Fitch: U.S. Timeshare Delinquencies Still Historically Low Despite End-2014 Increase

NEW YORK–(BUSINESS WIRE)–

U.S. timeshare ABS delinquencies increased slightly in the fourth quarter as they typically do in the winter, but they are likely to remain within historically normal levels, according to the latest monthly index results from Fitch Ratings.

Total delinquencies for fourth quarter-2014 (4Q’14) were 2.95%, up slightly from 2.79% in 3Q’14 but below the 3.38% observed in 4Q’13. Fitch has observed consistent, quarterly, year-over-year improvement since 2012.

Defaults also slightly increased in 4Q’14, but are also showing year-over-year improvement. Defaults for 4Q’14 were 0.56%, up slightly from 3Q’14 at 0.53% but down from the 0.66% observed a year ago for 4Q’13. While still somewhat elevated compared to pre-recessionary levels, defaults displayed overall modest improvement in 2014.

On an annualized basis (rolling 12 months), defaults were 6.79% for 4Q’14, down from 7.04% for 3Q’14. This represents over two years of consecutive quarterly improvement as well as the lowest level of defaults for timeshare ABS in six years.

Fitch’s Rating Outlook for timeshare ABS remains Stable due in part to the delevering structures found in timeshare transactions and ample credit enhancement levels.

Fitch’s timeshare ABS index is an aggregation of performance statistics on pools of securitized timeshare loans originated by various developers. Expected cumulative gross defaults on underlying transactions can range from 9% to above 20%. While delinquencies and defaults may vary on an absolute basis, most transactions supporting the index exhibit similar overall trends.

The Fitch timeshare performance index summarizes average monthly delinquency (over 30 days) and gross default trends tracked in Fitch’s database of timeshare asset backed securities (ABS) dating back to January 1997 and is available on a quarterly basis.

Fitch’s quarterly index can be found at ‘www.fitchratings.com‘ under the following headers:

Sectors Structured Finance ABS ABS Indices Timeshare

Additional information is available at ‘www.fitchratings.com‘.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contact:

Fitch Ratings
Brad Sohl
Senior Director
+1-212-908-0792
Fitch Ratings Inc., 33 Whitehall Street, New York, NY, 10004
or
Margaret Rowe
Director
+1-312-368-3167
or
John Bella
Managing Director
+1-212-908-0243
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Article source: http://finance.yahoo.com/news/fitch-u-timeshare-delinquencies-still-162800531.html

Fitch: U.S. Timeshare Delinquencies Still Historically Low Despite End-2014 Increase

NEW YORK–(BUSINESS WIRE)–

U.S. timeshare ABS delinquencies increased slightly in the fourth quarter as they typically do in the winter, but they are likely to remain within historically normal levels, according to the latest monthly index results from Fitch Ratings.

Total delinquencies for fourth quarter-2014 (4Q’14) were 2.95%, up slightly from 2.79% in 3Q’14 but below the 3.38% observed in 4Q’13. Fitch has observed consistent, quarterly, year-over-year improvement since 2012.

Defaults also slightly increased in 4Q’14, but are also showing year-over-year improvement. Defaults for 4Q’14 were 0.56%, up slightly from 3Q’14 at 0.53% but down from the 0.66% observed a year ago for 4Q’13. While still somewhat elevated compared to pre-recessionary levels, defaults displayed overall modest improvement in 2014.

On an annualized basis (rolling 12 months), defaults were 6.79% for 4Q’14, down from 7.04% for 3Q’14. This represents over two years of consecutive quarterly improvement as well as the lowest level of defaults for timeshare ABS in six years.

Fitch’s Rating Outlook for timeshare ABS remains Stable due in part to the delevering structures found in timeshare transactions and ample credit enhancement levels.

Fitch’s timeshare ABS index is an aggregation of performance statistics on pools of securitized timeshare loans originated by various developers. Expected cumulative gross defaults on underlying transactions can range from 9% to above 20%. While delinquencies and defaults may vary on an absolute basis, most transactions supporting the index exhibit similar overall trends.

The Fitch timeshare performance index summarizes average monthly delinquency (over 30 days) and gross default trends tracked in Fitch’s database of timeshare asset backed securities (ABS) dating back to January 1997 and is available on a quarterly basis.

Fitch’s quarterly index can be found at ‘www.fitchratings.com‘ under the following headers:

Sectors Structured Finance ABS ABS Indices Timeshare

Additional information is available at ‘www.fitchratings.com‘.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contact:

Fitch Ratings
Brad Sohl
Senior Director
+1-212-908-0792
Fitch Ratings Inc., 33 Whitehall Street, New York, NY, 10004
or
Margaret Rowe
Director
+1-312-368-3167
or
John Bella
Managing Director
+1-212-908-0243
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Article source: http://finance.yahoo.com/news/fitch-u-timeshare-delinquencies-still-162800531.html

Fitch: U.S. Timeshare Delinquencies Still Historically Low Despite End-2014 Increase

NEW YORK–(BUSINESS WIRE)–

U.S. timeshare ABS delinquencies increased slightly in the fourth quarter as they typically do in the winter, but they are likely to remain within historically normal levels, according to the latest monthly index results from Fitch Ratings.

Total delinquencies for fourth quarter-2014 (4Q’14) were 2.95%, up slightly from 2.79% in 3Q’14 but below the 3.38% observed in 4Q’13. Fitch has observed consistent, quarterly, year-over-year improvement since 2012.

Defaults also slightly increased in 4Q’14, but are also showing year-over-year improvement. Defaults for 4Q’14 were 0.56%, up slightly from 3Q’14 at 0.53% but down from the 0.66% observed a year ago for 4Q’13. While still somewhat elevated compared to pre-recessionary levels, defaults displayed overall modest improvement in 2014.

On an annualized basis (rolling 12 months), defaults were 6.79% for 4Q’14, down from 7.04% for 3Q’14. This represents over two years of consecutive quarterly improvement as well as the lowest level of defaults for timeshare ABS in six years.

Fitch’s Rating Outlook for timeshare ABS remains Stable due in part to the delevering structures found in timeshare transactions and ample credit enhancement levels.

Fitch’s timeshare ABS index is an aggregation of performance statistics on pools of securitized timeshare loans originated by various developers. Expected cumulative gross defaults on underlying transactions can range from 9% to above 20%. While delinquencies and defaults may vary on an absolute basis, most transactions supporting the index exhibit similar overall trends.

The Fitch timeshare performance index summarizes average monthly delinquency (over 30 days) and gross default trends tracked in Fitch’s database of timeshare asset backed securities (ABS) dating back to January 1997 and is available on a quarterly basis.

Fitch’s quarterly index can be found at ‘www.fitchratings.com‘ under the following headers:

Sectors Structured Finance ABS ABS Indices Timeshare

Additional information is available at ‘www.fitchratings.com‘.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

Contact:

Fitch Ratings
Brad Sohl
Senior Director
+1-212-908-0792
Fitch Ratings Inc., 33 Whitehall Street, New York, NY, 10004
or
Margaret Rowe
Director
+1-312-368-3167
or
John Bella
Managing Director
+1-212-908-0243
or
Media Relations:
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Article source: http://finance.yahoo.com/news/fitch-u-timeshare-delinquencies-still-162800531.html

6 things to know before you buy a timeshare

Shutterstock


Timeshares have been huge profit centers for hotel companies like Starwood Hotels Resorts Worldwide

HOT, -0.27%

 , which has sold more than $6 billion in vacation timeshare properties to more than 220,000 buyers over the past 30 years.

Starwood said last week that it plans to spin off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company.

“Separating this distinct part of our business will allow Starwood to continue participating in this growth industry through a fee-based business model, as we do with our managed and franchised hotel business,” said Frits van Paasschen, then-president and chief executive of Starwood. (One week after announcing the spinoff, van Paasschen resigned by “mutual agreement” with the board.)

Timeshare vacation plans have been around in the U.S. since 1969 — the first opened in Kauai, Hawaii — and are now a $7.6 billion business, as big as Major League Baseball, with more than 8 million owners, according to the American Resort Development Association, or ARDA, which represents many timeshare developments.

For some people, timeshares are a good option, as they can guarantee you vacation time since they often come with fixed annual dates for right-of-use. On top of that, timeshare resorts typically offer more in-room amenities, such as kitchens and washing machines, than a hotel room. Timeshare owners can also “exchange” their shares for accommodations at other resorts.

But timeshares are also associated with high-pressure sales tactics and often are sold at a loss when it comes time to unload one. Plus, they come with annual maintenance fees that can easily top $500 and which often increase whether you use the timeshare or not.

Here are some things experts say to keep in mind before you buy a timeshare:

Don’t pay full price

Like most real-estate transactions (even hotel stays), the price is usually negotiable. Timeshare initial prices typically average almost $16,000. The timeshare industry likes to point out that over a 20-year period, a family of four could save over $25,000 on accommodations by staying in a timeshare compared with what they would pay for hotel stays.

Nevertheless, considering how many options you have when it comes to vacations, you’ve got the leverage when it comes to price. As such, timeshare companies like to offer free gifts like dinners and show tickets, or free “try it out” rentals to prospective buyers.

Andy Doran, a now-42 year-old scientist at the Lawrence Berkeley National Laboratory recalls taking a timeshare company up on its offer for a free Las Vegas vacation if he and his fiancee attended a presentation across the Bay from their Berkeley home in Burlingame, a San Francisco suburb. “It was a traumatic couple of hours of hard, hard, hard sell,” he said in an interview. “We managed to exit with the coupon and no timeshare but we never cashed it in,” he said.

Often the “hard-sell” approach from some timeshare companies is because they have so much competition and sales and marketing costs are so high, sometimes as high as 55%, says Gary Prado, director of marketing and business development for RedWeek.com, a timeshare sales and rental site. “The reason why timeshares continually get mocked is the way they get sold,” he said. “People don’t go out and say ‘I want to buy a timeshare today’, it’s sold as a heavy impulse buy,” he said.

Article source: http://www.marketwatch.com/news/story.asp?guid=%7B3922B1FC-B6CC-11E4-8E3F-5A52BAB5ECBC%7D&siteid=rss&rss=1

Grand Solmar Timeshare Spends Spring Break in Cabo San Lucas

  • Email a friend

Grand Solmar

Grand Solmar

Cabo San Lucas, Mexico (PRWEB) February 26, 2015

Grand Solmar Timeshare is one of the top members of the travel industry, offering all those who hope to have the vacation of their dreams the chance to do so. Travelers will truly enjoy having access to a variety of amenities and of course a close location to activities in the area. Last but not least, excellent customer service in a variety of forms is one of the best things that travelers can expect while spending time here.

Grand Solmar Timeshare knows each and every vacationer will enjoy their exciting experience in Mexico, and there are many reasons why this can be said. This spring, one of the top attractions that brings in thousands of visitors each year happens to be right around the corner. Grand Solmar Timeshare knows an exciting spring break vacation is just what many travelers need. Here are some of the best activities to plan in the area that everyone will enjoy.

For all those looking for a start to Spring Break, skip the beach and start by enjoying one of the exciting activities in the area. Grand Solmar Timeshare knows travelers who visit Mexico will enjoy the adventurous spirit found here. The beaches are beautiful for lying out and enjoying the sunshine or taking a swim, but some of the best ways to spend time are to take it up a notch. Consider zip lining through an exciting course, snorkeling under the deep blue sea or riding down the beaches of Cabo on an ATV or other type of recreational vehicle. There are many tours offered in the area, so Grand Solmar Timeshare knows there is something for everyone.

Grand Solmar Timeshare also shares that there is a great deal to learn about the culture that is found in Mexico during spring break. Visitors have the chance to see art exhibits from famous local artists, tasting stations from authentic restaurants in the area, as well as live music and dancing at the Circuito Cultural Festival each Saturday.

Every traveler who spends time in Cabo San Lucas will soon learn there is something for everyone here. For more information about the resort or Cabo San Lucas in general, please visit Grand Solmar Timeshare online at http://grandsolmarresort.com/.

###

Grand Solmar Contact Information:

Av. Solmar No. 1A Col. Centro

Cabo San Lucas, BCS, México

C.P. 23450

Phone: 1-310-459-7276

Email: info(at)solmar(dot)com(dot)mx

Email a friend


PDF


Print

Article source: http://www.prweb.com/releases/GrandSolmarTimeshare/GrandSolmarReviews/prweb12544564.htm

Grand Solmar Timeshare Spends Spring Break in Cabo San Lucas

  • Email a friend

Grand Solmar

Grand Solmar

Cabo San Lucas, Mexico (PRWEB) February 26, 2015

Grand Solmar Timeshare is one of the top members of the travel industry, offering all those who hope to have the vacation of their dreams the chance to do so. Travelers will truly enjoy having access to a variety of amenities and of course a close location to activities in the area. Last but not least, excellent customer service in a variety of forms is one of the best things that travelers can expect while spending time here.

Grand Solmar Timeshare knows each and every vacationer will enjoy their exciting experience in Mexico, and there are many reasons why this can be said. This spring, one of the top attractions that brings in thousands of visitors each year happens to be right around the corner. Grand Solmar Timeshare knows an exciting spring break vacation is just what many travelers need. Here are some of the best activities to plan in the area that everyone will enjoy.

For all those looking for a start to Spring Break, skip the beach and start by enjoying one of the exciting activities in the area. Grand Solmar Timeshare knows travelers who visit Mexico will enjoy the adventurous spirit found here. The beaches are beautiful for lying out and enjoying the sunshine or taking a swim, but some of the best ways to spend time are to take it up a notch. Consider zip lining through an exciting course, snorkeling under the deep blue sea or riding down the beaches of Cabo on an ATV or other type of recreational vehicle. There are many tours offered in the area, so Grand Solmar Timeshare knows there is something for everyone.

Grand Solmar Timeshare also shares that there is a great deal to learn about the culture that is found in Mexico during spring break. Visitors have the chance to see art exhibits from famous local artists, tasting stations from authentic restaurants in the area, as well as live music and dancing at the Circuito Cultural Festival each Saturday.

Every traveler who spends time in Cabo San Lucas will soon learn there is something for everyone here. For more information about the resort or Cabo San Lucas in general, please visit Grand Solmar Timeshare online at http://grandsolmarresort.com/.

###

Grand Solmar Contact Information:

Av. Solmar No. 1A Col. Centro

Cabo San Lucas, BCS, México

C.P. 23450

Phone: 1-310-459-7276

Email: info(at)solmar(dot)com(dot)mx

Email a friend


PDF


Print

Article source: http://www.prweb.com/releases/GrandSolmarTimeshare/GrandSolmarReviews/prweb12544564.htm

6 things to know before you buy a timeshare

Shutterstock


Timeshares have been huge profit centers for hotel companies like Starwood Hotels Resorts Worldwide

HOT, +0.51%

 , which has sold more than $6 billion in vacation timeshare properties to more than 220,000 buyers over the past 30 years.

Starwood said last week that it plans to spin off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company.

“Separating this distinct part of our business will allow Starwood to continue participating in this growth industry through a fee-based business model, as we do with our managed and franchised hotel business,” said Frits van Paasschen, then-president and chief executive of Starwood. (One week after announcing the spinoff, van Paasschen resigned by “mutual agreement” with the board.)

Timeshare vacation plans have been around in the U.S. since 1969 — the first opened in Kauai, Hawaii — and are now a $7.6 billion business, as big as Major League Baseball, with more than 8 million owners, according to the American Resort Development Association, or ARDA, which represents many timeshare developments.

For some people, timeshares are a good option, as they can guarantee you vacation time since they often come with fixed annual dates for right-of-use. On top of that, timeshare resorts typically offer more in-room amenities, such as kitchens and washing machines, than a hotel room. Timeshare owners can also “exchange” their shares for accommodations at other resorts.

But timeshares are also associated with high-pressure sales tactics and often are sold at a loss when it comes time to unload one. Plus, they come with annual maintenance fees that can easily top $500 and which often increase whether you use the timeshare or not.

Here are some things experts say to keep in mind before you buy a timeshare:

Don’t pay full price

Like most real-estate transactions (even hotel stays), the price is usually negotiable. Timeshare initial prices typically average almost $16,000. The timeshare industry likes to point out that over a 20-year period, a family of four could save over $25,000 on accommodations by staying in a timeshare compared with what they would pay for hotel stays.

Nevertheless, considering how many options you have when it comes to vacations, you’ve got the leverage when it comes to price. As such, timeshare companies like to offer free gifts like dinners and show tickets, or free “try it out” rentals to prospective buyers.

Andy Doran, a now-42 year-old scientist at the Lawrence Berkeley National Laboratory recalls taking a timeshare company up on its offer for a free Las Vegas vacation if he and his fiancee attended a presentation across the Bay from their Berkeley home in Burlingame, a San Francisco suburb. “It was a traumatic couple of hours of hard, hard, hard sell,” he said in an interview. “We managed to exit with the coupon and no timeshare but we never cashed it in,” he said.

Often the “hard-sell” approach from some timeshare companies is because they have so much competition and sales and marketing costs are so high, sometimes as high as 55%, says Gary Prado, director of marketing and business development for RedWeek.com, a timeshare sales and rental site. “The reason why timeshares continually get mocked is the way they get sold,” he said. “People don’t go out and say ‘I want to buy a timeshare today’, it’s sold as a heavy impulse buy,” he said.

Article source: http://www.marketwatch.com/news/story.asp?guid=%7B3922B1FC-B6CC-11E4-8E3F-5A52BAB5ECBC%7D&siteid=rss&rss=1

6 things to know before you buy a timeshare

Shutterstock


Timeshares have been huge profit centers for hotel companies like Starwood Hotels Resorts Worldwide

HOT, +0.45%

 , which has sold more than $6 billion in vacation timeshare properties to more than 220,000 buyers over the past 30 years.

Starwood said last week that it plans to spin off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company.

“Separating this distinct part of our business will allow Starwood to continue participating in this growth industry through a fee-based business model, as we do with our managed and franchised hotel business,” said Frits van Paasschen, then-president and chief executive of Starwood. (One week after announcing the spinoff, van Paasschen resigned by “mutual agreement” with the board.)

Timeshare vacation plans have been around in the U.S. since 1969 — the first opened in Kauai, Hawaii — and are now a $7.6 billion business, as big as Major League Baseball, with more than 8 million owners, according to the American Resort Development Association, or ARDA, which represents many timeshare developments.

For some people, timeshares are a good option, as they can guarantee you vacation time since they often come with fixed annual dates for right-of-use. On top of that, timeshare resorts typically offer more in-room amenities, such as kitchens and washing machines, than a hotel room. Timeshare owners can also “exchange” their shares for accommodations at other resorts.

But timeshares are also associated with high-pressure sales tactics and often are sold at a loss when it comes time to unload one. Plus, they come with annual maintenance fees that can easily top $500 and which often increase whether you use the timeshare or not.

Here are some things experts say to keep in mind before you buy a timeshare:

Don’t pay full price

Like most real-estate transactions (even hotel stays), the price is usually negotiable. Timeshare initial prices typically average almost $16,000. The timeshare industry likes to point out that over a 20-year period, a family of four could save over $25,000 on accommodations by staying in a timeshare compared with what they would pay for hotel stays.

Nevertheless, considering how many options you have when it comes to vacations, you’ve got the leverage when it comes to price. As such, timeshare companies like to offer free gifts like dinners and show tickets, or free “try it out” rentals to prospective buyers.

Andy Doran, a now-42 year-old scientist at the Lawrence Berkeley National Laboratory recalls taking a timeshare company up on its offer for a free Las Vegas vacation if he and his fiancee attended a presentation across the Bay from their Berkeley home in Burlingame, a San Francisco suburb. “It was a traumatic couple of hours of hard, hard, hard sell,” he said in an interview. “We managed to exit with the coupon and no timeshare but we never cashed it in,” he said.

Often the “hard-sell” approach from some timeshare companies is because they have so much competition and sales and marketing costs are so high, sometimes as high as 55%, says Gary Prado, director of marketing and business development for RedWeek.com, a timeshare sales and rental site. “The reason why timeshares continually get mocked is the way they get sold,” he said. “People don’t go out and say ‘I want to buy a timeshare today’, it’s sold as a heavy impulse buy,” he said.

Article source: http://www.marketwatch.com/news/story.asp?guid=%7B3922B1FC-B6CC-11E4-8E3F-5A52BAB5ECBC%7D&siteid=rss&rss=1

6 things to know before you buy a timeshare

Shutterstock


Timeshares have been huge profit centers for hotel companies like Starwood Hotels Resorts Worldwide

HOT, +0.45%

 , which has sold more than $6 billion in vacation timeshare properties to more than 220,000 buyers over the past 30 years.

Starwood said last week that it plans to spin off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company.

“Separating this distinct part of our business will allow Starwood to continue participating in this growth industry through a fee-based business model, as we do with our managed and franchised hotel business,” said Frits van Paasschen, then-president and chief executive of Starwood. (One week after announcing the spinoff, van Paasschen resigned by “mutual agreement” with the board.)

Timeshare vacation plans have been around in the U.S. since 1969 — the first opened in Kauai, Hawaii — and are now a $7.6 billion business, as big as Major League Baseball, with more than 8 million owners, according to the American Resort Development Association, or ARDA, which represents many timeshare developments.

For some people, timeshares are a good option, as they can guarantee you vacation time since they often come with fixed annual dates for right-of-use. On top of that, timeshare resorts typically offer more in-room amenities, such as kitchens and washing machines, than a hotel room. Timeshare owners can also “exchange” their shares for accommodations at other resorts.

But timeshares are also associated with high-pressure sales tactics and often are sold at a loss when it comes time to unload one. Plus, they come with annual maintenance fees that can easily top $500 and which often increase whether you use the timeshare or not.

Here are some things experts say to keep in mind before you buy a timeshare:

Don’t pay full price

Like most real-estate transactions (even hotel stays), the price is usually negotiable. Timeshare initial prices typically average almost $16,000. The timeshare industry likes to point out that over a 20-year period, a family of four could save over $25,000 on accommodations by staying in a timeshare compared with what they would pay for hotel stays.

Nevertheless, considering how many options you have when it comes to vacations, you’ve got the leverage when it comes to price. As such, timeshare companies like to offer free gifts like dinners and show tickets, or free “try it out” rentals to prospective buyers.

Andy Doran, a now-42 year-old scientist at the Lawrence Berkeley National Laboratory recalls taking a timeshare company up on its offer for a free Las Vegas vacation if he and his fiancee attended a presentation across the Bay from their Berkeley home in Burlingame, a San Francisco suburb. “It was a traumatic couple of hours of hard, hard, hard sell,” he said in an interview. “We managed to exit with the coupon and no timeshare but we never cashed it in,” he said.

Often the “hard-sell” approach from some timeshare companies is because they have so much competition and sales and marketing costs are so high, sometimes as high as 55%, says Gary Prado, director of marketing and business development for RedWeek.com, a timeshare sales and rental site. “The reason why timeshares continually get mocked is the way they get sold,” he said. “People don’t go out and say ‘I want to buy a timeshare today’, it’s sold as a heavy impulse buy,” he said.

Article source: http://www.marketwatch.com/news/story.asp?guid=%7B3922B1FC-B6CC-11E4-8E3F-5A52BAB5ECBC%7D&siteid=rss&rss=1

6 things to know before you buy a timeshare

Shutterstock


Timeshares have been huge profit centers for hotel companies like Starwood Hotels Resorts Worldwide

HOT, -1.01%

 , which has sold more than $6 billion in vacation timeshare properties to more than 220,000 buyers over the past 30 years.

Starwood said last week that it plans to spin off its vacation ownership business, Starwood Vacation Ownership (“SVO”), into a separate publicly traded company.

“Separating this distinct part of our business will allow Starwood to continue participating in this growth industry through a fee-based business model, as we do with our managed and franchised hotel business,” said Frits van Paasschen, then-president and chief executive of Starwood. (One week after announcing the spinoff, van Paasschen resigned by “mutual agreement” with the board.)

Timeshare vacation plans have been around in the U.S. since 1969 — the first opened in Kauai, Hawaii — and are now a $7.6 billion business, as big as Major League Baseball, with more than 8 million owners, according to the American Resort Development Association, or ARDA, which represents many timeshare developments.

For some people, timeshares are a good option, as they can guarantee you vacation time since they often come with fixed annual dates for right-of-use. On top of that, timeshare resorts typically offer more in-room amenities, such as kitchens and washing machines, than a hotel room. Timeshare owners can also “exchange” their shares for accommodations at other resorts.

But timeshares are also associated with high-pressure sales tactics and often are sold at a loss when it comes time to unload one. Plus, they come with annual maintenance fees that can easily top $500 and which often increase whether you use the timeshare or not.

Here are some things experts say to keep in mind before you buy a timeshare:

Don’t pay full price

Like most real-estate transactions (even hotel stays), the price is usually negotiable. Timeshare initial prices typically average almost $16,000. The timeshare industry likes to point out that over a 20-year period, a family of four could save over $25,000 on accommodations by staying in a timeshare compared with what they would pay for hotel stays.

Nevertheless, considering how many options you have when it comes to vacations, you’ve got the leverage when it comes to price. As such, timeshare companies like to offer free gifts like dinners and show tickets, or free “try it out” rentals to prospective buyers.

Andy Doran, a now-42 year-old scientist at the Lawrence Berkeley National Laboratory recalls taking a timeshare company up on its offer for a free Las Vegas vacation if he and his fiancee attended a presentation across the Bay from their Berkeley home in Burlingame, a San Francisco suburb. “It was a traumatic couple of hours of hard, hard, hard sell,” he said in an interview. “We managed to exit with the coupon and no timeshare but we never cashed it in,” he said.

Often the “hard-sell” approach from some timeshare companies is because they have so much competition and sales and marketing costs are so high, sometimes as high as 55%, says Gary Prado, director of marketing and business development for RedWeek.com, a timeshare sales and rental site. “The reason why timeshares continually get mocked is the way they get sold,” he said. “People don’t go out and say ‘I want to buy a timeshare today’, it’s sold as a heavy impulse buy,” he said.

Article source: http://www.marketwatch.com/news/story.asp?guid=%7B3922B1FC-B6CC-11E4-8E3F-5A52BAB5ECBC%7D&siteid=rss&rss=1

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