Right of First Refusal—it may be a term you’ve heard in certain circles since buying your timeshare, though maybe you didn’t pay it much mind. It’s a term that doesn’t particularly affect the quality of your vacation ownership as much as it controls the natural lifecycle of your contract. If you’ve been thinking about selling your timeshare, odds are you’ve come across ROFR and have been perusing your contract to see if it applies to you.
If you’re not sure, here’s what ROFR means in a nutshell—the company with which you purchased your deeded real estate interest retains the right to intervene in any timeshare resale transaction and act as the buyer. More simply, ROFR gives timeshare brands the right to buy back the contract they sold to you originally. Certain timeshare ownership brands will enact this clause into their ownership contracts to ensure their properties are being resold at a fair price.
Here’s the catch, though—not all timeshare brands choose to enact right of first refusal. In fact, it’s common that some brands don’t at all, which leads to a confusing situation for owners. ROFR rules and patterns vary by brand, making the odds of your timeshare resale being interrupted differ on a case-by-case basis. We dove into some of the details behind the most popular timeshare brands to let you know what you can expect when selling your timeshare on the resale market.
Disney Vacation Club is one of the most popular timeshare ownership brands in the industry. With under 15 properties, ownership intervals at their resorts are often hard to come by. It’s not uncommon for certain DVC timeshares to be totally sold out, creating a demand that can drive up prices. Because of this, selling an unwanted Disney timeshare may result in surprising ROFR notifications from the club itself.
Since DVC timeshares are a commodity, it’s more common to see instance of ROFR interrupting resales in that brand. Since Disney wouldn’t have a problem reselling used timeshare contracts to new owners, it makes them more likely to step in and buy back from the current owner. When DVC becomes aware of a potential resale from one of its owners, the company has 30 days to make a decision whether to buy back the property or not. If they move forward with ROFR, the proposed closing date remains the same, and Disney will cover closing costs and disbursing funds.
However, despite the brand historically enacting ROFR at high rates, buy back rates at the end of 2017 were at an all-time low of 2.2%, a downward trend that’s been dropping as retail prices per point at DVC resorts have been rising.
Hilton Grand Vacations is another popular brand with locations all around the world. Like Disney, many of their properties are sought after, meaning there’s a high demand for timeshares in desirable destinations like Orlando or Las Vegas. As a Hilton owner contemplating resale, there are a few things you should know about ROFR before heading into the resale process.
Generally, Hilton Grand Vacations does not invoke right of first refusal for many contracts. Although it’s not uncommon, the company will likely allow resale agreements between owner and buyer to go through. However, it is more common for Hilton to buy back Platinum-level contracts than others. Another caveat of ROFR with Hilton is that owners may be required to contact their home resort to see if they’re interested in buying back the property before listing it for sale. This may be the case on some timeshare contracts, but not all, so be sure to check yours if you want to sell.
A worldwide leader in timeshare ownership, Marriott Vacation Club maintains thousands of owners across a vast litany of resorts that stretches from London to Honolulu. As such, this is yet another highly popular brand with ROFR rules and regulations. Marriott is unique in the sense that different resorts have different ROFR periods—the time the resort requires to consider buying back a timeshare from the current owner. Depending on your home resort and contract details, you may have to wait through a 30-, 20-, 15-, or 10-day period while the club considers purchasing your resale. It is also worth noting that Marriott owners may be required to notify the club’s Resale Operations department of any intent to sell their timeshare to a new owner.
However, certain resorts do not carry right of first refusal restrictions. Marriott’s Frenchman’s Cove, Marriott’s Royal Palms, and Marriott’s StreamSide – Evergreen are just a few examples of properties where owners can list their timeshares for sale without following the above requirements.
Right of first refusal rules are complex and can change on an individual basis, which can confuse many owners looking to sell their timeshares. Luckily, our team of timeshare resale experts can provide valuable insight on ROFR, as well as the rest of the resale process. If you’re thinking of listing your timeshare for sale, start by determining its resale value using our free market value estimate survey, or reach a representative directly at 1-877-815-4227.