DVC: what am I missing?

[bugsbunny]

I was going to purchase 220 points at Vero Beach in 2001 for a mere $10k at the time. I backed out at the last minute and had got my deposit back. I've wondered after 10 years if that was the right decision.

Just for giggles, I checked the other day and saw "annual dues" were up to almost $7/point. A 50% increase since 2001!!! Good Lord! I would have been paying almost $1500 a YEAR just for "dues" on top of my principal payments for the DVC membership itself. Having seen that Bay Lake is up to $150/point to own, 220 points there would cost me $33,000 to purchase ownership. Then tack on about $800/year in fees. Wow!

Looking at the charts, it would seem that the older the DVC, the higher the yearly fees. So any cost savings in buying somewhere "old" like Old Key West is quickly cancelled out by twice as high fees from something like Bay Lake or Saratoga. I read that OKW is selling from $75-100 point these days. Dues for OKW are listed at $4.98/point, VB $6.78/point, and basically any other Villas for more than $5/point.

Looking at the overall economy and the flood of cheap real estate, especially in Florida, I can't for the life of me see any value in purchasing a DVC. I can rent a house for more than a week at WDW for equal or less than the cost of annual dues at any DVC.

People have told me that you can make your money back by getting other people to stay with you and charging them. But I would think I'm buying it for ME and not to have calculated financial transactions funding my vacation.

This isn't a bash, just confused. I was wondering what other people's opinions are.

 

[DisneyJoe]

Principle payments - it's better when you can pay it off FAST - then you only have the yearly dues.

How many nights could you stay DVC for 220 points? ($1500/year?) Compare that against the nightly rack rate cost of the same resort.

As soon as you start comparing against off-site or house rentals you leave the DVC demographic.

 

[bugsbunny]

Principle payments - it's better when you can pay it off FAST - then you only have the yearly dues.

How many nights could you stay DVC for 220 points? ($1500/year?) Compare that against the nightly rack rate cost of the same resort.

As soon as you start comparing against off-site or house rentals you leave the DVC demographic.

I concur with the $1500 vs. nightly rack rates. That would be if I wasn't already paying for a DVC membership from $15-$30K. So its like I'm paying thousands for a membership so my dues are a break even cost against rack rates? That's how I'm looking at it and I feel like I'm losing money if I purchase a membership.

As far as staying off property, this trip in October will be my first time renting a house through allstarvacationhomes.com. While I am going to miss Disney ambiance, the "price vs.value" is just enormous compared to WDW rack rates. However, I will reserve judgment until after my rental is done. The reviews and pics from allears say its great, but I will have to see how it goes.

Instead of that DVC membership back in 2001, I bought an inground pool instead. Either way, it seems I have a hole in the ground that I throw money into every year! :ROFLOL:

 

[DisneyJoe]

So its like I'm paying thousands for a membership so my dues are a break even cost against rack rates? That's how I'm looking at it and I feel like I'm losing money if I purchase a membership.

If you do the math over the life of the membership in comparison with the same rack rate room, including your large purchase and your yearly dues, DVC members get roughly a 60%-75% discount.

Most will tell you that you should already be staying consistently at Disney Deluxe resorts for a week or more each and every year to be the proper member for DVC.

If you only spend $800-$1500 a year on your Disney vacation, then DVC wasn't meant for you anyway.

 

[Pioneer Hall]

Joe has it spot on, the moment you start to look at offsite accommodations you are no longer really in that target for DVC. There is no question that staying offsite in a rental house will be significantly cheaper than anything a DVC resort can offer you, or even one of Disney's less expensive resorts. However, DVC was designed for people who regularly stay at deluxe level resorts and want to continue to do that. It's a complete matter of preference, but if that is something you want to keep doing then DVC becomes a very good value especially if you aren't financing the initial cost. I purchased 200 points last year at AKV on the resale market for 76 a point and didn't finance. I pay about 1000 a year in dues now, and of course I do know that will go up, but it seems less so than the rates on the rooms. I have compiled a spreadsheet that compares what my "cost" in points is for my stays vs the best possible discount I can get at that time for the same room. After my trips this fall my savings since purchase will be close to $4,000. Granted this factors in that I will keep my points for the extent of the contract, but at the moment that is my plan.

As a note, Vero's dues went up sharply a few years ago when the area was hit hard by hurricanes. They had to close the resort for a while and do major work, which of course gets passed down to the members.

 

[goodanu]

DVC is a luxury, like owning an expensive sports car. That car will get you to the same place as the cheap beat box but you will be more comfortable and feel better in the fancy sports car. We bought knowing we may be paying more for a luxury we could do without, we could stay at all star, but we feel when we vacation we deserve it, even if it costs us a little more in the short term. But in the long term we know we will save money and we will enjoy every minute of it. Enjoy your rented house, but if you are a true fan of WDW it will not be the same. You will feel like an outsider. We stayed off property this spring and hated it, we bought our DVC on that trip. It turned out to be our favorite trip to date knowing we will never stay off property again.

And maybe we will get to Hawaii.

 

[tjkraz]

I can rent a house for more than a week at WDW for equal or less than the cost of annual dues at any DVC.

Of course off site is cheaper. Always has been and always will be. If you're comfortable with that sort of experience, go for it. But DVC is a sound way of staying on-site for lower rates.

I concur with the $1500 vs. nightly rack rates. That would be if I wasn't already paying for a DVC membership from $15-$30K. So its like I'm paying thousands for a membership so my dues are a break even cost against rack rates?

The 220 points you cited will get you as much as 2 weeks in a Studio villa. Even if we assume a discounted rate of $300 per night including tax--which is pretty reasonable for a Deluxe resort room--you're getting over $4000 worth of accommodations for the $1500 in dues. I'd say that's dramatically better than "break even."

General rule of thumb is that it takes 7-8 years to break even on the initial purchase, but then you're left with another 30-40 years of accommodations for pennies on the dollar.

 

[flynnibus]

General rule of thumb is that it takes 7-8 years to break even on the initial purchase, but then you're left with another 30-40 years of accommodations for pennies on the dollar.

And assuming you vacation at disney EVERY year for 2 weeks a year and plan on doing so for so long in the future.

I get that your dues will be cheaper then buying the hotel room - but that's if you are such a consistent visitor.

Getting DVC into DLR and Hawaii helps the story a good bit I think because of the variety of destinations increases so much.. but I could never see myself dumping that much money into ONE vacation type for the next 2 decades or more.

I mean if your kids are 8 now.. do you really think you are going to take them every year when they are in their 20s? Plus add in the cost of an AP each year per person to actually pay for the park tickets, etc too.

I'm just amazed so many people visit Disney that religiously or think they will.

 

[Pioneer Hall]

And assuming you vacation at disney EVERY year for 2 weeks a year and plan on doing so for so long in the future.

I get that your dues will be cheaper then buying the hotel room - but that's if you are such a consistent visitor.

Getting DVC into DLR and Hawaii helps the story a good bit I think because of the variety of destinations increases so much.. but I could never see myself dumping that much money into ONE vacation type for the next 2 decades or more.

I mean if your kids are 8 now.. do you really think you are going to take them every year when they are in their 20s? Plus add in the cost of an AP each year per person to actually pay for the park tickets, etc too.

I'm just amazed so many people visit Disney that religiously or think they will.

The good thing though is that i can rent my points if i don't want to or can't afford to go. This works best if your initial buy in is completely paid off so you don't have much to cover. If I wanted to go to Europe instead of WDW this year I could easily rent my points for a minimum of $10 a pt. That would cover my dues and give me $1000 to put towards my trip.

 

[becanya]

It's actually a very easy calculation. We bought enough points for 1 wk every year for the next 32 years. I added up the buy in price, plus my dues for 32 years. I compared this total amount to the price I would pay for 1 week for 32 years at a 40% off discount at the very same resort (the best I have ever gotten at Disney on a room). The difference for those 32 years was $54,000. For us, there was no comparison. We love our resort and wouldn't consider staying elsewhere if we had our first choice.

Yes, the cost of the dues will increase with inflation. But so will the rack rate on your room. If you are staying at Disney on property at a "favorite" resort, there is absolutely no comparison. I don't even consider this a luxury good. The vacations at Disney are a luxury good...DVC is just smart. If you are going to spend the money on a trip to disney every year and stay on resort, DVC is the way to go in my opinion.:wave:

 

[becanya]

And assuming you vacation at disney EVERY year for 2 weeks a year and plan on doing so for so long in the future.

I get that your dues will be cheaper then buying the hotel room - but that's if you are such a consistent visitor.

Getting DVC into DLR and Hawaii helps the story a good bit I think because of the variety of destinations increases so much.. but I could never see myself dumping that much money into ONE vacation type for the next 2 decades or more.

I mean if your kids are 8 now.. do you really think you are going to take them every year when they are in their 20s? Plus add in the cost of an AP each year per person to actually pay for the park tickets, etc too.

I'm just amazed so many people visit Disney that religiously or think they will.

I can appreciate your perspective, which is why DVC probably isn't a great idea for you. Yes, we do anticipate visiting Disney every year for a while. Once our kids get old enough that they don't want to go every year, if that ever happens, we will go by ourselves, since we are just as obsessed as our kids. We will take our nieces and nephews, who can't afford to go on their own. We will take our grandkids. We will skip a year and go on a cruise.

The AP is actually a huge savings for us over what we would normally pay for park tickets by paying by the day. We are taking 3 trips in the 365 day period; two 9-day trips and one 6-day trip. We are saving a ton of money on park tickets. Most people who feel like you do, which is completely valid, feel that way in general about Disney vacations. In fact, most people I know feel that way about Disney vacations. DVC is for people who value Disney vacations more than average.

 

[fivetexans]

I've been a DVC member for a couple years now at Kidani. The thing is, if you are trying to justify things financially, especially as an investment, making money by renting points, breaking even, etc., then you are never, never going to make any time share, let alone a Disney time share make sense.

We did DVC for several reasons:

1) We like staying on the Disney property and like the DVC resorts better. We like the 2-bedroom vacation homes and everything about them that a regular resort on the property simply cannot offer. From a financial standpoint, a suite the size of a 2-bedroom vacation home would be not be affordable if it wasn't for the points.

2) We like the flexibility with our points. So far we have done 4 vacations in 2 years and like how the whole system works. They have all been at Disney World, but next year will be using my points in New York City.

3) We like the membership. We enjoy the perks (they aren't susbstantial, but we like em). We simply like being a part of DVC.

4) We felt like we were making a commitment to our family for vacations, memories, fun, etc. That may sound corny, but my oldest is going off to college next week and we don't want to miss this or mess this up.

5) We felt like it was something we could share with others. Last summer we flipped the "points" bill and did two 2-bedroom vacation homes for a week and brought my mother, sister and her family, my family, etc. and had a great time. It was something that we intend to do every so often. We are also going to give my sister some points to use on a honeymoon when she gets remarried.

6) We could afford it. For any time share, if it's not in your budget it's not in your budget. But, for us, it is within our means.

7) We love Disney and have no problem taking multiple, multiple vacations there.

If everything was just about the money and trying to make sense of things from a financial investment point of view, we'd all be driving a Ford Focus.

While DVC is my thing, it isn't for everyone. Another person may be doing something with their money that just isn't a part of my desires. I like my DVC membership and would do it all again. I'd love to add another 150 points. My wife and I plan on using it looooonnngg after the kids are gone.

I'm a happy member!

 

[tjkraz]

And assuming you vacation at disney EVERY year for 2 weeks a year and plan on doing so for so long in the future.

I get that your dues will be cheaper then buying the hotel room - but that's if you are such a consistent visitor.

Thing is, you aren't obligated to buy that many points. 220 was the figure that OP threw out. DVC will sell as little as 100.

Others choose to stay in larger rooms. We use most of our points for One and Two Bedroom villas. Staying in a 300 sq ft hotel room with two children was never my idea of a vacation. But I also didn't want to pay $500+ per night. DVC is the happy medium.

In addition to Hawaii, DVC has resorts in Hilton Head and Vero Beach for some variety. Annual visits to the parks aren't even necessary since DVC allows members to bank and borrow points from different years' allocations. A family that wants to use 200 points for a trip to Walt Disney World every-other-year could simply purchase 100 points and use their banking rights to secure the needed 200 points every two years.

 

[flynnibus]

Thing is, you aren't obligated to buy that many points. 220 was the figure that OP threw out. DVC will sell as little as 100.

I know that - the key point though is the consistency. I goto the beach every summer - but my vacations always differ a bit. My 'traveling' vacations always differ. My kids complain about doing the same thing too much - Disney doesn't change THAT much that I need to be there every year, or every other year (if banking).

Annual visits to the parks aren't even necessary since DVC allows members to bank and borrow points from different years' allocations. A family that wants to use 200 points for a trip to Walt Disney World every-other-year could simply purchase 100 points and use their banking rights to secure the needed 200 points every two years.

But while banking/borrowing.. all you are doing is making one vacation longer, and another shorter. You are still paying for that vacation even if you don't take it because of your loan (if used) and your dues are due each year. From the point of 'paying for Disney every year' it still rings true. Banking/borrowing is just about trip durations.

I'm not trying to counter people's decisions to buy into DVC... I'm just amazed people want to VACATION that often at Disney... especially since it's really lost it's early resort aspects and is more of theme park dominated now then it used to be.

Visiting WDW in the 80s on the Magic Kingdom Club all inclusive plan was glorious.

 

[Pioneer Hall]

I know that - the key point though is the consistency. I goto the beach every summer - but my vacations always differ a bit. My 'traveling' vacations always differ. My kids complain about doing the same thing too much - Disney doesn't change THAT much that I need to be there every year, or every other year (if banking).



But while banking/borrowing.. all you are doing is making one vacation longer, and another shorter. You are still paying for that vacation even if you don't take it because of your loan (if used) and your dues are due each year. From the point of 'paying for Disney every year' it still rings true. Banking/borrowing is just about trip durations.

I'm not trying to counter people's decisions to buy into DVC... I'm just amazed people want to VACATION that often at Disney... especially since it's really lost it's early resort aspects and is more of theme park dominated now then it used to be.

Visiting WDW in the 80s on the Magic Kingdom Club all inclusive plan was glorious.

I think what he is trying to say about banking though, is that you can still find value by purchasing less points and then using double of your allotment every other year. If I didn't want to go to Disney as often I could have bought 100 points instead of 200, and banked them so I could go every other year. My dues would be half of what they are each year, and I would still save money taking that trip.

DVC doesn't work for anyone. There are a lot of people who like to go to Disney every year and sometimes more than that. I'm finding my points to be very useful now that I live closer because I can take weekend trips a lot and don't have to worry about using cash for each one of them. The savings are clear for the way I do things and I am able to afford it, so it was a no brainer for me.

 

[jim1051]

In 1999 we bought 280 points at HH for 19000. Our dues are in the 900 to 1000 per year range.

Just as an example, having "banked" last years points, we have 2 2-bedroom villas at Boardwalk booked for a week in October. Rack rate for that trip is $12000. Since it is in the midst of Food and Wine, you could never get a discounted rate for that time. So for 2 years worth of points and $ 2000 in dues, we are getting $ 12000 worth of villas . For us it works, and we feel we broke even after avout 5 years.

 

[bugsbunny]

That sounds great. But I go every year and sometimes twice, so banking and splurging probably isn't going to work for me.

 

[flynnibus]

In 1999 we bought 280 points at HH for 19000. Our dues are in the 900 to 1000 per year range.

Just as an example, having "banked" last years points, we have 2 2-bedroom villas at Boardwalk booked for a week in October. Rack rate for that trip is $12000. Since it is in the midst of Food and Wine, you could never get a discounted rate for that time. So for 2 years worth of points and $ 2000 in dues, we are getting $ 12000 worth of villas . For us it works, and we feel we broke even after avout 5 years.

But without DVC would you have realistically paid $12k for a room at Disney 5 years straight?

It's not much of a comparison unless that is what you would have done without DVC

 

[jim1051]

This particular trip would not have happened without DVC. Another reason to do it for us. We are able to take grown children and grand children on a great trip.

We did tend to stay at deluxe resorts, at Disney or elsewhere, before DVC. This is the deal maker/breaker. If you are happy in values or off site, then DVC is not for you.

We have however done other things like Alaska cruise, youngest son's honeymoon in Hawaii, weekends at Grove Park in in Asheville. For us it works, It is not for everyone but for us it works great.

 

[flynnibus]

IMO - it's a lot of the same logic Disney is using with DDP. With inflated list prices.. it makes the buying into the captive audience programs much more justifiable.

Why be forced to give discounts to your REGULAR visitors when you can entice them to buy in AND pay their own way by comparing what they would pay if they stayed on the 'outside'.

It's great.. they keep high prices because the ones that would demand it the most don't even pay those prices... it helps justify why you should buy in.. and they retain the freedom to discount those high prices as needed to adjust demand and suck in the new customers.

The ones that get left out are the people in the middle.. who want to visit frequently, but not THAT frequently.. they get left chasing the high prices. Same exact thing that they did with the DDP. They are penalized for being 'in the middle'.

DVC just feels like a real-estate deal much more then buying into Disney to me. The perks outside the room just aren't there for me. All my humble opinion.