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Single-location vacation resorts may be cornered into serious problems. Just look at the 13.1 percent decline in home values over the last year in Hawaii. Candace Jackson of the Wall Street Journal writes that exclusive hot-spot Hualalai on Hawaii’s big island has 50 homes and lots on the market, and reported half their sales volume of 2007. The celebrity magnet resort once had a two-year waiting list. It appears that consumers are looking for a deal, even in high-end markets.
The diversified home portfolios of destination clubs are an obvious counterpoint to the single location of resort real estate. Similar buy-in costs (typically $100,000 and up) and annual dues put the two options on the same playing field. However, destination club members have a dramatically wider variety of homes and locations to choose from. Industry giant Exclusive Resorts has over 350 homes in 40 destinations, and Ultimate Escapes offers nearly 300 homes to its members in over 150 locations.
But destination clubs are not immune to the same real estate woes as typical resorts, even on the ultra-high end. The highly selective Yellowstone Club boasted mogul members like Bill Gates and had over a $1 million buy-in cost, yet filed for Chapter 11 bankruptcy. Any smart buyer in this market should do their due diligence and weigh their vacation home options. Our decision guide is a comprehensive place to start.
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From: Vacation Club CommentSunday, January, 04, 2009 at 05:46 AM
OneKey and Capricorn are both listed on this website under DCs, even though they are vacation clubs instead of typical DCs in my opinion. They may not be any lower risk on a company level but they may be lower risk to a prospect in that you put up less inital money (less money to lose). This is definitely an advantage. However, they do have negatives just like any other vacation option, which is a more expensive per night cost, the residences are not owned and centrally managed by the vacation club and the costs are not hedged against inflation. So while the homes may be vetted, you don't have the level of consistency and exclusivity of a DC and the costs are probably higher on a per night basis.
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From: luxe_travelerTuesday, December, 30, 2008 at 11:49 AM
There are so many vacation home options in the marketplace today it's difficult to know which one to choose. I've been researching destination clubs for some time now and I was curious to see why you didn't list any travel clubs as an option. I know that luxury clubs like, One Key, offer over 500 homes and destination club service without the loaded debt or difficulty of entry/exit. I feel like travel clubs are a much safer option than those discussed above. But please correct me if I'm wrong.