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Is DVC worth it?

Discussion in 'Disney Vacation Club' started by CrystalPalace, Oct 30, 2016.

  1. CrystalPalace

    CrystalPalace New Member

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    Hubby and I are considering a DVC investment. I've heard from some that we'll never get our money's worth out of it. Can everyone who is a member or has been in the past please give me your honest opinion? Give me the good, the bad and the ugly! Thanks.
     
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  2. DVC Mike

    DVC Mike Well-Known Member

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  3. ParentsOf4

    ParentsOf4 Well-Known Member

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    I have a reasonably sophisticated Excel file to calculate the cost/benefit of DVC so I can write with some confidence that DVC generally makes financial sense if the following three criteria are satisfied:
    1. You normally stay at Disney Deluxe Resorts.
    2. You intend to vacation at DVC Resorts for many years.
    3. You can afford the initial purchase price and annual Maintenance Fees (MF).
    The following article provides an excellent summary of the pros and cons of DVC ownership:

    http://www.mousesavers.com/dvc.html

    I highly recommend it for anyone considering a DVC purchase.

    DVC is not the least expensive option for visiting WDW. It is cheaper to stay offsite (offsite condos or home rentals offer the most space at the lowest price), at Disney Value Resorts, or Disney Moderate Resorts. These will nearly always be less expensive than DVC.

    Even for those who consistently stay at Deluxe Resorts, with Disney's current pricing and point structure, it will be at least 10 years (and probably longer) before you reach the breakeven point where a DVC purchased directly from Disney (vs. a DVC resale) becomes less expensive than just paying cash.

    Still, DVC does offer value under the right circumstances but these are limited.

    You always have more flexibility by not purchasing DVC. Disney will gladly rent you a room at any hotel at any time. With DVC, you commonly have to plan your vacations 7 months out, sometimes even 11 months. Sarasota Springs Resort (SSR) generally is available on short notice but most other DVC Resorts require planning well in advance. More than anything, this is the biggest difference between DVC and Disney hotels.

    Sales pitch aside, a DVC purchase is first-and-foremost a financial decision. Effectively you are buying vacations in bulk. As with most things purchased in bulk, the upfront cost is higher but you could save a lot of money if you use enough of the product. Think buying toilet paper in bulk. ;)

    Long-term, a DVC purchase will save you money if you stay at Deluxe Resorts. The question becomes: How long will it take before you start saving money?

    Doing some basic number crunching, without financing, a purchase at the Polynesian Villas & Bungalows (PVB) has a breakeven point of roughly 15-20 years. That means that for the next 15-20 years, you'll actually spend more by purchasing DVC than you would have if you just rented DVC points or rented Polynesian hotel rooms directly from Disney. That breakeven point gets pushed out further if you finance.

    These numbers are approximate and will change depending on assumptions. Do you visit when Disney typically offers hotel discounts? How much will Disney increase prices? How much could you have made if you invested that money instead of purchasing a DVC? There are many assumptions that need to be made to determine the value of a DVC purchase. Depending on how I massage these numbers, I can get the PVB breakeven point down to about 10 years or as high as 25 years without financing.

    Also consider that these breakeven points assume Deluxe Resort stays. If, for example, you are happy at a Disney Moderate or Value Resort, then you might never reach the breakeven point. DVC only makes financial sense if you are a "Deluxe Resort" person.

    Good luck with your decision!
     
  4. dreamfinder

    dreamfinder Well-Known Member

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    Long and short, you really need to run the numbers. We bough resale and were able to pay cash (before any of the rules changed) so I think we broke even in 5 years or so. As @ParentsOf4 pointed out, if you buy direct or finance it can take decades to break even. You need to be able to be in it for the long haul. Once you break even, you can realize significant savings. For instance, I can now do a week's vacation at a deluxe resort for less than $600 (cost of dues for the points needed when we typically travel).

    Can you handle being locked into trips to Disney, planned 7-11 months out, for the next 40 years or so? That's a long term deal, and how many people travel will change during that time.

    And keep in mind, short term availability is usually really tight. So you need to pay attention to use year when/if you purchase, to help minimze the chances of getting stuck with points you can't use if you need to cancel for some reason.

    We like it, but it works for us. My DW doesn't like staying at values, and we timed it right before the rules started changing on resale. I don't think buying direct is worth it under current costs, and even resale is a hard thing to sell me one right now if you need to finance the deal.
     
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  5. CrystalPalace

    CrystalPalace New Member Original Poster

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    what "rule changes" are you referring to?
    Yes, we are ok with planning 7-10 months out.
    Yes, we can afford the upfront cost
    Yes, we usually stay in a deluxe resort (contemporary usually)
    Yes, we plan to visit at least every other year for the next 40 years.
    So I guess the question would be is it better to buy resale or direct?
    Thanks for all the great input!!
    CC
     
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  6. lostpro9het

    lostpro9het Well-Known Member

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    https://www.resalesdvc.com/changes-to-dvc-resale-policy/

    Sounds like DVC is for you then!
     
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  7. ParentsOf4

    ParentsOf4 Well-Known Member

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    At the moment and with a little diligence, you could buy a resale at SSR or AKV for about half the price of PVB.

    You'll have to weigh the pros and cons to decide which is the best deal for you.
     
  8. dreamfinder

    dreamfinder Well-Known Member

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    Rule changes were really more a reduction in benefits for deeds bought via resale. @lostpro9het posted a link, but at this point it limits where you can trade out the points (can't use them for things like cruises) and precludes you from being eligible for discounts. Not a show stopper for most people as the trades were usually a bad use of points, but something to keep in mind. As of now if you have any direct contract, you are eligible for the discounts, so you could buy a smaller 25 point contract direct after you buy reale if they really were important to you.

    Resale vs direct is really up to you. Resale points should be less than buying direct, and @ParentsOf4 said, they could be about half the cost of buying direct. There is a chance that your purchase would be "voided" by DVD if they exercise ROFR, so it take you a few attempts to get it completed, or you simply may need to wait a while for the number of points/use year/resort you want come up for sale.
    You may have an easier time getting financing if you go direct, but would be paying alot more per point. DVD will sell you points at any resort, not just the ones they are currently advertising, but you may need to wait for them to obtain the points from the resale market via ROFR.

    If you don't care about the discounts/trade outs, and are happy possibly taking a while to get the points/resort/use year you want, then resale should be fine, and save you money. Direct may be faster, and might be easier to get financed, but will cost you alot more unfront, usually doubling your breakeven point.
     
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  9. BigRedDad

    BigRedDad Well-Known Member

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    Here is another method to calculate the cost. Remember, maintenance fees will always increase as well as the number of points to reserve a room. This makes it get more expensive over time.

    you need to determine the Future Value of the initial purchase price. Then add in the maintenance fees with Future Value factored in. That will show you the overall cost of a DVC resort. From there, you have to figure out what you may pay for staying on your future trips.

    Don't get me wrong. There are people that can afford DVC that get great value for it. For me and my financial situation, it is not an investment that is wise to make. I have a mortgage, college savings to cover, and a few other loans that need to be paid. I do no need to pay for someone else's mortgage.
     
  10. lostpro9het

    lostpro9het Well-Known Member

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    What do you mean here? Maybe I'm reading it wrong but are you implying that a weeknight room in October may run 14 points/night now but can run me 21 points in a few years? If this is what you are implying then you are kind of right. IF DVD decides to INCREASE the number of points for a room on a given night they must REDUCE the number of points for a given night elsewhere. So it wouldn't be a net increase, just a possible increase on some nights but a reduction on other nights. They simply cannot just increase the points across the board.
     
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  11. BigRedDad

    BigRedDad Well-Known Member

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    What I mean is when I did a tour for it once, they sales guy told me there was no guarantee the points would remain the same for the duration of the contract. Nor would he commit that the seasons would remain the same. This gives them the right to alter what they consider their "seasons". They could simply alter everything to Prime season.
     
  12. dreamfinder

    dreamfinder Well-Known Member

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    Nope. There is a set number of points for the resort. They can shift the allocation of points needed for a given night, but that shift needs to be offset.

    It's like you had a apple pie. You split it into 8 even pieces, everyone gets the same size piece. But if you decide that one person needs a bigger piece of pie, someone else has to get a smaller piece.

    Seasons can and may shift every year. Depending on when holidays fall, seasons may get moved by a day or two in one direction or another. But the dates get offset by corresponding shifts elsewhere.
     
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  13. ParentsOf4

    ParentsOf4 Well-Known Member

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    Throughout its 25 year history, there have been a handful of adjustments to the points per night. These are almost always driven by DVC members.

    In a recent example, DVC members were complaining that their "theme park view" room at Bay Lake Tower did not offer a good room of the Magic Kingdom. As a result, these rooms were reclassified as standard view, making them less expensive to book.

    However, since the total number of points at Bay Lake Tower cannot change, the points per night for rooms had to be adjusted since there were fewer "theme park view" rooms.

    There is nothing nefarious going on here. Disney reacted to address DVC member complaints.

    At Saratoga Springs Resort, all rooms used to require the same number of points per night. However, some buildings are in preferred locations and in higher demand. Beginning next year, these rooms will require more points while rooms at other SSR buildings will end up requiring fewer points per night.

    Disney simply responded to DVC member demand by redistributing points per night at SSR.

    Again though, the total number of points at SSR remains constant.
     
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  14. dreamfinder

    dreamfinder Well-Known Member

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    I think the biggest most impacting change was when they re-balanced to make weekends cost less, just since it hit every resort, and took a while to be completed. If I recall, Fri & Sat were seeing much lower occupancy than mid week nights, mostly due to the cost difference for those nights. So DVD took 2 years (there is a limit on how much costs can change in any given year) and reduced the cost for weekends, while increasing midweeks. Due to the fact that the total number of points needed to stay the same, not all time periods shifted evenly, and I think some of the seasons also changed a bit to handle that many point changes at once. Total week cost stayed fairly consistent, but if weekend went down 2 and weekdays went up 1, that would be a +1 (-2*2+1*5=1) weekly cost, so that 1 point needed to come out of some other time to keep the total point count the same.
     
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  15. Phonedave

    Phonedave Well-Known Member

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    I used to stay weekends a lot when I was single, and at the time my job had me in Tampa quite a bit.

    I had an AP, so if I got sent to Tampa for business say, on Wed and Thrus, I would extend the return flight to Sunday (which usually ended saving the company money) and then use DVC from Fri and Saturday, and have myself a mini-vacation for very little cost. The only problem was it was eating up points because I was staying on a LOT of weekends.But, on the other hand, there was usually a lot of last minute weekend availability because nobody was booking them before they did the rebalance.


    -dave
     
  16. TheGuyThatMakesSwords

    TheGuyThatMakesSwords Active Member

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  17. Bone Daddy

    Bone Daddy Member

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    Let me just tell ya, I just purchased some of my parents DVC because they thought they had accumulated way too many points to Old Key West and now that they are getting older they have decided to utilize there Vero Beach Points more. So we took the plunge into purchasing them off my parents and becoming members and it has been one of the best purchases I have ever made. With a 2 year old now she can enjoy the Magic way more often than we would have originally been able to vacation at WDW so right there it is worth seeing her smile and happy.
     
  18. Ralphlaw

    Ralphlaw Well-Known Member

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    Don't know if this deters or inspires, but this is an example of what just happened to us.
     
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  19. WWWD

    WWWD Well-Known Member

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    This story, will make me eat a night's worth of points and on-line check-in the night before so I can go straight to my room when we decide a sea and land trip. For sanity sake, the few extra hundred dollars on top of that kind of money will well be worth it to me.
     
  20. Ralphlaw

    Ralphlaw Well-Known Member

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    Good strategy.

    The problem is that a 1 room Boardwalk standard view villa over Christmas is 48 points. That's a bit rich to just kind of blow on a few daytime hours of comfort when I just spent big money to be on the Fantasy for that same night. Nevertheless, that is something to keep in mind. We only stayed one night, so we probably should have booked 2 nights in a studio for a total of 50 points, and been there immediately. For an extra 2 points, I could stand less room but more time in the day to nap up for New Year's eve. Of course, we never had a delay until 3:15 before.

    I will definitely keep that in mind next time.
     

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