So what happens in 30 years and other questions

[pmaurer74]

So if I buy a resale for VWL or BCV and there is say 25-30 years left until the expiration date and the membership runs out does that mean if I wanted to sell say with 7-10 years left no one would want to buy it anymore?

Do we file taxes on the DVC?

When we bank points is it only for one year. Like if I banked 2012 I have to use the points by the end of the year 2013?

How do you know which use year to buy?

Is there a limit on how much they can raise MFs every year?

 

[disneynutz]

So if I buy a resale for VWL or BCV and there is say 25-30 years left until the expiration date and the membership runs out does that mean if I wanted to sell say with 7-10 years left no one would want to buy it anymore?

Do we file taxes on the DVC?

When we bank points is it only for one year. Like if I banked 2012 I have to use the points by the end of the year 2013?

How do you know which use year to buy?

Is there a limit on how much they can raise MFs every year?

True.
Taxes are up to you.
Yes, use them or lose them.
UY should be based on your vacation dates that you usually book.
15%

I suggest that you keep reading the posts here on the DIS, there is a lot to learn.

Bill

 

[tjkraz]

So if I buy a resale for VWL or BCV and there is say 25-30 years left until the expiration date and the membership runs out does that mean if I wanted to sell say with 7-10 years left no one would want to buy it anymore?

Unless Disney does some irreparable harm to the DVC program via restrictive policies, lack of perks, etc., expect there to be some value in the contract. Of course, any potential buyer is facing only 7-10 years of trips. Expect the amount you could recoup to reflect the short duration remaining.

Do we file taxes on the DVC?

Property taxes OWED by members are collected by DVC as part of our annual dues. Most owners can claim some federal 1040 deduction for the property taxes.

When we bank points is it only for one year. Like if I banked 2012 I have to use the points by the end of the year 2013?

Correct.

How do you know which use year to buy?

Buying a Use Year that immediately PRECEDES your normal vacation period gives you the most flexibility. If you vacation during many different times of the year, or see your plans changing as time passes, it really doesn't matter.

Is there a limit on how much they can raise MFs every year?

There is a stated cap of 15% per year. However, by law the dues must reflect the actual operating costs of the resort. This isn't like charging for theme park tickets or bottled water where Disney can charge whatever they wish. DVC must prepare a budget which is reviewed by internal auditors, external auditors and state timeshare oversight departments.

Expect dues to rise about 3% annually as Disney must pay more for employee salaries and benefits, fuel (theme park buses), taxes, building maintenance, etc.

 

[chalee94]

does that mean if I wanted to sell say with 7-10 years left no one would want to buy it anymore?

you never know. you might get only 5-10 years down the road and no one would want to buy it anymore...

Is there a limit on how much they can raise MFs every year?

BTW, the 15% cap does not count against property taxes. if property taxes jump 30% in one year, owners get hit for all 30%.

 

[disneynutz]

Other non-Disney timeshares can be purchased for $1.00 so anything can happen to the price.

Bill

 

[zavandor]

Unless Disney does some irreparable harm to the DVC program via restrictive policies, lack of perks, etc., expect there to be some value in the contract.

Closing costs are a fixed amount, not depending on the lenght of the contract. When only few years remain I espect that you should give the contract away if you want to get rid of the MF, with the buyer just paying the closing cost or a VERY slow amount.

 

[tjkraz]

Closing costs are a fixed amount, not depending on the lenght of the contract. When only few years remain I espect that you should give the contract away if you want to get rid of the MF, with the buyer just paying the closing cost or a VERY slow amount.

Why would you think this? Today there are non-members willing to pay $12-14 per point just to rent ONE YEAR'S usage of a DVC contract. Buyers aren't going to pay 5x that amount for a contract with 5 years remaining, but the value is likely to be much more substantial than closing costs.

I have as much fun with the doom and gloom scenarios as the next guy but as long as Walt Disney World remains a premier vacation destination, there WILL be resale demand for DVC points. Even when those contracts are short. When young families discover they can buy a 5-7 year DVC contract for the cost of 1-2 cash trips, many will obviously jump at the opportunity. And if they are still enjoying WDW in 2042 when that short-term BWV contract expires, some will look at buying a SSR resale contract and enjoying DVC for another 12 years.

 

[cc_nike]

I suspect Disney will offer extensions when the time comes.

 

[taaren]

When we bank points is it only for one year. Like if I banked 2012 I have to use the points by the end of the year 2013?

PPs have answered your questions well, I just wanted to point out one thing about this question ...

It depends on what your UY is. If you bank Dec 2012 points into your 2013 UY, those points are then eligible to be used from Dec 1, 2013-November 30, 2014. They do not expire on Dec 31, 2013. On the other end of the spectrum, if you purchase a Feb UY, your banked 2012 UY points into your 2013 UY would be valid from Feb 1, 2013-January 31, 2014. But yes, you can only bank one Use Year into the future.

 

[Dean]

To offer some additional thoughts. First, It's very likely that late in the contract it will not be worth closing costs to sell it but I think that time will be the last 2-3 years, not 7-10 years. However, it's entirely possible that the fees will get high enough that DVC is not worth closing costs earlier. If the current approach of having resale buyers overpay on maint fees is still in effect, it may be a little sooner. There is also likely to be an over supply at that time so that may further reduced prices. I wouldn't be surprised for DVC to take back points late in the RTU just to keep the price from being too low, although only if they are still in active sales. People have to realize that this is more than just an economic issue. There has to be enough savings and benefit for one to act and often that's as much an emotional issue as a mathematical one which is most certainly going to work against sellers.

UY will also have some effect on sales late. The other factor is HOW DVC decides to handle the fact that there are NOT enough villas and time to accommodate all points in all UY the last 2-3 years. So not all points will be able to be used late in the game by the extension date. Likely possibilities include a lottery, voluntary relinquishment with no fees on the points given up and a free for all with a lot of points expiring unused. It's also a certainty that banking will be suspended late, likely the last 3 years of the contract. These decisions, once known, will have an effect on any value and it's likely that just the uncertainty of these issues will have an effect as well.

I go back and forth on the extensions. I do think they likely will at some point but I don't know how or if it'll be worth it, it very well may not be, OKW clearly wasn't as offered. The only affects on taxes are for deductions for the real estate taxes and for income if you rent it (minus fees and other expenses). While technically there are limits on yearly increases, the recent reallocations have proven what I said all along, this really isn't a limitation, you just do it over 2 or more years if you need more.

Other non-Disney timeshares can be purchased for $1.00 so anything can happen to the price.

Bill

Some yes, some no. The reality is that market forces don't work all that well in timeshare sales overall but Disney is more known and in some ways, an entity unto itself. I think market forces work better for DVC than most, same for Marriott to a degree. However, it's very possible that DVC will be in this boat at some point as well, esp late in the RTU expiration.

 

[Chuck S]

I suspect Disney will offer extensions when the time comes.

Perhaps, but after the legal issues and problems extending OKW, I wouldn't count on it.

My thoughts are that the contracts will end, and Disney will fully rehab the units adding the latest technology and popular styles in furnishings. Inspect the buildings to see if there are any structural issues, and the resell them as a New DVC resort, giving the owners that had previous purchased there a discount on buying into the new DVC resort.

 

[tjkraz]

I agree with Dean that in the last 2-3 years, all bets are off. However any further out than that it would be very surprising if there is not a market for short term contracts. Disney park fans are a unique animal. Every day there are posts from people going to great lengths to save a relatively small amount of money on their trips--things like buying MYW tickets and converting them to APs to save twenty bucks or reserving unused hotel rooms just to get the "free dining" perks.

When there are 4+ years left on DVC contracts, many people will happily pay some amount of money (plus closing costs) for the "free" trips involved. It will be the newest phenomenon on the Budget Board. Every family with a toddler or two will be scouring for short-term DVC contracts in order to get 4 or 5 trips for the price of one.

Dues will increase but so will hotel prices. Barring tragic economic circumstances, Disney isn't going to allow its profit margins on the hotels to slip. As operating costs rise, so will dues. And so will hotel rates.