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View Full Version : Possible Buyer - Is it wrong to think about it this way?


Stichey
02-18-2003, 01:28 AM
Hi!

My family is considering purchasing interest in DVC. I have read the various posts within this great board, but near as I can figure it, the club is essentially a large buy-in amout for the ultimate right to take vacations for the next 40+ years at the cost of your fees.

Here is my thinking, if I were to buy in at about 150 points, it would cost me (ballpark figures here), $12k plus closing (about $500). In addition to that buy in, I am obligated to pay for the fee charge equal to my points (about $700-$800 points). Once that initial chunk is all paid, then the real value of the DVC is being able to have the deluxe Disney accomodations year after year for the fee amount (again $700-$800).

Yes, I'm still liable for the cost of food, transportation and park admission (at a discount), but lodging from that point on, is greatly reduced.

So, is that sound thinking, or am I missing something? Even with DVC framed in that manner, I still think that it is a benefical venture, since we do really enjoy visiting the Disney parks in both California and Florida and the ability to have tremendous accomodations is worth the $800 for the next forty years. We do like the more upscale accomodations like the Grand Californian or the Old Key West, so most vacations will cost us more than that. In addition, the flexibility of deciding when we want to go and the ability to increase the size of our accomodations (while expending the proper amount of points) is perfect, but again, all of you that actually own interest in the club would know best. I would love to hear any thoughts on this matter. From the reading I have done, it is obvious that this is a thoughtful group that performed a considerable amount of research before purchasing. As a non-number cruncher, again, I would love to hear anyone's insights into this matter. Thanks in advance!

Bottlejet
02-18-2003, 02:09 AM
Actually you have really hit the nail on the head! However you could save the up front costs and just rent DVC points. It's far less expensive. Remember DVC is not an "investment". Our family stayed at a DVC property last week for about 60% of the going rate. Make your money work for you, not the DVC.

vernon
02-18-2003, 05:18 AM
Your logic and understanding is reasonably sound. I disagree with botlejets summary of the situation, in that I think in the longterm your money works best by buying into DVC not paying on a year by year basis. I feel there are special circumstances that account for some of the good deals available at the moment and that longterm it will work out more cost effective tobe member, but that's up to each individual to do their own costing

Dean
02-18-2003, 06:31 AM
Only buy in if you want to go to WDW most every year and staying on property is something you'd pay for. Even then it doesn't work out well for long weekends.

Beth
02-18-2003, 06:51 AM
Bottlejet's logic might be sound if you intend only to take short stays, lasting only Sunday thru Friday but, if you intend to take longer stays which would include Friday and/or Saturday nights, renting is no longer that much of a savings over just paying cash.

If your stays are going to be longer than for 5 nights, investing in DVC would be the better option, IMHO.

You have grasped the concept beautifully, by the way...

- Owners since '97, no regrets, need more points......

poj7
02-18-2003, 07:23 AM
I was laughing to myself because your method of deciding/rationalizing buying in to DVC was exactly the same as mine. I'd be happy to give you my thoughts on DVC. We bought in Sept '02 when we were visiting WDW and paying cash at BCV. Let me know if you want to talk further about this.

Paul

dbond
02-18-2003, 08:40 AM
Your logic is exactly how we approached our purchase in 1997. However, we have since added on twice because we love it so much. You'll hear many different rationale's pro and con, I get a chuckle out of the accountant's in the group and the way they crunch the #'s. We justify our "investment" 2 ways, we have invested in years and years of memories for our family and their families as they grow, and second our initial cash "investment" is now worth about 20% more. I haven't had that kind of return on my money anywhere else in the last few years. I don't know if that value will hold up over time, but the same holds true for where the rest of our money is invested, but I do know that the memories we are creating are priceless and the opportunities are endless and that's enough for me.

KNWVIKING
02-18-2003, 09:03 AM
Can bottlejet guarantee you points will always be availible ? when you want to go? or what thier price will be in 20 years ? As a DVC member your only real variable is the cost of dues, but you have 10-11 yrs of OKW dues history to see that increases have been minimal-some years actually decreased. I want to be at WDW three times a year, and DVC is the best way for me to do that.

vbfamily
02-18-2003, 09:03 AM
FYI-I'm sure you know this but your fees aren't set for the next 40 years.

I couldn't tell from your post if you knew that or not.

It doesn't look like it has been or will be a problem-some go up 2, 3, 4% a year and I guess a couple times they have actually gone down.

They are capped (sp?) at 15 or 20%-DVC can't raise them more than this each year.

Just wanted to make sure you knew this. We tried to figure the cost of the annual fees over the next 40 yrs based upon them going up 3% every year-I think that was rather conservative and it gave us a good indication of where the yearly fees may be in 10 or 20 yrs.

GAIL HAYDEN
02-18-2003, 09:06 AM
Just a couple of points here.
There are no closing costs and the only admission discount at this time is for the UMP and that is at 10%. You do get some discounts here and there, but, that would not be a reason to join DVC.

todsue99
02-18-2003, 09:28 AM
I like your thinking. We bought into DVC for one reason and one reason only. I would not pay the kind of money it cost for 40 years to stay in a two bedroom at any of the resorts. I know all the number crunchers out there will laugh, but buying into DVC makes me go on vacation at least once a year (3 times last year to WDW) and stay in a very nice place. If I was not a member I would be looking for places off site or still Camping. We loved the camping, but it wasn't what we wanted to do for 40 years. The intial cost is hard to take, but I think it will pay for itself in the long run. Just my thought.:D :crazy:

poj7
02-18-2003, 09:34 AM
Tod,

I couldn't have said it better myself. You can think this stuff to death but the bottom line is that we love the place and it makes it so easy to go and when we go we really get to enjoy it the way it was meant to be enjoyed.

Paul

lacool
02-18-2003, 10:41 AM
Tod, I am a number-cruncher by trade, and your reasoning exactly why we bought in to DVC. We could have stayed elsewhere cheaper, but could not have come close to the DVC accomodations. And now we are required to vacation at least once a year -- or, if we miss a year and bank, in extreme luxury that we would never, ever have done if we had to pay in cash. We like to live well on vacation, and now we will for the next 40 years. Sounds like a logical investment to me!

TandyR
02-18-2003, 11:23 AM
I am with Tod, Paul and lacool. My DH is a computer programmer and I am a stay at home mom and we have two DDs. It wasn't until we bought into DVC did we start taking regular vacation and planning them and going on them. Before we would talk about vacations, but never take them. We know now we will be going on vacation to WDW at least every other year. It might not be the best financal investment, but it is a wonderful investment in our family and our sanity. (said looking out my window with the snow falling and a ton of snow on the ground.)

todsue99
02-18-2003, 11:34 AM
Glad see everyone seems to agree. One more note: It makes you plan ahead for vacations and there is nothing better than counting down to the next one. People at work hate you for it, but sometimes it gets you through the tough days. I don't think I am alone on this either, just look at all the count downs on the board. My only problem is I don't have my next one scheduled yet.:(

Stichey
02-18-2003, 12:54 PM
Really, I cannot express how grateful I am for each and every insight shared. This can be such a large decsion for my family or any other, I simply wanted to be certain that my reasoning was sound.

To respond to some of the questions that were raised, I should have explained that I was looking into purchasing a DVC share from an individual selling their's and that is why I mentioned closing costs. Based on a casual look, it seems like there might be some advantages in purchasing from an owner over Disney (although without doing any real research, it seems like Disney is doing the same).

If it wouldn't be an imposition, I was now curious if it made more sense to try and obtain a package with a lower fee amount (due to the home resort) over a higher one since all are available anyway (aside from the four month difference in making reservations between home and alternate resort)?

Regardless, thanks to everyone who replied. I do so appreciate it!

Dean
02-18-2003, 01:31 PM
Originally posted by Bottlejet
Actually you have really hit the nail on the head! However you could save the up front costs and just rent DVC points. It's far less expensive. Remember DVC is not an "investment". Our family stayed at a DVC property last week for about 60% of the going rate. Make your money work for you, not the DVC. I don't really believe this is the case in the long run and we have discussed this before. At the risk of getting censored, your approach rubs me the wrong way. Maybe it's because I know you were talking down the price before saying you could consistently rent for $5 pp or so.

todsue99
02-18-2003, 02:04 PM
I agree Dean, but Bottlejet might be correct if you are going to do it once or twice and don't really care where you stay. If you want to have control and go on vacation every year then we are talking a whole different story. I want to go to Disney every year or some place else with similar quality and DVC makes me do this. Or maybe 3 times like last year. To say again what I did before It makes you stay in very nice places. Let me see, I have been to Disney camping in a pop-up trailer 6 times and now I stay in two bedrooms. Which do you think is better? Don't get me wrong I like the camping experience and will probably do it again, but the two bedroom is so much nicer. The biggest thing with Disney is the cost of tickets. If we can get DVC to get us a discount now that MKC is no more. It sure is nice to dream anyway.

Cruelladeville
02-18-2003, 09:39 PM
We bought into DVC because Caribbean Beach had gone up to this un-Godly rate of $163 per night, and it finally penetrated my thick skull that I was paying $1630 plus tax every year, and, at that rate I could have DVC paid for in 6 years, and actually own something. I didn't even consider--at the time--that DVC accommodations were so much nicer, for me it was $$. Later on I realized that I had done something REALLY good when I had bought in, and I have become even more excited about it over the years.:p

Lilly's Dad
02-18-2003, 10:01 PM
Just as when buying a car you should keep in mind how much it will be worth when your ready to trade it in "salvage value"); you need to realize that your DVC property investment will probably bring you back 80-90% resale when you're ready to sell it. Current conditions considered, of course. Naturally, some Arabs scare (the "T" - word) people in Disney all values are anybody's guess.: we're all in trouble.

Macnjac87
02-19-2003, 10:56 AM
Tod and Paul--

You hit the nail directly on the head. It's exactly how DH and I view our DVC purchase.
We are heading "home" again in 39 days and its been less than 1 yr. since we went. (This is a snow emergency vacation!!!)

Bottlejet
02-20-2003, 01:12 AM
Originally posted by Dean
I don't really believe this is the case in the long run and we have discussed this before. At the risk of getting censored, your approach rubs me the wrong way. Maybe it's because I know you were talking down the price before saying you could consistently rent for $5 pp or so.

First of all, let me point out that I am a bargain hound! It's just my nature. My family and I have been regular visitors to WDW since 1983. We average about 4 trips a year and usually stay for a week. Part of the fun for us is staying at the different resorts. Over the years we have stayed both on and off property but during the last decade we have stayed exclusively on property. While we have stayed at most of the WDW resorts, we haven't stayed at them all....yet. Over the years we have booked packages through travel agents, booked our own packages and we were even lucky enough to once win an all expenses paid WDW week long vacation! In short, we know the ropes.

Our most recent trip was from 02/09/03 through 02/15/03 (7 nights). As with all of our trips we set out to find the best deal. Sometimes we end up at the All-Stars and sometimes we end up at the Disney Inn. This trip we found a great rental rate at the Boardwalk Villas. The rack rate is $390 a night for a 1 bedroom via the CRO. We rented 210 points at the BV for $1,025.00. I want to apologize for my previous post in which I stated that I got 60% off. I hit the "6" instead of the "5". I meant to say that I got 50% off. Please forgive my error.

Also, I'll be the first to admit that low rates at WDW resorts will not last forever. While the rates have been depressed during the past 2 years, I fully expect the resorts to rebound in the next 8 to 10 years. Let me add that while we stayed at the BV we were given the option to book at any WDW resort at any time this year (until, 12/2003) at a guaranteed rate of 40% off! I turned down the offer because I know I can get a better rate. WDW has about 9,000 rooms they wish they had never built!

Hi Dean! The slump in visitation the WDW is not my fault. I am only taking advantage of the decline in tourism because I can afford the time and the money. I have not rented DVC points from anyone on this board. I don't have to drive down prices. The prices are all ready down. It's called supply and demand. You seem to have a desire to fix prices rather than let the market decide.

Dean
02-20-2003, 06:30 AM
Originally posted by Bottlejet
Hi Dean! The slump in visitation the WDW is not my fault. I am only taking advantage of the decline in tourism because I can afford the time and the money. I have not rented DVC points from anyone on this board. I don't have to drive down prices. The prices are all ready down. It's called supply and demand. You seem to have a desire to fix prices rather than let the market decide. As I said before, I don't have any problems with you looking for a bargain or posting what a bargain you got. Letting people know what you got and what they might get is reasonable. I just got a 1 BR at BWV for a full week in Sept for $344. While I won't be able to use it the entire week, a friend will use the first few days and I will use the rest including a full weekend. If I just look at it as the weekend rental, it's about $100 a day plus tax even if all I charge my friend is a cleaning fee in between our visits. I'm a bargain hunter also but I"d never tell anyone what they should take, only what I'd offer.

The problem I have with your type of poster is the appearance that you're talking down the prices with a least an idea of generating the future higher chance of getting something cheaper later on. Anyone that rents non distressed points for the amount you described is out to lunch, unless they do so because it's friend or family want to give them a break. If someone sees your post, doesn't know better and gets worried then rents for that just because you said that was the going rate, you personally have done them a disservice. You DID post previously that the going rate was $5 pp, not just that you were lucky enough to get a rental at that rate. To me there's a big difference and the former is over the line of appropriateness, IMO for what it's worth. I can't tell your heart and intentions only what you wrote now and previously.

As to a slump, I don't think that applies to points other than the discounts at other hotels and competition for rentals. I personally have never had any problem renting my points for $10-11 pp (and that includes now) and I turn away many more people because I don't have points to rent after the few rentals I do and personal usage. Your reply was civil and I've tried to make mine as such while still being honest.

Tine
02-20-2003, 08:56 AM
Hi All!
Ok, OK, happy to report that we are proud purchasers of BCV as of last pm!!! And needless to say, my DH & I (&3kids) are thrilled beyond words! We're going in Oct & CANNOT wait. We're going to be in a 2BR Villa Thanks for ALL the advice, it really helped us make the final decision. Obviiusly all are happy, satisfied Disney-ers. I do agree tho, this is NOT a financial investment, it's a family/memory investment, one which will reap it's benefits for years & years to come! Bottom line, we too JUST LOVE the place, & look forward to making many more happy memories there.
THANKS again!
Chris:earsgirl:

todsue99
02-20-2003, 08:59 AM
Welcome home! Chris. Congrats.:bounce: :Pinkbounc :bounce: :Pinkbounc :bounce: :Pinkbounc

icydog
02-20-2003, 10:01 AM
We love DVC and have been members for 11 years. I love the resorts and am always proud to bring family or guests with us. WE watch their faces light up with amazment when first seeing our accomodations. We always get a 1 bdrm when we are alone or 2 bdrm with family or guest. We never squash people in and this adds to our enjoyment. I would say that Disney isn't a great investment, some of my points are worth about $6 more now, most less, but as a number of people have said, it does encourage you to vacation and have fun. We have travelled to Paris and London on points and have stayed in four outstanding Concierge Collection resorts. We never could have afforded such luxury befroe DVC. Our kids now go down with their spouses to WDw and we love that we can provided them with such luxurious rooms. They are completly spoiled by DVC and only expect the best when they travel.
Marylyn

poj7
02-20-2003, 12:17 PM
Wonderful stories. That's what it's all about. Welcome Home!