May 23, 2014 — Did you know that a National Association of Realtors® (NAR) survey for 2013 reported consumers seemed to gobble up VACATION HOMES in record numbers? Why should you care? Well along with all of us being in the global hospitality industry, marketing and selling a Slice of Paradise is also peddling Casas de Vacaciones, at its core, and doing so without the ‘price tag’ or the time consuming and costly annual maintenance requirements of the traditional vacation home buyer.
So Here’s The Scoop: Apparently this NAR study is part of the survey and research commissioned by “HomeAway, Inc.” (NASDAQ: AWAY). In case you’re not familiar with them & according to the company website: “HomeAway, Inc., based in Austin, Texas, is the world’s leading online marketplace of vacation rentals, with sites representing approximately 952,000 paid listings of vacation rental homes in 190 countries.”
One of the facts in the survey that struck me is that while our industry is out there bribing folks to come in for a look-see at our vacation homes “717,000” ‘families’ (prospects) woke up one day in 2013 and thought (e.g.) ‘Golly Gee Whiz, this would be a gosh darn good day to buy that dang vacation home we’ve always dreamed about’ – and then did so to the tune of an average price of $168,000 (up 12.5% from $150-K in 2012).
Meanwhile, back in The Land of Time during that same year and based on reports from ARDA and others we likely sold around 450,000 intervals of our vacation home ‘plans’ (weeks-points).
And collectively, excluding sales commissions, etc., our combined marketing cost was in the $1.5 BILLION neighborhood that year — often dragging in very reluctant and highly suspicious ‘sales guests’ (nearly 3 million of ‘em) to comb through them and come out with a less than stellar number of ‘buyers’ – likely, industry wide, 18% (net) or less.
Now, among those dastardly conventional vacation home buyers – drum roll please – a whopping “78%” of the demons ‘stepped up’, and did so because of potential “rental income” without any guarantees (in most cases) whatsoever.
Imagine that! Those money hungry ‘buyers’ are interested in rental income, and the survey said that the gold rush by vacation home owners/buyers will fork out ‘just south’ of $1,000 to “market” their property and that the average weekly rate generated is “$1,520.00”.
And according to the survey “58% of the buyers” (owners) firmly believe that each year they’ll recoup about ½ (50%) of their annual mortgage payments and even more surprising this new breed of vacation home buyers are in their mid to late 40’s (average) and ARE NOT wealthy high-rolling ‘wall-street’ types, as they have an “$85,600 Medium Household Income” (which is about the same age and income range as are the majority of buyers of Time).
Below I’ll leave the links to both NAR and HomeAway so you anyone interested can read more of the ‘data’ etc. but for today I’ll only say this.
As a global industry, though fortunes have surely been generated, as many of us have discussed for decades we’ve done a miserable overall job ‘marketing’ our unique vacation homes.
That is, in part, because we don’t niche market and instead drag in millions of 25-35-year-olds and 65(plus)-year-olds each decade, including low-income earners (may God bless them all). And by foolishly doing so, against our own best interest, we’ve suppressed our product value and equally important our net ‘selling prices’.
As many of us have insisted over the years, exchanging is a by-product and selling our slices of paradise should be, first and foremost just that — the pride of vacation home ownership without the hassle of those ‘other’ vacation homes; and our Casas come with some pretty awesome perks that the competition can’t touch.
And when you add to the mix what is actually happening in the “extended vacation stay” market (accommodations in Hotels, Motels, Condos, etc), as an industry we are surely in need (once and for all) of a MAJOR correction regarding how and to whom we market, what and in what manner we sell – and more!
After all we’re selling a vacation home pilgrim – but I shall not hold my breath – NEXT!
Good Luck Out There!
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Contributing sometimes extravagant, bombastic, emotional, pompous or even pretentious writings about the timeshare industry, Scoop covers an array of industry related subjects each week including inside information, tips, scandals, interviews, forecasts as well as new (good or bad) products and services — and, of course, all the ‘Good’, the ‘Bad’ and the ‘Ugly’.
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