DVC has changed the resell rules

DVCOwner

A Long Time DVC Member
Original Poster
DVC has just changed the resell rules on DVC points. I was planning on adding additional points this year, but now I am going to hold out to see if this is just the first of many rule changes to come. I have already written to DVC and would suggest all DVC members write to DVC and tell them what you think. Below is the letter I sent to DVC:

I was planning on buying an additional 100 points this year at Bay Lake Tower direct from DVC. I have 250 points in which I purchased 150 from DVC and 100 resell points. The new resell rules have changed my mind. I have always felt that if bad times hit my family (lost my job or illness in the family) and I could no longer afford DVC, I could resell my points. Now that DVC has made this first change in the rules, I feel that more are to come. I will not be looking to expand my points past what I now have. I have also recommended DVC to two friends that have purchased points directly from DVC. I will not be recommending to anyone to purchase into DVC until we find out if the rules will continue to change. If DVC kills the resell market than DVC is going to be the one that hurts in the long run.
 

Phonedave

Well-Known Member
This is the third thread I am posting this in, in this DVC sub-forum.

As for me, it is pretty much a non-issue. It might drive re-sale prices down or it might create a larger market for direct purchases, which would increase the amount of ROFR purchases, which would inflate the re-sale market.

I am suprised that DVC held out as long as it did. Differences between direct purchases and secondary market owned timeshares are not uncommon.

As it is, the re-sale market for DVC is strong, not because of the lack of a difference between direct buy and re-sell points, but because of the ROFR and the inherent value in the DVC product. If you would like, I can find your week long time shares in the Carribbean for $20. Seriously, $20 or less. Not for one week to rent. To own the weekly time share year over year over year. $20, and they are not selling. It's not because of the difference between re-sale and direct buy either (NOBODY Is buying direct buy at this place) but because people cannot afford the dues and cannot afford airfare, so they sell at a loss just to avoid the bills.

-dave




Copied right from the DVC website


New Policy Announced for Re-sale Purchases

Disney Vacation Club® has announced a new policy that limits access to certain Member Getaways exchanges for Ownership Interests purchased on the secondary market (also known as the re-sale market).

Under the new policy,Members who purchase from anyone other than Disney Vacation Development, Inc., on or after March 21, 2011, will not be eligible to use those Vacation Points to make reservations within the Concierge Collection, the Disney Collection or the Adventurer Collection. Those Vacation Points will instead be valid only for reservations at Disney Vacation Club resorts, as well as for RCI® exchanges, Club Cordial and Club Intrawest.

The affected collections are special Member benefits programs offered by Disney Vacation Development, Inc., and are not part of Members' Ownership Interests. That said, Members who purchased on the secondary market prior to March 21, 2011, may use those Vacation Points for all Member Getaways.

Note that the policy doesn't impact banking, borrowing or transferring Vacation Points. All Members will continue to have the ability make such transactions, regardless of where they purchased their Ownership Interests. Complete rules about these transactions are available in the Home Resort Rules and Regulations section of this website.


And some additional info.

Concierge Collection is Mandarin Oriental - Washington DC. Resort at Squaw Creek - Lake Tahoe, Royal Garden - London, The Sagamore - Lake George, Topnotch - Stowe, and The Whitehall - Chicago.

The Disney Collection are Disney Properties other than DVC (WDW resorts, California, Paris, and Tokyo)

Adventurer Collection are the Adventures by Disney vacation packages.
 

216bruce

Well-Known Member
Wow! Glad I bought from resale when I did. A couple of thoughts: 1) This creates a "second class citizen" if you buy resale after the magic date and 2) You'll see a lot of folks move quickly on buying resale before the deadline.
Yeah, I know it's not a huge deal for most DVC prospective buyers, but you are getting less options. Kinda stinks, actually.
 

Disneykidder

Well-Known Member
We have been watching the DVC resale market for a while now. We love Disney but also loved the option to be able to use our points at different excersions around the country and the world. We were planning on using it in the future (when the little ones were older) on Adventures by Disney and a Disney cruise and even in other countries.

This new change now limits our options to only Disney World/land DVC resorts. I must say that I am very disapointed and will probabloy not be purchasing anymore. I cannot afford the $20,000 through Disney to allow the extra perks that will now accompany by purchasing direct. Yes, as was stated above, this will now make people who purchase on the ressale market feel like they really aren't apart of the DVC Club and will now be limited. This is really making me angry.:mad:
 

Phonedave

Well-Known Member
We have been watching the DVC resale market for a while now. We love Disney but also loved the option to be able to use our points at different excersions around the country and the world. We were planning on using it in the future (when the little ones were older) on Adventures by Disney and a Disney cruise and even in other countries.

This new change now limits our options to only Disney World/land DVC resorts. I must say that I am very disapointed and will probabloy not be purchasing anymore. I cannot afford the $20,000 through Disney to allow the extra perks that will now accompany by purchasing direct. Yes, as was stated above, this will now make people who purchase on the ressale market feel like they really aren't apart of the DVC Club and will now be limited. This is really making me angry.:mad:


People grandfathered in are not effected.

People buying after the date can still trade their points into RCI. They just cannot use their points for a non-timeshare property.

The 'other' Disney properties, DLC, and ABD are not time share properties. No matter what time share you own (aside from DVC) you cannot book them.

You can still use it in other countries, or other properties, just only ones through RCI.

As I said before, since there is such a demand for rental DVC points out there, if there was some year you really wanted to take a cruise, or stay at the Poly, or take an ABD trip, you can with minimal effort rent your points out for $10 a point through a broker - thats after commissions. And the people doing the renting are all looking to stay at DVC properties. Nobody is looking to rent points to go on a cruise.

-dave
 

DVCOwner

A Long Time DVC Member
Original Poster
Several have stated that those of us that already own points purchased on the resell market are not effected...All I have to say is that I have lost trust in DVC and who knows what the next step is. I have defended DVC before, but now I think they are going to do what every they can to sell inventory they have and are building. Next it will be additional benfits only for those that purchase new. I believe they will continue to cut benifits for those that own points now (no matter where they are purchased) and offer better benfits at new properties or lower the price on new points with the savings.

DVC has changed me from a big supporter to a wait and see what happens in the next few years.
 

celticfan

Member
My guess is that the new policy will cause a temporary increase in the cost of resale points, as people try to get them before the March 20th date. Once that date passes I would imagine that the cost per point will go down.

At what point does DVC start exercising it ROFR and buying the points back? How low will they let the per point cost go? They have seemed reluctant to do that of late because I would imagine it puts a strain on cash flow for them.

If people are looking to buy points after the March date, and only want to use them at DVC properties, then they may be able to purchase resale points at an even lower price than they can today.

Should be interesting to see how everything shakes out over the next few months!!!!!!
 

tjkraz

Active Member
I believe they will continue to cut benifits for those that own points now (no matter where they are purchased) and offer better benfits at new properties or lower the price on new points with the savings.

I sort of doubt that only because evergreen benefit programs can be expensive to maintain.

In order to attract new business, better to just offer incentives as they have always done (free AP vouchers, free cruises, $500 gift cards, etc.)
 

tjkraz

Active Member
If DVC kills the resell market than DVC is going to be the one that hurts in the long run.

I'd like to think that is true but history has shown that it isn't.

Disappointing though this may be, Disney is just following the lead of most other timeshare developers. Most others have different perks/rules for direct and resale buyers and most are more dramatic than what DVC announced.

You can go to eBay now and buy Wyndham points for pennies. Not pennies on the dollar....pennies. And yet direct sales are still a profit center. Most of that can be attributed to uninformed consumers but companies have been known to thrive on the uninformed.

I really don't know what other choice Disney had. I doubt they have the resources to use ROFR to prop-up values in any meaningful manner. Particularly not when they are sitting on MILLIONS of unsold points. Remember Disney got burned by the recession as much as the rest of us. They didn't expect to still be selling SSR and AKV points in 2011.

There isn't a whole lot of ROFR going on right now and resale values have still found their own levels. And those levels are much higher than many other timeshares.

I can understand the ire, but going into something like a timeshare with future value expectations usually leads to disappointment. I don't think this will be the death of DVC. Frankly, they would have been in a much worse position if they continued to allow resale prices to undercut direct with no differentiation.
 

Phonedave

Well-Known Member
I'd like to think that is true but history has shown that it isn't.

Disappointing though this may be, Disney is just following the lead of most other timeshare developers. Most others have different perks/rules for direct and resale buyers and most are more dramatic than what DVC announced.

You can go to eBay now and buy Wyndham points for pennies. Not pennies on the dollar....pennies. And yet direct sales are still a profit center. Most of that can be attributed to uninformed consumers but companies have been known to thrive on the uninformed.

I really don't know what other choice Disney had. I doubt they have the resources to use ROFR to prop-up values in any meaningful manner. Particularly not when they are sitting on MILLIONS of unsold points. Remember Disney got burned by the recession as much as the rest of us. They didn't expect to still be selling SSR and AKV points in 2011.

There isn't a whole lot of ROFR going on right now and resale values have still found their own levels. And those levels are much higher than many other timeshares.

I can understand the ire, but going into something like a timeshare with future value expectations usually leads to disappointment. I don't think this will be the death of DVC. Frankly, they would have been in a much worse position if they continued to allow resale prices to undercut direct with no differentiation.

Not just Wyndham. I have friends who own two weeks at a resort in the Caymans. You cannot GIVE those weeks away. Seriously, you can get them on eBay for closing costs. Not one weeks rental - the whole timshare ownership. Yet, as with Wyndam, you can still buy them direct for a couple of grand. The uniformed are what keeps it going.

This really does not bother me. I don't see it impacting re-sale prices that much. I don't plan on selling my DVC ownership. I was kicking around the idea of adding on via the re-sale market, and I still may - these restrictions really don't bother me.

-dave
 

Pioneer Hall

Well-Known Member
This particular change does not bother me, since there isn't nearly as good of a value in trading your points for non-dvc properties. I am more concerned that this might not be the only change they may implement on resale points somewhere down the road. Although, I feel that with a distinct grandfather date being established other changes may be difficult to make.
 

slappy magoo

Well-Known Member
I don't know how off-topic this will be, it could be somewhat germane to the topic...when it comes to using your points in a Concierge Collection, or Adventures by Disney, or anything else Disney that isn't a DVC resort, where do the points go? I thought, for example, that if you used your DVC points to book a cruise, then those points for that use year wold be used by Disney to rent out a room in your home resort, on top of the small percentage of points they retain in each home resort.

if so, that could be one of the reasons for the change. Swapping with RCI just means another family, who otherwise might not have gone to WDW or to a DVC resort that year, is going in your place, still spending money on park tickets or meals or other Disney merch. But in the other scenarios (except for the Concierge Collection) there's not much profit involved, and if you bought resale, they never made that initial profit off of you, so limiting your incentives insures they make more money off of the resale purchaser in the long run.
 

Phonedave

Well-Known Member
I don't know how off-topic this will be, it could be somewhat germane to the topic...when it comes to using your points in a Concierge Collection, or Adventures by Disney, or anything else Disney that isn't a DVC resort, where do the points go? I thought, for example, that if you used your DVC points to book a cruise, then those points for that use year wold be used by Disney to rent out a room in your home resort, on top of the small percentage of points they retain in each home resort.

if so, that could be one of the reasons for the change. Swapping with RCI just means another family, who otherwise might not have gone to WDW or to a DVC resort that year, is going in your place, still spending money on park tickets or meals or other Disney merch. But in the other scenarios (except for the Concierge Collection) there's not much profit involved, and if you bought resale, they never made that initial profit off of you, so limiting your incentives insures they make more money off of the resale purchaser in the long run.


But if those points you used for a cruise went to the cash room pool, wouldn'd Disney be making money off whoever rented that room and came to WDW.

It really is just a way for them to incent people to buy from DVC. Once a robust secondary market for a resort develops, there is little reason to buy points from DVC for that resort. They have to provide some sort of incentive to pay the higher price. They do this in a number of ways.

1) Ease of transaction and financing.
2) Ability to buy exactly how many points you want (taking into account minimums)
3) Incentive programs (cash back, developer points, free passes, etc)

In my opinion, that was not enought incentive to get people to buy direct. Towards the end of selling off a resort, sales must really slow down.

This new rule is just another incentive to get people to buy direct.

Quite honestly, it was a smart move on the part of the DVC. The can tout it as a perk, it was easy to impliment, it was something that was never guarenteed (to ANYONE, they could eliminate this program for ALL of us at any time), and it is fairly painless to most people.

I will say this though. I went on my first Disney cruise on points. I know, I rail against wasting your points in this way. Well, when I bought in, I got developers points as a bonus. I had planned to get a 2BR for a week or more and invite friends and family down. The problem was nobody could go - finances, vacation time, other plans, all those excuses. So I had to use these points up before they expired, so my kids and I went on a 3 day cruise. That is what got us hooked. We are now set for cruise #3 this July. We have been cruising every other summer, and they have been getting longer each cruise. Disney really sucked me with that first cruise. If I had not been able to use my points for a cruise, they might have lost out on all the future cruising revenue.

-dave
 

ddbowdoin

Well-Known Member
well... I guess this is not THAT bad. From what I have read it really doesn't affect normal park going DVC members. I couldnt afford points for the other destinations, even in the resale.
 

Jo DeVil

Well-Known Member
This may be alittle off point, are DVC limiting sales to 160 points or more? We only need 123 for BLT, one week each year which we woulduse every 2 years and have a fortnight at the world, If we have to buy 160 from DVC we are going to have to wait until the piggy bank gets fuller and we will have points we are paying dues on and not able to use??
 

slappy magoo

Well-Known Member
This may be alittle off point, are DVC limiting sales to 160 points or more? We only need 123 for BLT, one week each year which we woulduse every 2 years and have a fortnight at the world, If we have to buy 160 from DVC we are going to have to wait until the piggy bank gets fuller and we will have points we are paying dues on and not able to use??

When you buy from DVC, there is a 160-point minimum for your initial buy-in. There is no minimum if you buy resale. So for example, you could buy 100 points from one person and 25 from another, if those kinds of contracts become available to you.

Bear in mind DVC reserves the right to shift around the point values of rooms here and there. They can't raise points across the board for every single day, but they can make certain times of the year cost a few points more, then take away the same point values somewhere else. Or shift the difference between Sun-Thur point values and Fri-Sat point values. This is all my way of suggesting you consider buying at least a few points more than you think you'll need as of the time you purchase. We currently have enough points to have 2 8-night trips in a 1BR at our home resort, 2 out of each 3 year periods, with a few points to bank or borrow just in case.
 

slappy magoo

Well-Known Member
But if those points you used for a cruise went to the cash room pool, wouldn'd Disney be making money off whoever rented that room and came to WDW.

I'm sure they make money, but I wonder how much. Here's my suspicion, and again, what do I know? I think that a lot of those very special promotions they run ("stay in a deluxe resort of only $149 a night") are based on using those points. And they consider them loss-leaders in an attempt to get people who normally stay in values or mods to get a taste of DVC. So they make money, but I suspect it's not as profitable as a trade with RCI.
 
We just joined this summer. Although we did end up buying in at 200 points, one of the reasons we agreed to go to the sales pitch was because they lowered the buy-in (truthfully we didn't know if it was in the budget before running the numbers). The buy in has been lowered...I believe to 100 points. You can still buy add on contracts directly with as few as 25 points.
 

toolsnspools

Well-Known Member
It seems that using DVC points on Disney resorts would be a win for them. It's one of the least desireable ways to use DVC points based on the $ value per point formula. It's also keeping customers at Disney, which helps in the overall product sales category. I guess you could argue that pushing resale contract trades out to RCI would bring new faces to DVC resorts, and add exposure to the "Best Kept Secret", but that's a weak argument. Shifting empty rooms from Disney Resorts, and DCL to DVC just keeps empty rooms in their overall system; accounting-wise keeping resale contracts in DVC would help DVC show higher occupancy rates than Disney Resorts, or DCL, but in the end, even that is a wash.

The only time I see this effecting me is that as a DVC owner, because I now know about this little rule, if I want to add on points, I'm going to think twice before buying a resale contract instead of a direct sale. There are a lot of DVC owners who spend their points on DCL ships and or Adventures by Disney. (I'll be taking my first points cruise in Apr, and no I don't need the lecture about how I should have rented the points. :animwink:) If I like cruising, and feel like picking up a few hundred more points so I can do it every year, I'll now have to go direct to DVC to get the extra points. The DVC resale market is also much better known to me as an owner than it was prior to buying my first points. I'm sure many of you have added on through re-sale vs. direct sale contracts. IMO - DVC is specifically trying to shift current DVC owners from resale market add-ons, back to direct sale add-ons.
 

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