Aggressive anti-rental email response from MS

[Sandisw]

When did the 20 rental per year audits happen? The rental market today is very different than it was 10 or 20 years ago. I have to think they will continue to reassess things like this as time goes on...within the limits of the contracts we all signed.

At the end of 2007 it was amended to include that language.

Definitely different today but i think it’s because there are a lot more owners out there who do casual renting than in the past and that the ease of renting via places like the DIS, FB, and even brokers give us more insight into it.

And, it seems that renting confirmed reservations has been on the rise the past few years as well.

 

[AnnaKristoff2013]

What does stand out though is the line about corporations and businesses and is not something I had processed before...it would certainly seem to mean that an actual LLC, or business has different set of use rules than we do as individual owners?

Sure does seem like business that are buying solely to rent/strip and then sell are violating that clause.

 

[Sandisw]

Sure does seem like business that are buying solely to rent/strip and then sell are violating that clause.

I won't go that far because the LLC or business could buy, transfer to an individual ownership for one of the owners of the corporation to use as rentals and then sell....in that case, not sure that is a violation, as long as those individually owned memberships are not demonstrating a pattern of rental activity deemed commercial.

But, while a contract is owned by a business, it does seem that any reservations made under that membership have different rules than those of us who are individuals.

There is also a lot of speculation on this thread that this is widespread with no one actually having data that supports its an on going process. That is a lot of work for little return, especially if it is a broker who is selling contracts and making commissions off every sale.

Now, I think the instant sale options have them buying more assuming they will get taken back via ROFR and grabbing commission on an easy and quick sale...but not sure I believe the whole buy, rent, and sell is being done in bulk.

 

[Brian Noble]

The Wyndham solution was to adopt a rule that said any reservation made that was not for the member personally could later be canceled in favor of another reservation for a member if availability otherwise did not exist. For example, if a member made a reservation well in advance as a present for his daughter on her wedding, the member and daughter could learn as late as the day of the wedding – the day before the trip to a Wyndham resort – that the reservation was cancelled in favor of another member.

I am a Wyndham owner, active on TUG, and I'm 99% sure this is not correct.

Wyndham has done a lot of things to attempt to curb renting. But as far as I know, this is not a rule in the system. It is certainly not present in the Member Directory (which does articulate many the other rules, including the overlapping-reservation rule and the Owner Priority restriction.)

There is a chance that I'm wrong about this, but I don't think it is a very big one.

The thing that Wyndham has done is that it has used its discretion in specific individual cases to decide that an owner has violated the commercial use clause without precisely defining how that clause is interpreted. They've used their position as first-mover to preemptively make that declaration, and put further restrictions on individual owners' use of guest certificates. I suspect it is possible (and maybe even likely) that an owner in this situation could prevail in court. But Wyndham will make that very expensive and time consuming along the way in a war of attrition so it's a big risk for that owner. Wydham has also cancelled some reservations with guest certificates attached, but those were either (a) owners who were in the "further restricted" condition who pressed on defiantly or (b) owners who had run afoul of the Owner Priority restrictions before the web site started enforcing it at reservation time.

The only other time I can think of this is when a resort had either an emergency that took several units out of service, or a refurbishment/repair that went longer than expected. In those cases, they look for volunteers first, and may cancel reservations if they can't get enough volunteers. I think some cancellations were guests-first, but others (and the majority I can think of) were last-booked-first.

There is no reason, in principle, why DVC could not try the "you've violated commercial use but we won't tell you why" thing with specific, individual owners. I know that if I had a side business of renting DVC points, I'd have a ready exit plan. The buy-strip-flip folks are well-positioned here, because their model already incorporates a short holding period and a plan to sell quickly.

 

[GoingSince1990]

I am a Wyndham owner, active on TUG, and I'm 99% sure this is not correct.

Wyndham has done a lot of things to attempt to curb renting. But as far as I know, this is not a rule in the system. It is certainly not present in the Member Directory (which does articulate many the other rules, including the overlapping-reservation rule and the Owner Priority restriction.)

There is a chance that I'm wrong about this, but I don't think it is a very big one.

The thing that Wyndham has done is that it has used its discretion in specific individual cases to decide that an owner has violated the commercial use clause without precisely defining how that clause is interpreted. They've used their position as first-mover to preemptively make that declaration, and put further restrictions on individual owners' use of guest certificates. I suspect it is possible (and maybe even likely) that an owner in this situation could prevail in court. But Wyndham will make that very expensive and time consuming along the way in a war of attrition.

There is no reason, in principle, why DVC could not do the same thing with specific, individual owners. I know that if I had a side business of renting DVC points, I'd have a ready exit plan. The buy-strip-flip folks are well-positioned here, because their model already incorporates a short holding period and a plan to sell quickly.

Wyndham defines “peak times” during which owners are limited to doing two rentals (or reservations for family or friends) per year. Outside of these peak times rentals are unlimited, and Wyndham has its own rental agency (Extra Holidays) to facilitate owners renting.
https://clubwyndham.wyndhamdestinat...rces/reservations/owner-priority-reservations

 

[Brian Noble]

Yes, that's what I mean by the Owner Priority rule. But the web site now prevents owners from making more than two such reservations per year, and so they are not cancelled after the fact. It's also not applied to any guest reservation (as claimed in the quoted passage) but only to those reservations at resorts and times on the list. Finally, it's not invoked only when the resort is full, but at any time. Anecdotally, there has been a lot more availability at Bonnet Creek and Glacier Canyon, two oft-cited locations of "rental abuse", since this policy was put into place. I can't say it is because of this policy, but it probably doesn't hurt.

If you have a legitimate exception to the Owner Priority rule (i.e. at least one Owner has an overlapping reservation) you can call and the VCs can make the reservation. AFAIK, no one has tested the idea of doing so and then cancelling the owner's overlapping reservation, but I suspect if one did that, then in fact the guest reservation could (and by rule, should) be cancelled.

 

[Brian Noble]

Getting back to the post at the beginning of this thread: It's also entirely possible that Disney will pursue a "Fear, Uncertainty, and Doubt" strategy around rentals by sending out "reminders" to the ownership about commercial use. This would be in the hope that it would discourage at least some owners from renting. Marriott is doing this now--to add a Guest Name, the owner needs to acknowledge a no-commercial-use clause. I have to believe that discourages at least some people from renting.

 

[GoingSince1990]

Yes, that's what I mean by the Owner Priority rule. But the web site now prevents owners from making more than two such reservations per year, and so they are not cancelled after the fact. It's also not applied to any guest reservation (as claimed in the quoted passage) but only to those reservations at resorts and times on the list. Finally, it's not invoked only when the resort is full, but at any time. Anecdotally, there has been a lot more availability at Bonnet Creek and Glacier Canyon, two oft-cited locations of "rental abuse", since this policy was put into place. I can't say it is because of this policy, but it probably doesn't hurt.

If you have a legitimate exception to the Owner Priority rule (i.e. at least one Owner has an overlapping reservation) you can call and the VCs can make the reservation. AFAIK, no one has tested the idea of doing so and then cancelling the owner's overlapping reservation, but I suspect if one did that, then in fact the guest reservation could (and by rule, should) be cancelled.

I’m also guessing that Wyndham does not allow online or in-app check-in, as DVC does with its direct-to-room service? For a DVC clampdown to be effective, this service would need to be discontinued, with the owner being required to wait in line at the resort with their photo ID in hand, prior to the room being released.

 

[Brian Noble]

Correct. You must present an ID to check in. That ID has to match the name of the lead guest. Secondary guests may not check in, period. They are very strict about this.

Happily, I rarely encounter a line to do this. I'm not sure when I last had to wait to check in for a Wyndham reservation. (Not so for the most recent Marriott one!)

 

[GoingSince1990]

Correct. You must present an ID to check in. That ID has to match the name of the lead guest. Secondary guests may not check in, period. They are very strict about this.

Happily, I rarely encounter a line to do this. I'm not sure when I last had to wait to check in for a Wyndham reservation. (Not so for the most recent Marriott one!)

Thanks. So as always, be careful what you wish for and beware of unintended consequences. That big extended family trip that you all planned months ago, with people flying in from all over the country, Dad is the points owner, his flight got cancelled, and he can’t make it to WDW until tomorrow? Tough, nobody else is allowed into the room until tomorrow either, because DVC did a strict clampdown on point rentals.

 

[Brian Noble]

Dad is the points owner, his flight got cancelled, and he can’t make it to WDW until tomorrow? Tough, nobody else is allowed into the room until tomorrow either, because DVC did a strict clampdown on point rentals.

In this situation, it is possible to either (a) change the reservation to the name of another owner (who is not already a lead guest) or (b) add a last-second guest as the lead guest on this reservation (which would be okay no matter what, because that other owner of record is a lead guest, and so the Owner Priority restriction does not apply. These changes can be made up to the end of the check-in day.

The only time this would be a problem is if (a) "Dad" is the only owner of record on this trip, (b) the trip was during an Owner Priority period, and (c) "Dad" had already used both of his guest allowances for the year.

Even then, I suspect that Wyndham would help in response to a panicked call from the airport.

 

[DonMacGregor]

Seems like other timeshare operators are responding to an increase in commercial renting in the industry that many on here swear doesn't exist. To the point where they, apparently foolishly and without evidence, are taking proactive steps to curb said nonexistent increases in commercial renting. Or, it must just be happening at Wyndham and Marriott.

Man, are THOSE guys gullible (or unlucky)...

 

[Brian Noble]

Interestingly, I don't think it matters whether or not there has been an increase in renting, and if so, whether it is "commercial."

What matters is that owners in those systems think there has been.

Surprisingly, Wyndham is not really in the business of owning inventory for rental purposes. I suspect that's partly because Wyndham's hotel brands are not exactly what I think of when I think "let's go on a nice vacation," and partly because of historical accident. The timeshare end of the business started as an independent entity (Fairfield) and that entity did not have a rental market presence. They were a straight-up real estate developer that was into planned "leisure communities" when they realized timeshare had a better ROI. They then bought Wyndham to give them some brand recognition. (I still think that was a mistake given the nature of that brand, but what do I know?) The hotel side and the timeshare side never really integrated beyond timeshare owners getting comped status in the hotel loyalty program, and some minor crossover for loyalty points. So, Wyndham doesn't really care* if someone is undercutting them in private rentals, because there is nothing in particular to undercut.

Marriott is a different ballgame. But, I suspect Marriott is not worried about "Joe's Luxury Resort Rentals" because Marriott is a trusted brand name, and who is this guy Joe? So I also suspect Marriott doesn't really care about Joe because he's not even the fly bothering the horse, he's the mite on the fly that's bothering the horse. Not worth the expense to track down and do anything about. What's more, Marriott is much (much!) bigger than the vacation club end of the business. I suspect there are dozens and dozens of cash rooms in the portfolio for every single timeshare unit. If that's true, it can't ever be that important.

But, what happens when the sales floor starts seeing prospects balk with a stated reason of "There's never any availability for what I want! Why would I want more points?" It's especially interesting if those balking prospects say "because renting." It doesn't even matter if it's not actually "because renting" but just because some resorts are really popular and others aren't. By doing something "about renting" the developer can give the impression they are improving availability for owners. Wyndham's Owner Priority thing is easily the most obvious of these, but they all play a similar role.

DVC is a little different. Disney very much is in the rental business. Disney has less than five cash rooms per DVC unit (and they've been busy moving the former to the latter). There is also a highly visible, consolidated, large-scale rental ecosystem that has a reasonable degree of trust among the target market. In short, Disney might be the timeshare operator with a hotel business that is most threatened by an existing rental market.

Now add in "I can't book what I want (because of those evil renters), why would I want more points?" and you might have a company with some motivation.

------------------------
*: There is one thing Wyndham cared very very much about: Owners using cheap resale points with the benefit of developer-tier room discounts and upgrades, because those discounts/upgrades came out of sales' marketing budget. They put a stop to that a few years ago.

 

[GoingSince1990]

With no reports of similar incidents now in over four months, it’s looking more and more like that this was a rogue CM acting against policy, and that those who were concerned about a clampdown on rentals can breathe a bit easier.

 

[LandonDunes]

With no reports of similar incidents now in over four months, it’s looking more and more like that this was a rogue CM acting against policy, and that those who were concerned about a clampdown on rentals can breathe a bit easier.

I found a DVC that I am looking at renting on Redweek. Do you think there will be any issues? Have you heard or seen of any? Thanks.

 

[Huskerpaul]

I found a DVC that I am looking at renting on Redweek. Do you think there will be any issues? Have you heard or seen of any? Thanks.

Is it for a full seven days? I think the only issue possible with a Redweek rental is if someone was trying to rent a week they exchanged for through Interval International (not allowed by Interval). Those are always for a full week. Even then, probably a very small risk.

 

[LandonDunes]

Is it for a full seven days? I think the only issue possible with a Redweek rental is if someone was trying to rent a week they exchanged for through Interval International (not allowed by Interval). Those are always for a full week. Even then, probably a very small risk.

No just 4 nights.

 

[TinkAgainU]

I found a DVC that I am looking at renting on Redweek. Do you think there will be any issues? Have you heard or seen of any? Thanks.

I wish I recall where I saw the list (perhaps someone here has it) but I was told to check x number of items before sending funds for a Marriott rental (not DVC) I did thru Redweek. The rental went fine - I checked the documents to be reasonably sure the person owned the points, reviewed the contract I was sent, made a reasonable deposit, then the rental appeared in my account with Marriott and I paid the balance. Hopefully, someone can give you a list somewhat specific to Redweek / DVC?

 

[LandonDunes]

I wish I recall where I saw the list (perhaps someone here has it) but I was told to check x number of items before sending funds for a Marriott rental (not DVC) I did thru Redweek. The rental went fine - I checked the documents to be reasonably sure the person owned the points, reviewed the contract I was sent, made a reasonable deposit, then the rental appeared in my account with Marriott and I paid the balance. Hopefully, someone can give you a list somewhat specific to Redweek / DVC?

Ok thanks. This is specifically for a DVC that was listed on there. The price for this particular too. Type is WAY cheaper than the rack rate for the same dates but it says “Verified and Protected” on the listing. I just don’t want o get into a situation where I cancel my WDW reservation for the one on Redweek and get fleeced or something does wrong.

 

[Huskerpaul]

Ok thanks. This is specifically for a DVC that was listed on there. The price for this particular too. Type is WAY cheaper than the rack rate for the same dates but it says “Verified and Protected” on the listing. I just don’t want o get into a situation where I cancel my WDW reservation for the one on Redweek and get fleeced or something does wrong.

If it is verified and protected then you should be fine. With verified and protected Redweek has checked that the reservation details are correct and after you pay they hold the renters money and do not release it to the owner until two days after check-in. Only then do they pass on the renters money to the owner. About as safe as you can get when renting a timeshare.

The owner pays Redweek extra for a verified and protected ad.