Destination South Beach

So you probably have heard of the world famous South Beach, being a destination not just for American travelers but for thrill-seeking party people from around the world. When people think of South Beach three things usually come to mind: beautiful weather, beautiful places and beautiful people.

During the day there is so many things to do it is hard to pick just a few. South Beach boasts some of the most spectacular beaches in the world with soft white sand and pristine blue oceans. After you dry off head to Lincoln road where you can expect to see many people performing at night and shopping that can rival Paris, 5th avenue in New York, and Rodeo Drive in California. Some of the more famous stores on Lincoln Road are D-A-S-H Miami run by Kim, Chloe, and Kourtney Kardashian, GUESS the flagship shop for the Marciano brand of contemporary sportswear, and Base which only plays distinct music from Ibiza. Not much of a shopper, no problem, the Miami City Ballet is a world-class ballet with many programs including favorites such as The Nutcracker and Romeo and Juliet.

As the sun falls, South Beach comes to life with neon lights and nightclubs opening their doors. SET Miami, which is on Lincoln road, is run by the elite Opium Group and is one of the top clubs in the country. The Opium Group also runs many other nationally acclaimed nightclubs including Mansion, Living Room, Mokai, Cameo, and Club Louis in the W Hotel.

Getting a little tired? Understandable but that should not stop you from staying in the ultra-plush hotels. Canyon Ranch Hotel and Spa, Epic Hotel, and the Hilton Bentley Miami are all top-rated choices that you will not be dissatisfied with. Make sure to come back and visit all of us again in South Beach!

Buying a Timeshare in South Beach – A Real Estate Investors Point of View

We hadn’t even checked into our little boutique hotel on Ocean Drive in Miami’s South Beach when Danny was greeting us with promises of VIP passes to the Mansion, reserved chairs, tent and towels at Nikki Beach, $100 in gas, a free meal and more, if we would spend 60 minutes listening to the hotel’s timeshare deal.

My wife Julie and I took a tour in Maui of the Westin Timeshares but didn’t go through the salespitch. I am not in the market for a timeshare, but I’ve always wondered if they would make a good real estate investment (and, I love the idea of getting free stuff for listening to someone tell me about a real estate deal). Julie hates wasting time but was curious and reluctantly agreed to sit through the spiel.

We barely managed to get checked into the hotel, and we were ushered up to the fourth floor to begin. We walk into what used to be a hotel room, and were offered the choice between two of the empty tables at the back. We were both expecting a one on many presentation. But, it looked like we were about to get a one on one sales presentation.

The room was buzzing with conversation as there were 8 other tables of couples listening as salesmen gave them their best pitches.

No less than 90 minutes later, we had walked our 22 year old salesman through our extensive travels over the past two years. He felt bad that we didn’t know about this deal sooner. He told us we would have saved SO MUCH money if we had known about this deal before we went to Spain, England, France, Belize, Hawaii, and Australia. He emphasized that this was an investment because when we would sell the property later we would get more than our money back. He also slipped in the fact that we could ‘game’ the system by renting our property out at peak times if we weren’t going to use it, and, make money from that to pay for future trips.

Careful to always show us the low amounts when referring to what each week would cost in terms of timeshare points (I will get to that in a sec), and to tell us the higher end of what we’d be otherwise spend if we didn’t have this deal, he artfully painted a powerful picture of what life would be like once we were the proud owners of South Beach timeshare.

At this point, we knew the general structure of the deal, but we still did not know the price. But here is how it works:

  • Annually you get 7,800 points,
  • The points accumulate and rollover, so unused points just roll into the following year,
  • You can break them up and use them for 4 days or 3 days instead of only week chunks,
  • Your friends and family can use your points so long as you make the booking,
  • Your points can be used directly at any of their resorts or through their network of timeshares,
  • There are no black out periods, and because you are buying at South Beach which is top tier you can more easily stay at other desirable locations around the world.  

500 points would get us a week in Costa Rica. But, as we dug into it, we found out that 500 points was for what they called GREEN weeks, which basically means nobody in their right mind travels there during that period because of volatile weather conditions.

Realistically, with those points, we would get two weeks at a place we would want to stay during the time period we would want to stay. By compromising on either the quality of property or the timing of the trips, we could potentially squeeze four weeks out of it. But I can’t say that with confidence.

This timeshare program definitely seemed to have some advantages over what we’d heard about timeshares from other people. For example, you are not stuck to one specific week each year. You don’t lose your points if you don’t use them. And you can transfer to your friends or family as long as you make the booking yourself. It also seemed very flexible.

Really, it didn’t sound half bad. I am sure Julie was nervous that I was going to want to buy one. But, at this point we still didn’t know the price.

FINALLY, as we are getting close to two hours sitting at this little table, and Julie is about to pass out on the table from exhaustion and impatience, we learn that all this could be ours for $36,000.

And with their financing, at the rate of 18% APR, your total cost for the purchase comes to $39,180 + $9,000 (required 25% downpayment) = $48,180.

In addition to that, your timeshare fees for maintenance, taxes and insurance are $963/year (total of $4,815). So your grand total for owning this time share for 5 years is:

$52,995 which works out to $10,599 per year.

Or, put another way, it’s the same as paying $757/night at a hotel of your choosing during a two week vacation each year for 5 years.

Even if you buy it with cash (no financing) and hold it for 15 years, you are still going to be paying the equivalent of $240/night each year for your two weeks of vacation. I don’t think you can rent out your properties enough to cover your costs on that one!!

And the worst part is that the locations they offered were not of much interest to us. And you had to pay $154 to transfer your points for use at their network properties. We ARE big travelers, but that also makes us pretty particular. We know we like to be within walking distance of the sites and highlights of places we visit. We don’t want to be outside of the city, or at least not centrally located. Our young salesman tried to convince us that the amount we were saving was going to make a $5 cab ride to get to the things we wanted to see or do worth it. It would be more like a $25 cab ride…each way…every time we wanted to go anywhere. What a pain!

For $757/night, let’s face it, we can stay in some pretty swanky places RIGHT IN THE MIDDLE Of the action just about anywhere in the world.

So, we said no thanks. But, wait, we couldn’t just leave because we decided this wasn’t a deal for us. We had to tell his manager why we weren’t buying. And after that we had to meet one last person.

This final guy sat down and actually told us that they didn’t want to lose out on our business. They wanted to give us the opportunity to enjoy the resort further. To do that, they were prepared to hold the $36,000 price for us for two years, and they would give us 8,000 points to use for the low price of $2,200! Maybe it’s a better deal, but we’re still not interested.

Ok, so for most people, you won’t make money or save money because you own this timeshare, but maybe you can resell it later for a higher price? I went onto multiple sites that have resale timeshares on them, and found this exact timeshare on sale for $21,000 with a note beside it saying “negotiable”. And a quick look around at other timeshares within this resort group showed a sad story of prices dropping, and people anxious to offload their timeshares at rock bottom prices. So, it doesn’t look like it’s a good investment either.

And on top of all of this, the free gifts that I got all excited about are pretty much useless. The hoops you have to jump through to get any of the rewards are ridiculous. Take the free $100 in gas for instance. You will enjoy a $25 rebate each month you spend $100…but it has to be four consecutive months of spending $100 and sending in your receipts or you don’t get it! I am sure 99% of the people never use most of the free gifts you get.

After the long presentation, Julie smugly said to me “So, you promise we never have to do that again?”. But, I’m a real estate investor, and when I see someone talking about a deal, I get curious. So, I couldn’t tell her that would be our last one, but I tried to reassure her that the next one would give us really good gifts!

From South Beach to Savannah in Honor of St. Patrick

So I went to Florida and Atlanta recently and let me tell you something…there is something special about that part of the US. I stayed in a town called Key Largo in the keys, which is about 70 miles south of Miami. Being that it is an island, the way of life there is completely relaxed. On any given day of the week, you can walk into a beachfront bar, my favorite happens to be snappers, order up a dozen mouthwatering oysters with a pint of Yuengling beer and waste away the rest of your day chit-chatting and munching to the rhythmic hum of the salt water breeze blowing through your hair. I mean does it get any better than that? The only drawback about going there in the winter is the high price of lodging as this is high season. But once you get there, everything else is relatively inexpensive.

Next was South Beach and all its Latin flavors. I wasn’t there long as I had other matters to attend to, but the energy on the SOBE strip was primal. All the girls are wearing skimpy bathing suits, and the guys walk with no shirts. Loud music blaring from every direction, the hot sun shining with all its lustful fury, Cuban bar-b-cue and palm trees everywhere! Sounds like heaven, doesn’t it? It most certainly was. As I said, I didn’t stay long, but did manage to do a little shopping and had the most amazing Cuban style chicken!
What happened next was a true surprise! First I headed west to Tampa and Orlando after that. Both were nice cities but nothing really special. Orlando has Disney World and Sea World. I drove through both but visited neither as these tourist traps have a way of sucking all your money without you even noticing. Besides I’ve already been to Disneyland and Sea world on the west coast. The real surprise was to be found in Savannah, GA.

Having been driving for 4 hours straight, I was exhausted. Still about 40 miles from my destination of Hilton Head Island, I decided to stop for the night and continue the trip tomorrow. I pulled off the highway and found a random motel and checked in. Hungry, I asked the concierge to point me in the direction of a decent restaurant to which he replied, “just go into downtown, you’ll find something there.” And find something I did. I didn’t realize that it was St. Patrick’s Day and had no idea that Savannah has the second largest St. Patrick’s Day celebration in the US, just behind New York. The river that runs through downtown was died green, massive sections of the downtown were blocked off for live concerts, every bar has crowds spilling out of it…Mayhem! As crazy as it sounds and of course with St. Patty’s Day being a drinking holiday, you’d expect this to be a free-for-all! On the contrary! It was very well organized, nobody was out of control, the environment was friendly and inviting the people were incredibly nice and welcoming. I am not the type to go out by myself. I mean back home, I find it difficult to get take-out alone. But there was something so pleasant about the environment in Savannah, I had absolutely no reservations about being out on the town solo. And Furthermore, I had a great time meeting people, socializing and of course drinking a pint or two in honor of good ole’ St. Patrick! What a night!