Ep. 70 – Do You Wanna Buy a Timeshare?

SHOW #70  December 24, 2015

Intro

This week on Episode 70 Smoky Mountains Radio, I’m Back…..again! And we discuss timeshares in the Smoky Mountains. Let’s go!

Post-Intro

It is Thursday, December 24 and this is Episode 70 of Smoky Mountains Radio. Yes, it has been awhile my friends. I had the premature notion that I was officially back, and of course, life completely got in the way of that. For those of you that don’t know, my wife and I just had a baby, and of course, everything that goes along with that has pretty much kept every second of the day tied up. Things were not as smooth as expected or hoped, but that is life. The good news is that both mom and baby are now doing well, so everything is back on track, with the obvious exception of sleeping. Really, do babies instinctively know when you want to sleep and pick those times be awake and fussy? And why do they wait until you just finish changing a diaper to make a mess in the new one. Okay, so I could make this whole show about adventures of new baby, but i’m guessing that is not why you tuned in. But sufficed to say, this is our first, and let me tell you, we are definitely learning as we go! Before I leave the topic completely though, we have already been discussing when the boy’s first trip to the Smokies will be. I went, as you might remember, before I could even walk and my first “hike” was on dad’s back to Laurel Falls. So, i’m not sure when I am going to get the little guy out there, but we are thinking sometime in March might be the date. I’ll let you know how that all turns out. It will be a different dynamic for sure on that trip. I’ve never had to pack diapers, wipes, and milk in my backpack before. Interesting to see how that turns out. If you have experiences with this, I would love to hear from you. This is one area of the Smokies that I am admittedly a novice!

So if you can remember back to the last time we talked….and I didn’t, I had to go back to the old show notes to figure it out, our plan for this week’s show was to talk all about moving to the smokies. Well, I got in touch with my buddy who was doing real estate out there and they have folded shop and he is now doing real estate in Asheville, NC. By the way, if I ever wanted to move close to the Smokies but not be right in them, Asheville would be my city. It has all the modern conveniences of a big city but has a small town feel. And you are just miles to the NC side entrance to the Smokies. You’ve got the Blue Ridge Parkway there and so much more. But I digress.

I did get in touch this week with a realty team right in the Smokies about setting up a time to record the show, but I managed to get them on Christmas week, which made lining things up difficult. In addition to the time prep with families, this week is also very busy with clients…which surprised me a bit. Anyway, we will have that show next time. I hope to record with them on Monday and have the show out at the end of next week. So in the meantime, we will do a little different variation on the same theme for this week. But before we do all that, let’s do a little housekeeping.

I realize that not all of you have been sitting here waiting on me to get something out for the last month….like Curt was. You crack me up brother! So, if you are a new listener, welcome aboard!  We are glad you have found us here at SMR. After rambling for the last few minutes, let me introduce myself. I am your host Mike, and I am here to bring my nearly forty years of experience in and around the Smoky Mountains help you have the best possible time on your next trip to the Smokies.  Whatever you plan to do and wherever you plan to go around here, we’ve got you covered.

I invite you to check out our website SmokyMountainsRadio.com to get all the information you need about your trip to the Smokies. You can contact me directly by emailing me at mike@smokymountansradio.com, on Facebook at facebook.com/smokymountainsradio or on twitter @smokies_radio.  You can also call the listener line at 865-325 9784.  Finally, of course, every one of our shows can be found on the website for you to stream or download. Of course, you can make sure you get episodes the moment they are released by subscribing to the show via iTunes or stitcher.  Leave me a review while you are there.  Those links can also be found on the site .  If you have anything you would like me to cover on the show, please feel free to contact me at any time.  Again, all the ways to reach me are right on the website at SmokyMountainsRadio.com

I also want to send out a special thank you to TL Wright down in Alabama for your donation to the show. It is much appreciated! Thanks so very much. Those kinds of donations help me offset the cost of web hosting, podcast file storage, and everything else that goes along with putting the show together. If you would like to donate to the show, the link is at the bottom of the homepage at SmokyMountainsRadio.com

And with housekeeping out of the way, let’s get on with the show!

The Crowds, Oh My The Crowds

The crowds, oh my the crowds! If you have gone to the Smokies at all this year, you have probably noticed the sheer amount of people. It is something I have brought up several times on this show this year, but the numbers confirm it. Starting in 2009, visitor numbers had dwindled. The economy was in the toilet, disposable income was done, and it was a much better idea to buy groceries than to go stay at the Park Vista. After that, the weather pattern got strange. There were lots and lots of days and weeks that roads were so icy that the entire national park was closed. Not only that, access roads to cabins and motels were so bad for so long that scores of people cancelled reservations. Those that were here couldn’t go anywhere. And then there was the government shutdown. One of the pieces of that was shutting down the national park during its peak season. Brilliant Washington, brilliant. Regardless of your political affiliation I think we can all agree that shutting down national parks is idiotic. Assign blame who you want to there, but there was plenty of stupid to go around.

So now there is an uptick. Numbers rose last year to more than 10 million in the first time in more than five years. Not counting the Christmas season yet, it is already the 2nd highest amount of visitors in park history. Once the christmas numbers are in, no doubt this will be the highest by hundreds of thousands of guests. And if you are one of the hundreds of thousands in the mountain area now…you have fun with that. Christmas to New Years is one of the three highest attendance dates on the calendar right there with Thanksgiving and Memorial Day.

But as you sit in traffic for the next several days (and I say you because i’m not going near it), remember that thousands of new people are being introduced to the smokies right now. Maybe that will make the bumper to bumper traffic on the parkway and the two hour wait at Pancake Pantry a little more worth it!

Timeshares in the Smokies

As i’ve said on the program before, i’ve seen business’s come and go. There are very few that stick around for 5 years, and it is indeed under 10 percent that have been around a decade or more. But there is one business that simply has not gone away. And it is a business that is thriving in nearly all vacation destinations in the world. So what could the Smokies have in common with Disney, Vegas, and New York? It is timeshares.

Time shares have a pretty simple premise. Instead of having to pay the full cost of a property in these desirable areas (which is pretty much impossible for most of us working stiffs), you basically go in together with a bunch of other people and you own a small piece of it. This entitles you to days or weeks each year at your condo or resort for your upfront payment and annual fees.

If you have spent anytime in Gatlinburg, you have seen these timeshare peddlers before. They walk up to you on the sidewalks and asking you if you are staying in town for the night, if you would like to see a popular show, or offer you free rooms. If you stop to talk to them, you find out the only stipulation to getting these great freebees is that you have to attend a “short” presentation on their particular timeshare.

And this is where they are all the same regardless of where you travel. The sales pitch is pressurized from the start. The short meeting lasts longer and longer. They make sure you know that you can’t afford not to take advantage of this opportunity. So is it worth it? In a word, no. Think of it this way. If it was so great, they would have sold out years ago and there would not be enough supply to keep up with demand. Still don’t believe me? Look at house and condo prices over the last five years in the Smokies. The prices have nearly doubled in most cases. The economy recovered and there is not enough supply to keep up with demand. Sellers can almost name their price. So let’s get back to timeshares. How are there still any left? It is minimal investment with the perks of ownership. I say minimal, but expect to pay $6000 at the low end and up to $80000 on the high end.

For your money, you get the piece of mind of knowing where you will vacation each year. The burden of planning is off of you. And the rooms are better than your typical hotel room. They have kitchens or kitchenettes and often separate bedrooms. And if you don’t want to stay at your home condo or resort, you can stay at any other property owned by the group. In my estimation, this is where the advantages often disappear.

If all you paid was the initial investment, it would be a bargain for anyone that often visits the Smokies. But each year you will pay maintenance fees that seem to go up year after year and in many instances, it will cost you more money if you want to vacation at a different time. So let’s say that your assigned week is the third week of February, but this year you want to go during June. Good luck. In most cases it will cost you more money. And if you are one of the lucky few that don’t have to pay extra to change your dates, you better plan ahead. In most cases, you must plan ahead nearly a year to get the dates you want.

So to recap, you paid thousands upfront. You have to pay hundreds each year for annual fees. And picking your dates is a nightmare. What else? Well, you can rent the same places if you are NOT a member. If there are open dates and you like the property, you can rent the place just like any hotel or cabin. And then YOU have the flexibility to say WHEN and how much you are willing to shell out. You are not contractually obligated.

But aren’t the properties nicer than other places? After all, dozens or hundreds of people are paying thousands of dollars for this. They have to be pretty posh, right? In some cases, yes. But that often falls to the management company. They will keep furniture and appliances for decades longer than they should because it saves a buck. And they know people won’t just stop coming. After all, they already paid for it. If you decide not to go this year, it is free money for them. They won’t complain.

So i’ve been down on them pretty bad. Is there ever a time it makes sense? The answer is MAYBE. About 5 years ago my wife and I looked into the Disney Vacation Club, which is Disney’s version of a time share. At nearly 20K, we had to look at it as a major investment, and we took our time. Basically, we vacation at Disney at least once per year. If we took the investment and fees, we would be in the red financially on this for 17 years. After that, the cost of our vacation with the timeshare would be cut in half. And prices only go up, so we seriously considered doing it to lock in the price. Indeed today, the same timeshare goes for 28K.

But in the end, we passed. And Disney is by far the most upfront and lowest pressure of the bunch. But in the end it is just not a good idea. Here’s why we said no and I think you should too whether it is for Disney or anywhere else. It takes too long to reap rewards of your investment. I am not waiting 20 years to see a benefit. I’m middle class at best. The math just doesn’t work. If we missed going to Disney for a single year, that puts back our break even 3 years. The math works the same for the Smokies. And years like this for us where we had the baby made Disney an impossibility. If you think you might miss a year in the Smokies, pass it by. And the biggest single problem for me is that there is no guarantee about annual fees. Maintenance fees and miscellaneous fees go up yearly in most of these places. If they were guaranteed to stay the same forever, I would likely do it. But they don’t work that way.

Have you ever read a timeshare contract? It is worse than buying a house. Far worse and longer. It makes the iTunes agreement seem like a curious george book. And most of the time you don’t have the luxury of a buyer’s agent to explain things to you. How much do you think the seller is willing to explain the legal-eeze? My final point, almost every time share that I contacted before the show does not give you the property forever. Unlike your house, you and your family won’t own this thing forever. Many of them have time limits….40 years, 50 years, 60 years. Others end with the death of the owner, meaning you can’t pass it to family in the event of your demise. They get the property back to see at full price to someone else. That just doesn’t seem right.

The only instance that I think that these are a good option for you is if you plan on visiting the Smokies at least twice per year AND your travel dates are flexible from year to year AND you are happy staying in the same place for your vacations each time. If that is you, then you will likely come out ahead in the end. But if you can’t answer yes to all three of those, my advice is to stay away. But even if you didn’t have all of this information, just consider this…If these were such an amazing deal, would these sellers have to put on such a high pressure sales pitch and offer freebees just to get you in the door? The answer is of course NO. There are better options.

There are condos and other similar properties for sale in the Smokies that you can go in with an investment partner group to purchase for roughly the same price. However, you are going in with a group of four to eight others and YOU manage the property. If you want to rent it out, you make money. Whatever dates you want to travel you only have to clear with a small group of people. And best of all, you OWN it. I would check into these first. But speak with a realtor or real estate professional first. Just a google search of this before the show found a bunch of timeshare people mascaraing as these investment partner groups. But again, stay away from these in my opinion. If you want a place in the Smokies badly, save up and move here. And we will get into how to do that next time.

I’ll put more information about this in the show notes and on smokymountainsradio.com

POST:

It was great to be back with you this week friends! Sorry it has been so long. I hope you and your family all have a Merry Christmas and stay safe if you are traveling. I really appreciate that you took the time out of your day and your holiday to listen to the show.  Before we wrap up, I want to let you know to be sure to check out SmokyMountainsRadio.com for all your Smokies needs. You can get our entire back catalog there. Contact me all the ways listed on the website.  I’m glad to hear from each and every one of you…and thanks to so many of you for checking in during my absence. So until next time my friends, walking bristly past the timeshare salesman and join the record number of people in the mountains and….GO TAKE A HIKE!

SmokyMountainsRadio.com

mike@smokymountainsradio.com

Facebook.com/smokymountainsradio

@smokies_radio on twitter

865-325-9784

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