To Buy or Not to Buy...

[jcs4evas1298]

Hello all,

My wife and I are trying to decide whether or not to buy into DVC and Im looking for some input from DVC members and non members alike so this seems like a good place to start.

First of all, we usually stay in Value or Moderate resorts when we go to Disney. Now I have read that if you stay in value/moderate resorts you will not see substantial savings (or any, according to some) by joining DVC. Personally after crunching some numbers I dont see how one could not save in the long run as long as you go every year, 1-2 weeks a year, which we do. Yes the initial buy-in is expensive, but if you take that and spread it over 20-40 trips, then add annual dues with around the same yearly % increase as Disney resort costs, I show good savings even vs value. Am I missing something? (I have seen people who factor in investing the money in the markets and use the returns, and high % returns at that, as a reason DVC doesnt save money... but Ive lost enough money in the market and lets just assume my money is going to make something like 1% a year in a safe savings account if I dont buy into DVC).

Next, and probably more importantly, is the difference in resorts. I've read up some on the DVC resorts, and they look nice, but having never been in one Im curious about what people think of a place like Boardwalk or Animal Kingdom Lodge versus something we might stay at such as Riverside or Coronado. Can anyone who has stayed in both shed some light on the differences in terms of atmosphere, quality, and anything else that might not show up in a brochure?

Any other information is more than welcome as well. This is a large financial decision for us and I just dont want to be wrong!

 

[Phonedave]

There are a number of good spreadsheets out there that will tell you the yearly cost.

You should look at the time value of money - It is a real factor in any sort of financial analysis. If you are going to be paying in full or financing then that is a factor as well.

You CAN come out ahead when comparing to a Moderate, it just takes longer.

Be aware your DVC ownership does have an end date. Take that into account.

In my opinion there is a larger step in quality between Moderate to Deluxe (DVC) than between Value and Moderate. If you are really interested, ask for a DVC tour. They are low pressure, no real sales push at all and very easy to schedule. They will pick you up and drop you off wherever you would like (on property).

It can be a cost savings, but you have to look at it carfully. I will also say that it is a very flexiable time share, and because of Disneys ROFR it seems to retain a high resale value.

-dave

 

[jcs4evas1298]

Just for more information on what we are considering:

We are looking at approx 160 points, from a resale (probably a Saratoga one since they seem to be good cost per point and low annual dues), and not to finance.

 

[toolsnspools]

When I bought into DVC, I had to weigh the purchase based on a lot more factors than just price. You will go through a lot of life changes in the next 20-40 years. You also have to ask yourself, "How well will a DVC fit me after 10 years, 20 years, ...?"

You should consider the amount of time that you'll be able to stay with 160 pts/year as well. The cheapest week in a studio at SSR is 96 pts/wk. For me, 200 was the least I could live with. I also have 3 kids, so a 1 bd is the smallest room we'll be staying in for a long time. It will probably be a 2 bd while they are teens. That means buying more points or vacationing less often.

I've stayed in a 1 bd at ASM and a 1 bd at AKL-KV. The size and quality of the room at AKL was far above that of the ASM. If you spend any significant time at the resort, the upgrade will be a huge plus over the years. If you're already booked for your next trip, take a day or two and spend them visiting DVC resorts. Eat at the restaurants, walk the property, and take a tour.

In Feb we spent our week at AKL. During the week, all 5 of us ended up sick. Did it ruin the vacation? Pretty much, but because the room had a full kitchen, we could make meals there, and we had a savanna out the window for entertainment. I can't imagine how bad it would have been if we were crammed into the smaller ASM room with nothing but a parking lot to look at.

 

[jcs4evas1298]

If we joined DVC we would definitely do so with the plans to buy more points down the road. Right now it's just me and my wife so we only need a studio at this point. We are also both 25 years old, and Im looking at DVC as sort of a building block for our family once we have kids. Her and I are huge Disney fans... very rarely do we vacation anywhere else and we have no interest in doing so even though it's just us two. I figure when we have kids, it will be even more fun to go to Disney and see it through their eyes. My family brought me to Disney almost every year growing up and to be honest most of the memories I have as a child were in Disney -- I want my kids to have great times to remember from Disney as well.

So I guess I look at DVC as a little bit of insurance that we'll be able to give our children that, and save some money along the way. If we bought now in something like SSR, wed own it until we're 69. So Id think we're in the sweet spot to buy into something like DVC and get the best use out of the full term.

 

[dizzney]

We bought in in 1999 after we had gone yearly or sometimes twice a year from 1994 on when our oldest turned three. Our three kids have gone numerous times and our only regret is that we didnt buy sooner. I wish we had purchased when OKW first was marketed, we would have saved money.

As it is, we purchased 220 in BWV in 1999 and added on 30 points 3 years later and then another 25. Each time we were able to save and pay in full so we didnt finance. We figure we recouped our BWV costs by 2006, and now are saving yearly.

We added another 100 in BLT in 2008 (also paying cash) and are working on recouping that cost now.

We know we have our vacations covered for years to come, and we would most likely do an extension at BWV if it was offered as it was at OKW a few years back.

The earlier you purchase, the more you can expereince and the more cost effecgtive in the long run.

Its such a fun expeirence and our kids feel that WDW is home to them. Our 18year old now brings his girl friend. We've brought family a number of times and they love it too.

My suggestion is obviously to buy as soon as you can so you can enjoy for years to come

 

[LovingDisney]

We purchase at SSR 250 points on a whim when we were there in 2006. It was the best investment we have ever made and we have never questioned our decision one bit. We did not look into it before we purchased- we just knew we go every year and loved it- so it was a win win for us. We also always stayed at the deluxe resorts before purchasing. We are now looking into buying more points in the next year or so. Good Luck with your decision.

 

[Lynne M]

DVC isn't a discount program, and it isn't an investment. It's a way to prepay for luxury accommodations. If you're looking for a way to vacation cheaply, as compared to values or moderates, DVC isn't it. If you're looking for a way to stay in villa-style accommodations for far less than rack rate.....then DVC may well be a good value for you.

The difference is in the resorts, and the rooms. Riverside and Coronado are motels. AKV and BWV are deluxe level resorts, with all the amenities that go with deluxes. More dining choices, better pools and recreation, balconies, and in BWV's case, the ability to walk to two theme parks.

DVC studios are the closest comparison to a regular hotel room; they have either a queen bed and a sofabed, or two queens (OKW). They're larger than moderate rooms, and have a kitchenette with fridge, sink, microwave and toaster.

The real draw of DVC is the villas. In the 1, 2, and 3-bedroom villas, you get a full kitchen, washer/dryer, king beds in the master bedroom, and a jacuzzi.

 

[PHSCoach]

We have been DVC members since 2001. Bought 200 points at BCV. Have since purchased an additional 130 at BCV and 100 at BLT. We have been going to WDW since 1981 and the only regret I have about DVC is that i didn't buy it sooner. We have saved so much and enjoy deluxe accommodations every trip.

 

[dizzney]

DVC isn't a discount program, and it isn't an investment. It's a way to prepay for luxury accommodations. If you're looking for a way to vacation cheaply, as compared to values or moderates, DVC isn't it. If you're looking for a way to stay in villa-style accommodations for far less than rack rate.....then DVC may well be a good value for you.

The difference is in the resorts, and the rooms. Riverside and Coronado are motels. AKV and BWV are deluxe level resorts, with all the amenities that go with deluxes. More dining choices, better pools and recreation, balconies, and in BWV's case, the ability to walk to two theme parks.

DVC studios are the closest comparison to a regular hotel room; they have either a queen bed and a sofabed, or two queens (OKW). They're larger than moderate rooms, and have a kitchenette with fridge, sink, microwave and toaster.

The real draw of DVC is the villas. In the 1, 2, and 3-bedroom villas, you get a full kitchen, washer/dryer, king beds in the master bedroom, and a jacuzzi.

Totally disagree with your take on this, that the real draw is the villas and its not an investment, do the math of the current price of disney accomodations and how it increases yearly as others have on other threads, and over the years, it fixes the price of your accomodations at what will end up being a good investment (if you use it).

That being said, yes we looked at having our accomodations paid over hte years, but we also liked the locations of the accomodations (including HH and VB), the fact we can trade into RCI (current timeshare partner) for weeks elsewhere; we can go to Disneyland using points for rooms (we have) and we can bring oru family with us on vacation - brothers/sisters etc and everyone can enjoy these great resorts and Disneyworld.

The draw is far more than the villas...................though I do like my washer/dryer and full kitchen.

 

[Lynne M]

Totally disagree with your take on this, that the real draw is the villas and its not an investment, do the math of the current price of disney accomodations and how it increases yearly as others have on other threads, and over the years, it fixes the price of your accomodations at what will end up being a good investment (if you use it).

DVC's cost is in no way 'fixed'. Maintenance fees go up annually, just as resort rates do. And I was using 'investment' in the sense that the OP did. A DVC membership is not something that appreciates in value over time.

That being said, yes we looked at having our accomodations paid over hte years, but we also liked the locations of the accomodations (including HH and VB), the fact we can trade into RCI (current timeshare partner) for weeks elsewhere; we can go to Disneyland using points for rooms (we have) and we can bring oru family with us on vacation - brothers/sisters etc and everyone can enjoy these great resorts and Disneyworld.

.

All of which you can do by paying cash. None of those things in and of themselves are a reason to buy DVC, as you don't have to be a DVC member to do any of them. I stayed at HH on cash, took family and friends on trips to WDW, and stayed at other resorts on cash reservations long before I became a DVC member.

The question the OP is getting at is, will buying DVC allow them to do these things at a lower cost than paying out of pocket.

 

[dizzney]

I can sell my BWV membership now for more than I paid for it; I have already realized back my cost on purchasing BWV and the annual maintenance I pay now is far cheaper than it would cost me if I were paying for rooms, and if necessary I could sell pieces if I needed to. It has been and continues to be a good deal because we use it. Even rented extra points once as I couldnt get the accomodations I wanted outside of Disney, rental of 125 points covered cost of the accomodations I wanted and paid some of my annual dues, and I still had 250 points left to use. Its a great deal.......

 

[slappy magoo]

Totally disagree with your take on this, that the real draw is the villas and its not an investment, do the math of the current price of disney accomodations and how it increases yearly as others have on other threads, and over the years, it fixes the price of your accomodations at what will end up being a good investment (if you use it).

That being said, yes we looked at having our accomodations paid over hte years, but we also liked the locations of the accomodations (including HH and VB), the fact we can trade into RCI (current timeshare partner) for weeks elsewhere; we can go to Disneyland using points for rooms (we have) and we can bring oru family with us on vacation - brothers/sisters etc and everyone can enjoy these great resorts and Disneyworld.

The draw is far more than the villas...................though I do like my washer/dryer and full kitchen.

Well the idea of calling DVC an "investment" is kind of an inappropriate term. Usually, an "investment" is something that pays dividends down the road. Warm and fuzzy "DVC DOES pay dividends...in the heart" sentimentality aside, no one can guarantee that they'll make money off of DVC (nor should they assume they will). It is a long-term way to lock in significant savings for Disney trips compared to accommodations of similar size and resorts of similar amenities. It is a club - with membership and dues and "perks" like most clubs have.

 

[Fizbain32]

When we first took a DVC tour, we bought into the idea right away. Unfortunately we decided we could not afford it for 5 more years. So we can't say that "Now that we are members we wished we had done it sooner.." as we always wished we had done it sooner.

We had been lucky enough to go once a year and had started purchasing annual passes. So the discount on annual passes perk was a big benny to us as well. We tend to stay in a moderate unless the AP rates are good enough to fit in a deluxe. Even with it being just the 2 of us we feel we are making out on the deal.

We have been lucky enough on each of our stays so far to be able to say we enjoyed each location. Even Saratoga Springs.

 

[jcs4evas1298]

Thanks for all the feedback so far!

One or two of you have been making the point that this is not an investment -- however I never called it one. The comparison Im trying to make is that if I go to Disney every year (which we have so far) and buy 11 nights or so at a value or moderate then in the long run it is indeed cheaper for me to pay the up front cost for points and then my annual dues than it is even to stay at pop century for that amount of time.

My guess is that annual dues and room rates will increase at a similar rate, but instead of paying $1300-$2000+ per year to start with at a value/moderate we'll be paying $800ish for dues. Because of the starting point, DVC should become an exponentially better value as time goes on, I would think.

 

[wvdisneyfamily]

Here's what I think. DVC seems like a good thing on the surface. However, it may not be worth it once you study the details. Yes, you prepay for 50 years of vacation. You essentially lock in today's prices. The catch is the points do not retain their complete value; they decrease. Maintenance fees go up each year. It also looks like the points don't really trade fairly amongst DVC and resorts. This final reason is more of a personal one. I don't want to deal with the DVC in terms of taxes, locking in times, etc...

Again, these are just initial thoughts. I haven't studied on them a great deal. I may change some of them after I really think about it.

 

[wvdisneyfamily]

My husband the economics teacher pointed out that if you can pay for the DVC points up front, then it is a good buy. The financing is not a good buy and compromises some of the value.

 

[jcs4evas1298]

Yeah I would not finance DVC, the rates are outrageous. I do not believe that the points decrease in value at all -- from what Ive read each resort has to keep their total point values the same. So even though they can play with how to distribute the point costs between different room types or different times of year, anywhere they increase point costs they have to decrease somewhere else. Really it just comes down to having to strategize your point usage when you're ready to book (and although some people may not like that, I find the planning of the vacation a fun activity so Im fine with that).

The only part that changes in the long run is the annual dues -- which again start considerably lower than resort room rates so they should become a better and better value as time goes on. If Im missing something someone please let me know! Im not ready to buy just yet but we're planning for it.

 

[slappy magoo]

Here's what I think. DVC seems like a good thing on the surface. However, it may not be worth it once you study the details. Yes, you prepay for 50 years of vacation. You essentially lock in today's prices. The catch is the points do not retain their complete value; they decrease. Maintenance fees go up each year. It also looks like the points don't really trade fairly amongst DVC and resorts. This final reason is more of a personal one. I don't want to deal with the DVC in terms of taxes, locking in times, etc...

Again, these are just initial thoughts. I haven't studied on them a great deal. I may change some of them after I really think about it.

1: People who bought into DVC early on, bought at significantly lower prices than the current "Point value." Those people, when they sell their interest in DVC, often sell for more than what they paid for. More recent members, and in this economy, not so much. It'd be unwise to buy DVC thinking you can sell it for more later on, but it doesn't change the fact that some people, indeed, have been able to do just that. Regardless, once the contracts get much closer to expiring, I'm sure people won't see a ROI if they're selling, but at that point, I'd hope they used their membership enough that they feel like they got their money's worth out of it.

2: Maintenance fees don't necessarily go up every year, they at times remain flat, and on a few occasions go down (though I wouldn't plan on that). The DVC resorts (or the sections of the resorts that are a part of DVC) aren't supposed to turn a profit and are legally forbidden from doing so; if it cost less to maintain a resort one year than anticipated, then the people who call that resort their home resort are required to get that money back, most likely by having the next year's fees reduced (as opposed to getting money back).

3: "the points don't really trade fairly amongst DVC and resorts." Not sure what this means, but I'm guessing that it means that if you wanted to use DVC points at a non-DVC resort, your points wouldn't net you as long of a stay. In which case, yes. That's true. Because DVC resorts are a time-share, and the other resorts are not. They're not required to be an equivalent value. DVC point rates for DVC rooms are loosely "fixed" - they can raise point rates for certain days, but then reduce it on other days to balance out. Because, again, they're not supposed to generate a profit. Rack rates for hotel rooms keep going up. Hotels ARE supposed to generate a profit. As a result, as room rates get more expensive, it'll "cost" DVC members more and more and more points to stay at non-DVC resorts. The possible solution is that maybe, one day, every Disney resort may at least have a DVC villa wing. Don't know if that would happen, but it would then render that argument moot.

4: I agree. You haven't studied them a great deal.

 

[slappy magoo]

One or two of you have been making the point that this is not an investment -- however I never called it one.

You did not do this, it's true. But if you review the thread...

We purchase at SSR 250 points on a whim when we were there in 2006. It was the best investment we have ever made and we have never questioned our decision one bit...

Seemingly in reply, Lynne M wrote...

DVC isn't a discount program, and it isn't an investment. It's a way to prepay for luxury accommodations. If you're looking for a way to vacation cheaply, as compared to values or moderates, DVC isn't it. If you're looking for a way to stay in villa-style accommodations for far less than rack rate.....then DVC may well be a good value for you...

-snip-

...The real draw of DVC is the villas. In the 1, 2, and 3-bedroom villas, you get a full kitchen, washer/dryer, king beds in the master bedroom, and a jacuzzi.

In reply, dizzney wrote...

Totally disagree with your take on this, that the real draw is the villas and its not an investment , do the math of the current price of disney accomodations and how it increases yearly as others have on other threads, and over the years, it fixes the price of your accomodations at what will end up being a good investment (if you use it)...

To which Lynne M replied

...And I was using 'investment' in the sense that the OP did. A DVC membership is not something that appreciates in value over time...

To which dizzney replied

I can sell my BWV membership now for more than I paid for it; I have already realized back my cost on purchasing BWV and the annual maintenance I pay now is far cheaper than it would cost me if I were paying for rooms, and if necessary I could sell pieces if I needed to...

...which is why dizzney refers to DVC as an investment. So I, in wisdom that goes far beyond my meager years on this planet, wrote...

Well the idea of calling DVC an "investment" is kind of an inappropriate term. Usually, an "investment" is something that pays dividends down the road. Warm and fuzzy "DVC DOES pay dividends...in the heart" sentimentality aside, no one can guarantee that they'll make money off of DVC (nor should they assume they will). It is a long-term way to lock in significant savings for Disney trips compared to accommodations of similar size and resorts of similar amenities. It is a club - with membership and dues and "perks" like most clubs have.

Hope that helps, and that you don't think anyone was accusing you of writing something you did not.

EDIT: Aaaaahhhhhh...I see it now...

...And I was using 'investment' in the sense that the OP did. A DVC membership is not something that appreciates in value over time...

Missed that myself. You did not call DVC an investment, LovingDisney did, but LynneM credited the comment to you.

Lynne may have confused by this comment of yours:
(I have seen people who factor in investing the money in the markets and use the returns, and high % returns at that, as a reason DVC doesnt save money... but Ive lost enough money in the market and lets just assume my money is going to make something like 1% a year in a safe savings account if I dont buy into DVC).

But even if that were the case, that doesn't mean you were calling DVC an investment, rather that other people say you're better off investing the money elsewhere and using the return on the investment for your vacations.