$13.50 a Point

[Doctor P]

Keep in mind that even the $25 increase in the cost per point only averages out to a little over $0.60 over 40 years, and dues have not increased that much over the years. I am not arguing that people should be willing to pay more than $10.00 per point, but the cost based argument (not the only argument, but one that is often made) does not really suggest much of an increase is appropriate. I don't really care one way or another in general, but just want us to make sure we compare "apples to apples."

 

[Tiggeriffic]

It's not just the cost to the person who is renting out their points that needs to be considered, but also the cost of renting an alternative room. One of the main benefits of buying into DVC is that Disney's rack room rates go up quite a bit each year - I'm not sure about the discounted rates. So, I would think that when a person is trying to decide whether to rent points or go through Disney then the increase to the room rates would probably need to be considered as well.

For example, If one year I can rent points from a member for a room that would cost $2000, but I only pay $1200, I might decide that its a great deal.
Now, if the next year the rate that Disney is charging goes up 10%, that same room would cost $2200. However, if the cost to rent the points went up %10, it would cost $1320. I would actually be saving $880, instead of $800. In other words, I would still be saving 40% by renting the points from a member, but it would be more money that I've saved. (NOTE: I just picked numbers out of the air here. The 40% and 10% are just an example to illustrate the point.)

A completely different way to look at this is this: I joined DVC to pre-pay my vacations. If for some reason I can't use my DVC vacation for a year that doesn't mean that I don't want to be able to take a vacation, but that I may have to do it some other way. So, my vacation may now cost me more because I can't use my points to pay for it. Now maybe that should just be my loss, but I'm sure not everybody looks at it that way.

I just think that there are definitely at least two sides to this situation that need to be considered and that the value of the points will be determined by the two parties involved. I don't think that we need a concerted effort to raise the point rental price. Nor do I think that we need to try to keep them low. The only concern that I have with renting is those people who seem to be in the business of renting out points consistently. However, given the current state of things, I don't think that there is much that we can do about it.

 

[Doctor P]

Tiggeriffic, I think you have done a darn good job of explaining the issues. A market transaction takes a willing buyer and a willing seller. However, I think the posts indicate that there are still a number of sellers who are willing to rent at $10 per point. Good or bad, this means that there will be a number of buyers who will be able to get their rental at $10 per point. I also like your point about prepaying your vacation and seeking to recover that cost in a rare year where you need to rent the points rather than use them for your vacation. I suspect that rental prices will gradually increase, but not so much as a result of the increasing "costs" of points but rather their increased "value" as a means of securing deluxe lodging.

 

[one_cat]

There are some other factors involved in these transactions that I think are being missed in this discussion. We rented 132 points in April. Of these points 85 were in a 30 day hold account the rest were set to expire in less than 3 months. I would have loved to hold out for 13.50 per point but didn't feel I could afford to do so. I sold for 8.50 and 10.00 per point. Yes the people who vacationed for 8.50 got a great deal but they were flexible and could vacation when I could get them reservations. Here's what I found. Firstly I got lots of calls but most people I couldn't help because the timeframe of their vacation did not coincide with the 30 day booking window or times when there were reservations available. In April there are no reservations available for Memorial Day weekend. In addition, it cost me $30.00 for long distance phone calls plus about 4 hours of time over 3 days to sell these points. To have held out for more money would have cost me a lot more time and probably a higher phone bill. That 4 hours lost from work is worth a lot more than the 350.00 or so I could have gotten by selling my points for more money. Besides the fact that I may not have sold them at all and would have had to eat the cost. I know that would have helped out those that do a lot of point selling but I wasn't worried about that. I was simply trying to get some value out of a cancelled vacation for my Father. I know this is a bit disjointed but hopefully it will add something to the discussion

 

[Doctor P]

Great points, one_cat! I'm glad that renting worked out for you under these circumstances.

 

[RobDoc]

Of these points 85 were in a 30 day hold account the rest were set to expire in less than 3 months.

Not that this affects the flow of this thread, but.....

The Holding Account is now 60 days instead of 30- so we have much more flexibility in using (or renting) those points. The change occurred last fall.

Enjoy!

 

[Dean]

I'm not sure I'll add anything new here, but I'll try. There will always be someone who has distressed points and those points should be cheaper than the standard rate, whatever that ends up being. Actually $8.50 and $10 pp is this situation is a good deal for the seller.

Ultimately rental market will be determined by market forces. What will a renter pay for the savings over Disney but with the increased risk and less flexibility. However, what a seller should expect depends partly on their upfront costs, yearly costs and Disney's discounted prices. Lets say a Moderate is $99 plus the 11% tax ($110) and OKW is 8 points per night, DVC is a much better deal and likely worth the extra risk for most families. At 11 points, the deal is a wash and likely not worth it. For BW and WL, the points would be a little higher to be a "break even" due to the higher cost of points there. I think it also is important to look at this as an investment, even if only renting occasionally. That means take into account the purchase, lost earnings on the money used, yearly fees and any other expenses. That puts those that paid about $50 pp at OKW to consider at least about $8-9 pp and those that paid $72-75 at WLV or BW, a price around $11-12 pp.

I didn't buy DVC to rent out but with life changes, other interests and avenues, I find myself with extra points almost yearly. I have no interest in letting them go to waste nor am I particularly interested in selling them at this time.

 

[one_cat]

You are right Doc - I misspoke. They were in a 60 day window. It seems like years ago though it was just March that I was selling those points. It certainly adds another dimension to your sales when you have to contend with that booking window. I even had to borrow some points from my next use year to fill out one customer's reservation However the money is in a savings account now so if I want to I can rent points from someone else to fill out my vacation

 

[Caskbill]

These are small points, but nobody has touched on them yet.

Someone looking to rent points will compare that cost to the best rate they can get for similar accommodations. Thus comparing the 'value' of rented points to the rack rate of a room is probably not accurate as there are discounts available all over WDW.

2nd, a stay on rented points does not come with daily maid service, while a cash room does.

3rd, rental points only make any sense for a buyer for a Sun-Thur stay. Cash rates do not have the same large deviation in price between weekday and weekend that points do.

For example, a Fri-Sat stay at BWV, Studio, preferred view, Dream season, is 58 points. At 13.50/point, that's $783 without maid service, or $391/night. You can definitely get a better cash rate than that.

On the other hand, a Sun-Thurs stay is 65 points. At 13.50/point that's $877 or $175/night without maid service. Not very competitive with available discounts that you can get for similar accommodations. But at 10.00/point, it's $650, or $130/night, which is competitive, even without the maid service.

Yes, I know there is trash and tidy, but that doesn't come close to daily maid service.