Contradictions Abound: Wyndham Reports Slump

The timeshare industry has seemingly carved an all-but-unique bubble in the recent real estate downturn, floating unscathed to everyone's bewilderment. However, it was bound to slow at some point, and Wyndham Worldwide has just released what is likely the start of an industry wide trend.

We must bear in mind that Wyndham also franchises hotels, and their earnings are not itemized in the following reports. However, on the whole it is a safe assumption that US families are finding vacation time less and less crucial -- probably due to rising gas, food, and overall cost of living prices.

AP also reported that Starwood Hotels have seen a 28 percent decline in timeshare revenue during the second quarter of 2008. AP analysts "have expressed concern about timeshare sales, particularly after Starwood's second-quarter declines."

STOCK PERFORMANCE: Wyndham shares lost about 13 percent in the quarter, closing at $17.91 on June 30. During the past 52 weeks, the stock has fallen from a high of $36 last August to a low of $14.62 in mid-July.

http://money.cnn.com/news/newsfeeds/articles/apwire/8ff43b93985ca009455d544312a85fe7.htm

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Branson Fights Back

According to a story published this morning in the Branson Daily News, Branson, Missouri is altering its solicitation laws to combat timeshare companies with allegedly predatory offers.

A few timeshare companies, such as Branson Highlites, bring in much of their business by standing outside their properties and offering passers-by free show tickets if they tour the units. This practice has operated in a legal loop hole, until now.

If only similar laws were passed in regards to larger timeshare companies and their "free weekend getaway" offers. As a company representative in the article mentions below, most timeshare business is snared in this manner.


[From the Original Article]


“All we’re doing is creating a definition that will bring in a free-ticket scenario,” City Attorney Paul Link said. “I think people were unaware of what the law was. Under the current code, if the person soliciting or the person solicited are on public property, it is unlawful.”

“If they change this, they might as well put a lock on our door,” said Jackie Stephenson, owner of Branson Highlites on Main Street. We stand in the doorway, we greet the people and we do have free tickets. They come in and get them. We do offer, ‘Hey folks do you want to go on a tour?’ They do say ‘yes’ or ‘no.’ Obviously, we have quite a few who say ‘yes’ or we wouldn’t have been in business for five years in this town.”

The city reevaluated its law based on complaints that salesmen were chasing shoppers down sidewalks.

“They believe it’s hurting their business because of that,” Branson Sgt. Sean Barnwell said. “They say they’re having issues not only with (customers) getting agitated, they’ll skip their store.”

Some downtown business owners say aggressive timeshare salesmen are bad for business.

In the short time she’s been in business downtown, Monica Rhodes, co-owner of Pinkiedinks Cupcakes, has seen potential customers flee from persistent salesmen, she said.

“I had to tell one of them — a guy on the corner — to stop,” Rhodes said. “People are trying to get away from them and they run right past our store. They aren’t even looking at our stuff.”

Alderwomen Cris Bohinc and Sandra Williams said they’ve both been harassed by salesmen downtown.

“I do not know what particular business is doing this,” Williams said. “I do know they have approached me several times, that they have followed me down the street. So if I was downtown to do any business, I didn’t do the business because I wanted away from them.”

Downtown Monday afternoon, Pat and Bob Eastwood of Cherry Hill, N.J., said all was quiet.

“We’ve been all up and down the streets and haven’t been approached,” Pat Eastwood said.

Stephenson said she’s fired renegade salesmen in the past.

“Dog gone right I have. We’ve let a few people go because they were too aggressive,” she said. “They’re not allowed to leave my property, ever.”

Stephenson said she realizes the timeshare industry is sometimes looked down upon but hopes she can keep doing business downtown.

“I know a lot of people don’t like my business, don’t like timeshares, but it brings a lot of business to Branson,” she said.

Quotes from "Branson defining ‘solicit’" by Chad Hunter

CNN: Are Timeshares Worthwhile?

It's very rare to see frank discussion of timesharing in the media, especially here in the US. And yet, it seems like in the last few months many national periodicals have published feature stories on the timeshare industry, and how it has inexplicably managed to survive the recent downswing of the housing market. Perhaps most surprisingly, many of the articles in question have admitted outright that timeshares are not great purchases for the majority of consumers.

CNN recently ran an article like this, entitled "Are Timeshares Worthwhile?". This article takes a question/answer format like many others, posing the inquiry "Are timeshares a good investment" and then offering a response.

A few notable points with TSR Commentary:


- "Timeshares can bring their owners substantial savings in time and money when planning vacations, but experts warn that they should never be viewed as a financial or real estate investment."

True - a timeshare is a prepaid vacation, not an investment.

- "They do have their drawbacks -- an owner hoping to sell a timeshare might end up taking a loss. And while there are laws protecting buyers who purchase a timeshare from a developer, they don't help someone buying from an owner."

Also true. In many cases a title transfer is the only option available to a timeshare owner.

- "Basically, if you take at least a week of vacation each year and don't like sleeping on grandma's couch, then this is a great deal," says Howard Nusbaum, president of the American Resort Development Association. "But if you're not a vacationer, then I wouldn't recommend this, just as I wouldn't recommend you buy a car if you don't drive."

- Prospective buyers might think that purchasing from a timeshare owner could seem like a steal, but Nusbaum warns, buyer beware. While there are consumer protections and regulatory oversight of the industry, that would not apply to a sale in the secondary market. Most important, the buyer should be sure that all of the rights to the property or access to the facilities would transfer with the deed. While a contract with the developer is government-backed, that protection may not extend to the person the timeshare is resold to.

Again, very true, and it is refreshing to see even the resale market fall under such careful scrutiny. While it is true that timeshares purchased on resale will save dollars, it is the opinion of many that a FREE timeshare is not much of a deal. The industry has issues from top to bottom.

Read the full article.

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RENT: Don't Buy

That's right.

There's an article about 3 Clever Ways to Save Money on Family Vacations. Amidst several other pieces of excellent advice there's the following suggestion:

"Rent a Timeshare

This option, I estimate, saves us anywhere from 30% to 50% off traditional resort accommodations.

We not only save money, but our lodging is more comfortable and roomy than typical hotel rooms. We typically enjoy a large, two-bedroom unit with a spacious kitchen. Ordering take-out food and making easy meals stretches our dollars.

You can find thousands of rentals posted by timeshare owners..."

It's true. Many timeshare owners are unable to vacation when they want, but they're still forced to pay for unused timeshare weeks. In order to minimize the financial loss they rent out the week for one-time-only bargain basement prices.

It might seem exploitative, but it's the way of the industry. Those who buy timeshares often regret it, leaving others -- such as prospective renters -- to benefit from unfortunate circumstances.

The people have spoken -- Don't Buy, RENT.

Share of Paradise: the Canadians get it Right

We caught a fascinating article this week from the Ottawa Citizen that analyzes the pros and cons of timeshare owning. And while the author is Canadian, there are plenty of references to the US Market -- in fact, the same advice essentially applies to timeshares on either side of the northern border.

The author and his wife are happy timeshare owners, but even they admit that the market is severely flawed, teeming with corrupt sales representatives and scandals. An all too familiar story is recounted:


"We'd been listening to the pitch for two hours when we said enough's enough, and told the salesman we had to leave for another appointment. He ignored our pleas and continued to press on.

After several polite repetitions of the 'sorry, we must go' approach, I insisted we had to depart immediately. The salesman demanded to know what our appointment was. When I told him it was none of his business, his face contorted in rage, he shook his fist in my face and invited me to step outside to settle the matter.

In seven happy years as timeshare owners, this was the only such incident we experienced, and it's one we can now laugh off. Happily, it's not typical. Yet even timeshare's fans admit the industry's sales pitch needs a serious makeover.

'The product and the delivery of the service is exceptional,' said timeshare industry expert Jerry Sikes in an e-mail interview. 'It's the sales and marketing stuff that give the bad rap.'

Sikes, who is president of Professional Resort Operators Inc. in Scottsdale, Arizona, says that 'until the developers truly change the way they choose to market and sell the new product, the effort to change the public image will be just smoke.' "

While we disagree with one important point here -- that in many cases the product (timeshares) and the delivery of service is anything BUT exceptional and often empties consumers' pocketbooks on what are essentially worthless vacations, Mr. Sikes has a very valid argument. What worthwhile timeshares that do exist are essentially being ruined by poor sales tactics and an ugly reputation. Maybe if that ugly reputation didn't equal a multi-billion dollar industry yearly we would see some change; until then, it's up to the consumer to be on his or her guard.

Read the full article here.

Tips and Gyps

Searching for timeshare-related information online can be a tricky activity. One of the merits and drawbacks of the world wide web is that anyone, anywhere can upload virtually any content they want. So, the articles you read could be the fruits of years of experience, or some meaningless text generated using google searches for a corporate agenda. Furthermore, the latter category could appear cleaner and more appealing than the former, making distinction exceptionally difficult.

One of the most interesting formats for online information is the top five or top ten. These are nearly ubiquitous, and with good reason -- they are easy to write, and easy to read. They distill information into convenient enumerations of knowledge that seem, somehow, definitive. And yet, one could put the numbers 1 through 5 beside ANYTHING and make it seem definitive and complete. This is the impression the numbers themselves offer, not the information itself. And when speaking of timeshares, it's important to consider the subtleties that could potentially get neglected from any top 5 or 10.

One of the better top 5's we've read here is this one, "Tips on How to Sell Your Timeshare Successfully".

The author offers a number of worthy suggestions to essay when reselling a timeshare. For instance, attempting to get the original company to buy the property back (although this very often does not work). And consumers should certainly be wary of any upfront fees that a resale agent might demand, as the reseller's industry is fraught with utter scam. Selling online is an equally dubious prospect, and very often ends in theft or frustration.

And yet, there are a few details left out. For instance, it is mentioned that many timeshares are resold at 30-50% of the original price. It is not, however, mentioned that this is because timeshare companies inflate the prices of timeshares with overhead costs from presentations and "free weekend getaways". In fact, almost ANY timeshare can be bought for a fraction of the resort's price on the resale market. And the author additionally fails to take into consideration the fact that very few timeshares are ever sold at a profit. The article ends with this statement: "However, if done correctly, selling timeshares can be a rewarding and profitable undertaking." The profitable selling of a timeshare is truthfully less a case of accuracy and more of the luck of the draw and the status of the current market.

In any case, this is a good example of fair advice that misses a few crucial steps. To a prospective timeshare owner, it could appear as though a profitable exit strategy is the norm in the industry -- when in fact the exact opposite of that statement is true. Compare this article with many others online for a better portrait of what the timeshare resale industry really looks like.

Happy Holidays from the Timeshare Relief Blog!

Timeshare Relief @ Kyte

As our readers know, Timeshare Relief is devoted first and foremost to consumer rights -- which is why we try to spread our message around as much as possible. Blogs, video shares, social networks, anything to get the truth about timeshares out there. I've posted a few of our videos on this blog before.

Recently I became aware of the video-share site kyte. It's pretty much the same as places like youtube and google vids with one monumental difference: you can engage in live chat with your viewers. Video chat, even, if your comp is rigged for those kind of hi-tech shenanigans.

The Timeshare Relief kyte vids are viewable here:

http://www.kyte.tv/ch/30307-timeshare-relief#uri=channels/30307/84963

And I've also added a kyte channel pod to the right, here in this blog!

Stop in, kick off yer shoes, watch a vid, and chat with us if we're around!

Timeshares in Popular Culture

I remember the first time I ever heard the word "timeshare" uttered. It wasn't on television, but by a friend of mine. We were both in fifth grade at the time. Apparently his parents had owned a timeshare in Palm Springs for several years. He brought it up when we had been scheming a practical location for a joint vacation between our families. "So, could we use the Palm Springs timeshare?" I asked.

"Probably not," he said, scratching his head.

In the early 90s timeshares were enjoying a golden age in America, although this is also the time period where they became closely associated with the scams that persist in the industry to this day. It was an entirely foreign concept to my friends and I, despite living in a burgeoning city in suburban California and thus being somewhat better acquainted with real estate and property terms than most kids (I remember getting excited when an empty lot across town had been zoned for commercial activity -- they wound up building a mall there 5 years later). Today it's a different story. Most people have at least heard a joke about, or seen a commercial for, or received a postcard invitation from a timeshare company. The word has become more or less embedded within popular culture.

Television, in its perpetual quest for easily identifiable material, was quick to pick up on the trend -- timeshares have been spoofed in just about every long-running sitcom from the late 90s on. Several of the families from South Park once attended a ridiculous timeshare presentation in Aspen. Doug and Carrie from "The King of Queens" once had an episode-long argument regarding the potential purchase of a timeshare. Characters from "King of the Hill" nearly got suckered into a Mexican timeshare scam. And Peter and Lois, from "Family Guy," perfectly illustrated the bait-and-switch sales tactic so common in timesharing today at the start of one of their misadventures.

Peter and Lois receive a postcard mailer claiming that they've won a free boat -- all they need to do is sit through a timeshare presentation to retrieve it. They attend the presentation with several of their friends, all of whom are given the following option: take the boat, OR the contents of a mystery box.

Lois, the intelligent consumer that she is, chooses the boat immediately, but Peter isn't sure. The box could hold ANYTHING, he says. After some hilarious deliberating Peter finally chooses the mystery box, which turns out to contain tickets to a cheap comedy club -- understandably disappointing Lois (at least Peter didn't actually BUY the timeshare, though).

The illustration in this episode isn't quite accurate -- after all, other attendees of the presentation walk out with free boats, which is hard to believe. But the spirit of timeshare sales is there, and it's spot-on. Too often the choice is already made for consumers, and instead of receiving the high-priced entertainment (the "boat") they've been promised, they're treated poorly and handed a "mystery box" of a timeshare no one is even able to open. And whether or not they use that mystery box, of course they still owe the timeshare company all the relevant fees, year after year.

Timeshare has become a stock scam on TV, but it's still a billion dollar industry. For once popular culture is right -- and it would probably be better to avoid both the boat and the mystery box altogether.

Where There's A Will...

One of the most unfortunate situations we encounter here at Timeshare Relief are timeshare scam inheritances. It's more common than you might imagine. An elderly relative purchases a timeshare while on his or her last vacation, not realizing that the property is a moneypit and impossible to use. The relative returns home with thoughts of using the timeshare and happily pays the maintenance fees. Then, one day, the relative passes on. The timeshare company hears of the news (probably due to a truant fee payment) and contacts the next of kin. He or she has never heard of the company before and never been to the city where the timeshare is located -- in fact, it's never been considered as a holiday location. And yet, this family member has just become embroiled in what is perhaps the most menacing of timeshare contract stipulations, an agreement known as perpetuity.

The easiest way for me to describe perpetuity is to ask my readers to imagine a timeshare with the stamina of the Energizer bunny. Indeed, the life of the timeshare contract -- and all agreements therein, including payment of fees -- keeps going and going and going and.... You get the idea. Perpetuity ensures that timeshare contract outlives its owner -- maybe even a few generations beyond its owner, if it isn't taken care of properly, as through a sale or title transfer.

Timeshare inheritance is far too common, the reason for it is simple -- con men prey upon the elderly. Several arrests have been made recently as part of an SEC crack-down on vacation scams targeting aging American adults -- a worthy, if somewhat minor, reaction to what has become a very serious problem. Often times these con artists operate below the border or in the Caribbean, where there are delays in seeking legal reprisal. And the result is very often the same: middle-aged families, while grieving the death of a loved one, are struck with the double-whammy of a timeshare scam inheritance they didn't ask for, and cannot afford.

We've found a few resources online to underscore this unfortunate trend. Here's a good if short forum discussion outlining timeshare inheritance:

http://timeshareadventures.com/vacation/general-timesharing-information/1289.htm

And a brief advice column offering clarification on a real-life situation:

http://www.thinkglink.com/Figuring_Out_The_Inheritance_Of_A_Timeshare.htm

If you think a relative of yours may be at risk for timeshare scams and unknowingly leave a burden on your family, get the right information and try to plan ahead.

Video Roll Call

Hey all,

Most of you are probably aware of Timeshare Relief's video presence online, but for those of you who aren't here a few samples of the excellent customer testimonies and short informational films we have. These are a great resource not only for our prospective customers but also for any timeshare-laden or timeshare-curious individual.

From Youtube:




From google:




From Revver:

Enter: The Webmaster

Hi everyone, I'd like to introduce myself. My name's Joe and I'm the webmaster and blog runner over here at Timeshare Relief. And I'm really excited about the work we're doing. Finally an industry leader like TSR, who has helped countless individuals shed the ball and chain of an unwanted timeshare over the years, is getting the presence it deserves online. That's reason enough for celebration, isn't it?

This blog will be the unofficial home of Timeshare Relief's thoughts and updates, so stop in often if you're able to. You never know what you might find. We could link to an article about the timeshare industry, or post a story from the field that one of our reps offers. But it'll all provide you crucial information related to this market, a market that is growing larger and more perilous by the financial quarter.

So, as I said, stop in often, and please comment! We always welcome feedback. I'll be back in later today with urls to some of our new pages online.

Timeshare Relief Introduction

This is Kate. I write for Timeshare Relief, Inc., which means I also do a lot of research about the timesharing industry as a whole.

I’m working on getting our second newsletter published, and so have myriad articles either ready, or being edited so we can share our insights and knowledge with you and help you avoid the pitfalls and problems of the timeshare trap.

It’s our goal to rescue as many people as possible, who’ve been trapped into a lifelong contract, and who are looking for a way to escape. That’s why we’re Timeshare Relief, Inc. We want to help you get relief from a timeshare that has either always been, or lately has become a burden.

That’s my thought for today. I’ll be back with more.

Thanks, Kate.

ps. Feel free to email me at kate@timesharerelief.com if you’d like a copy of the newsletter to be emailed to you.