An Insightful Guest Blog From Wes Kogelman

To Pay Or Not To Pay – That Is The Question?

Over the years, probably the most contentious issue I have heard regarding the timeshare resale sector involves paying for fee-based resale services and whether an owner should consider paying for marketing costs in advance or just have any associated costs come from commissions after a sale has been concluded.

While this is an understandable debate, considering the abuses that have taken place over the years from rogue companies, I continue to be amazed at the lack of understanding about the process – especially in the transparent world of the Internet in which we now reside.

I manage separate companies which cater to both sides of the debate, having started my advertising business, BuyaTimeshare.com, 14 years ago and also obtaining a real estate license for my brokerage business, CashOutATimeshare.com, so I have a unique perspective. While we keep our businesses completely separate, I see the industry in a more holistic capacity than most operators.     

The Advertising Model – What To Look For

On the advertising side, when I describe our business as more of a technology company similar to AutoTrader.com or Monster.com, operating very similar but just with a different product to sell, most people grasp how we operate. But over the years, the timeshare product has been depicted in a different light than other products and timeshare online advertising outlets have received very different scrutiny than these other aforementioned businesses, simply because of the product, not necessarily because of the method of advertising.

Because online advertising can be effective, anyone thinking of using an online advertiser should consider objective evaluation touchpoints such as:

·         Never do business with someone who cold calls you – this is a leading characteristic of a rogue company.

·         Beware the “buyer in waiting” pitch – since buyers do not line up to purchase unadvertised products.

·         Marketing visibility – how does a company intend to market themselves to attract buyers. In this Google age, a simple search for terms such as “timeshares for sale” or “buy a Marriott timeshare” should reveal legitimate operators. If you can’t find an operator through a simple search, then how will a buyer?

·         Business processes – is the company registered to do business? Do they even post their address and contact details? Do they offer a written contract? Do they protect consumer data? These are basic principles of business today and are a starting point when considering a business relationship.

·         Do they get results – any reasonable operators should be able to document their successes.

Are Licensed Brokers The Answer?

This leads me to the other side of the conversation, the no up-front fee, commission-based licensed brokerage option. Because there are no guarantees that a timeshare will sell, many people decide on this option because they are more comfortable with the process. This can be a very effective means of selling a timeshare. However, keep in mind that most brokers will only want to handle timeshares they know they can sell quickly, whether they are certain name brand timeshares or in specific high demand geographical locations, because their livelihood depends on it. So a vast number of timeshare owners go unserviced with limited options because they don’t happen to fall into these categories.

Do We Need To Choose?

Hence, the tease in the title – why even ask the question in the first place? These are not mutually exclusive options, as there are more opportunities available today to sell than ever before and a combination of outlets may work best. Many times it just takes creative thinking to establish a marketing plan that gives an owner the best possible avenue to sell. According to the American Resort Development Association, nearly one in three timeshare buyers are doing so through resale outlets, so consumers are identifying the resale market as genuine in an industry that, overall, sold nearly $7billion in timeshares last year. 

We have even come up with a hybrid subscription service that essentially blends the idea of online marketing for the cost of a couple of cups of Starbucks coffee to give owners access to online buyers. This is a program we have offered as a benefit of membership of the National Timeshare Owners Association, so owners would need to contact the NTOA about this option.

The point is that consumers are taking more control of the process than ever before and, contrary to popular opinion, consumers are looking online to buy timeshares. Google estimates that about 129,000 searches per month are entered for buyer-related terms such as “timeshares for sale” or “buy timeshare”. So fear not, for there is a market for the product and options are available.   

New Timeshare Fee or Something Else?

One of my readers brought something to my attention last week and I thought it best to ask everyone else if they've ever heard of/paid this new timeshare fee.

It's called a "Trustee Registry Fee For Points Certification".  Huh?

$395 was charged for the initial purchase and another $395 for the upgrade.

I've never heard of this fee...has anyone else?

I've asked my reader to get a written explanation of this fee and will report back.

Yet another example of the need to take your time when buying a timeshare and carefully review all the paperwork.

Welcome Our Newest Timeshare Guest Blogger, Desiree French

Desiree French is a writer in Washington DC  Today she reviews Club Ocean Villas in Ocean City, Maryland.

I needed a vacation and wanted a place close to home that’s child friendly. I spoke those words to a co-worker more than 10 years ago. Without hesitation, she recommended Club Ocean Villas II in Ocean City, Maryland. I’ve been going there with my son during the summer, and sometimes the spring, ever since. The amenities are to die for. The proximity to the beach is priceless. And the units, each with yellow patio umbrellas, are cozy and equipped with everything you need.

Fond of low-rise buildings, I took to Ocean Villas immediately. Especially appealing: our unit overlooking the canal and tiny pier with boat slips. And the units are airy, bright, and feel like home away from home. Need an extra pillow or blanket? Look in the closet. Spilled ice cream on your shorts? Dump them in the washing machine and dryer behind the sliding glass door.  There’s no maid service—and therefore no interruptions—while there, but there’s a broom and vacuum cleaner in every “apartment,” which the one- and two-bedroom units feel like.

The two-bedroom apartments have a living room—which my son likes to dominate playing his video games—master bedroom, a well-stocked kitchen, dining area, three televisions, and two bathrooms, one with a Jacuzzi. One of my favorite pastimes is sitting on the balcony watching the occasional boat pass within a few feet of our living quarters. The outdoor hot tub that’s available in private space at each unit is a real treat, particularly at night after a long, lazy day at the beach and boardwalk.

Ah, the beach. It’s only a block away. But it’s far from the hustle and bustle of the boardwalk and other main attractions, such as the amusement parks, about five or six miles away. This means Ocean Villas is located in a quiet area. No rowdy teenagers, wild parties, or intoxicated vacationers.

When my son was younger, he and his friends spent most of their days at the resort’s outdoor and indoor pools. I still prefer the indoor pool house and sauna but can’t deny enjoying lounging on the beach chairs at the outdoor pool. And although I used to play racquetball and my son played tennis, we have yet to take advantage of the racquetball or tennis courts. But we both like going to Gold’s gym, which accepts temporary passes from guests staying at Ocean Villas.

About two or three years after visiting Ocean Villas, I purchased a canal side unit that we have come to love. We continue to visit the timeshare every June, although we have the option to trade our one-week stay for an excursion to other RCI locations. But Ocean Villas II has become our special, family vacation spot, and we have no plans to switch. We have many treasured memories of our stay there over the years—from watching videos on the sofa and spying rabbits in the bushes to chilling in the hot tub and playing in the pools.  Good times, indeed.

Update On The Manhattan Club Issue

I've been asked to share this link which is a petition to New York governor Andrew Cuomo:

http://www.change.org/petitions/gov-andrew-cuomo-return-money-scammed-by-the-manhattan-club-timeshare

I don't own a timeshare at the Manhattan Club, but I do think that these owners need a voice to help their cause.

Feel free to share.

Five and Almost 10 With...Bert Blicher

Today we meet Bert Blicher, former head of ARDA and now the owner of Blue Water Resort in Nassau.

What was your first job in timeshare?

I was the CEO of a company called Oxford First Corp. I started a department that financing timeshare resorts. We were the first  US lender in the business in 1979.

What is the greatest lesson you've ever been taught? 

A few. A. Take care of your reputation. B. Treat people with respect. C. As you become successful give back .

What is your favorite vacation spot? 

St. Martin

If you could change one thing about timeshare, what would it be? 

Again two things. 1. Improve the resale business so it is easy for one to sell their timeshare if life changes occur and they need to exit. 2. Change the initial purchase product from a lifetime purchase to a 10 or so year purchase with the option to renew. Thus, the buyer would be able to exit at the 10-year mark if they wanted to.

What is your favorite color? 

Blue. For Blue Water Resort in Nassau Bahamas. I own it.

Thanks!  If you'd like to be featured, drop me a line at lisa@timeshareinsights.com

Sad/Funny/True/Not True---This Is What Wikipedia Says

For those of you who have not been paying attention, I get into a LOT of hot water for putting my views onto a public platform.  I'm OK with it, despite the fact it results in lots of ignored e-mails, being barred from certain events and lots of name calling behind my back.

But since this new timeshare book that I'm writing (here's the link to have your voice heard:  http://www.timeshareinsights.com/feedback.php) is based solely on consumer input (I can be ignored and people can wish that I would go away, but it's harder to get away with that towards the public), I found this description of the timeshare "tour" i.e. sales presentation on Wikipedia worthy of blog recognition.

I've done NO editing.  Sad/funny/true/eye-opening?  You tell me.

The Tour

First, the "Prospects" (prospective buyers) are seated in a Hospitality Room with many tables and chairs to accommodate families. The Prospects are assigned a Tour Guide; he/she is usually a Licensed Real-Estate Agent, but not in all cases. The actual cost of the Timeshare can only be quoted by a Licensed Real-Estate Agent. After a warm up period and some coffee or snack, there more than likely will be a Podium Speaker welcoming the Prospects to the Resort. Then the lights will dim and the Prospects will be shown a film designed to dazzle them with exotic places they could visit as Timeshare Owners.

Next, the Prospects will be invited to take a tour of the property. Depending on the Resort's available inventory, the tour will include an accommodation that the Tour Guide or Agent feels will best fit the Prospect's family's needs. Then it is back to the Hospitality Room for the verbal sales presentation. The prospective buyers are given a brief history of Timeshare and how it relates to the Vacation Industry today. During the presentation they will be handed the resort exchange book from RCI, Interval International, or what ever exchange company is associated with that particular Resort Property. The Prospects will be asked to tell the Tour Guide the places they would like to visit if they were Timeshare Owners. The rest of the presentation will be designed around the responses the prospective buyers give to that question.

If the guide is licensed, he/she will then give the Prospect the retail price of the particular unit that best seemed to fit the prospective buyer's needs. If he/she is not a Licensed Agent, a Licensed Agent will now step in to present the price. If the Prospect replies with "no", or "I would like to think about it", the prospective buyer will then be given a new incentive to buy. This incentive will usually be a discounted price that will only be good "Today". If again, the reply is "no", or "I would like to think about it", the Guide/Agent will ask the Prospect to please talk to one of his/her managers before the Prospect leaves. It is at this moment that the prospective buyer realizes that the 'Tour' has actually just begun.^[24]

The Manager, Assistant Manager or Project Director will now be called to the table. This procedure is called: "TO", or getting the "Turn Over" man to find an incentive usually in the form of a smaller less expensive unit or "Trade-In" unit from another owner. This tactic is commonly used as a sales ploy, because the Resort is not interested in reselling 'Already Deeded Property'. Similar to the Automobile Sales Industry, the manager and salesman know before hand exactly what the lowest price is that will be offered to the Prospect, well before the prospective buyer has arrived for the Tour. If one incentive doesn't move a Prospect to purchase, another will follow shortly, until the Prospect has either purchased, convinced the usually very polite sales crew that no means no, or has gotten up from the table and escorted himself/herself out of the building.

What To Know Before Buying A Timeshare

When purchasing from the developer, it’s implied you have clear title, although it is always good to ask.  In addition to the questions you need to ask yourself to determine if timeshare is right for you, there are a number of questions you should get full answers to before signing on the dotted line.  Remember that there are more than 6,000 resorts worldwide and at any given time, literally millions of intervals for sale on both the primary and secondary market.  Rarely, if ever, does a case of “this is the only one” exist in timeshare.

Here is a “starter list” of questions to ask and get full answers to:

1)    Do you understand all the terms and conditions of the contract?

2)    What are the current maintenance fees?

3)    What is the five (5) year history of those fees?

4)    Are there any special assessments and if so, what are they and what are they for?

5)    Is the HOA (Home Owners Association) under developer control or owner control? 

6)    How much of the resort is sold out?

7)    Does control of the HOA change at any point based on how sold out the resort is?

8)    What is the current delinquency rate among owners?

What would you add to this list?