Have I got a deal for YOU….

6 May
Granite countertops and upgrades galore

Granite countertops and upgrades galore

Last weekend, hubby and I got a long deserved night away on the coast. While there, we ran across what seemed to be an incredible opportunity to have access to a beautiful condo community.

They offer a unique take on the time share….calling the opportunity “fractional ownership”. The view from Pacific City intrigued me enough that we went on a tour.

There is something to be said for arriving in a timeshare, with every possible amenity and fully stocked kitchen. With Travertine floors and granite countertops, this place was a gorgeous place I could really see myslef relaxing in. The price? $80,000 for one set week, and two floater weeks per year. The set week was in the summer, and the rest could be negotiated.  We would share a specific unit with 16 others, and the property could be deeded or sold by us at any time. I walked away thinking about how nice it would be to have Thanksgiving dinners on the beach in our 3 bedroom condo with the fabuloso view.

I now know why they usually want you to sign on the dotted line immediately….so you don’t have time to think. On the way home, I did the math:

$80,000 initial investment +$4000 annually ownership feesX 10 years of ownership = $120,000

Now, divide $120,000 by 210 (10 years X 3 weeksX7 days) and you get: $571.43 per night….. I could stay a weekend at a NICE resort for that price!!

So…so much for the beach cottage!!

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5 Responses to “Have I got a deal for YOU….”

  1. Robert May 6, 2009 at 10:25 pm #

    Problem with your calculations is that you make the assumption of zero value of your ownership in 10 years. Your three week deeded ownership will likely be worth **something** in ten years; so for now, assume a break-even on ownership.

    Using that, fees of $4000 divided by 21 days of use equals $190/night.

    I’m a fractional owner (NOT timeshare) with 13 weeks at a Mexican resort; it’s a worthwhile ownership model to consider.

  2. thyroidinfo May 7, 2009 at 2:36 am #

    Robert;

    That is actually an excellent point. But there is one other aspect of this timeshare that concerned me. In my opinion, they have already inflated the cost of the condo unit. A two bedroom two bath condo for $80,000 x 17 co-owners comes to 1.36 million dollars. 1.3 million!! Plus, I have to believe that the annual fees will go up annually, possible doubling by 2020. As nice as these units are, I gotta believe they are as nice as they will ever be right now…and we are at the mercy of our other 16 fractional owners, who may or may not take the same pride in ownership as we do. And this “resort” remains to be seen…there is talk of a clubhouse and a spa, but they are having trouble selling the existing units as it is…

    But 13 weeks in Mexico sounds heavenly!! And the resort setting (and year round warm weather) really adds value, in my opinion…I could really go for that!! Bravo for you!!

  3. Robert May 7, 2009 at 3:48 am #

    Don’t confuse timeshare with fractional ownership. Timeshare is a “right to use” with no ownership.

    $1.3 million isn’t too bad for oceanfront. With fractional, there is an inherent mark-up over full ownership, but something needs to pay for the extra work involved selling to 16 owners rather than one.

    The other benefit of ownership is being able to trade one’s vacation property for another using http://www.RegistryCollection.com, http://www.HomeExchange.com or http://www.FractionalExchange.com.

    I suspect that a property with oceanfront will always retain its value, if not appreciate over time.

    Regarding dues, it’s an actual homeowner’s association, run by the homeowners. Doubling by 2020 is possible, but that’s pretty much inflation and not a hosing like in timeshare.

  4. thyroidinfo May 7, 2009 at 7:16 pm #

    Robert….

    Where were you when I needed you? You could’ve helped me win this discussion in the car a week ago….(how do you feel about backseats?)

    You’ve really given me some good food for thought….although fractional ownership in Maui has a bit more appeal to me! LOL!

  5. Robert May 7, 2009 at 10:52 pm #

    If you love the Oregon Coast, that might be a good purchase for you. Fractional ownership is the wave of the future for vacation property ownership. If you want to be able to exchange, be sure to buy a fractional with good trading potential. For example, we bought beachfront in Mexico due to the demand.

    Compare dues also. Ownership in Mexico is a lot less expensive per week than USA.

    BTW, $25,000/week is about right for good quality fractional property. That’s about the going rate in Mexico, with dues of about $600/week.

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