Holiday Property Bond

ChrisM_2

I think you've put it very well Seronera. The person who introduced us to the Bond has a degree in economics, so I knew we weren't buying into something that wasn't worthwhile! There are quite a number of people in our neighbourhood who are bondholders (we have gradually discovered this by accident during conversations at local events) among whom there are doctors, senior academics, and a retired senior police officer, none of whom are going to invest in a 'con'.

coachwise

If you have active children the sports facilities are brilliant.The accommodation is first class and the onsite staff superb. You also have laundry facilities-so no piles of dirty washing to take home. A tad expensive but you are guaranteed so many things that go to make for a happy holiday.
We have been members for 14years and our children are 16 and 19 now and have grown up with HPB and know that the swimming pools will be brilliant:T
You own part of the property portfolio ,its investment potential on one level is that it can be written in trust for your children.Some centres have on site restaurants and in others the manager can recommend bars/eateries and organise transport.

thameswan

Really interesting to read the negative reports from those who don't have a Bond! From someone who has had a Bond for over 20 years rest assured that this is a solid, respectable and high quality product which is in a different league to package holidays. As others have said 'you get what you pay for' and I have never had any reason to be critical of the company, the accommodation or the wonderful facilities. There is attention to detail with every element and I have had up to three holidays a year for 20 years so I should know!

Contrary to other reports here there is no maintenance charge - this differentiates it from time shares. You only pay a user charge when you actually rent a property. I invested early so don't even have a user charge - every holiday I have taken has been virtually free.

Clients are generally professionals so you know in advance the type of people you will be encountering. If you like packages and all that goes with them then stay away.... long may HPB continue to thrive with intellectual investors who know when they are on to a good thing!

scrayfield

We have been in the Bond now since 2007 but have only used it twice, primarily because our daily life is subject to constant changes and we are always looking for short notice breaks. If this is you then avoid HPB like the plague.

I thought I was being careful prior to investing and wanted to know what the occupancy rates were, at that time I was quoted 75%. I then assumed (wrongly) that this represented a reasonable level of vacancies throughout the year. Added to this are the vast list of Tenancies which on average are much more expensive than Bond properties and more often vacant (at a price) - I wasn't aware of these and am only interested in Bond properties - another mistake.

On the 2 occasions we used a Bond property the standards were very high and we throughly enjoyed our time there. However, if you can't get a booking this is absolutely meaningless.

So, if you want quality accommodation and are prepared to book up to a year ahead this is for you. Obviously the further afield the properties are the more likely you are to find a short notice slot, meaning the UK is almost shutdown for several months, if not a year ahead.

As mentioned in other emails this is more of a lifestyle decision and not an investment. So, if your life is predictably laid out for you year on year - go for it and fingers crossed you are still alive when the booking date arrives - otherwise, grab life by the throat on a day to day basis and enjoy it while you can - you won't get another one!

Seronera

I think thats fair comment from Scrayfield. The bond will always favour those who can sit and plan ahead, and believe me there are bond holders who do this with military precision. I am not one of them.

To be fair to the Bond they underestimated how popular the UK based properties would be in their initial planning, assuming that most would like to go abroad, but in response to surveys of bondholder preferences they have tried to increase the number of UK venues, but are chasing the game to some extent. They are also a bit limited with suitable properties coming up at the right price in the right locations.

I don't agree about the tenancies. I've only done one tenancy holiday in Crete and it wasn't a bad price at all. The more luxurious you go the pricier it is of course, and some are quite pricey. Whilst we were there there were German agents trying hard to get the contract with the owner of tthe apartments off HPB, so its never easy in a competitive market. I do believe the tenancies have been useful in providing extra options for bond holders without the need for vast capital outlay that would otherwise be needed in building properties, and the time factor that would involve.

I do agree that getting bookings in the short term is a problem, unless you do as I do and just ring the bond up and say "What have you got left....anywhere will do". This works OK ish as there is not a bad location in the portfolio and the staff always try their best, they really do.

Seronera

peteritchie42

I have received the paperwork and read through it. The idea looks good at first glance but the sums don't really add up!
You invest money to add to the bond pile for future investment, running costs, admin as I thought and then are asked for approx £100 per year management fees and £200 - £500 for user fees each time you holiday, knowing that some founder members pay NOTHING!

Although the places look 5 star, for 2 people wanting a holiday abroad you still have to find money for flights, hefty user fees, money for food as not even breakfast included. Finally what really gets me is I cannot reconcile double standards with the user fees some pay some do not, ALL should contribute and that would lower the user fee.

GrassInTheSky

Only a tiny percentage pay no "user charge". The Bond could not have survived on that basis in the long term. My experience of over 20 years of HPB holidays is that it is the best financial investment that I have made. Not just because you get quality accomodation but the complete trust in that the holiday will be great in so many ways.

This scheme would not have survived without repeat custom from people like me. The only downside is that your children expect to keep using them after they have left home! Also you should consider that they will inherit your holiday points one day.

Seronera

peteritchie42 wrote: »

I have received the paperwork and read through it. The idea looks good at first glance but the sums don't really add up!
You invest money to add to the bond pile for future investment, running costs, admin as I thought and then are asked for approx £100 per year management fees and £200 - £500 for user fees each time you holiday, knowing that some founder members pay NOTHING!

Although the places look 5 star, for 2 people wanting a holiday abroad you still have to find money for flights, hefty user fees, money for food as not even breakfast included. Finally what really gets me is I cannot reconcile double standards with the user fees some pay some do not, ALL should contribute and that would lower the user fee.

You have badly misunderstood the user charge issue and should perhaps get your facts right before mouthing off. In fact the 'founder members' as you incorrectly call them (no such status exists, they are silver or gold bond holders who simply invested earlier under different charging structures) get less benefits (holiday points) and have just been delivered a major kick in the teeth and been asked to add 36% of the cash value of their bond to maintain its value...for no extra benefit, as their non payment of user charge and annual management fees has eroded the value of the securities in the the Silver and Gold bond funds (all entrants since 2004 go into Diamond Fund) which have performed badly according to the managers.

If you choose not to cough up this cash by 30th June 2011 you lose no holiday benefits, but 2.8% per annum will be rolled up and deducted from the value of your Silver or Gold Bond should you encash. They are even suggesting that the Gold Fund may be wound up and Gold Bond holders will be kicked out with whatever is left of their fund, and effectively told to p*ss off.

I am a Gold Bond holder, though I started out in 1987 as one of the early Bond holders (called Silver now) who paid no user charge, and indeed took the risk of investing early in this new venture. This was a risk I fully understood both then and now.

Is the HPB going bust? I'm not sure, but parts of its financial structure are looking a bit shaky. I have to say I was a bit shocked to receive a letter giving me few options that do not involve forking out more cash at three weeks notice.

What worries me is that Exactly this story was trotted out when they asked us to convert from Silver (no user charge) to Gold (User charge) and assurances were given that this structure would work. We converted to Gold eventually. Then we are now told all over again the finances don't quite add up and we need to convert to Diamond. The difference is that previously there was a postive incentive to change, last weeks letter is effectively holding a gun to our heads demanding money.

I'd have to ask..how long before Diamond Bond holder get 'invited' to change to Osmium bondholders..or whatever.

I don't have vast amounts invested in HPB, so my absolute risk is low, but I'd still be very hacked off to lose it, as anybody would. I now have to decide whether to add more is just throwing good money after bad, or whether to cut my losses and let my existing bond last as long as it lasts and pick up whatever crumbs are left over (they will be crumbs I assure you).

As to whether its wise to invest in the HPB? I think I might have changed my mind. I am not allowed to advise others but If the returns on stock markets do not improve then the income derived from the Bonds securities portfolio may possibily not be robust enough to cover its outgoings. I'm not close enough to know, but as I said, last weeks bombshell letter to the longest standing bondholders has shaken my confidence in HPB somewhat.

Your other questions about flight costs and so forth go back to the questions..do you want cheap holidays? It seems you do, so don't bother wih HPB then, they are not supposed to be cheap..seemples.

Seronera

arsenalrick

Seronera wrote: »

You have badly misunderstood the user charge issue and should perhaps get your facts right before mouthing off. In fact the 'founder members' as you incorrectly call them (no such status exists, they are silver or gold bond holders who simply invested earlier under different charging structures) get less benefits (holiday points) and have just been delivered a major kick in the teeth and been asked to add 36% of the cash value of their bond to maintain its value...for no extra benefit, as their non payment of user charge and annual management fees has eroded the value of the securities in the the Silver and Gold bond funds (all entrants since 2004 go into Diamond Fund) which have performed badly according to the managers.

If you choose not to cough up this cash by 30th June 2011 you lose no holiday benefits, but 2.8% per annum will be rolled up and deducted from the value of your Silver or Gold Bond should you encash. They are even suggesting that the Gold Fund may be wound up and Gold Bond holders will be kicked out with whatever is left of their fund, and effectively told to p*ss off.

I am a Gold Bond holder, though I started out in 1987 as one of the early Bond holders (called Silver now) who paid no user charge, and indeed took the risk of investing early in this new venture. This was a risk I fully understood both then and now.

Is the HPB going bust? I'm not sure, but parts of its financial structure are looking a bit shaky. I have to say I was a bit shocked to receive a letter giving me few options that do not involve forking out more cash at three weeks notice.

What worries me is that Exactly this story was trotted out when they asked us to convert from Silver (no user charge) to Gold (User charge) and assurances were given that this structure would work. We converted to Gold eventually. Then we are now told all over again the finances don't quite add up and we need to convert to Diamond. The difference is that previously there was a postive incentive to change, last weeks letter is effectively holding a gun to our heads demanding money.

I'd have to ask..how long before Diamond Bond holder get 'invited' to change to Osmium bondholders..or whatever.

I don't have vast amounts invested in HPB, so my absolute risk is low, but I'd still be very hacked off to lose it, as anybody would. I now have to decide whether to add more is just throwing good money after bad, or whether to cut my losses and let my existing bond last as long as it lasts and pick up whatever crumbs are left over (they will be crumbs I assure you).

As to whether its wise to invest in the HPB? I think I might have changed my mind. I am not allowed to advise others but If the returns on stock markets do not improve then the income derived from the Bonds securities portfolio may possibily not be robust enough to cover its outgoings. I'm not close enough to know, but as I said, last weeks bombshell letter to the longest standing bondholders has shaken my confidence in HPB somewhat.

Your other questions about flight costs and so forth go back to the questions..do you want cheap holidays? It seems you do, so don't bother wih HPB then, they are not supposed to be cheap..seemples.

Seronera

I also think perhaps those who do NOT have a bond shouldn't really be dragging down what for me has been a great Holiday experience over the past 14 years. Yes, it is not the cheapest - but then again my family has met people at Bond properties who (i'll say it diplomatically lest I offend anyone here) are not trying to get the cheapest holiday and would rather holiday with people of similar ideals.......


Anyhow - as a Gold member I was also a little confused and a bit bewildered by the letter received. But from what I can gather on highlighted point 5 in the information bit is that the actual Holiday Entitlement of the Gold members will stay the same. It will not decrease or fade away completely. Its the fund and encashment amount if it is sold that will be affected. As I entered purely for the Holiday Entitlements, am happy with those and will continue to have them and have no intention nor need to encash then I see no issue at all from my point of view. As far as I read this, it affects if you are in this for investment. Those like me that were in this for the Holiday Entitlements and want those to continue don't need to worry from what I read into this.

Seronera

arsenalrick wrote: »

I also think perhaps those who do NOT have a bond shouldn't really be dragging down what for me has been a great Holiday experience over the past 14 years. Yes, it is not the cheapest - but then again my family has met people at Bond properties who (i'll say it diplomatically lest I offend anyone here) are not trying to get the cheapest holiday and would rather holiday with people of similar ideals.......


Anyhow - as a Gold member I was also a little confused and a bit bewildered by the letter received. But from what I can gather on highlighted point 5 in the information bit is that the actual Holiday Entitlement of the Gold members will stay the same. It will not decrease or fade away completely. Its the fund and encashment amount if it is sold that will be affected. As I entered purely for the Holiday Entitlements, am happy with those and will continue to have them and have no intention nor need to encash then I see no issue at all from my point of view. As far as I read this, it affects if you are in this for investment. Those like me that were in this for the Holiday Entitlements and want those to continue don't need to worry from what I read into this.

Well I admire you for your optimism, but to me the numbers don't add up. What happens if the investment content of your bond decreases still further? Don't forget 25% disappeared on the initial charge, then you have been paying 2.8% a year annual management charge..which is high, very high in fact (average fund management charge should be about 1.5%) bearing in mind that all running costs are supposed to come from user charges (non profit we are told) and the investment portfolio. Now they are saying to get back to par you need to inject 36% cash...so thats 61% shortfall on your initial investment.

If you are not concerned then I'd suggest you should be, particularly as this has been dumped on us as a fait accompli. Putting this another way they would only be making such statements if things are really bad and it has NEVER been suggested that the bond was this badly exposed previously.

The holiday points are a notional device, and whilst they are not being affected they have no real value. My personal take is that the bond investments have been milked too hard by the managers. This is OK if markets perform, but when markets are static or falling then 2.8% compounded kills the fund stone dead resulting in erosion of capital.

They now realise this, but have only DEFERRED their take, not reduced it. This is a time bomb.

Seronera