever. Why so publicly point an accusatory finger at Marriott if you can't or won't even bother to "back up" your statement with any supporting facts?