Resale Prices Down?

[Lensman]

@LensmanOne other tax thing to consider. There’s no sales tax to pay. With a hotel room at WDW you pay the 12.5% sales tax. With DVC you don’t pay sales tax on the initial purchase and there’s no sales tax on your annual dues.

I'll have to add that to my spreadsheet!

 

[GoofGoof]

I'll have to add that to my spreadsheet!

When comparing DVC to cash hotel rooms you always have to add the 12.5% to the hotel room price, plus parking now if you drive...and maybe soon the resort fee

 

[correcaminos]

@Lensman listed the 2 potential benefits for your federal taxes. Not much of a benefit.

One other tax thing to consider. There’s no sales tax to pay. With a hotel room at WDW you pay the 12.5% sales tax. With DVC you don’t pay sales tax on the initial purchase and there’s no sales tax on your annual dues.

Oh that's a tax view I had not thought of. The other type I was thinking of weren't applicable/a benefit to us.

 

[Club Cooloholic]

1. You can still write off interest on a mortgage on a vacation home, but you shouldn't finance a DVC purchase.
2. You can write off property taxes paid as part of your annual dues. This was minor ($60 I think) and the effect is now zero since I'm capped on my State and Local Tax deductions.

It's not really a tax benefit, but in my DVC analysis, the "alternative" scenario that I consider is investing the money instead and using the "interest" returns to rent lodging. When doing this part of the analysis, you either need to account for the taxes that you pay on that interest or you have to use high quality municipal bonds since they are Federal tax free.

If this off-topic discussion goes any further, we should consider opening a new thread on the tax considerations for timeshares. It's off-topic for this thread on resale prices.

There really aren't any tax benefits in a timeshare. Even if you donated the use of the points for a year that donation is not able to be used as a write off

 

[Lensman]

Dvcresalemarket's report of resale prices for April 2019 are out:

Average Sales Prices for April 2019 | DVC Resale Market

The average sales price of Disney Vacation Club resale contracts categorized by resort and month sold for April of 2018 through April 2019 with graphed data.

www.dvcresalemarket.com

I don't see any significant year-over-year changes.

Their ROFR report is also as interesting as always. Apparently Disney bought back 35% of the contracts presented in April.

Right of First Refusal (ROFR): April 2019 | DVC Resale Market

We witnessed 114 buy backs in the month of April, the most ever in a given month. This record-breaking month for buy backs can be attributed to 3 things.

www.dvcresalemarket.com

Here's their ROFR table for April 2019:

One thought/question I had is whether we won't see immediate large price drops from the new policies due to the "price floor" effect that Disney's ROFR has. OTOH, it's not like Disney can prop up prices forever since they are limited based on how many requests they get for direct purchases of old resorts.

 

[eliza61nyc]

Why is Disney buying back property a bad thing? I understand ROFR but lol never paid attention much to the "buyback" because never entered my mind to see my contract.

I do understand the frustration on a buyers part if Disney swoops in and grabs some thing you hoped to purchase but as far as resale value, does it effect that?

 

[LuvtheGoof]

Why is Disney buying back property a bad thing? I understand ROFR but lol never paid attention much to the "buyback" because never entered my mind to see my contract.

I do understand the frustration on a buyers part if Disney swoops in and grabs some thing you hoped to purchase but as far as resale value, does it effect that?

If you are on the selling side, you really don't care if a person or Disney buys your points, as long as you get the price point you wanted. It certainly hasn't seemed to affect the resale prices.

DVC News reported that April was also a huge month for other "sold out" resorts as well. It could be that Disney had a lot of people on waiting lists for specific properties with specific use years, and since they recently changed their rules for changing use years for a set of points, they are able to get a lot more off the waiting list by buying back a bunch of contracts, change the use year, and resell them to people on the wait list. Will be interesting to see if May continues the ROFR buyback trend.

 

[Lensman]

I do understand the frustration on a buyers part if Disney swoops in and grabs some thing you hoped to purchase but as far as resale value, does it effect that?

The first DVC Resale Market article I quoted wondered whether increased buybacks seen so far in 2019 would contribute to increased resale prices at some point. Their thinking is that a buyback often results in the unsuccessful buyer coming back into the market and purchasing another contract. Said another way, Disney's buybacks increase demand in the resale market.

Of course, another interpretation is that Disney is seeing increased demand themselves for contracts on their sold-out [I call them "legacy"] resorts. One line of thinking is that this is the result of the new policy that we've been complaining about. The idea is that more buyers will choose to buy direct rather than resale because by buying a legacy resort, they get access to Riviera reservations. I'm not convinced of this just because the price difference seems to big to really justify this, but it could be one other thing that gets people over the line to buying direct.

You know, this is one aspect of the resale market that I don't think I've seen anyone discuss before - that by moving buyers from the resale market to the direct market, the new resort reservation rules won't impact resale pricing that much because even direct sales of legacy resorts ultimately have to come out of the resale market as ROFR buybacks.

 

[Club Cooloholic]

Maybe the buyback rates are higher because sold out resorts, like AKL ect, are having longer waiting lists, so it makes no sense for Disney not to gobble up the contracts that host resale, particularly lower ones, that they can quickly turn around and offer direct. Simple math shows they win right away(so long as they have buyers ready to pay on their end). I am surprised we don't see more bought back honestly. Now one question I have. If Disney buys back a 200 point contract, are they able to divide it up how they want, such as into 2 100 point contracts or just it stay 200, even of they own the whole thing?

 

[Lensman]

Maybe the buyback rates are higher because sold out resorts, like AKL ect, are having longer waiting lists, so it makes no sense for Disney not to gobble up the contracts that host resale, particularly lower ones, that they can quickly turn around and offer direct. Simple math shows they win right away(so long as they have buyers ready to pay on their end). I am surprised we don't see more bought back honestly. Now one question I have. If Disney buys back a 200 point contract, are they able to divide it up how they want, such as into 2 100 point contracts or just it stay 200, even of they own the whole thing?

Disney have the unique ability to combine and divide up points/contracts, though I think this might be limited by the need to have each contract represent at most one unit. Or can a DVC contract represent an ownership interest in more than one unit?

As of March 8th of this year, they have the ability to change use years of points they acquire. This new ability to change use years of contracts may mean that people may be coming off of wait lists. It also may account for the surge in ROFR activity this year, due to their new ability to change use years. If there were a lot of people backlogged in wait lists waiting for the right use year to come up, them coming off of the wait lists because of Disney's new ability to change the use years of units in their inventory.

 

[Lensman]

I missed posting May 2019 results, but here are June's.

Average Sales Prices for June 2019 | DVC Resale Market

The average sale price of Disney Vacation Club resale contracts categorized by resort and month sold for June of 2018 through June 2019 with graphed data.

www.dvcresalemarket.com

I think this is the last one I'm going to post because I think it looks like there's little to no evidence that the inability to book Riviera and newer resorts as a new resale buyer has affected legacy resort resale prices at all. OKW and SSR resale prices are flat, year-over-year, and some premium resort prices like VGF and BLT are even headed higher.

 

[FCivish3]

I missed posting May 2019 results, but here are June's.
View attachment 389327

Average Sales Prices for June 2019 | DVC Resale Market

The average sale price of Disney Vacation Club resale contracts categorized by resort and month sold for June of 2018 through June 2019 with graphed data.

www.dvcresalemarket.com

I think this is the last one I'm going to post because I think it looks like there's little to no evidence that the inability to book Riviera and newer resorts as a new resale buyer has affected legacy resort resale prices at all. OKW and SSR resale prices are flat, year-over-year, and some premium resort prices like VGF and BLT are even headed higher.

Lensman, thank you for your service. You have contributed to us all by keeping us informed of the resale prices and the trends. I for one certainly appreciate it. Thank you for the work that you have done.

 

[correcaminos]

I missed posting May 2019 results, but here are June's.
View attachment 389327

Average Sales Prices for June 2019 | DVC Resale Market

The average sale price of Disney Vacation Club resale contracts categorized by resort and month sold for June of 2018 through June 2019 with graphed data.

www.dvcresalemarket.com

I think this is the last one I'm going to post because I think it looks like there's little to no evidence that the inability to book Riviera and newer resorts as a new resale buyer has affected legacy resort resale prices at all. OKW and SSR resale prices are flat, year-over-year, and some premium resort prices like VGF and BLT are even headed higher.

Very cool!

I see BRV is down, I attribute it to CCV opening though. Most I see small increase or relatively flat. I'm not surprised by that.

 

[FCivish3]

BRV is an indicator of the price that Beach Club and Boardwalk SHOULD be. Except they are just more generally desirable for other reasons (LOCATION).

What does this say about future desirability of Reflections. It will be at almost the same location, and the design info that has been released doesn’t sound nearly as beautiful as Wilderness Lodge.

 

[correcaminos]

BRV is an indicator of the price that Beach Club and Boardwalk SHOULD be. Except they are just more generally desirable for other reasons (LOCATION).

What does this say about future desirability of Reflections. It will be at almost the same location, and the design info that has been released doesn’t sound nearly as beautiful as Wilderness Lodge.

I don't know if it is just about location as it is about "shiny new" other option in the same resort.

Not sure about Reflections though. I'm not interested in that one at all. Not really interested in RR either but hey they make something for all, but a bit of a bummer the 2 newest in a row will be meh for me.

 

[Lensman]

I don't know if it is just about location as it is about "shiny new" other option in the same resort.

Not sure about Reflections though. I'm not interested in that one at all. Not really interested in RR either but hey they make something for all, but a bit of a bummer the 2 newest in a row will be meh for me.

We'll give Riviera a try. I like the idea of it being halfway between World Showcase and DHS. It'll also be a nice change to have the "tower" experience.

I wonder if Reflections will have any attributes or features that'll make it interesting to me. I think it's going to have a lazy river and great pool area, but with the kids grown I don't think that's a big draw anymore until the grandkids come along (if any). I guess being across the street from the stables could mean the third riding experience of my life...

 

[GoofGoof]

I don't know if it is just about location as it is about "shiny new" other option in the same resort.

Not sure about Reflections though. I'm not interested in that one at all. Not really interested in RR either but hey they make something for all, but a bit of a bummer the 2 newest in a row will be meh for me.

And the shiny new option has a longer contract.

 

[correcaminos]

We'll give Riviera a try. I like the idea of it being halfway between World Showcase and DHS. It'll also be a nice change to have the "tower" experience.

I wonder if Reflections will have any attributes or features that'll make it interesting to me. I think it's going to have a lazy river and great pool area, but with the kids grown I don't think that's a big draw anymore until the grandkids come along (if any). I guess being across the street from the stables could mean the third riding experience of my life...

I love the way RR looks, I will give it that. I'm just not keen on the location or gondolas (I hate heights). I might try to stay there next June but not 100% sure it will be a good fit for our group. I worry it will be a little like BLT in that it will miss good greenery on the grounds. We'll see.

I'm not a fan of Ft. Wilderness for staying. The dual bus route bugs me (also why we haven't done THVs - though we did the old villas ages ago when we had a car). If the lazy river is nice, I'll be happy. If it's like SAB, a big hard pass to me.

Not thrilled that I read the stables were moving because of it too. We'll see but not excited.

And the shiny new option has a longer contract.

Absolutely!

 

[Lensman]

I love the way RR looks, I will give it that. I'm just not keen on the location or gondolas (I hate heights). I might try to stay there next June but not 100% sure it will be a good fit for our group. I worry it will be a little like BLT in that it will miss good greenery on the grounds. We'll see.

There's a fair amount of shrubbery visible in their outside shots in their promotional video:

Explore Disney's Riviera Resort | Disney Vacation Club

Discover Disney’s Riviera Resort, located at Walt Disney World Resort in Florida. This new Disney Vacation Club Resort celebrates the grandeur of Europe, reimagined with Disney touches.

disneyvacationclub.disney.go.com

 

[nickys]

We'll give Riviera a try. I like the idea of it being halfway between World Showcase and DHS. It'll also be a nice change to have the "tower" experience.

I wonder if Reflections will have any attributes or features that'll make it interesting to me. I think it's going to have a lazy river and great pool area, but with the kids grown I don't think that's a big draw anymore until the grandkids come along (if any). I guess being across the street from the stables could mean the third riding experience of my life...

I’d try it for the pool area and lazy river alone! And being near FW to explore - although I realise that will be changed as a result, and not for the better.