Point Costs Calculation

[thebigman65]

I apologize if it is here somewhere....but I can't find it. What is the calculation used to determine how much each point is costing you per reservation. I.E. If I wanted to rent my points....

TIA!

 

[Mousewerks]

I apologize if it is here somewhere....but I can't find it. What is the calculation used to determine how much each point is costing you per reservation. I.E. If I wanted to rent my points....

TIA!

Are you looking for a points calculator like what David has on his website?

 

[thebigman65]

Are you looking for a points calculator like what David has on his website?

No I am looking to calculate how much my points cost me....I guess, per stay/year....so is it $8 per point, $10 per point, etc.

 

[calleger]

I would believe such a calculator exist. However, for a general idea....

Final cost of points(purchase price + interest from any loans)/total points (yearly allotment x total years of ownership[Final Year of contract - First year of ownership]) + yearly dues = approx. actual cost per point


disclaimer: I am not, nor do I pretend to be, an accountant. I assume this basic equation is missing some elements.

 

[supersnoop]

Your cost is irrelevant when renting points; you can charge whatever you want, but people will only pay based on the market and their alternatives.

Generally speaking, your points "cost" the annual maintenance fees plus your amortized up-front costs. If you financed, include your financing expenses. But, again, your cost is really irrelevant.

 

[calleger]

Agreed. The marked for rented points remains what it is regardless of how much you paid for the points. However, having a rough idea of how much the point you are renting out actually cost you, could help in a persons decision to make them available via rental.