RCI Family & Friends

I received this message from a reader:

Hi, I found your blog on trendwest... and had a quick question about your post on RCI Family and friends...

I don't really understand how to use it - most stuff i find on that website just says to call thier consultants... i was hoping to be able to see some deals online .... to have some kind of idea what deals i can get...

Any more info you can provide on this site would be good, thanks :)

Andrew

Well, the time that I booked through them for a week in Noosa at around $550, I rang their call centre and got details over the phone. I later found that this exactly matched the information available online. To access the availability listings:

• Go to Family & Friends
• Select 'Resort Stays'
• Click the 'Availability' tab
• Make your selections: Month, region, unit size, resort/fixed week

You'll then see a list of available weeks with their prices. I did did a quick trial and found some for Nov-06 but not Jan-07. Remember -- you're most likely to get availability out of school holidays!

-- Fabbo

Tags: trendwest worldmark

Same tactics, but some clever thinking...

I just received this from a reader...

Hi Fabbo,

attended a Trendwest presentation last night and they were very slick, but the exact sales pressure tactics you mention. We had never heard of them before so we were quite tempted, but the "buy tonight" really set off alarm bells.

One of the key questions I asked was how they valued the credit points (currently $2.14). In my opinion, a fair valuation would be the total value of all the resorts/assets divided by the number of credit points issued (ie if the company goes bust and liquidates, how much money would I get back for each credit point a.k.a. equity per share)

Being financially minded, I wanted to get information on how the tax office views this:

• Can I buy this through a personal company, family trust etc.
• Am I liable for capital gains tax (it is a managed investment trust after all...)
• If so can I claim the yearly fees (body corporate) as a tax deduction?
• Obviously they couldn't answer any of that.

In the end, we didn't end up buying simply because it was so uncomfortable. We were talked to by 2 managers (one was a "finance manager" who didn't tell us anything about the financials of the company) and felt very pressured. When we asked the tough questions, we got derisive snorts and rhetorical questions implying that they were stupid questions. In the end, both turned nasty and said that the product was clearly not for us and that we should just pick up our free gift and leave.

Which is a real shame because I love the concept. If a product is good, it will sell itself. People will extol it on the internet. By making it into a product and pouring money into the marketing, they have effectively diluted the cost-saving and made it into any other resort company on the market. For example, if you join via ACAP Rotary, Trendwest pays them $1000!!!

Anyway, thanks for your interesting blog. Here are a few interesting articles on a quick google, which you probably have already seen:

• Submission on the Parliamentary Joint Committee Inquiry into regulation of the timeshare industry (PDF) [very dodgy!]
• Trendwest Resorts Austrailia - Timeshare - subjected to rude, high-pressure marketing experience
• Trendwest Will Pay Restitution to Consumers and $795,000 in Civil Penalties [US complaints]
• Timeshare seller provides undertakings to the Federal Court [closer to home]

Thanks for the links! I especially like the last one, which says:

Trendwest has undertaken to ... not make the following representations to consumers:

• the purchase of Holiday Credits is a good financial investment;
• over time, the resale price of Holiday Credits in a secondary market will remain stable or increase relative to their acquisition price;
• a strong market exists for the secondary sale of Holiday Credits; and
• consumers may sell Holiday Credits through Century 21 Real Estate in Australia.

As to how they value the $2.14 (which fairly recently was $2.08, then $2.10), I think they increase it whenever they want more money. It's certainly not related to any calculation of underlying value.

I love the idea of handling it via a capital gains tax -- you'd be able to claim a very large deduction as soon as you buy it, since the units are only worth around $1! (Of course, you could just avoid the loss in total by buying it on eBay or via redseason.com.au!)

Thanks,

-- Fabbo

Tags: trendwest worldmark