Many timeshare owners are beginning to worry about whether their timeshare companies will survive the economic downturn. Some timeshare and hotel companies like Wyndham are showing signs of serious stress. Wyndham announced recently that it is laying off 4,000 employees in its timeshare business. Wyndham stock shares lost more than 70 percent in 2008. As a result of these problems, Wyndham stockholders clamor for the Chairman to be replaced by an Independent Director. Things have gotten so bad that the Wyndham CEO decided to reduce his 2008 bonus to only $6.3 million. When Wyndham’s CEO takes a 17% pay-cut, things must be extremely bad. We all know how much corporate executives hate to give up bonuses (even when they take federal bailout money, as with AIG). Actually, Wyndham timeshare owners may be dismayed to learn that the CEO took any bonus at all, considering the benefit cuts that have been made recently. The layoffs, stock price decline, and cuts in CEO compensation are very bad signs about the viability of the Wyndham timeshare business. Even if the company manages to pull itself out of this tailspin, the layoffs will definitely have a negative impact on service quality for Wyndham timeshare owners. That’s like adding insult to injury.
It’s bad enough that many people who buy timeshares do not know that the value of their investment will decrease from 50 to 90 percent. When people try to sell their timeshares, they are often shocked to find out that they can not get anywhere near what they paid originally. The timeshare companies often neglect to tell people that timeshares depreciate like cars, but the maintenance fees and taxes typically go up. In the past, the timeshare industry enjoyed great profits despite these cold hard facts. People seemed to feel that the timeshares were a better deal than hotels. Now there is such a decrease in demand for hotel rooms, that the rates are going down and special deals are offered everywhere. Timeshare owners are not getting any breaks on their costs. and now they have to worry that timeshare companies may go out of business.
The timeshare companies continue to paint a glowing picture of the industry’s future. The thing to remember is that the real estate agents and home builders kept telling everyone that the housing market was invincible right up until the bubble burst. Now housing prices have declined dramatically and many people can’t sell their homes at all. An appalling number of people got caught in the subprime mortgage mess and now face foreclosure. Many of us thought that our homes were the most solid investments of all. With the housing market in such a shambles, it’s no surprise that many people are beginning to worry about what will happen to their timeshares. It seems unlikely that the federal government would bail out a timeshare company. No wonder people are beginning to think about what would happen to their timeshares if a company like Wyndham goes bankrupt.
About the Author: The timeshare experts at Apex Professionals, LLC, concentrate on helping disillusioned timeshare holders to rid themselves of unwanted maintenance fees, unnecessary assessment costs, and to do away with those annoying high-interest mortgages by offering to take over unwanted timeshare agreements instantly. Related posts:
I hope they do go broke. Bad vacation investment. And if they were so great why the buy now or lose at the sales table.
I agree with Rick, I hope that they go broke and out of business. It was a bad investment I agree. I will never recommend buying into one. They always increase your fees and they won’t send out a statement that shows your monthly payments and balance left on the account.