DVC question

[canada1414]

Hi everyone. We have been pondering the idea about joining the DVC. We were just curious as to how much the start up costs are? We've been saying for a few years we would like to do it but want to know some more info.
Thanks for all your input.

 

[brkgnews]

Startup costs are typically 10% of your total financed amount + closing costs of roughly $300.

Financed amount depends on which resort you chose as home base, how many points you buy, how long you finance, and any discounts you might be eligible for. You might roughly consider $104 per point, but that's way subject to change.

Are you familiar with the basics of DVC, or is all of that greek to you?

 

[canada1414]

I'm familar with some of the basics...not to sure how the points work- do you renew each year for more points? ect. Just not to sure. Is it worth it to be a part of the DVC? We usually go once a year.

 

[DisneyPhD]

Hi there neighbor, I'm just across the river on the north side of Detroit.
Here's a very abbreviated rundown. You purchase a set number of points that gets renewed each year until 2057(if at Animal Kingdom). The minimum from Disney is 160pts @ $104 per point (less with incentives). So that's $16,000 one time payment. Each year you get the same number of points to use to book rooms at the DVC resorts. Studios (most equivalent to regular hotel rooms) are about 100-130 points per week depending on time of year and resort. The recurring cost is the annual dues which are about $4-5 per point each year. They tend to increase at a 3 to 4% rate each year.

In general, if you go for a week or more each year and stay in moderate or deluxe resorts, you will eventually come out ahead. Off-site or value resorts you won't see much if any savings.

We've been DVC members for 6 years and are now at the "break even" point. That means the amount we've paid to DVC (initial purchase + dues) is equal to what we would have paid had we been staying at Deluxe resorts on cash for the last six years. Now we just pay our dues which is about $800 for 170 points at VWL and can stay for about 12-14 nights or about $60-70 per night at any of the DVC resorts.
Yikes, that's the abbreviated version, I hate to see the long version.

 

[brkgnews]

Just to make sure its absolutely clear since it can be confusing.

You only "buy" the points (at the ~ $104 rate) ONCE. Then you pay a yearly per-point maintenancce fee that is MUCH less than the original purchase price... to the tune of about four or five bucks per point.

Easiest way to consider it... you buy your car for a five-digit price. Then you put gas in it (which, for the moment at least, is cheaper than an entire new car) every so often in order to keep using it. It may take you several years to pay off your car, but you come out much better in the long run if you buy the car once and refill it with gas, rather than buying a new car every time your tank reaches empty. :hammer:

 

[Pippa]

Thats a pretty good way of looking at it!
I was always staying at Moderates and realised if we joined DVC, yes it is a big outlay to start with, but we then get to stay in Deluxe resorts for 50years!!!!
So glad we joined, we go every year so we know we'll get our moneys worth in the long run.

 

[Craig & Lisa]

My wife and I joined in 03, and we figured that since then staying at deluxe resorts we have saved at least 10,000. Now some may say that's impossible, well this past July we stayed at SSR in a one bedroom, out of pocket it would have cost over 400 a night for the 7 nights we were there. Now even if we stayed in WDW only once a year, which we haven't we will have spent over that amount already. Being in DVC may seem like a no brainer for some and for others too much, and as said on these forums so many times, it's not for everybody.

 

[MaxsDad]

Canada,

To give you an idea, here's how it went down for us. We got 170 pts. at AKV last year. There was a discount ($8 per point?) at the time that put the cost for 170 equal to what 160 would have been at full price, approx 17,000 USD including closing cost. We paid 10% down plus closing, all told it was between 1700 and 2000 USD. We financed the rest at the preferred rate. Our monthly loan payment (198 USD) plus our membership dues total about 265 USD.

Hope this helps in some way. We stayed for six nights in a two bedroom suite overlooking the Savannah last August. It was awesome! It took us about a year and a half of our points, but we got to take another family with us, so some of our cost was paid back to us by them.

 

[Main Street USA]

In my opinion, the general rule of "if you have to finance it, then it's really not the best idea for you" is the best way to look at it. As Max's Dad said above, his monthly payment is around $265. That's about $3180 per year. I don't know about anyone else, but I think that's a LOT to pay for ONLY your hotel for a year.

Again, though, all of this is just my take, and no one else's. Obviously, Max's Dad above decided it was right for them. So, there ya have it.

The bottom line is that it's a completely different decision for everyone, and you really need to do the research based on your unique situation.

 

[Cubs Brian]

In my opinion, the general rule of "if you have to finance it, then it's really not the best idea for you" is the best way to look at it. As Max's Dad said above, his monthly payment is around $265. That's about $3180 per year. I don't know about anyone else, but I think that's a LOT to pay for ONLY your hotel for a year.

Again, though, all of this is just my take, and no one else's. Obviously, Max's Dad above decided it was right for them. So, there ya have it.

The bottom line is that it's a completely different decision for everyone, and you really need to do the research based on your unique situation.

You could look at it like that, but then you have to rememberthat its 3180.00 ayear for 10 yrs. Then after that it's only about 275.00 a year for 40 years. So if you average it out over 50 yrs, it's under 900.00 per year, app. the cost of a moderate resort for a week in the off season at todays rate. And those rates go up about 7% a year. IMHO it's a pretty good buy!

 

[scorp111]

You could look at it like that, but then you have to rememberthat its 3180.00 ayear for 10 yrs. Then after that it's only about 275.00 a year for 40 years. So if you average it out over 50 yrs, it's under 900.00 per year, app. the cost of a moderate resort for a week in the off season at todays rate. And those rates go up about 7% a year. IMHO it's a pretty good buy!

The maintenance fees mentioned would actually be just over $800 per year at the current cost ($67 x 12). The maintenance fees do increase as well, but obviously not at the same rate as rooms.

We paid for our points completely up front, and now just pay the maintenance fees which for us run around $1200 per year currently.

 

[DisneyPirate85]

We just bought in, Buying from The Time Share Store, And after we have went 4 times it JUST MAKES SENSE! We started out at $1800(July 2005) a year w/o DDP and last July decided for me for sure,for the 4 of us DW and 2 DD was almost $3900, w/ DDP and we stayed at Pop! Now we get Deluxe Resort. Its not getting cheaper to go to Disney,:wave:so was kinda a no Brainer. We need our Vacations just to get away for awhile and with the deal we got was an easy decision.:sohappy:

 

[MaxsDad]

In my opinion, the general rule of "if you have to finance it, then it's really not the best idea for you" is the best way to look at it. As Max's Dad said above, his monthly payment is around $265. That's about $3180 per year. I don't know about anyone else, but I think that's a LOT to pay for ONLY your hotel for a year.

Again, though, all of this is just my take, and no one else's. Obviously, Max's Dad above decided it was right for them. So, there ya have it.

The bottom line is that it's a completely different decision for everyone, and you really need to do the research based on your unique situation.

$3100?!? Wow, I never thought of it like that in those terms. That sounds like a lot! I agree with you Main St., to some extent. It is much better to forgo the interest on the loan if you can. Research is needed, and some folks it will benefit, others not so much. As was already pointed out, that 3100 figure is only temporary (10 yrs max, vs. a 50 yr ownership) though. $800 in today's money will be the payments for the other 40 yrs. I am a bit of a Math Geek, so lets see what I actually paid, and actually got, for my first two "use years".

I paid about 1700 down, and my payments started in about July '07, but my Use Year started March 2007. Lets look at the first two years of payments(thru Feb 28 , 2009). That's 8 months from 6/07 thru 02/08 and of course 12 from 3/08 thru 02/09. 20months*$265+$1700=$7000. What accommodations was I able to book during that time period?

A 2 BR Savannah View Lock-Off Villa at AKV for 6 nights in August. Per mousesavers, that would be a rack rate of about $900 per night, plus tax. That comes out to be $6075.

I (hopefully) will also be able to book 5 nights in a Kilimanjaro Concierge Club Level Studio in December. Mousesavers again list a regular AKL room rate of $445 per night, plus 25 per extra adult (I've two), plus tax. That's $2784.

Grand total $8859. Some folks say the break even point is at 6 or 7 years, but I like it already. I will really like it when those loan payments are gone.

I must admit, your post Main St. had me going "What was I thinking??" Then I tried to remember just what that was. It was the spring of 2007, and I knew I was going to go to WDW in August. I was hoping for free dining, but my dates just missed it. I was about to book a room and a half(splitting three rooms w/ another family) at Pop for a week. There goes $900+ down the drain. Then I found out that instead of having a large tax bill due 4/15, I got a decent refund instead, more than enough for the down payment. Then I changed phone service carriers at my business, BAM! $300 rebate. That's the closing cost, taken care of. Plus a lower monthly bill to offset those membership fees. I started looking at other ways to make up those fees in my monthly bills. 5 here, ten there. It began to look like the way to go.

It is a very similar situation to the age old issue of renting an apartment or buying a house. I am building equity. Eventually, I will own it free and clear. Yes, I will have to maintain it, just like a home. But those renters have to pay that landlord like clockwork everyday for something they never own, or build any equity in. Many will say I don't own it, its a lease. But I do own the lease (a 50 year lease)and the rights therein, which are transferable and redeemable for wonderful vacations and magical memories. I will be long dead by the time that lease runs out, but my kids are enjoying it, they will enjoy it, my eventual grandchildren will be able to enjoy it, and it is very likely my great grand kids will too, for a short while. Do you know anybody who vacations at their great grandfather's house not named Vanderbilt?