For me, the Hilton Grand Vacation Club timeshare numbers didn’t end up working
A pal of mine emailed me a few days ago asking:
Do you have a hilton grand vacations hgvc timeshare? Which resort do you usually go to? Are you happy with it?
We went back and forth in email, including me explaining some of the math behind time shares and why they’re such a bad idea for most people (myself included, in hindsight) and so I thought I’d publish the back and forth here, add some additional comments, and invite you readers to add your own two cents and your experiences with timeshares, whether you jumped or not.
Ready? Here we go…
I responded: We paid $110,000 for a double-timeshare share at the fanciest new King’s Land location in the Waikaloa Beach area (Kona Coast) of the Big Island of Hawaii. When Linda and I separated, however, and we took a two-location, shared kids, trip to Hawaii for a few weeks, she booked through Hilton Grand Vacations and I just went to the vacation rentals by owner (VRBO) Web site and booked a nicer place with far, far less hassle.
The theory of timeshares is good, but my experience is that the reality is that it’s so complicated to figure out their point system and when you can / can’t get what you want, when you want, that I strongly suggest you put the money into a CD and use sites like vrbo.com to book your trips instead.
For example, check out this page to see how many rentals there are on just the Waikoloa coast area on the west side of the Big Island of Hawaii.
My friend, rather surprised to get this information from me (I think he expected it was a better deal), responded:
Thanks for the straight scoop, that’s very sobering. You were one of the few people I know who had bought a timeshare and I thought you were still high on it.
We would only buy one on the used market but I think we’re leaning away even from that. The annual fees scare me and it seems like they can increase them at will. I like the idea of renting other people’s timeshares — there is a huge market for that and lots of bargains.
Also, VRBO looks great.
My response:
Yeah, ultimately it’s about complexity. I really like being able to just go where I want, when I want, and timeshares only work if you actually use them annually for at least 20 years, then the math starts to work in your favor.
I mean, our Hawaiian timeshare was about $110k plus I think $2k/annual fee and a $180 booking fee per trip. My VRBO condo was about $1300/week (maybe?) for a two bedroom. We planned on using it 2-3 weeks/year, so that’s $2,600-$3,900 flat fee versus $110,000. How many years do you have to actually go on vacation before the numbers balance out?
To be fair, I will say that the rooms and the facilities are gorgeous. Here’s a typical King’s Land room:
Nice, eh? But if we would have gone for two weeks every year for a decade then run out of steam and stop using it, that room would cost me about ($110,000/10)/2 per week, or an impressive $5,500/week. At that rate I want a butler, cook and driver thrown in, and probably a private jet to get me to Hawaii in the first place.
The worst thing is that of course that’s not the full math because there’s at least a $2200 annual fee and that $180/trip booking fee too, so let’s say $6,000 per week, paid in advance.
Now there are definitely people who groove on timeshares, but I expect that they have less expensive options, and indeed, I should point out that the King’s Land Hilton Grand Vacation Club resort is one of the most expensive ones in the entire chain, and that if were were willing to stay in the older HGVC resorts in Waikoloa Beach, we’d have had enough points for a month/year there. So that’s $2,500/week across a decade, but again, the math doesn’t quite work out that nicely and there’s no mention of the fact that nailing down what we wanted, when we wanted it, was a pain in the booty.
Nonetheless, my kids are very flexible when it comes to vacations, so if I go back to the VRBO site and look for two or three bedroom condos available for a week, it’s about five minutes to find a three-bedroom + loft condo in a great location about a half-mile from the King’s Land Resort, priced at $199/night (or $1,393/week):
[see more info] [makes me want to book and go out there for a few weeks, actually!]
In a nutshell, timeshares seem to be a relatively obsolete concept to me with the rise of Internet-based vacation rental sites like VRBO.com. If you have the ability to dig around, why go through the hassle and tie up your cash in advance?
Marriott International Inc. disclosed in Sept 2009 that it will stop developing new time-share and luxury-residential projects and write down the value of timeshares under construction by $760 million.
The Wall Street Journal wrote, “The three largest time-share players — Wyndham Worldwide Corp., Starwood Hotels & Resorts Worldwide Inc. and Marriott — already had dramatically pared their time-share businesses in the past year to reflect weakening demand, falling prices and difficulty securitizing loans for consumers.”
“[The timeshare] business, at least for the next 10 years, is going to remain permanently shrunk,” said Joseph Greff, a gambling and lodging analyst for J.P. Morgan Securities, speaking of the time-share and luxury-residential markets in general.”
http://online.wsj.com/article/SB125371358595033997.html#mod=todays_us_marketplace
Vacation Rental home owners are taking a beating, too, in this dreadful economy. I speak from experience.
Better link for the Wall Street Journal Article:
http://online.wsj.com/article/SB125371358595033997.html
We also like the flexibility – and inexpensive cost – of renting a timeshare. We use http://www.redweek.com and have gotten wonderful deals in some great luxury resorts.
I so agree with you about the nonsense of buying a timeshare. But I gotta say that thank heavens some people own them, and want to rent them out, because renting a timeshare has been for us a saving grace in getting to have family vacations. They are so much less expensive (we get ours through http://www.redweek.com) than hotel rooms, and come with all of the perks that resorts have to offer.
I love me VRBO. The company rocks!
I’m in the industry, so it may sound weard, but my only advice is “don’t buy timeshare” (maybe unless you have a relative working for the exchange program…)
I am trying to rent a condo in Kings Land for a trip with my daughter. Do you still have contact info for the one you rented. I can’t seem to find any on VRBO or redbook
Melinda, I dug around and couldn’t find any information other than this:
http://www1.hilton.com/en_US/hi/hotel/KOAKLGV-Kings-Land-Hawaii/index.do
I will note that I gave my share of our timeshare to my ex and when she goes on holiday, she stays at a different place and seems to have abandoned the timeshare entirely.
If you’re considering buying a timeshare, be smart and buy a timeshare on the timeshare resale market. Not only will you save thousands of dollars, you’ll receive all the benefits included in vacation ownership. Itâs really important when buying or selling timeshares to deal with a reputable, licensed realtor who has extensive knowledge of the timeshare industry, however, so you don’t get ripped off.
you’ll save alot of money buying timeshare on the resale market but there is a catch. i work in the business and the companies don’t allow you all the benefits like that person said. if you go to that location great, but if you want to use your points for car rental, air fare, food, gas, gift cards. forgt it. if you get a weeks resort, there are issues also. just be carefull, people assume all the time that they can use all the benefits and then after buying are stuck with it. if you buy one resale, then buy another one at that same resort and they will combine the both and you’ll be ok.
I couldn’t agree more with the numbers not adding up for the Hilton Grand Vacations. I fell victim to the sales pitch in 2008 and have regretted it ever since. I have seen my annual maintenance fee raised significantly every year and is now $1,091. This of course doesnât include all of the small periodic fees for using my timeshare, nor the fees that are charged for not using my timeshare. I just recently made a reservation in December to use my 2010 points before they expired, but for some reason the system would only let me use my 2011 points for the reservation (and of course I got charged for this). Then my 2010 points expired and I had to call someone to complain about it, and I had to pay to ârescueâ my 2010 points (which was another $84). The HGV rep said I should read the rules more carefully because there are stipulations about why I can only use my 2010 points if I pay to move them to 2011.
Now maybe this program makes sense to some people, but for someone like me who barely has enough time to TAKE a vacation, this program has been a colossal waste of money. I feel like I sold my last cow for an ordinary bean.
that stink but all companies aren’t like that. you have to do your homework before buying or ask alot of questions when your on tour. some companies allow you to keep your points forever. it only cost 45.00 to put them into a seperate account and then you save them for food,airline tickets,shopping,car rental,cruise. so if you don’t go on vacation-cash them in for gift cards to best buy or dick sporting goods. all companies are different. i have worked at 4 different companies and they all have good things. your reps should help you, not run away after the sale. that’s why people are unhappy, they don’t get the service.
Thanks for this frank information, most useful for those of us getting all of the special offer emails from HGV, I will now delete them as they arrive.
What I find savoy owners do is rent part of their ownership out and use part of their ownership… buy doing this they are able to vacation annual free and have something to leave behind to future generations.
I felt as though this forum needed a different perspective, as it is HGVC is they only company expanding and doing more for their owners.. We have over 95% customer satisfaction approval rating from our owners and the most flexible system in the industry!
For all of the people who think the “Resale market” is the way to go… Good Luck! It is currently the biggest complaint in the state of FL and is the most unregulated market in terms of real estate in the country. Hilton last year set aside over $20 million to clear up the resale market, which is more than enough to buy any and everything you’ll see, so the question is, if we didn’t buy it… why would you?
Of course ownership isn’t for everybody and you can always find “deals” out there, but I was always taught, if you don’t own, you’re owned!
The true value comes when you leave behind lifetimes of vacations to future generations…. already paid off!