Offer Confusion w/ Timeshare Store

[Brian Noble]

If I understand things correctly, the broker has a fiduciary duty to the seller. If so, and an early-but-low offer comes in, I can easily imagine the broker advising the seller to "consider the offer" for a short while to see what else comes in before responding. As a buyer looking to grab a quick bargain, that's a bummer, but the broker is representing the seller, not the buyer.

[bighoo93]

Originally Posted by Dean

As I've said before, it is my opinion that the major resale companies drive prices as much (more in some cases) than does DVD and retail. Some companies are more receptive to presenting borderline or low offers than others. Not right or wrong, just the way it is.

Can you elaborate on this? A buyer and seller agree to a price. It isn't clear to me what role the resale company played in this.

[Missyrose]

Originally Posted by Brian Noble

If I understand things correctly, the broker has a fiduciary duty to the seller. If so, and an early-but-low offer comes in, I can easily imagine the broker advising the seller to "consider the offer" for a short while to see what else comes in before responding. As a buyer looking to grab a quick bargain, that's a bummer, but the broker is representing the seller, not the buyer.

Technically I believe the resale brokers are considered neither buyer's nor seller's agents. But they will make their commission off a completed purchase.

[Dean]

Originally Posted by Brian Noble

If I understand things correctly, the broker has a fiduciary duty to the seller. If so, and an early-but-low offer comes in, I can easily imagine the broker advising the seller to "consider the offer" for a short while to see what else comes in before responding. As a buyer looking to grab a quick bargain, that's a bummer, but the broker is representing the seller, not the buyer.

No doubt but legally they must present all offers. In the past TSS has stated they are a transaction broker and work for both parties equally.

Originally Posted by bighoo93

Can you elaborate on this? A buyer and seller agree to a price. It isn't clear to me what role the resale company played in this.

The broker and seller want to get as much as possible. In the past it's been reported that some brokers refused to present low offers and refused to accept listings at low prices. There are also behind the scenes ways to increase prices including the overcharging for fees that takes place with several of the companies. IF you're a big player and you refuse to present low offers and you control listing prices, you exert direct control over sale prices.

[bighoo93]

Originally Posted by Dean

The broker and seller want to get as much as possible. In the past it's been reported that some brokers refused to present low offers and refused to accept listings at low prices. There are also behind the scenes ways to increase prices including the overcharging for fees that takes place with several of the companies. IF you're a big player and you refuse to present low offers and you control listing prices, you exert direct control over sale prices.

It is still the market setting the price. If buyers were not willing to pay, it wouldn't matter what the brokers did.

[wishicouldgomoreofte]

Not relating to this particular situation, but I would like to know.
Isn't the seller allowed to decline all offers that are less than asking price?
Do resale agents, like TTS and the others, only allow like 2 refusals, and on the third it has to be taken off the market?
I have read threads on here before about people offering lower bids, and then owners pulling the listing off the market.
Why would they do that? Do they have to after a certain amount of declines? Can't they leave it on the market and hold firm for asking price?

[Dean]

Originally Posted by bighoo93

It is still the market setting the price. If buyers were not willing to pay, it wouldn't matter what the brokers did.

Not necessarily, it's simply setting the price for that situation. It's much like buying a used car from the dealer for that make, they tend to be overpriced. The reality is that market forces don't work well for timeshares for a number of reasons mostly related to emotion, limited options, and a limited market. As a rule prices tend to be lower than par value with exceptions and DVC is one largely due to Disney's name and popularity. Without facts to back it up, I'd venture to guess that the selling prices for TSS is generally higher than for the rest on average.

Originally Posted by wishicouldgomoreofte

Not relating to this particular situation, but I would like to know.
Isn't the seller allowed to decline all offers that are less than asking price?
Do resale agents, like TTS and the others, only allow like 2 refusals, and on the third it has to be taken off the market?
I have read threads on here before about people offering lower bids, and then owners pulling the listing off the market.
Why would they do that? Do they have to after a certain amount of declines? Can't they leave it on the market and hold firm for asking price?

They can decline all offers period but they might have consequences related to their sales contract and commissions though I doubt any company would go after them for such a relatively small amount. I've never heard of it happening (sue for commission) with timeshares. Most brokers who sell timeshares do so on a non exclusive basis, that means you could list with multiple companies and offer it for sale yourself as well. As long as you notified the brokers in a timely manner it was sold, or you had decided not to sell, you'd have no risk. As for why they might decline full price offers, there are a number of reasons. They might have decided not to sell or they can't sell (upside down loan, bankruptcy) or they simply want to keep it. Or they might have already sold it as mentioned above or they might have at trip planned and can't close for some time. I'm not aware of any refusal limit and since there are legal rights to cancel a purchase within a certain period, sometimes buyers under contract will continue to make offers on other contracts and cancel previous ones if they get a better deal. I personally find this unethical and I would hold any broker who knowingly participated in this type of process accountable as well, but it happens.

[CarolMN]

Originally Posted by Brian Noble

If I understand things correctly, the broker has a fiduciary duty to the seller. If so, and an early-but-low offer comes in, I can easily imagine the broker advising the seller to "consider the offer" for a short while to see what else comes in before responding. As a buyer looking to grab a quick bargain, that's a bummer, but the broker is representing the seller, not the buyer.

Originally Posted by Dean

No doubt but legally they must present all offers. In the past TSS has stated they are a transaction broker and work for both parties equally....(snip).....

Originally Posted by Missyrose

Technically I believe the resale brokers are considered neither buyer's nor seller's agents. But they will make their commission off a completed purchase.

Missyrose is correct. This is from the Florida statutes, 475.278 Authorized brokerage relationships; presumption of transaction brokerage:

(b) Presumption of transaction brokerage.—It shall be presumed that all licensees are operating as transaction brokers unless a single agent or no brokerage relationship is established, in writing, with a customer.
(2) TRANSACTION BROKER RELATIONSHIP.—A transaction broker provides a limited form of representation to a buyer, a seller, or both in a real estate transaction but does not represent either in a fiduciary capacity or as a single agent.

Here's a link to the statute for anyone who wants more -

The 2012 Florida Statutes / Chapter 475, REAL ESTATE BROKERS, SALES ASSOCIATES, SCHOOLS, AND APPRAISERS

[bighoo93]

Originally Posted by Dean

Not necessarily, it's simply setting the price for that situation. It's much like buying a used car from the dealer for that make, they tend to be overpriced. The reality is that market forces don't work well for timeshares for a number of reasons mostly related to emotion, limited options, and a limited market. As a rule prices tend to be lower than par value with exceptions and DVC is one largely due to Disney's name and popularity. Without facts to back it up, I'd venture to guess that the selling prices for TSS is generally higher than for the rest on average.

I appreciate your response. Somehow, though, we aren't quite talking about the same thing. Probably not worth trying to resolve. I agree in particular with one point though, and that is that we are stuck with speculating on this and most DVC financial issues, because we don't have the data. I've looked, and either it isn't available or I haven't looked in the right places.

[LauraLea]

Originally Posted by BWV Dreamin

It seems that there is a trend here with TSS that I don't see with other brokers. I submitted an offer over the summer on a small contract through TSS. It was a low offer. They said they would submit the offer right away. A day later I still didn't hear from them. I called them and they told me a higher offer was accepted. That is fine, but what I didn't like is that I was never notified that my offer was declined. Also, how long did they sit on the offer? If it was declined right away I should have had an opportunity to counter.

So I do see the OP's concern and I know other brokers do not do business that way. FWIW, I will never buy or sell from them again.

If I had been the seller in this case and got a low offer when first listed I would just tell the broker, "Let's see what else comes in before I turn this one down". Then within the next day or so I get a better offer, I would tell the broker to pass on the first offer. Just because you are the first bidder, the seller can still wait until more offers come in to decide which one to accept.

Laura

[bighoo93]

Originally Posted by LauraLea

If I had been the seller in this case and got a low offer when first listed I would just tell the broker, "Let's see what else comes in before I turn this one down". Then within the next day or so I get a better offer, I would tell the broker to pass on the first offer. Just because you are the first bidder, the seller can still wait until more offers come in to decide which one to accept.

Laura

Personally, I would still feel like I owed the bidder a response. It's just how I prefer to do business, and how it has worked in every non-timeshare real estate purchase. If I didn't like the offer, I would either counter, or say that I would consider it after seeing what other offers have come in within a certain time (a few days or a week). Meanwhile, if I were making an offer, I would stipulate that the offer expires by the end of the day at the latest if I have not heard back. One way or another, I'd like to hear back and know whether I can pursue other contracts.

[Brian Noble]

Technically I believe the resale brokers are considered neither buyer's nor seller's agents. But they will make their commission off a completed purchase.

Thanks for the clarification; somehow I never noticed that!

[WebmasterDoc]

I think many look at resale purchases as they do eBay auctions. We frequently see posts where someone has "put in a bid" on a resale offering when they are actually "making an offer" on a real estate transaction.

eBay auctions are pretty transparent - right up to the end-time of the auction since no broker is involved and anyone can watch the transaction from start-to-finish if they so desire. Resale transactions are not transparent transactions and have no end date. They are complete only once there is an accepted offer and closing.

In my experience, there is no requirement for a buyer to respond to any offer since normally the offer will have an expiration included in the offering paperwork. No response by the expiration simply means there is no longer an offer unless the buyer wants to escalate the amount of his offer by making another offer. There is certainly no requirement that the seller must counter any offer.

[MsTessP]

I never knew that my experience was not typical.

I called about TTS about a listing and put in a rather low offer. The agent immediately called the seller and then called me back with a counter offer. I gave our counter, and the seller was called back and the offer was accepted.

Less than 30 minutes from start to finish, I had our offer accepted. BTW, this was for a rather small contract at BWV which had just been put on the market late the day before. Seven weeks later, I was in the system and made our first reservations.

[Dean]

Originally Posted by bighoo93

I appreciate your response. Somehow, though, we aren't quite talking about the same thing. Probably not worth trying to resolve. I agree in particular with one point though, and that is that we are stuck with speculating on this and most DVC financial issues, because we don't have the data. I've looked, and either it isn't available or I haven't looked in the right places.

Maybe I'm missing something but the bottom line is that market forces don't work well in timeshares, never have and likely never will. They likely come closer with DVC than most.