Visit to two time-share resorts: the pressure is on
Both government officials and the National Timesharing Council (NTC) urge potential buyers to research and compare values before they buy at a time-sharing resort.
But in practice, careful comparison shopping is difficult. When this reporter and his wife answered two offers to tour time-sharing properties, no mention was made that we would be asked to buy during the visits, nor were any prices listed.
Industry critics say that after supplying little or no information to customers beforehand, time-sharing marketers use pressure selling to close the sale immediately, eliminating the option to investigate the developer after the visit. At the Ponds at Foxhollow in Lenox, Mass., a three-hour tour ended with the salesman rejecting our request to take a contract home for examination by a lawyer. When he was told that no deal could be made otherwise, he then offered a recision period in which we could nullify the contract - if we signed before we left. ''That's the 'R' word,'' he said after looking around, although there was no one else in the room. ''We're not supposed to mention it. I could get fired for telling you.''
At the Summit in Laconia, N.H., the salesman also refused to let an unsigned contract off the premises. ''If we did, our competitors could copy it,'' the salesman told us. ''We've put a lot of work into our contract.'' He did not explain how signed contracts carried out by buyers were kept from competitors. Later, by phone, Summit project director Jay Anderson gave a different reason. ''If I gave everyone who walked in here a contract, my marketing costs would be sky high,'' said Mr. Anderson. ''I'm sure you can understand that.'' He does, however, give away television sets to visitors.
Foxhollow developer Donald Altshuler, contacted by phone four days after our visit, insisted that his contract did offer recision rights, including ''automatic'' recision for three days and ''seven days if you want a lawyer to see it.'' He said the salesman this reporter talked with was no longer employed by Foxhollow.
Both resorts are members of the NTC. The council's consumer guide advises buyers to ''have an attorney review any documents or legal requirements that you do not understand before you sign anything'' (emphasis added). ''You should be allowed to take a contract home,'' added NTC spokesman Victor Parra in a telephone interview. When told that two member resorts would not allow an unsigned contract off the premises, he added that ''we do not condone such practices.'' He said the council is ''taking aggressive steps, including through legislation'' to better regulate the industry.
To encourage a sale during our visit, the Summit salesman offered this reporter a $500 discount on its $6,000 to $12,500 per week units and a free membership in the owners' organization (price tag: $750). In addition, prices were to rise $1,500 on July 1. All of these advantages would be lost, he said, if we wished to wait.
At both resorts salesmen were careful not to promise that units would rise in value. But both mentioned that prices in their project had already shot up. ''When this was mud in 1980,'' said the Foxhollow salesman with a wave of his hand, ''a fellow bought two weeks of time for $5,000 each. Today, if I had any of those times left to sell, the units would go for more than twice that amount.'' (The NTC's consumer guide reminds buyers that ''you should recognize that a time share is not an investment opportunity in real estate. Rather you are buying the right to future vacations . . . at today's prices.'' Mr. Parra adds that the industry is ''too young to tell if resales are a good investment.'')
Both resorts did award the incentives they promised in their advertising. At Foxhollow, a ''$90 Berkshire vacation'' weekend cost $25 and included overnight accommodations, a half-priced dinner, and free breakfast. The Summit promised a television with a two-year warranty by a ''world famous'' manufacturer in exchange for a tour. The TV was a 12-inch, black-and-white portable made in Korea. A spokesman for Taihan America Corporation in Chatsworth, Calif., the US distributor, put its recommended retail value at $68.