Small Contracts (50 points and under)

[Tunseeker1]

I have some questions on small DVC contracts.

1. Direct.
I spoke to a rep that said that for an initial contract I can purchase a 50 point contract at current pricing and they would give me the 2011 and 2012 points right away.

2. Resale.
How often do small contracts come up for resale?
How long do they take to sell and what kinds of pricing?
How often do they make it through the ROFR?


I have offers on 2 contracts right now waiting on ROFR, and I am worried about them making it and how often I can get more of them at decent pricing.

If they don't make it past Disney, I don't know if i should just purchase direct or keep trying.

 

[xstitches]

I just made it through ROFR today on 2-50pt contracts with BCV.

 

[Kidanifan08]

Small contracts come up not infrequently, but you have to watch for them on a daily basis. Contracts for under 100 points don't last long. Often it seems like they are gone within a day or two. They tend to sell for a higher price, so they usually pass ROFR. We purchased AKV 50 pt and 55 pt add-ons last year and both passed. Both were listed in the AM on the day I bought them and there were other 50 pointers listed the same day that were sale pending at the end of the day.

Some people have suggested calling the major resellers and getting on a list to be called when the small contracts come in. Some of the small resales may not even make it to the postings, as they are purchased when they come in to the resellers. I don't know that this as fact, but have read it on other threads about purchasing resale.

 

[nunzia]

I'm just amazed that you can buy a direct initial contract of 50 points when not long ago initial purchases had to be 160 points and I went through all kinds of hoops to get my contracts in small chunks..

 

[emilymad]

Typically how much more do smaller contracts go for? 30% more? I looked at the ROFR thread but there aren't that many recent small contracts listed.

 

[disneynutz]

We own 26 contracts and the majority are 50 pointers purchased years ago before the price hikes. Like anything supply and demand will set the price. The other benefit is that you can sell off 1 or 2 contracts should your needs decrease and 50 point contracts sell fast.

Disney isn't giving you anything, you are buying 2011 points because they are selling you a 2011 contract.

Take the time to learn about UY and all of the rules and policies that will affect your membership.

Bill

 

[permavac]

Typically how much more do smaller contracts go for? 30% more? I looked at the ROFR thread but there aren't that many recent small contracts listed.

I can only speak to my case - I am in ROFR for 2 small contracts. The 50-point BWV I calculated that I paid approx 30% more than the $50 price/point you might be able to get for a higher point contract. For my OKW 75-point I calculated that I paid 10% more than a possible $50 price/point you might be able to get for higher points. So in my case, the range was from 10% to 30% more. Hope that helps.

Terri

 

[Tunseeker1]

I can only speak to my case - I am in ROFR for 2 small contracts. The 50-point BWV I calculated that I paid approx 30% more than the $50 price/point you might be able to get for a higher point contract. For my OKW 75-point I calculated that I paid 10% more than a possible $50 price/point you might be able to get for higher points. So in my case, the range was from 10% to 30% more. Hope that helps.

Terri

What was the total cost per point when you figured in closing and dues?

 

[permavac]

What was the total cost per point when you figured in closing and dues?

About $63 per point for the OKW one - Disney took that in ROFR. About $80 per point for BWV - still waiting to hear on that one.

Terri

 

[Tunseeker1]

About $63 per point for the OKW one - Disney took that in ROFR. About $80 per point for BWV - still waiting to hear on that one.

Terri

Sorry about the ROFR.

 

[permavac]

Sorry about the ROFR.

Thanks. That's life. Fingers x'd for the BWV ones - hopefully I paid enough to make them not interested in that one

Terri

 

[JimMIA]

I have some questions on small DVC contracts.

1. Direct.
I spoke to a rep that said that for an initial contract I can purchase a 50 point contract at current pricing and they would give me the 2011 and 2012 points right away.

This sales pitch is typical of the timeshare industry -- it's not technically a LIE, but it's certainly not the truth either.

You will get 2011 points if you buy during the 2011 Use Year for your contract. The developer is required by law to give you those points, because you are PAYING for them. You are getting absolutely NOTHING for free -- you're just getting what you are purchasing.

But they'll try to con you into believing you're getting something for nothing.

It's a tactic that should tell you to watch your back.

 

[ELMC]

One thing to consider is that closing costs are more per point on smaller contracts. A $325 closing cost on a 50 point contract adds $6.50 to the cost of each point whereas a $425 closing cost on a 150 point contract adds only $2.83 to the cost of each point. There is definitely an economy of scale at work there.

 

[Tunseeker1]

I posted this somewhere else and decided to post it here



When everyone talks about the price savings in resale I tend to cringe. I understand that there are deals to be found, but they are not as great as it seems.

First look for a 50 point contract at the resort you want. They are bought very quickly and for a premium.
The closing costs on 50 points work out to about $9 a point.
A lot of contracts do not have points for the current UY included(2011 for some) and you have to pay the dues up front in full.

The direct contracts are for current UY and the dues are pro-rated based on how much time is left of the year.

When you look at the 50 and under contracts that are out there and figure out what the cost is it opens your eyes a bit on the smaller contracts.

I looked at a SSR contract which is pending for reference (55@$67).
It has no points for 2012 on a Feb UY, and it works out to be $73 a point with closing costs figured in. If you wanted to use 55 points in 2012 for a trip you would have to rent points for about $12 a point(again an example) for a total of $85 a point.

SSR sells for $105 a point from Disney, so you save about $30 a point if you want to use 2012 points, but the total savings is about $1500 on that contract.

Direct he got points with a Dec UY with 2011 points and 2012, so he has 150 points to go on vacation in December. With that contract he would have had 55 points so rental would have been $1160.

Total Prices in this example:
Resale with closing costs and rental cost to fund a 150 point trip in December is $5204, and you wait about 2 months to find out.
Direct with closing is $5317 and he already booked the trip.

Total Saving for Him in this example $113

I chose a contract as an example that sold within hours of being posted (I was trying to get him a small contract), that he could not get.

When you start to look at other contracts that are out there SSR might go for $80 a point, and other resorts may not make it in ROFR so you have to start the process over.

Its just another level of thought when pricing direct vs. resale

 

[ELMC]

I posted this somewhere else and decided to post it here



When everyone talks about the price savings in resale I tend to cringe. I understand that there are deals to be found, but they are not as great as it seems.

First look for a 50 point contract at the resort you want. They are bought very quickly and for a premium.
The closing costs on 50 points work out to about $9 a point.
A lot of contracts do not have points for the current UY included(2011 for some) and you have to pay the dues up front in full.

The direct contracts are for current UY and the dues are pro-rated based on how much time is left of the year.

When you look at the 50 and under contracts that are out there and figure out what the cost is it opens your eyes a bit on the smaller contracts.

I looked at a SSR contract which is pending for reference (55@$67).
It has no points for 2012 on a Feb UY, and it works out to be $73 a point with closing costs figured in. If you wanted to use 55 points in 2012 for a trip you would have to rent points for about $12 a point(again an example) for a total of $85 a point.

SSR sells for $105 a point from Disney, so you save about $30 a point if you want to use 2012 points, but the total savings is about $1500 on that contract.

Direct he got points with a Dec UY with 2011 points and 2012, so he has 150 points to go on vacation in December. With that contract he would have had 55 points so rental would have been $1160.

Total Prices in this example:
Resale with closing costs and rental cost to fund a 150 point trip in December is $5204, and you wait about 2 months to find out.
Direct with closing is $5317 and he already booked the trip.

Total Saving for Him in this example $113

I chose a contract as an example that sold within hours of being posted (I was trying to get him a small contract), that he could not get.

When you start to look at other contracts that are out there SSR might go for $80 a point, and other resorts may not make it in ROFR so you have to start the process over.

Its just another level of thought when pricing direct vs. resale

I appreciate what you are saying, but I think you should remember that it is only one example of what can happen. Somebody out there really wanted this contract and did not seem to care about the cost in acquiring it. You can't win in those situations. However, I would suggest that this was not a good deal for the buyer and does not represent the majority of resale contracts out there.

If you look at the ROFR thread, you will see that the last two documented small contracts for SSR sold for $50 and $57 (a 65 pointer and a 100 pointer respectively). They contained most or all of the 2011 points and represent a huge savings over buying direct.

My point is, I don't think it's fair for you to use one contract that someone clearly overpaid for as an example of how resale and direct can be comparable in price. Although that was somewhat true in the case you provided, I think that this is the exception and certainly not the rule.

 

[Tunseeker1]

I am using that contract because it is a REAL situation that I just worked on for someone using the contracts that are for sale right now.

If I could get the prices someone else paid in the past then I would love it, but I can't.

I know now that many small contracts never make it to the listings, so that makes the listed contracts second choice at best.

I could figure out a lot of different ways to make one or the other look better, but I only have so many options to look at. Just knowing that a seller wants too much money doesn't make the price cheaper. Knowing that the price is too high doesn't get you points when you want to go on vacation this year.

 

[nunzia]

Wouldn't Disney closing costs change that scenario also? I know Disney used to not charge closing costs on their contracts and I was disappointedwhen they chose to start.

 

[Tunseeker1]

Closing costs on 50 points is about $65.

 

[emilymad]

Closing costs on 50 points is about $65.

Through Disney?

What are they resale? The $325 mentioned above?

 

[ELMC]

Through Disney?

What are they resale? The $325 mentioned above?

That depends on the broker and the closing company they use. The Timeshare store advertises closing costs as low as $322 whereas I believe Fidelity's minimum closing costs are $425. It varies.