Posts filed under 'Perceptions'

The Queen of Versailles, David Siegel, and Timeshare Resale Values at Westgate Resorts

It has been said that there’s no such thing as bad publicity, and perhaps that’s true for David Siegel, self-proclaimed “Timeshare King” and CEO of Westgate Resorts. After all, how many other CEO’s of timeshare companies can you name?

What is not so clear, however, is to what extent publicity received by Siegel has negatively affected resale values of Westgate timeshares. Perhaps this is one the reasons most timeshare developers prefer to keep a low-profile.

When Siegel and his wife Jackie decided to build America’s largest private home, a 90,000 square foot palace aptly named “Versailles,” they attracted the attention of filmmaker Lauren Greenfield. Over the course of three years, Ms. Greenfield filmed interviews with the Siegels and their staff – including behind-the-scenes footage of Westgate Resorts operations. The resulting documentary film, The Queen of Versailles, was well received; winning the U.S. Directing Award at the 2012 Sundance Film Festival. (Now available on Netflix.)

The timing, of both the construction of Siegel’s home and the filming of the documentary, happened to coincide with the recent financial crisis; turning what might have been just another story about the excesses of the rich into a saga of survival. Ezra Kline, of the Washington Post, dubbed The Queen of Versailles “the single best film on the Great Recession.” When Siegel is unable to procure financing for Westgate Resorts’ receivables, construction on Versailles is halted and the very fate of the company appears to hang in the balance. In a candid moment, Siegel declares, “this is almost like a riches-to-rags story.”

Needless to say, The Queen of Versailles became a PR nightmare for Westgate Resorts. Siegel was so concerned about negative fallout that, the day before the film’s premier, he sued the filmmaker for defamation; claiming Westgate Resorts was depicted “in an array of defamatory, derogatory and damaging ways.” According to Siegel, by the time filming concluded Westgate Resorts was as profitable as it ever had been. The lawsuit has since been dismissed, but Siegel remains in damage control mode; appearing earlier this year on CNBC with his wife to announce “record profits” for Westgate Resorts and continuing construction of “Versailles.”

There’s no reason to doubt that both Siegel and Westgate Resorts are now financially solvent, but numerous other timeshare developers have gone bankrupt over the past 5 years. (e.g. Celebrity Resorts, Consolidated Resorts) When timeshare developers fail, the underlying real estate (individual timeshare interval) is not directly affected, but the resulting negative “buzz” often has lasting effects on perceived resale value. And speaking of perceptions, The Queen of Versailles portrays Westgate timeshare owners as victims of the same predatory sub-prime lending practices blamed for crashing the economy. Overall, it’s easy to conclude that Siegel’s PR mistakes have damaged the value of timeshares owned by hundreds of thousands of Westgate owners (at least temporarily.)

That said, now may well be the perfect time to buy a Westgate timeshare resale. Westgate Resorts makes a terrific product: Its timeshares are really, really nice. The properties are located on prime real estate. The maintenance fees are reasonable. And, for now, the prices are artificially low! Take this Westgate Lakes Resort and Spa resale, for example, located on some of Orlando’s best real estate and featuring leather furniture, granite and stainless kitchen, private patio, lock-out floor-plan, and large jetted-tub in master – priced thousands under cost.

westgate-lakes-resort-and-spa-living-room

Siegel has described Westgate Resorts as the “Rolls Royce of timeshare companies,” designed to allow ordinary Americans to “vacation like a Rockefeller.” Love him or hate him, if you’ve stayed in a Westgate timeshare, you have to agree with him.

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3 comments October 17th, 2013

Timeshare Scams: Sympathy for the Devil

Back in 2009, a new type of scam popped up on the timeshare resale scene: The owner receives a call out of the blue from a stranger claiming their timeshare “is already sold” and then asks for several thousand dollars to complete the transaction. Of course, there is no buyer and the scammers disappear along with the money. I imagine that, when this hustle was still fairly fresh, it might have been believable to some owners desperate to sell after the recession.

On this blog, we warned timeshare owners of this “already sold” scam back in February of 2010. Elsewhere, throughout both the timeshare industry and mainstream media, similar warnings were issued around the same time. Yet, despite countless warnings – not to mention the obviously dubious story – timeshare owners continue to fall for this stupid trick. It’s almost enough to give you sympathy for the devil.

the-devil-you-know-will-not-sell-your-timeshareOkay, so maybe not sympathy exactly… But I have to state the obvious here: If you are willing to wire $3,000 to Mexico because someone called you on the phone with a catchy story, you are going to get just what you deserve. I have to wonder how someone that dumb would come into possession of $3,000 to begin with? My guess would be inheritance or personal injury settlement.

Last year, my 88 year old Grandfather received a call from Mexico: The caller told him that his grandson (he only has one, so he assumed they meant me) had been injured, arrested in Mexico, and needed $1,500 for bail ASAP. This call clearly put him into a panic, and my Grandfather was willing to pay to save me from a terrible Mexican prison – but he is not a complete idiot. After telling the caller that he’d need time to get the money together and needed to arrange a call-back, he hung up the phone and called my home number. My wife answered and assured him that I was at work here in Atlanta, not in a Mexican prison. My Grandfather kept his emotions in check – and kept his money. (Despite being particularly vulnerable due to early-stage Alzheimer’s.)

Yet, when timeshare owners wire money to someone they don’t know because they believe a fairly tale about their timeshare being sold, it’s the legitimate timeshare resale industry that gets the blame: More onerous regulations are passed and imposed upon law-abiding companies, more articles are written about “timeshare scams” that draw no distinction between the real and fake timeshare resale industry, and more consumers simply detest all timeshare resale companies because of being “burned.”

I say enough already! If someone gets tricked into wiring their money to a timeshare scam it is not my fault, it is not my company’s fault, and it is not the fault of the timeshare industry at large. If you have paid thousands of dollars because you thought your timeshare was already sold, you my friend have poor judgement at best – at worst, you are an idiot and your money probably ought to be in someone Else’s hands anyway.

This may sound harsh, it certainly is not politically-correct, but it’s true. We should not regulate every single aspect of our great country because of the stupid few, or we’ll just get more of this:

a-stupid-proof-society

3 comments August 15th, 2013

Timeshare & The TSA – Vacation Ownership in the No-Fly Zone

Apparently, now not even Rep. Ron Paul can fly without being accused of being a terrorist, and being subjected to the depredations of the TSA. It’s no wonder, then, that more and more American timeshare owners won’t fly to their vacation destinations. This can be costly for those who own timeshares far from home, and are forced to exchange their week every year for closer drive-to vacations. Some owners have even asked me whether it may be advantageous to sell their distant timeshare and buy a resale within driving distance, while others feel being abused by the TSA is a small price to pay for safe travel to spend a week in their luxurious timeshare property. Here are the top 3 reasons I won’t fly with my family:

  1. Airports Have Become Prisons – Perhaps it is a reflection of the somewhat puritanical nature of Americans that no one wants to admit they’ve seen the inside of a jail. But, whether for an “incident” in college or an unpaid speeding ticket, many of us have been through central booking. When you arrive at jail: You have to remove your shoes and belt. Your pockets must be emptied into a tray. You have to produce identification. You must submit to a pat-down by someone wearing rubber gloves. By the time you’ve been processed into the holding area, your mental state is one psychologists refer to as total compliance. Clearly, the entire process of flying in America (post 9/11) is the psychological equivalent of being incarcerated – only voluntary; a post-modern Stockholm syndrome! Perhaps we should re-classify “frequent fliers” as “repeat offenders.”
  2. Your Wife and Kids May be Molested While You Watch – As a man, it’s hard to say which is worse: Having to watch impotently while your wife gets groped by a TSA goon, or watching your kid cry while she wonders why Daddy won’t make the mean man stop touching her. I’ll take a pass on both, thank you. Visiting Scottsdale just isn’t that important.
  3. The Moral Hazard – Not long ago I found myself waiting in a TSA line, standing behind a scruffy young man whose black clothes smelled of clove cigarettes. He was carrying an old backpack stuffed with video game gear. As we approached the metal detector, this young man was pulled to the side and made to unload his backpack and submit to all manner of secondary screenings, while I was permitted to pass through undisturbed. In that moment, I found myself actually happy to see this kid getting hassled instead of me… When that moment passed, I was overcome with guilt; guilt over not speaking up for this innocent young fellow whose only “crime” was looking a little different and loving video games. It’s this hazard, this moral hazard of hoping someone else gets picked off the queue, and of looking the other way while fellow Americans are mistreated, that poses the biggest risk to our humanity. As the German citizens of the 1930’s found, the slope from freedom to fascism is indeed a slippery one.

Given that both candidates for President in 2012 support continuing the TSA, it’s a safe bet that its assault on Americans’ civil liberties will continue, at least for a while. For timeshare owners that share my concerns about flying, selling a timeshare that can’t be easily driven to is probably a sound idea.

Recently, a neighbor of mine here in Atlanta decided to list her Napa Valley timeshare for sale, and perhaps consider a resale in the nearby Hilton Head Island area. The good news for her, and anyone in her position, is that today’s resale market is not only full of great deals, but bustling with activity like never before. With sophisticated new internet platforms for buying and selling timeshare resales, both buyers and sellers are increasingly choosing the resale market… And, if enough of us choose not to fly with our families, financial pressure on the airlines may eventually end the TSA, making the skies friendly for Americans once again.

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2 comments August 30th, 2012

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