what happens in 2042

[sunking]

guys...
just wondering...dvc is supposed to end in 2042...hope i'm still around to deal with it but what do you all think will happen with dvc then...when will they stop selling since no one in the right mind would buy in towards 2042...
just wondering... :confused:
sunking

[Granny]

There has been a lot of speculation on what happens in 2042. Will Disney just create a new 50 year program and "resell" memberships (with 40-50 year old resorts)? Will they turn into cash ressie locations only?

I'm sure Disney has a master plan for this, but they probably don't need to formalize it for at least 10 years. With most of us figuring a 5-10 year "pay back" break even timetable, DVC will remain viable even as a 30 year proposition.

Another related question regards the new resorts that are built after BCV. Will they start a DVC II with a different ending date?

These topics have been debated here before and no one really knows the answer. But it's fun guessing! :)

[KNWVIKING]

They'll installed alot more handicap ramps. Up the wheelchair inventory about 10 fold. Have early bird specials at Olivia's. Bingo at the community center.

[EROS]

2042?????!!!!!!????

I just hope that I'll remember the way from Boardwalk to Epcot by then:) :)

[wdwnut]

too bad we can't get into any of the old posts. we had quite a thread going on "geriatric dvc" a year or so ago. requests for all the rooms to be near the elevators, regular vs. motorized wheelchair races, senior discounts, etc. we'll be well into our 80's and 90's at that time- dvc, what dvc? i can just hear us now.

[Werner Weiss]

It's quite possible that the executive who will ultimately make the decision of what will happen to the current DVC resorts in 2042 hasn't even been born yet.

[Granny]

Originally posted by Werner Weiss
It's quite possible that the executive who will ultimately make the decision of what will happen to the current DVC resorts in 2042 hasn't even been born yet. I know your post is somewhat whimsical, but I have a hard time believing that Disney doesn't have a few scenarios on what to do with the DVC homes already in the hopper.

I think that'll be my kids problem anyway. :)

[dianeschlicht]

LOL, Werner! That was a good one!

[firemankenpfd]

My wife and I will be in our mid-70's so let's just enjoy it while we are young and let the future just happen....We are looking forward to enjoying Disney with our kids and our grandkids down the line....

[lrodk]

I just returned from a 2 week trip to WDW(stayed at the Dolphin). I'm a DVC member at BWVs and have several contacts within the DVC sales dept. I have news directly related to the 2042 expiration date. While not official, and I cannot name the source for purposes of anonymity, I've been told from a very reliable source that Disney is in the process of considering a very attractive DVC Renewal program, which in affect would extend the contracts of current members beyond the 2042 expiration date. The fees would be modest and would allow members to pass along rights and usage of their vacation ownership to family members past the 2042 date.

My source went on to add that more and more guests are opting for "home-away-from-home" type accomodations vs traditional hotel room accomodations, something that I appreciated on this trip after having stayed at BWVs for the first time this past May. Once you stay at a 1 or 2br suite with children in tow there's just no turning back. Food alone is outrageously expensive if you rely on dining at the parks/resorts every night. I really missed our DVC room during this stay. Anyway, demand is spreading like wildfire for DVC, which is the reason they're working on the renewal program. At some point, if the new program is in fact launched, new members will receive a new expiration date beyond the 2042 calendar year once the legal isuues of current contracts, and how they would relate to the proposed renewal contracts, are worked out. DVC is currently the best business model for Disney right now at WDW, consistently showing positive interest during a time when other on-property resorts are struggling. DVC is here to stay, and it seems that current members will have a wonderful option that will allow them to extend their usage should they decide to take advantage of it. I don't know about the rest of you, but I'm very excited about this.

[Dean]

If they have newer resorts with a later expiration (Eagle Pines if it really happens), it would make sense to extend the entire group of resorts and it would make things much more simple for Disney. I have heard this rumor as well.

[PamOKW]

Along the lines of DVC moving into geriatric territory....I found it interesting that the latest VM talked about the 15 new wheelchairs OKW has purchased. I know they are important but it struck me as funny that maybe there is "increased demand" as we hit the 10 year mark. ;)

[mikek]

i Never understand this talk of a later date or DVC II. Why would they give anyone more as long as they can sell it the way it is without any problems?

[Dean]

Originally posted by mikek
i Never understand this talk of a later date or DVC II. Why would they give anyone more as long as they can sell it the way it is without any problems? Part of the problem is that it is unlikely they will actually be able to sell Eagle Pines "the way it is" with an expiration of 2042. Since it's such a large resort, will start selling in 2004 AT THE EARLIEST and will likely take some 10 years to sell out; it is unlikely to have an ending date of 2042. If it did, there would only be some 38 years remaining at the start and 28 at the end. IMO, they must extend it at least to 2050 and it's likely they would extend it to 50 years from initial sales, hopefully 2054.

I'm sure they wouldn't give it away, what they'd likely do is offer to extend the time for a fee. Something like an extra $15-20 per point to extend for the extra length of time. Remember that we would be buying only some additional 10 years or so in 40-50 year old resorts with high maint fees.

[mikek]

I hear ya Dean, but i dont see the problem untill at least eagle pines and maybe even after. If i remember correctly there was a camp whjo though wilderness lodge would need a later date, and quite a few times it's come up that BCV 'must' be the start of DVCII. Didnt think about eagle pines taking so long till you pointed it out, so i'll have to mull that one over.

Everyone calculates the payback at 10 or 15 years. I think they could easily sell it still with a 20-30 year time frame, your payback is still half the life of the thing. We (those who own already or buy soon) got a GREAT DEAL, why wont people buy it when its just a good deal? They arent going to discount a thing by lowering the price (or giving longer duration for the same cost) until people stop buyiing the way it is now. I think the resale market backs me up- the trend is up and up and up if you take out the current economic mess- if it still wasnt a great deal the prices would at least stay stagnant.

At some point I wholeheartedly agree they will need to stop jacking the price every year. I never bothered to work it out on a spread sheet, but i think its very late in the game before they need to actually reduce the cost or lengthen the contract. Once they stop jacking the cost, inflation devalues the cost every year for them.

Who says they even need to decide when they start selling eagle pines. If people stop buying, stop declaring inventory into DVC and only then start DVCII- no?

[Caskbill]

One thought about a DVC II, say Eagle Pines with a new 50 year term, Disney could easily find themselves in competition with the current DVC.

Let's say Eagle Pines is trying to sell in 2010, after being open for about 5 years. They would then be offering 45 years, at (just for an example), $100/point. Also, by then, many current owners may start thinking about selling their DVC memberships, since they'll be down to 32 years left. This just might be about where the prices begin to drop, or at least level off, as we start toward the downhill side of the original 50 year contract. In this case, let's say that resales start to go down in price. Just for example, say at that time they'd be $70/point.

Now, if you're a brand new buyer, which is more attractive to you? 45 years at $100, or 32 years at $70?

Numbers are for illustration, but I think the point is clear.

[Dean]

A few points I've made before. First, no real need for a DVC II. There's nothing in the setup that would preclude having a new resort in the system with a different expiration date. There's even a provision for extending any of the resorts and they could extend one resort without extending others if they wanted.

As for price competition, that is going on now and DVC is doing OK. Don't forget, they have ultimate control. As long as they excercise their ROFR, the prices will remain fairly close to retail. I think DVC could hold their own in sales at the prices Casbill quoted. The price difference now is $75 vs around $60 with all ending dates the same and DVC doesn't seem to be suffering.

Also remember that Eagle Pines will be directed far more at new sales than add ons which is somewhat different that WL and BC, slower economy, higher prices and likely more points per unit will all factor in. As for the value of DVC in terms of getting our money's worth, it varies with each family. From my standpoint, I'm not sure DVC has saved me any money, it's simply allowed me to have better options at around the same price.

I think BC can sell with an expiration of 2042 but think it's possible that they will have a later one if they are going to go that route anyway with Eagles Pines, they may want to get the benefits now. In the Timeshare world, less than 30 years seems to be the time when prices start to suffer. I just don't see DVD taking the the chance that they'll have a resort with less than 30 years that they'll have trouble selling. Remember this is still for the money and Eagle Pines is actually larger than OKW in terms of number of rooms and likely far larger in total points costs to fill the resort. I know I personally wouldn't have bought as my first DVC purchase at Eagle Pines with less than 30 years for around $100 and 350 or more points for a 2 BR and I suspect most people new to the concept wouldn't either and that's the people that will need to buy most of the points to sell such a large resort. There are only so many sales you can get from present owners. Obviously it partly depends on what gimmick they come up with and they will need a gimmick. Something along the lines of the free passes but it will be something else.

[CaptainMidnight]

They'll installed alot more handicap ramps. Up the wheelchair inventory about 10 fold. Have early bird specials at Olivia's. Bingo at the community center.

Very good, got a good chuckle from this one.....

[gmboy95]

There are only three questions i can think of that are relevant in 2042

1) will my kids take me out of the "home" long enough for me to travel to disney world?

2) Is sipping oatmeal through a straw a pleasurable experience?

3) Will my social security check cover the cost of admission to disneyquest?

Please keep in mind people....it is my stated goal to make sure when I croak, my kids will find a $0 balance in all of my accounts....I look forward to sending them to a reasonably priced college and then immediately turning their room into a TV den, complete with sattelite TV....then I will sell my house after they graduate, and spend all of that money foolishly at Disney.....and yes I will tack my wrinkled behind to disney in 2042 to make sure i have maximized all of my assets!!!!!......So as to the question "what happens in 2042"....WHO CARES!!!!....its my kids problem..hahahahahahahahahahah!!!!!:D :D :D :D :D :D :D :D

[CaptainMidnight]

Great news, lrodk. Thank you for sharing. I would probably extend my ownership in order to pass along some extra time to my children for them to continue the magic with thier kids. They can remember dear old Dad shooting it out with them on Buzz Lightyear or holding them as we shoot down the water rapids and have some wonderful experience with thier children and maybe grand children.....

[ralphd]

Remember our DVC is a very profitable part of the Disney business plan.

Think BCV will retain the 2042 expiration date.

Also believe Disney will want to retain the present member base for the existing DVC resorts for as long as possible. It is 'probable' that they will draw up a plan to retain the current memberships beyond 2042.

The contract extension offer will be in line with the new expiration for Eagle Pines.

The offer will have to be attractive enough to entice us to extend our memberships in (as Dean said) what will become older resorts. Note that Disney has set up reserves to handle future maintenance expenses.

The DVD business plan will assume a certain percentage of the Eagle Pines sales will be to existing DVC members. Agree it will probably be a smaller percentage than VWL and BCV.

Interesting isn't it????????

Think there is an answer in the above opinions!

ralphd
:) :) :) :) :) :)

[Dean]

Looking at this from a business perspective. If I were DVD and Eagle Pines is still in the works, I'd extend BCV to 50 years from the start selling date then have Eagle Pines with the same expiration of say 2052 or even a little longer. I'd find some gimmick to activites at Eagle Pines like a themed pool, golf package or the like. I'd then offer those that added on there say at least 100 points to extend their total membership to end in 2052. Once the resort was mostly sold out, I'd then offer current members with expirations of 2042 to extend for around 15% of the then current sales price, at least for the on property locations. I'd likely not do the same for HH and VB, but I'm sure others would.

One item is that to run the big organization that MS and DVC has become (and it will get worse) takes a lot of money. The problem of funding that from only one or 2 resorts will be difficult. It's hard to decrease spending enough once things have been running for a while, just ask the government.

[EROS]

Originally posted by Dean
It's hard to decrease spending enough once things have been running for a while, JUST ASK THE GOVERNMENT.

You got that right;) ;) ;) ;) ;) ;)

[KNWVIKING]

..... Ditto,Ditto,Ditto.

We have told our two boys for years not to look for an inheritance,we're spending everything.

We did let them pick their colleges- one in Boston,one in Rochester, but they busted their humps in high school so we didn't let cost rule the decision.

Already converted one bedroom to a den.Making plans for the 2nd.

We plan on selling the house when the youngest graduates in 4 1/2 yrs and heading either to FL or AZ.

And I'm not sure about oatmeal but I think cream-of-wheat travels nicely thru a straw.

[mikek]

dean-

'from a business perspective'-

I dont get your point- why would they add years to BCV when it will most likely sell out fast itself. People say they plan to have pre-sales, it's small, and the resort accross the way sold out pretty quick. Why sweeten the pot? They have been jacking the prices up and up at a rate i think faster then inflation, yet reportedly sales trend up and up and up....

Seems the price is pretty elastic (or is that inelastic- i slept through most of econimics...). In other words they havent hit the price line yet where 'the invisible' hand slows down sales- even with less and less value in years

Did you mean more years in exchange for a hefty price increase? That i could see making sense.

[ralphd]

DVC sales has a long waiting list of members for BCV. Some will obviously drop off because of the economy (and other reasons). They expect it to sell pretty quick.

ralphd:) :) :)

[Dean]

mikek, My point was that if Eagle Pines is still on it will almost certainly have a new expiration date and it doesn't make sense to have only one resort ending at a later date. I don't see how they could sell that one without an extension of the current deadline. The inherent costs of the system would be too great. I'd look at the big picture. May as well go ahead with BCV and expand the length of usage at the same time either upping the price or stimulating sales. I don't think for a second that BCV will sell out that quickly. True, it's a small resort but WLV sales are slowing down somewhat and I'd be surprised if BCV sold nearly as quickly. True there will be an initial push from those either wanting to add on or waiting for that resort opening to purchase but after that things will settle down.

True, if their plan was to offer an extension to current members, it wouldn't matter that much. They would accomplish the same goal in the long run. If not, they will want a larger member base to spread the expenses out once teh current resorts drop out.

[mikek]

oh- i just assumed it was a given that they would offer extensions. As you said- it would be hard to have just one resort like that.

As far as how long it takes to sell out BCV- you probably know better than me.

[plain crazy]

in thinking this through, remember that the "value" of extending ownership from 2042 for, say, another ten years is pretty small in 2002 dollars.
let's say hypothetically that a point is "worth" $10/year to the holder. the present value of that point over the next forty years (i.e. to 2042) at a discount rate of 7% is about $133. now let's assume that the life of the point is extended an extra ten years, to 2052. the present value of that point over the next fifty years at the same discount rate is about $138, or only 3.8% more.
so what? what does this mean? among other things, it implies that either dvc will wait until they need the cash (which could be many years in the future), and charge much more for the extension (of course each point holder will have had the use of his/her cash for that same period of time), or if dvc has attractive uses for the capital now, it can extend for very little cost per point.
more bluntly, this also means that if dvc charged anything beyond a nominal sum for the extension, it would be a rip-off. and although many people may not have a background in the analytics of discounted cash flow, enough people do that i think word gets out about what is a good deal, and what is not.
incidentally, the analysis is not very sensitive to the discount rate you choose, provided you use the same rate in both scenarios.
**********************
just a few more thoughts to confuse the discussion.

[Dean]

mikek, there is a provision in the POS for an extension but the last 6 months is the first indications from the DVC side that it is even being considered. There are a lot of reasons to think they would extend IF THEY HAVE OTHER RESORTS WITH A DIFFERENT AND LATER EXPIRATION. There are some drawbacks though. I'm sure the determining factor is DVC's estimation of what percent of owners would extend and how much they could get. I'd guess that DVC would need around 40-50% participation in order to make it worthwhile. They'd then need either to sell the rest again or just rent out the remaining inventory. I wouldn't think a major sales push would be reasonable and if they still have new sales at the time (which I doubt), they'd be competing with themselves.

I'd agree that there's no reason to extend BCV on it's own but looking at the whole picture, it makes sense if they will have a new resort with a different expiration, just do it all now and pick ONE new date.

plain crazy, I would just look at this in terms of todays dollars and assume the inflation, etc would take care of itself. The trouble is that 50 year old wood structures in FL don't hold up all that well. Even if they extend it for free, it might not be a good deal depending on the yearly fees at the time. I'd assume say about $1.00-1.50 per year per point which is in line with current sales prices. That's equivilent to $75 per point for 50 years. I think you must look at it like a new purchase at the time. Basically buying 10 years at X price. It remains to be seen if it'll be offered and if it will be a good deal or not for the consumer.

[plain crazy]

dean:
i agree that if you were extending at or near the end of the original term you'd have to look at it as a new investment. and at that point it might have some measurable value associated with it, in 2042 dollars. my only point was if, for some reason, dvc offered extensions today it would be worth very little money in today's dollars, just because the benefit is 40+ years in the future. this is just a simple reflection of the time value of money.

[legs22]

Too bad you pay all that money and It's only yours until 2042. I bought a timeshare in Key West and I have the deed and own it forever to pass on to my kids. I trade to anywhere in the world (RCI has more choices than II), or I can rent it out (and have a Disney cruise paid for, for me and my DD4).
What are the advantages to owning at DVC? What are the price ranges? I can only imagine, since it's Disney.:rolleyes:

[Dean]

Originally posted by legs22
Too bad you pay all that money and It's only yours until 2042. I bought a timeshare in Key West and I have the deed and own it forever to pass on to my kids. I trade to anywhere in the world (RCI has more choices than II), or I can rent it out (and have a Disney cruise paid for, for me and my DD4).
What are the advantages to owning at DVC? What are the price ranges? I can only imagine, since it's Disney.:rolleyes: I own both DVC and other timeshares and find each have their own positives and negatives. DVC is for staying at a DVC resort and not reasonable if that's not the buyers main goal. For flexibility and WDW usage, DVC is the better choice by far.

For exchanging and stays in the Keys, other timeshares ar better choices. As for the length of ownership, I think it's somewhat irrelavent. 40 years left is enough to make it a moot point. I can't think of anywhere I'll want to be in 40 years, I'll just be happy if I'm alive and well. Also, there are few timeshares I want to own that are 50 years old and that includes DVC and Marriotts. As for price, you usually get what you pay for. I own timeshares I gave somewhat more than I did for DVC and others I gave a fraction of that amount. Each fits my needs in their own way and all 8 weeks are worth on the immediate resale market more than I gave for them including my 2 DVC contracts. 5 weeks I own are deeded, 2 DVC contracts expire in 2042 and my MX week expires in 2033 and I bought it after DVC.

[slimplaw]

I'll be in my 80's. Actually, I am waiting for them to offer a retirement home plan. I'd be delighted to buy in to a retirement plan in about 15 to 20 years and work somewhere at WDW 1 or 2 days a week.

[legs22]

Dean-
Thanks for your timeshare expertise. Is it true that in 2042 DVC ownership reverts back to Disney? That's what I thought I read on one of these info threads. Does Disney give you any money when this happens? Would you sell before ownership reverted back to Disney? But then if there wasn't much time left- who would want to buy it?
Thanks. Just trying to understand all this.

[TXTIGGR]

Werner ... LOL.

What a thought, oddly enough very likely.

So ... everyone make sure you bring your kids,
grandkids, and their friends to WDW.

Take them to B&C for a "Kitchen Sink", let them
ride the slide through the clown at BW til it's dark,
and run back to ride Rock'n Roller Coaster "just
one more time".

In short, have fun!

With any luck, that should ensure whatever
guy or gal makes that decision based on
"value" and not purely economics.

-TXTIGGR :)

[Dean]

Originally posted by legs22
Is it true that in 2042 DVC ownership reverts back to Disney? That's what I thought I read on one of these info threads. Does Disney give you any money when this happens? Would you sell before ownership reverted back to Disney? But then if there wasn't much time left- who would want to buy it?
Thanks. Just trying to understand all this. DVC does revert back to Disney on 31 Jan, 2042, if it's not extended. No residual value. If you sell late, I'm sure the return will be slight. Still, likely the best investment I've ever made.

I own 8 timeshare weeks to include Marriott, DVC, MX and Aruba. They are all a great value in their own right. I think the Royals in Cancun are the only timeshare that will reportedly give you back money at the end of the time. This remains to be seen if it will actually happen, though come 2006, we should get a pretty good idea as the first Royal, VCI, will expire then. Remember that purchase price per se is not the most important factor in value of a timeshare resort, quality, yearly fees, how well it fits your needs are all more important. I know of weeks they will give you as long as you pay the yearly fees, still not a good deal. DVC used appropriately and for the right family is the best deal going. I also own at Marriott's Grande Ocean which I like just as well but for different reasons and a different vacation experience.

Unfortunately the party line on TUG is anti DVC and anti Disney. The idea that DVC is a bad deal becaues it's RTU with now 40 years left and that the Royals or Marriott Aruba or Marriott Custom House are great, is frankly hypocritical. I could also care less whether Grande Ocean is deeded. At least with a RTU, someone can simply walk away at some point with no hassles, no special assessments and no yearly fees on a 50 year old property.

[legs22]

What is RTU?

[WebmasterDoc]

RTU= Right To Use. We don't actually own the property, but own the Right to Use it until 2042.

[DVCajun]

gmboy95, you crack me up!!! :D Those are my sentiments exactly! I didn't buy into DVC so my children and grandchildren could go to WDW after I'm gone! If that happens, so be it, but I'm certainly not happy about it! I want to enjoy every year there myself! I too plan to spend every penny I have -- if possible at Disney World!!!! :cool:

Maybe they'll institute a Bingo night for us. heehee

[gmboy95]

Yeah...and maybe disney can make a deal with ENSURE so that we can buy cans and get free re-fills for the entire trip.....I predict they will be spending our dues those portable golf carts, so that all of us can make sure we make it on time to the ice cream social.....oh and I almost forgot....olivias will be turned into a buffet where we can eat half price before 5pm.

Hope to see you all this May in VWL, and also in august at BWV!!!