If you are a destination club prospect, you might have already seen something like the chart below, provided to you by one of the clubs you are considering – a simple discounted cash flow analysis of membership in a typical club compared to second home ownership.

Many of the assumptions are conservative – recent luxury vacation home appreciation has probably been in the 15-25% range over the last two years, not 7%. But 7% compounded over 10 years might end up being realistic, even in this era.

The net is that it’s probably too close to call – maybe even slightly positive to join a destination club vs. owning a vacation home, in terms of cash flow. Of course, that’s just the start of the analysis, but we do think that times have changed. It feels like it used to be a dream to be able to pass down a vacation home to your kids, but for some kids now, they just might prefer the club membership!

If you want to play with this model using your own assumptions, email us and we will send you an Excel version. Write us at info@halogenguides.com and take a minute to tell us if you are considering a destination club, and if so, which ones.