Think Twice Before Purchasing a Resale - New DVC Policy Set to Take Effect in March

[Ian]

You really haven't thought before that WDW has become too dependent on DVC? Between 1990 and 2000, Disney opened 11 regular WDW resorts, 2 DVC resorts at Disney World, a theme park gate and a water park.

Between 2000 and 2010, they opened 2 regular resorts and FIVE DVC resorts at WDW, no theme parks and no water parks. I think they've known which side their bread's been buttered on for quite awhile.

Wow ... that's pretty shocking when you put it out there like that.

And yeah ... I mean I've known that they've sort of become addicted to the DVC gravy train, but I'm starting to suspect that the house of cards in WDW is becoming unstable. I feel like they've painted themselves into a corner a bit, what with the crazy prices and declining service and merchandise quality. Their struggles pushing food and merch are pretty well documented and they were very dependent on that revenue stream.

[DizneyRox]

I don't think it's rocket science really...

DVC is geared towards repeat visitors. There are now 4000+ rooms on property for DVC guests, many of which have no urgent need to spend like crazy on souvies and even buy Disney food. They will be back ad probably sooner than later. It's almost 1/6 of the rooms available on property...

I'd be surprised if that doesn't have the potential to make a significant impact on the merch and restaurant sales at any given time. The very nature of DVC affords people the opportunity to not have to spend as much on food, etc. We've found that we can still have a great time just staying at the resort, and others figured that out well before us.

The more they build out DVC, the more of an impact it can potentially have on everything else. Now that I think about it, my spending on property probably went down around the same time we bought into DVC. I can't really say that they are connected, but I wouldn't second guess anyone for saying such a thing.

Maybe this is another case of not thinking things through on Disney's part. They usually really are on top of everything (especially profits), but I can see getting wrapped up in all the potential monies generated and not being able to see this happening. We've got other factors that can be blamed, like 9/11, and now the economy. If/when spending doesn't pick up and there are no more excuses, maybe it will finally sink in.

[faline]

This is telling, though, in this sense ... Disney just raised prices for Bay Lake Tower points under the pretense that sales were too hot and needed to be cooled off some to allow them to retain enough inventory to sell until the next new property is available.

We were very interested in Bay Lake Tower but couldn't justify the price. In our discussions with Disney, we were told on more than one occasion that, if we wanted to buy into Bay Lake Tower, we would need to hurry because (1) it would be sold out by Thanksgiving (I believe that was in 2009 so didn't happen) and (2) Bay Lake Tower is simply NOT available on the resale market (and I now regularly see Bay Lake Tower points on the resale market).

[DizneyRox]

These are not the droids you are looking for...

[WRWDisney]

Originally Posted by Aurora
You really haven't thought before that WDW has become too dependent on DVC? Between 1990 and 2000, Disney opened 11 regular WDW resorts, 2 DVC resorts at Disney World, a theme park gate and a water park.

Between 2000 and 2010, they opened 2 regular resorts and FIVE DVC resorts at WDW, no theme parks and no water parks. I think they've known which side their bread's been buttered on for quite awhile.

While true, remember that, one, you are comparing a two decade period to one; and two (and more significant), you are comparing a time frame in which we have had the biggest economic downturn since the great depression, as well as the pre 9/11 recession combined with the post 9/11 massive travel decline. Those events ate up at least 5 of your second 10 year period.

That all said, has disney become to dependent on DVC? Probably. It allows them to expand capacity with minimal investment; the same cannot be said for park expansions. Do I think a park expansion is needed at this point? Yes, and I think we are starting to see them begin to roll-out (DCA re-work and Fantasyland expansion, the rumors of EPCOT additions and hopefully the eventual land addition at AK). I think we will look at this current decade as a great time of park expansion at Disney. I also think we will continue to see DVC growth (at a slower pace). They need point to sell on property; if they don't have them in a new property (the sexy option), they have to sell at the older resorts (points they acquire through buy-back). Thus, I think there will always be a new property in development (though no rush at the moment with the number of AKV point still out there.

Just my opinion

[Aurora]

While true, remember that, one, you are comparing a two decade period to one; and two (and more significant), you are comparing a time frame in which we have had the biggest economic downturn since the great depression, as well as the pre 9/11 recession combined with the post 9/11 massive travel decline. Those events ate up at least 5 of your second 10 year period.

That all said, has disney become to dependent on DVC? Probably. It allows them to expand capacity with minimal investment; the same cannot be said for park expansions. Do I think a park expansion is needed at this point? Yes, and I think we are starting to see them begin to roll-out (DCA re-work and Fantasyland expansion, the rumors of EPCOT additions and hopefully the eventual land addition at AK). I think we will look at this current decade as a great time of park expansion at Disney. I also think we will continue to see DVC growth (at a slower pace). They need point to sell on property; if they don't have them in a new property (the sexy option), they have to sell at the older resorts (points they acquire through buy-back). Thus, I think there will always be a new property in development (though no rush at the moment with the number of AKV point still out there.

Just my opinion

We're not arguing, here. Just wanted to clarify.

I really was comparing one decade to another, not two to one. To be more accurate, I was comparing 1990-1999 to 2000-2009. (I did not include 2010, in which Disney opened ... nothing.) And yes, we did go belly up financially in the latter part of this past decade, but three of the five DVC properties I mentioned above (Wilderness, Beach Club and Saratoga) were opened between 2000 and 2004, two of them post-9/11 and all before the recession.

I do hope you're right about the near future being a time of park expansion. They sure could use some more places to put all these people.

[lovin'fl]

I just hope it doesn't make it more difficult to book non-home resorts. We have a friend who owns DVC (tons of points) and uses it to stay at POLY each year. New resale folks won't be able to do that.

[WRWDisney]

Aurora--good points,you are right, I can't do math, and I hope so too.

[Donald A]

I traded into the Disney Collection for my second trip as a DVC member to go to the Grand Floridian as I wanted to give it a try. However, I would likely not do that again as it was a terrible value for my points, especially now with Bay Lake Towers available as a Magic Kingdom Resort. I MIGHT consider trading to a DCL cruise but still think it is not a good value for points.

I am concerned as others said on here as well. DVC seems good on the surface but I am starting to realize it is too good to be true. If Disney can manipulate a contract, they will do it to make a profit. I remember when they increased weekday points and decreased weekend points (allowed under contract) and said that it was based on member "feedback." That is a small fib at best.

[DVC Mike]

Things like the Disney Collection, the Adventurer Collection, the Concierge Collection, and AP discounts are all offered by Disney Vacation Development (DVD), the unit that builds the resorts and then sells the memberships. They are not part of our "ownership interest" and the cost of these programs is not passed on to members and is not included in the annual dues we pay.

They are - pure and simple - sales and marketing tools to entice people to purchase an ownership interest.

I am not defending DVD but I can see how they'd want to differentiate resale versus direct and make it more enticing to purchase direct. They now have an answer to the sales prospect who asks "Why buy direct when I can buy resale for less?"

Since it's really a waste of points to use your points for the Disney Collection, the Adventurer Collection, and the Concierge Collection, it's no great loss to potential resales buyers anyway. It's more symbolic at this point.

It may, however, lead to lower resale values and cost existing members who wish to sell their points, which is the real shame.

[DizneyRox]

It may, however, lead to lower resale values and cost existing members who wish to sell their points, which is the real shame.

I think this. Disney doesn't buy back points from members except for ROFR. So this preceived loss of value will probably translate into even lower values on the resale market. It will hurt those who buy from Disney, but not really those who buy resale. The value won't drop further if they need to re-sell. Disney will now pay even less for any points they pick up on the resale market, which they can turn around and offer back at even greater profits.

This only hurts members as far as I can see... The old chinese proverb, be careful what you wish for seems to apply!

Everybody needs to stop taking those darn surveys!

[Aurora]

I just hope it doesn't make it more difficult to book non-home resorts. We have a friend who owns DVC (tons of points) and uses it to stay at POLY each year. New resale folks won't be able to do that.

I don't know the details of exactly how this works, so maybe someone else can expand, but I thought that when you use your points to book a non-DVC room, those points go into the DVC system to be reserved as cash rooms. So if that's true, there would be no more difficulty in booking, because the room wouldn't have been available for DVC points anyway.

[lovin'fl]

I don't know the details of exactly how this works, so maybe someone else can expand, but I thought that when you use your points to book a non-DVC room, those points go into the DVC system to be reserved as cash rooms. So if that's true, there would be no more difficulty in booking, because the room wouldn't have been available for DVC points anyway.

I thought that was if DVC folks trade into RCI. If DVC folks use their points to stay at POLY, I didn't think their DVC unit went into the 'cash' system. I could be wrong though.

[KAT1811]

Just thinking a bit here. . .

In the dire economic times we are facing right now I'm sure there are quite a few DVC owners defaulting on their contracts. If you were faced with losing something (ie. house, car, timeshare, etc.) I would think that the timeshare would be first to go. Do we really know how many people trying to sell on the resale market have defaulted on their contracts? According to the Disney finance person we spoke with while in Disney, Disney will finance anyone since they have nothing to lose. You don't pay you don't vacation.

We are still debating DVC and the new restrictions wouldn't have any weight in our decision because, like Ian previously stated, we would buy DVC to stay in Disney and we have taken a very long time to decide which resort is right for us so even booking in another DVC resort other than our home resort doesn't seem like something we would want to do so further restrictions don't really scare me. The resale point contract would pay for itself in about 4 trips (not taking into account annual dues)

As for using DVC point to go on other Disney vacations, never happen. The book I have from a few years ago 2008/2009 has a 9 day/8 night Italy "Viva Italia" - Rome Tuscany, & Venice vacation listed as 430 points (per adult) and 387 points (per child) during the "value season". Seriously do the math. 1634 points for a family of four (not to mention we are a family of 6).

Just out of curiosity, does anyone know what Disney is selling their older units at per point? Do they sell units from OKW, VWL, and other older DVC resorts? If so does anyone have any idea how much more per point Disney v. reslae market?

[DizneyRox]

Not exact numbers, but when I wanted to do an add-on at BWV, it was going to cost nearly the same as AKLV points (their current resort at the time).

There is a huge disparity between DVC and resale point costs on older resorts.

BTW - I think we are now at the point where Disney can stall the ROFR to the point where all resales now will fall into the ineligible category . I'm curious though if they would do this. I'm guessing they will.

[patandtwins]

Just out of curiosity, does anyone know what Disney is selling their older units at per point? Do they sell units from OKW, VWL, and other older DVC resorts? If so does anyone have any idea how much more per point Disney v. reslae market?

I checked on this right before Christmas. They sell OKW, BCV, BWV, etc. for $120/point. CRAZY!!! SSR and AKL were up there too...like $115 or $120.

[UCJen]

I checked on this right before Christmas. They sell OKW, BCV, BWV, etc. for $120/point. CRAZY!!! SSR and AKL were up there too...like $115 or $120.

Are you serious? We would really like to buy into BCV, but $120/pt?

I don't want to coerced into buying into Aulani, BLT, or whatever inventory they're having difficulty shifting.

We'll definitely be looking into the secondary market. That is, if Disney doesn't start, exercising ROFR left, right, and center--like DisneyRox suggested.

Every year, Disney does something that chinks away at my fondness for it. This is just par for the course, I guess.

[Ian]

I checked on this right before Christmas. They sell OKW, BCV, BWV, etc. for $120/point. CRAZY!!! SSR and AKL were up there too...like $115 or $120.

I've never priced these direct from Disney, but if this is true it's near outrageous. Those prices are like double what they get on the open market.

Maybe I'm crazy, but this almost seems a bit like price fixing on Disney's part. The true value of what they're selling isn't anywhere near what they are charging for it, so they're using artificial means to prop up prices so they can continue to reap additional, unwarranted profits.

I find that extremely distasteful.

[laprana]

Just out of curiosity, does anyone know what Disney is selling their older units at per point? Do they sell units from OKW, VWL, and other older DVC resorts? If so does anyone have any idea how much more per point Disney v. reslae market?

I found this pricing info on the DVC News site this morning showing what Disney currently charges for points at older/sold out resorts:

*BCV - $115 per point
*BWV - $115 per point
*HHI - $80 per point
*OKW - $101 per point
*SSR - $120 per point (incentives offered)
*VB - $80 per point
*VGC - $120 per point
*VWL - $101 per point

AKV and Aulani are currently selling at $120 per point and BLT is at $130 (incentives offered), although the site also says that BLT is going up to $140 per point as of March 7, 2011.

A quick look at some resale listings show contracts available for OKW as low as $57 per point, BCV as low as $75 per point, BWV as low as $64 per point, HHI as low as $48 per point, SSR as low as $62 per point, VB as low as $42 per point, and VWL as low as $60 per point. So, in some cases, buying resale would save about half the cost of buying direct from Disney!

[DizneyRox]

SSR @ $120 with incentives and considered sold out? Something doesn't smell right with that one.

I believe that SSR was part of the whole housing crash however and probably left Disney holding a ton of points now. Considering they were using them as incentives for AKL and I think BLT contract sales, it makes sense.

i think I need to step away form this one before I become even more disillusioned in TWDC. As hard as that sounds possible.