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Nw Resale Restrictions as of Jan 19th

Crafty

Active Member
Do you think that Disney is trying to put the resellers out of business and handle all resales themselves? That would be a major change.

Their prices for the original 14 are prohibitive. And they are shortly going to raise them.

We have several contracts and we had wanted more. With these prices we are not buying. I’ll bet that a lot of other people are being priced out as well.
 

Sirwalterraleigh

Well-Known Member
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Do you think that Disney is trying to put the resellers out of business and handle all resales themselves? That would be a major change.

Their prices for the original 14 are prohibitive. And they are shortly going to raise them.

We have several contracts and we had wanted more. With these prices we are not buying. I’ll bet that a lot of other people are being priced out as well.
Disney’s resell prices are insane...some of them are two approaching three times the original new contract price.

Not even a chevy dealer would try to sell a used car like that.
 

nickys

Premium Member
Original Poster
Do you think that Disney is trying to put the resellers out of business and handle all resales themselves? That would be a major change.

Their prices for the original 14 are prohibitive. And they are shortly going to raise them.

We have several contracts and we had wanted more. With these prices we are not buying. I’ll bet that a lot of other people are being priced out as well.
No, I don’t.

And I don’t think that resale prices of what I am terming the “legacy” resorts, ie the original 14 resorts, will be affected all that much. They will still have a lot of resorts they can use their points at. In fact the market for them will probably continue to grow and prices may well hold steady.

It will be interesting to see what happens with Riviera though. I think existing owners who want to buy will buy small contracts that they can combine by banking and borrowing for a stay at that resort every 2-3 years. I would still be tempted by that idea.
 

Lensman

Premium Member
It seems to me that DVC makes most of its money from selling new resorts, not buying back points at older resorts through ROFR, so I'm not convinced that they would really intend to drive down resale prices at Riviera at the risk of turning off buyers of the new resort due to this new resale policy. I'd call it an unfortunate unintended side effect - both for owners (for obvious reasons) and for DVC because anything that makes the initial sale harder is the worst possible outcome for them.

I'll hypothesize a positive reason for the change is to make some effort to have Riviera reservations be obtainable within the 7-month window. This would go for both Riviera owners as well as direct owners of the older resorts.

I wonder if they're a little worried about the effect of resold "Poly bungalow" contracts (and "Copper Creek cabin" contracts), if such a beast could be said to really exist.

Anyway, this is just a thought. The conspiracy/evil hypothesis has much better legs. :)
 

Sirwalterraleigh

Well-Known Member
I wonder if they're a little worried about the effect of resold "Poly bungalow" contracts (and "Copper Creek cabin" contracts), if such a beast could be said to really exist.
:)
You mean those ridiculous point eaters they built to flood points they Can Divide up and sell in $15,000 contracts 100 times over? Not actually built to be occupied?

They’re practically movie sets...props. A ruse. Poly bungalows was the first real sleazy timeshare moves they made. A Turning point. They’ve made several since - notably restricting minor discounts and now limiting where you can book (which was the main advantage to DVC and why they originally ripped the idea from Marriott).

I don’t know what that taste is exactly...but it’s sure sour.
 

helenabear

Well-Known Member
You mean those ridiculous point eaters they built to flood points they Can Divide up and sell in $15,000 contracts 100 times over? Not actually built to be occupied?

They’re practically movie sets...props. A ruse. Poly bungalows was the first real sleazy timeshare moves they made. A Turning point. They’ve made several since - notably restricting minor discounts and now limiting where you can book (which was the main advantage to DVC and why they originally ripped the idea from Marriott).

I don’t know what that taste is exactly...but it’s sure sour.
Yep booking at capacity (90-95%) last reported is not using them at all and never meant to be booked.

I do see sour in your post, but I wonder why it's so bad.

Honestly I have seen so many posts complaining and sometimes it sounds like people didn't understand before buying.

It seems to me that DVC makes most of its money from selling new resorts, not buying back points at older resorts through ROFR, so I'm not convinced that they would really intend to drive down resale prices at Riviera at the risk of turning off buyers of the new resort due to this new resale policy. I'd call it an unfortunate unintended side effect - both for owners (for obvious reasons) and for DVC because anything that makes the initial sale harder is the worst possible outcome for them.

I'll hypothesize a positive reason for the change is to make some effort to have Riviera reservations be obtainable within the 7-month window. This would go for both Riviera owners as well as direct owners of the older resorts.

I wonder if they're a little worried about the effect of resold "Poly bungalow" contracts (and "Copper Creek cabin" contracts), if such a beast could be said to really exist.

Anyway, this is just a thought. The conspiracy/evil hypothesis has much better legs. :)
What would they be worried about? Resale doesn't matter much to them now that perks are not involved.
 

Crafty

Active Member
I would love someday to spend a couple of nights in a CCVC cabin. Maybe for a special occasion. They look incredible. While we own enough points to swing that, we probably won’t do it because it would mean shortening or eliminating another trip.

The cabins and bungalows were meant for high point owners without a ‘cheap’ gene like mine. Cash customers may also be booking them.

Unfortunately, due to the high prices, a lot of owners at Poly and CCVC do not own enough points to ever stay in a bungalow or cabin. This drives them to other resorts at the 7 month window, curtailing trading for all owners.

I wouldn’t think that Disney would care very much about this. Potential direct buyers won’t even know about the problem.

Since resale restrictions are common across timeshare companies, they must provide a benefit to the companies even though owners are hurt. Disney, historically, did not do restrictions and owners were happy and resale values were high. What changed? What benefit will Disney derive from these restrictions? I wish I could figure it out.
 

helenabear

Well-Known Member
I would love someday to spend a couple of nights in a CCVC cabin. Maybe for a special occasion. They look incredible. While we own enough points to swing that, we probably won’t do it because it would mean shortening or eliminating another trip.

The cabins and bungalows were meant for high point owners without a ‘cheap’ gene like mine. Cash customers may also be booking them.

Unfortunately, due to the high prices, a lot of owners at Poly and CCVC do not own enough points to ever stay in a bungalow or cabin. This drives them to other resorts at the 7 month window, curtailing trading for all owners.

I wouldn’t think that Disney would care very much about this. Potential direct buyers won’t even know about the problem.

Since resale restrictions are common across timeshare companies, they must provide a benefit to the companies even though owners are hurt. Disney, historically, did not do restrictions and owners were happy and resale values were high. What changed? What benefit will Disney derive from these restrictions? I wish I could figure it out.
The math on the bungalows is that less than 1% of all DVC points belong to the bungalows. I think the cabins are similar. While many bought into PVB to stay there, others didn't ever intend to stay there. Same with those at other resorts. SSR is a big one I can think of. Quite a few Aulani too. No, Disney wouldn't care where people bought from though or where they stay as long as they get their money. I think too many people view Disney with Pixie Dust in their eyes and think they are above the average company trying to make money.

I hope to add more points some day to get cabins regularly ad we'll do the bungalows again in a few years. We just have the wrong groups going with us for those.

They may as well just class themselves as a regular timeshare these days
They are just a timeshare. A slightly more flexible one, but that is what they are.
 

Club Cooloholic

Well-Known Member
I saw the original post on DVC News but I’m having a hard time believing it. This takes away one of the biggest direct from Disney selling features for new owners...the resale market. Resale prices for Riviera would be much lower without the flexibility of trading in so now a prospective buyer can’t be told that if they need to get out and sell their points they won’t get hurt too bad Iike you do with a lot of traditional timeshares. If that’s true it’s foolish and will make it much harder for them to sell direct points. It also makes the legacy 14 resorts worth even more resale since they will be the only resale ones that allow trading in.
That's how see it too.
Now going back to someone else speaking about this as an investment or not. I kinda see it like a comic book. I buy it, I read and enjoy it, maybe in 10 years I decide to sell it. Will it be worth more than what I paid for it? Maybe, I have read plenty of people saying they made back their initial investment and then some. Especially early buyers and I know if I had not waited 6 months to make my purchase I could have saved about $1500, but I also know there have been times(maybe around 2008) where if I had bought the year before and tried to sell I would be losing money. I am going to enjoy it while I have it. Heck I find even the RCI trade in decent if you find the right place to use it.
 
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GoofGoof

Premium Member
No, I don’t.

And I don’t think that resale prices of what I am terming the “legacy” resorts, ie the original 14 resorts, will be affected all that much. They will still have a lot of resorts they can use their points at. In fact the market for them will probably continue to grow and prices may well hold steady.

It will be interesting to see what happens with Riviera though. I think existing owners who want to buy will buy small contracts that they can combine by banking and borrowing for a stay at that resort every 2-3 years. I would still be tempted by that idea.
If this policy is true it will actually make the legacy resorts much more valuable for resale. I wouldn’t be surprised to see a nice bump up in resale prices for them. People like the option of staying at various places, not being locked into one place.
 

GoofGoof

Premium Member
That's how see it too.
Now going back to someone else speaking about this as an investment or not. I kinda see it like a comic book. I buy it, I read and enjoy it, maybe in 10 years I decide to sell it. Will it be worth more than what I paid for it? Maybe, I have read plenty of people saying they made back their initial investment and then some. Especially early buyers and I know if I had not waited 6 months to make my purchase I could have saved about $1500, but I also know there have been times(maybe around 2008) where if I had bought the year before and tried to sell I would be losing money. I am going to enjoy it while I have it. Heck I find even the RCI trade in decent if you find the right place to use it.
I think the investment thing just comes down to definition. If you narrowly define an investment as a “financial” investment that either earns interest or appreciates in value it doesn’t qualify (it can appreciate in value, but shouldn’t be viewed that way). If however you have a broader definition it can/does qualify. If I buy a new high efficiency heater for my house that’s going to cut my heating bill significantly is that an investment? I am paying cash today for something that in the future will save me money. It will never actually earn income but it does save me future cash outlays. Let’s say the heater cost me $5,000 but will save me a little less than $50 a month on my heating bill. Assuming my old heater still works, I have a choice of either continuing with the old heater and investing the $5,000 in a financial instrument or spending the money on the heater and saving about $500 a year on my bills. If the financial investment pays 10% interest (or $500 a year) then I’m at the same place from a monthly cash standpoint as saving $500 on my heating bill. Most likely the financial investment will have a lesser return than 10%. Investing in the heater only makes financial sense if at some point the money saved would cover the up front $5,000 as well as continue to earn a regular savings on the bill.

DVC is like the heater. I’m paying money upfront and my “investment” saves me money on future trips. The maintenance fees are less than the cash room rate for a similar hotel room and each time you save that money it’s reducing the money you originally put out until you break even. Then you are staying in a room for whatever the MFs are.
 

GoofGoof

Premium Member
It seems to me that DVC makes most of its money from selling new resorts, not buying back points at older resorts through ROFR, so I'm not convinced that they would really intend to drive down resale prices at Riviera at the risk of turning off buyers of the new resort due to this new resale policy. I'd call it an unfortunate unintended side effect - both for owners (for obvious reasons) and for DVC because anything that makes the initial sale harder is the worst possible outcome for them.

I'll hypothesize a positive reason for the change is to make some effort to have Riviera reservations be obtainable within the 7-month window. This would go for both Riviera owners as well as direct owners of the older resorts.

I wonder if they're a little worried about the effect of resold "Poly bungalow" contracts (and "Copper Creek cabin" contracts), if such a beast could be said to really exist.

Anyway, this is just a thought. The conspiracy/evil hypothesis has much better legs. :)
I did the math a few years back on one of these threads, but the cost of the construction of the resorts is only around 50% of DVC costs. The sales and administration function is a higher percentage of cost than most people realize. The example from a few years ago was BLT. The rumor was it cost $300M to build and they sold 5.7M points. That’s roughly $53 per point in construction costs. Since that was almost a decade ago maybe using current construction prices it would be in the $60s per point. Even so that’s significantly less than the ROFR prices to buy the older resorts back. In other words it’s much cheaper for Disney to build a new resort (they already own the land so no need to buy that) than it is to buy back and resell old points. The only advantage to selling old repurchased points is those contracts expire sooner.
 

Crafty

Active Member
What is the percentage of bungalow points specifically at Poly? It may be less across DVC, but I feel that Poly owners may need the 7 month window due to lack of studio availability there.
 

GoofGoof

Premium Member
What is the percentage of bungalow points specifically at Poly? It may be less across DVC, but I feel that Poly owners may need the 7 month window due to lack of studio availability there.
Poly DVC has 360 studios and 20 villas.

There are 2 view types and multiple seasons so someone can do exact math if they want. Quick and dirty math, the studios average around 170 points a week or roughly 3.2M points for all rooms for the year. The bungalows average about 1,000 points for a week or rough 1M points. Based on that very rough math the bungalows make up about 25% of the points at Poly DVC. I think the math is pretty close since the resort is supposed to have about 4M total points.
 

helenabear

Well-Known Member
What is the percentage of bungalow points specifically at Poly? It may be less across DVC, but I feel that Poly owners may need the 7 month window due to lack of studio availability there.
I don't know now with the reallocation, but it was roughly 1/4 before. Still we have to remember that not all bought PVb for use there. I did buy there to get it at 11 months. Otherwise it wasn't a wise buy IMO to do.
 

Lensman

Premium Member
Yep booking at capacity (90-95%) last reported is not using them at all and never meant to be booked.
I kinda view inventory available into the 7-month window as "less desirable". Do you have any anecdotal information on availability of bungalows? [note: I want to be clear that I don't hold an extremist position on the bungalows, just that I'm concerned about people not booking them]

What would they be worried about? Resale doesn't matter much to them now that perks are not involved.
I think that generally, direct buyers want to stay at their home resort, so I'm less worried about their booking behavior. I worry a little about resale buyers of big Poly bungalow contracts (or once-every three years Poly bungalow contracts) buying and then staying elsewhere. This would put more pressure on the more desirable resorts inside the 7-month window. Resold SSR contracts are the same way - resale buyers are pretty obviously choosing those contracts because they're the cheapest and they're hoping to get in at other resorts in the 7-month window. It's one of my hypotheses that Disney is trying to prevent these people from using their points at Riviera.

The math on the bungalows is that less than 1% of all DVC points belong to the bungalows. I think the cabins are similar.
I also wonder how much owners change their behavior over time. I could see people going every year for the first 5-10 years or so, then using banking to "upsize" to 2-bedrooms for years 7-12. Then once there are grandkids, you end up in the Grand Villas.

Then again, I don't see much let-up in the demand for studios, so this conjecture may not hold much water. It's certainly my personal experience, as we pretty much only stay in the 2-bedrooms nowadays.

I think the investment thing just comes down to definition. If you narrowly define an investment as a “financial” investment that either earns interest or appreciates in value it doesn’t qualify (it can appreciate in value, but shouldn’t be viewed that way). If however you have a broader definition it can/does qualify. If I buy a new high efficiency heater for my house that’s going to cut my heating bill significantly is that an investment? I am paying cash today for something that in the future will save me money. It will never actually earn income but it does save me future cash outlays. Let’s say the heater cost me $5,000 but will save me a little less than $50 a month on my heating bill. Assuming my old heater still works, I have a choice of either continuing with the old heater and investing the $5,000 in a financial instrument or spending the money on the heater and saving about $500 a year on my bills. If the financial investment pays 10% interest (or $500 a year) then I’m at the same place from a monthly cash standpoint as saving $500 on my heating bill. Most likely the financial investment will have a lesser return than 10%. Investing in the heater only makes financial sense if at some point the money saved would cover the up front $5,000 as well as continue to earn a regular savings on the bill.

DVC is like the heater. I’m paying money upfront and my “investment” saves me money on future trips. The maintenance fees are less than the cash room rate for a similar hotel room and each time you save that money it’s reducing the money you originally put out until you break even. Then you are staying in a room for whatever the MFs are.
I agree with the idea of what you're saying, but I don't think it's what people mean when they discuss DVC as an investment. I tend to think that those who do use the word "investment" wrt DVC are ill-advised. :)

For me, solar PV is like that - it's a capital expenditure that yields "free" electricity for 25 years and then ends with zero or slightly negative value. 10 year breakeven. Also similar is buying new windows or putting in insulation.
 

GoofGoof

Premium Member
I don't know now with the reallocation, but it was roughly 1/4 before. Still we have to remember that not all bought PVb for use there. I did buy there to get it at 11 months. Otherwise it wasn't a wise buy IMO to do.
Good point, my rough math was based on the old point charts. It will be a little less than 25% with the new chart.
 

GoofGoof

Premium Member
I agree with the idea of what you're saying, but I don't think it's what people mean when they discuss DVC as an investment. I tend to think that those who do use the word "investment" wrt DVC are ill-advised. :)

For me, solar PV is like that - it's a capital expenditure that yields "free" electricity for 25 years and then ends with zero or slightly negative value. 10 year breakeven. Also similar is buying new windows or putting in insulation.
I agree. Most people compare DVC to something like buying a beach house and say the house is an investment (hopefully it goes up in value) while a DVC contract eventually has to go to zero value.

I consider all of your examples investments as well. Even if a product has a terminal value of zero, as long as it more than paid for itself in savings it’s an investment. Just a different way to look at things.
 

Crafty

Active Member
I like going to WDW. I feel cramped in hotel rooms. Therefore, I bought DVC.

I don’t like a lot of the things Disney is doing, but unless the two requirements above change, I am keeping it.

I have a contract in ROFR now that I don’t expect to pass. Please..please..please..

We may downsize or change home resorts. Or keep what we’ve got. We change our minds every thirty seconds.
 
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