$84 a point is crazy

[CrayzeeDiz]

I bought at $65 a point last year . You cant tell me that the value of this timeshare actualy increased 33% in one year. Also this is one less year to be able to use it. I believe that the original price 10 years ago was $75 a point. So over 10 years the price has increased $9 a point with 10 less use years. The math does not add up. In my opinion ( after returning from 7 days at the beach club) it is not worth the extra $20 a point to have the BCV as a home resort. I dont think you can go wrong with any of your choices as all these resorts are great.

Disney should offer special point discounts to any DVC owner to add on. There is absolutely no reason for an experienced DVC owner to pay extra for points. Most of us know how to manipulate our points to get any particular resort on most stays.

 

[vernon]

The original price 10 years ago for DVC was $50-55 range.

Disney doesn't need to sell at a special discount to current members because sales are going well enough as full price.

I agree with you that all the DVC resorts are great places to stay.

So over 10 years the price has increased $9 a point with 10 less use years. The math does not add up

Actually the price has increased by $30 per point ( 60%) . While this may be suprising there are a number of reasons why the price rise has increased, IMHO the original price for DVC was plain wrong. But as often happens with a groundbreaking new idea it's very difficult to strike the offer price at a level that makes economic sense to the company but low enough to get enoughinterest from the punters to make sales brisk and the subject matter talked about. As Disney worked out the level of interest in DVC sales they adjusted their pricing to what they thought the market would stand. As most people think the "breakeven" for DVC can be anywhere between 8 years and 15 years depending on personal circumstances , I disagree with you that the numbers don't add up. It does mean that currently DVC isn't quite as good a deal as it was in 1992, but that doesn't mean DVC no longer represent value for money.

 

[Eeyore2U]

If someone will pay it's not crazy and I'm sure many will. Also my feeling is that MANY people will buy before the price increase.

 

[Dean]

The original price was $50 though I've heard a few that said it might have even been $48 for just a short time (never been able to confirm this). It's worth what people will pay. I personally would not be willing to pay $84 pp other than maybe a small add on. I think it still has value for many people if used appropriately. Even at $65 pp, many of us that bought much cheaper said the same thing then. There are also those that feel BC is a better value at $80-84 pp than say WLV was at $70 pp since the points are the same. In the timeshare world the RTU doesn't usually have much affect on price until you're at or less than 30 years. For DVC I'd say it'll be at a little less than 30 years unless they open a new resort that has a longer use, say 50 more years. If that happens I wouldn't be surprised to see an extension offered to current members, for a price of course.

 

[anniet]

The people who purchased at the beginning of DVC deserved to pay the lower cost, since they were assuming the most risk. Good for them..... it paid off handsomely!!!!! I wanted to purchase back then, but didn't for a LOT of different reasons. I feel lucky that I got in at $65 per point.

And when I was telling DBF about the price increase he smiled and said "It's like buying a house and seeing the property value go up in the neighborhood"

I know, I know...we don't OWN it, but it still makes me feel good about purchasing.

 

[Simba's Mom]

We just bought in late January at $75 per point. It just amazes me that it's gone up 12% in less than a year. But I'll bet it's just simple supply and demand. And DVC can't be too bad at figuring that out. I'm sure enough people will pay $84 per point to make money at DVC.

 

[joepoe]

First, let me say that I am a CPA by training, I have an MBA in Finance and have been in the business world for over twenty years. I also teach accounting part time, and have been doing budgeting and forecasting for a long time.

We bought DVC as a lifestyle decision. We love going down there, and felt that DVC was a good way of pre-paying for top-notch accomodations for forty some years. We bought BWV in 98 at $63 and OKW in '02 at a resale price of $60 (includes closing costs) We feel we already broke even on BWV.

I wondered, as we all do, how far can DVC go in selling these things and raising the price before we get too close to 2042?

I did up a spread sheet that assumed a cost of going to BWV every year for forty years using our points.

Then I calculated the Present Value of those cash outflows for forty years. Then I calculated the Present Value per point for 270 points. Then I pegged the price per point as a percentage of the PV per point, and I did so for forty years. The price I came up with for 2003 is $82 per point. I believe DVC is $2.00 higher per point because demand is very strong now. The spreadsheet topped out at $109 per point in 2022. I also calculated that the price will continue to rise for another twenty years before the Present Value of Future cash flows starts to decline rather than increase. So I think DVC will continue to raise prices for twenty years, assuming they maintain the units, and continue to be the choice for magical vacations in the future. I would predict maybe 15 to 20 years from now there will be a major change to the program, but not before. Just like Dean said: Either the new resorts will have more years tacked on, or the old resorts will offer extensions (for a price), or both.

Sorry if I put you to sleep, but believe me, DVC has a herd of financial analysts who have it all figured out. The best way to get a deal is through re-sale rather than pay retail.

 

[CrayzeeDiz]

Good point,

Supply and Demand actualy drives every price. But it is amazing to me that in the same market for just about the same product resale prices are so much lower and people are still willing to buy at $10 - $20 more from Disney. Although I do see that Disney makes it real easy to Finance the whole thing.

 

[fkj2]

I do think the original price was $48 per point, offered in the pre-opening stage. I can remember looking at the in-flight magazine ad for the DVC and my mom asking if I was going to purchase. It must have been 1991. I assured her, "No way". Well, needless to say, I rapidly changed my mind. My first points were around $51 but I'd have to look at the paperwork for sure. It was the perks that went with them that made DVC such a deal.

 

[lrodk]

For DVC I'd say it'll be at a little less than 30 years unless they open a new resort that has a longer use, say 50 more years. If that happens I wouldn't be surprised to see an extension offered to current members, for a price of course.

As Dean has eluded to, the extention program for current members is definitely in the works. The only question that remains is when to implement it. My sources have told me that the offer will be very reasonable when rolled out and will become an integral component of DVC in the future.

 

[CrayzeeDiz]

I dont know??? I would think that after 40 more years of Disney I would have had my fill.

 

[PamOKW]

Yes, the early visionaries did get to purchase at $48 per point.

Silly me, when I bought in 1993 I worried I was paying too much since in a year or two the price would go down as the time decreased.....glad I didn't wait!

I know on paper the increases look crazy but it's what the market will bear (plus the increased costs of construction for the new resorts). I expect the price to continue to increase for the foreseeable future.

As to who would want to renew after 40 years? I don't think it's aimed at the original owners who will be knocking each other over with motorized wheelchairs. It will be offers to those who have inherited DVC memberships and might want to add on for their future enjoyment. Of course, there are some younger members who will only be in their late 50's/early 60's, an age when some people are still first purchasing DVC.

 

[DVCajun]

Originally posted by CrayzeeDiz
I dont know??? I would think that after 40 more years of Disney I would have had my fill.

Wow, you really are "Crayzee"!! Not me!

Thanks for the analysis Joepoe! Very interesting. Glad I've already got some points at the lower price. That way if I have to pay more for my next contract (I've got a problem) I'll be able to justify an "average" price to myself.

 

[tiggerguy2000]

What people are forgeting is that when it was first opened their was only one resort.Hurraay! for the people who bought back then at $48.00 to $52.00 dollars.Back then they gave park passes with your purchase.I know the cost is up but they give you more choices in what theme resort you want to stay at.So stop looking back because it's like saying WOULDAAAAA......COULDAAAA.....SHOULDAAAAA............

 

[jmminarik]

Originally posted by CrayzeeDiz
Good point,

Supply and Demand actualy drives every price. But it is amazing to me that in the same market for just about the same product resale prices are so much lower and people are still willing to buy at $10 - $20 more from Disney. Although I do see that Disney makes it real easy to Finance the whole thing.

There are something like 60,000 members in the DVC right now, how many DVC'ers read these boards? How many found out about them _after_ they purchased? (at least two...me and my friend who just bought BCV)

My point is, while the resale market does seem to offer a better value so long as you are careful and you buy a large enough contract to offset having to pay the closing costs, not everyone interested in DVC knows about resales. Lots of people only know about DVC from the in World kiosks and the sales presentation at BW.

-Joe
(who, if he had known, would have bought an OKW resale).

 

[CarolMN]

We knew about resale, but chose to buy directly from Disney anyway. We paid cash up front. Didn't want to go through the "hassle" of finding the right contract, negotiating price and then waiting to close and get into the system. Didn't like the idea of making a large purchase over the phone or working with a sales agent we didn't know, either. (Kind of paranoid, I guess). Going through Disney was easy, quick and for two people who were very, very wary of timeshares, it just seemed "safer". From what I've read, the resale process isn't always "a piece of cake", even though it is possible to save $$$.

I have to admit that I was in a hurry mostly because I was afraid my DH would change his mind. I just couldn't believe he agreed to buy when I brought it up on our November 1999 WDW trip. I was positive he would laugh at the very idea. Neither one of us regrets the purchase and the only interest I have in resale right now is in the very distant future - I'd like there to always be a resale market just in case we decide to sell (sometime in the "can't hardly imagine it yet" future)!

 

[CrayzeeDiz]

Sorry JMM didnt want anyone to feel bad about this. Hey I didnt know about these boards until after I bought.

I am not talking about people who are new buyers. As you say most of them dont know about resales.

But I read on these boards all the time about current DVC owners who are buying add-ons just so they have some home resort points for the BCV. I cant understand their paying up to $20 more a point just to be able to book the BCV 11 months in advance. And I love the BCV.

 

[DVCajun]

I think the reason it would be preferable to buy a small add on through Disney is so your add on points have the same use year as your main contract.