Advice for prospective DVC buyers

[JimMIA]

OP's NOTE: This thread was initially started to give some insight to newcomers just considering DVC. Throughout the thread, numerous DVC veterans have offered quite a bit of sound advice, so the whole thread is worth skimming through. It's really not possible for people to keep answering the same questions over, and over, and over again...so you might want to start your search here.

PLEASE NOTE, however, that this thread was started in March 2005, so many of the prices, incentives, etc, etc, have changed. Read the thread for the general info here, but forget the specific numbers because they have changed.

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A recent thread has reminded me of some excellent advice I received here when I was making my DVC buying decision. It is not "Buy where you want to stay," a mantra we hear repeated more often than we probably should.

It was that everyone's needs, calculations, and best options are different...and you need to find the best fit for you and your family. As Beca, I believe, once said, "The best deal is the one with your name on it."

I strongly believe there are a whole bunch of folks for whom "Buy where you want to stay" makes perfect sense. It not only makes sense, it is the only sensible decision for those buyers. I will offer some of my criteria for "Buy where you want to stay," acknowledging up front that I have stolen these brilliant thoughts from other posters too numerous to mention. I'm sure other posters will add to this list. I think you should "buy where you want to stay"...if...

1. You generally have the ability to set vacation dates and book more than seven months in advance. If you do, you can take advantage of the eleven month window at your home resort. If not, what's the point?
2. If you anticipate vacationing during peak periods. Remember that we are talking about peak periods for DVC, which are not necessarily the same as peak periods for WDW. Again, the benefit here depends on your ability to book more than seven months out.
3. You REALLY want to stay at a specific resort most of the time.
4. You have specific needs for accommodations which are in limited supply, like Grand Villas or studios with a particular view.

Again, ALL of the above rests on your ability to book more than seven months out. Other than the perceived prestige of saying you own at a particular place, the eleven month window is really the only benefit of buying where you want to stay.

For many potential buyers, there are many other factors which are much more important than the eleven month window.

In my case, we have the ability to book 11 months out, but we're really not locked on to any particular resort. In fact, we are looking forward to trying all of them. And, because of our family situation, we are flexible about accommodations - if we go looking for a one-bedroom at VWL, but can only get a studio at SSR, we're fine with that. We'll get a 1 BR at VWL some other time. We figure ANY DVC stay is way better than staying anywhere else. I recognize that is not true for everybody, but it is for us.

So, when we were looking, we looked at a lot of other factors besides the 11-month window. We looked primarily at initial purchase price and dues - in other words, we looked at cost. Where to buy was a financial decision for us, not a decision of the heart. That led us to buy a resale at OKW, but our backup plan was always buying direct at SSR. We think both of those are great values.

We think the other WDW resorts are also great values, we just think OKW and SSR are just a little better financially right now. I can't offer an opinion about VB or HH, because although we look forward to staying at both, we never considered buying at either one because of the high dues cost.

The other big financial decision - in addition to where to buy - is whether to buy resale or direct from DVC. Many buyers are under the impression that they can buy only SSR directly from DVC, but that is not true. You can buy any resort directly from DVC.

We hashed the numbers a million ways from Sunday, as many others have. In the end - if you consider the long term, not just the initial purchase price - I don't think it makes a whole lot of difference. We saved around $4,000 on a 310 point resale purchase, but if you look at the total picture, that savings is really not so dramatic in the context of the overall total cost for the duration of your ownership.

In another thread, I think we arrived at a consensus that there really isn't much difference - with resale at resorts other than SSR, you pay a little less for a little less; buying SSR direct, you pay a little more for a little more.

I hope starting this thread will generate some additional comments which will be helpful to new prospective buyers.

 

[EdTreo]

Well said. I admire your time and patience in writing this all up.

 

[carol1231]

When we made our "first" DVC purchase, we didn't follow the "buy where you want to stay" motto. We just bought what DVC was selling at the time. The same with a couple of our add ons. If there was an incentive (such as there is now), then that's what we purchased. I haven't had too much trouble making a reservation at the 7 or 11 month windows and am not to particular as to where we stay, love them all. So I, for the most part, will take where is available for when I want to stay. But that doesn't always work for everyone, so I am sure that sways their Home Resort decision.

My motto: "Points is Points" and I never can have enough.

 

[nickglover]

Thanks, Jim!

 

[DrTomorrow]

Thanks for putting this together - I wish it could be added to the DIS DVC FAQ!

Another bit of advice I'd like to add is to think long-term, particularly when it comes to planning when you'll go or which resort you buy into. DVC is a 40 or 50 year "lifestyle"; don't get too caught up in the here-and-now. If you have young children, you won't be tied to the school calendar forever, and SAB might not appeal to them (or you) when older. If you're old enough to buy into DVC, then there will probably come a time when you're not limited to a week or two of annual vacation; eventually, you might not have to worry about work at all. DTD sounds great to you, 'cause you "party hearty"? Maybe not so much when you're 58.

Don't get me wrong; I'm not suggesting that that you buy into a resort - and make point-use plans - that you don't like now just because of later (that's like buying, for a child with a size 7 foot, a size 10 shoe a "to grow into" ). Just keep in mind that things will change over the next 4 or 5 decades.

Be well!

 

[paslea_pooh]

Thank you for your post. I think I've read almost everything on the web relating to DVC and resales. I posted somewhere else where I think that if you are buying SSR you might as well go thru Disney. We took the tour about 5 days ago and fell madly in love with the resort. We are a big family of 6 , so we would always need a two bedroom villa to accomodate all of us. I didn't get an opportunity to visit the BCV or the BWV , I would have liked to but we wanted to spend as much time at the parks as possible. I got home and checked the resale pages on the web for DVC and after doing the math - buying 300 points resale would save me about 300 dollars. I guess if you are buying a DVC resort OTHER than SSR it would be worth it?

Anyways your post helped.

Thanks

 

[JimMIA]

We took the tour about 5 days ago and fell madly in love with the resort.

You'll see some negative comments here (actually, quite a few), but I took the tour too, and I really liked SSR. I ended up buying at OKW, but I thought SSR was very nice! I would be very happy owning there.

I got home and checked the resale pages on the web for DVC and after doing the math - buying 300 points resale would save me about 300 dollars.

I assume you are talking about the difference between SSR resale and SSR direct. Hmmm...it would have to be a lot more than $300 to get me to chose resale over direct!

Both methods have their drawbacks. If you look carefully at the current crop of SSR resales, you will find a lot of "stripped" contracts, and a lot of "can't close until's..." To compare apples to apples, you really have to find an SSR resale with all of the '05 points intact. The negatives of the resale process are that it takes a long time, and Disney can jump in and snatch the contract away from you. I doubt they would on any of the SSR contracts I've seen, but you never know.

The drawback with SSR direct is that you will probably have to wait for completion of the building your contract is tied to. That can mean a several month wait before you are really "in." (Which may or may not be an issue in your particular case - everybody's different)

I guess if you are buying a DVC resort OTHER than SSR it would be worth it?

Yes, but. Yes, but you have to remember that the other resorts carry 37 years of points vs. 49, so you have to factor that in.

And it depends a lot on which resort you buy. My OKW contract at $73 vs. OKW direct at $89 is a big difference. BCV at $83 vs. $89 direct is not such a big difference, provided you can get it direct.

 

[paslea_pooh]

Thank you for your response..

What negative comments are you referring to? About SSR or the tours in general?

I was speaking specifically about a 300 point SSR resale. The points will be available in August, I spoke with the resale sales person and I was told I would have to pay 24,000 (asking price), plus 625.00 (real estate fee), plus the maintenance for tha year... 1100.00 A total from RESALE = 25725.00


From Disney Directly 28,500 for 300 points - but Disney gives you a 8.00 credit per point for a total of 2400.00 - subtract that from the 28,500 it comes to 26,100

So you figure it's a savings of $375.00 if you bought the resale...

Not worth it, I think.

I'd rather buy from Disney and just have peace of mind that way.

Does that sound silly?

 

[paslea_pooh]

[
Both methods have their drawbacks. If you look carefully at the current crop of SSR resales, you will find a lot of "stripped" contracts, and a lot of "can't close until's..." To compare apples to apples, you really have to find an SSR resale with all of the '05 points intact. The negatives of the resale process are that it takes a long time, and Disney can jump in and snatch the contract away from you. I doubt they would on any of the SSR contracts I've seen, but you never know.


What is a stripped contract and why can't they close until certain dates... I have seen many of those...




The drawback with SSR direct is that you will probably have to wait for completion of the building your contract is tied to. That can mean a several month wait before you are really "in." (Which may or may not be an issue in your particular case - everybody's different)


I was told that we will get our points in September, but does that mean we can begin making our reservations then?

 

[bom_noite]

If I had the chance - I would buy again.

Financially speaking, we certainly have not lost money in the 3 years we owned - in fact - based on re-sale data I have looked at we would either break even or pocket a few $1000 if we sold. I could make even more money if I just decided to stop going and begin selling off my points yearly. I have 3 or 4 friends that have just taken a bath on time shares and are kicking themselves they did not have the foresight to buy in to DVC.

On the flip side, I am certain that financially I would have been much better off to take my family to a "suite hotel" off site for the next 30 years. A co-worker just rented at a very nice hotel (1 mile from WDW) for $59 a night. The $300 he will pay for 6 nights is less then half of my yearly maintenance assessment.

In the end I personally feel you cannot analyze the DVC investment strictly financially - rather - you have to decide: Is this how my family and I want to spend our vacation? For my family it is a no brainer - 51 weeks a year we dream about the next trip to DVC!

 

[Beca]

JimMIA....thanks!! That's a WONDERFUL thread!!! I agree with Dr. Tomorrow...that should be a "sticky" at the top of the page!!!



Beca

 

[JimMIA]

Thank you for your response..

What negative comments are you referring to? About SSR or the tours in general?

No not the tours. You hear a lot of questions about whether there will be pressure on the tours, but I doubt if you will ever hear any negative feedback about the tours from people who have actually been on one.

The negative feedback is about the resort itself - there is even a separate thread about negative feedback with SSR. Frankly, however, I loved the place and I think much of the negativiity right now is speculative. Will it be too big? Will it be good for my kids? How come no great dining yet? I think a lot of that will be resolved as SSR is built out.

No matter what resort you talk about, you will hear some negative feedback, because every resort offers a different setting, different theme, etc. OKW? Too large and spread out; too quiet. BWV? Too busy and noisy. BCV? Too small, can't get the accommodations I want there. VWL? The dreaded long hallways. But if you talk to the owners at those resorts, they love them.

If you like SSR - as I do - let others love what they love and you love what you love. Truth be told, all of the resorts are wonderful.

I was speaking specifically about a 300 point SSR resale. The points will be available in August, I spoke with the resale sales person and I was told I would have to pay 24,000 (asking price), plus 625.00 (real estate fee), plus the maintenance for tha year... 1100.00 A total from RESALE = 25725.00


From Disney Directly 28,500 for 300 points - but Disney gives you a 8.00 credit per point for a total of 2400.00 - subtract that from the 28,500 it comes to 26,100

So you figure it's a savings of $375.00 if you bought the resale...

Not worth it, I think.

I'd rather buy from Disney and just have peace of mind that way.

Does that sound silly?

No, but I think there is a minor miscalculation. With either route, you have to pay maintenance. DVC currently has an incentive of paying maintenance through 2005, I believe, so depending on when you close and what your use year is, they would pay maintenance through 12/31. That might only be a month or two, so you would have to add the remainder of the maintenance you would pay for that first year to get apples to apples. The net difference between those two alternatives might be $1000 or so, not $375.

Also, check the add-on incentives for SSR. I believe there is currently an add-on incentive which gives you 100 one-time points if you add on 120 points. I believe those 100 points are bankable, and if they are, they are a significant benefit.

You'll have to price everything out again to do an accurate comparison, but you may come out ahead doing an original contract of 180 points and an immediate add-on of 120 points. I'm not positive you can do that, and if so I am not sure it would be to your advantage, but it is something to check.

Another big difference between resale and buying direct may be the date you can actually use your DVC. Figure 8-12 weeks from start to finish with resale. You will have to check with your guide and see when your direct closing would be, because I don't think you can make ressies until you close. That may or may not be an issue for your family, but it is for some people who are planning a WDW trip in the near future.

 

[JimMIA]

What is a stripped contract and why can't they close until certain dates... I have seen many of those...

A stripped contract is one which has few or no points left in the current use year. You won't see a big warning sign that says CAUTION: STRIPPED CONTRACT! But you will see only a minimal number of current-year points available. Another thing to look for is how many points are "coming" at the beginning of the next use year. If it is less than the contract, they have borrowed points from next year and you won't get the full complement of points. (You should NOT pay maintenance for any points you are not actually getting, so watch that.)

"Can't close until" means they have some sort of encumberance between now and then. Could be they are planning their own trip, could have rented points and have to keep ownership until the tenant finishes their trip, etc. The meaning to you is that buying resale, you cannot make ressies until you close and are "in the system," which is usually within 10 days after closing.

I was told that we will get our points in September, but does that mean we can begin making our reservations then?

If you will have a September use year, you will receive your 2005 points on September 1. However, you can make ressies before that. I have read that you can make ressies as soon as you make a deposit when you go direct, but I'm not entirely clear on that. If so, I am sure the ressies would have to be for a time after your closing, because you would not actually be an owner until closing. You wouldn't have to wait until September; you could borrow points once you were a member. Check with your guide for the specifics and nuances of that.

 

[paslea_pooh]

I can't believe how much I've learned on these boards. I've been up the past two nights till 1 a.m. reading posts. It's been very helpful. I'm going to speak to my guide today!

Thanks again

 

[JimMIA]

 

[JimMIA]

bumpin' for new folks

 

[ferastu]

Just got off the phone with the VCGuide for the first time. She answered all my questions. What was most impressive is that there was absolutely NO pressure to sell. I mean no pressure, there wasn't even a sales pitch. She is mailing out some 70-odd page packet with more complete info.

But at this point I'm pretty much sold. Just waiting for my home equity loan to close so I can do a cash purchase.

To answer some of the other responses on this thread. I was told that the 100 vacation point must be used by the end of the year. She didn't indicate that they are bankable.

Also it is a choice between the $8 discount OR the 100 points.

I believe that paslea's calculation's are spot on. They included maint in the resale contract, most likely because the points for this year are still available. The maint isn't in the Disney side of the contract because Disney is picking it up.

Also I was told that I could start making reservations against my Sept points right after my deposit was accepted.

I also explored the resale route. After factoring in the $8 discount, resale closing costs and potential maint fees, buying directly from Disney is only costing $1 more a point.

 

[TheRustyScupper]

1) I think your posting was well-thought.
2) However, I think you are incorrect about "buy where you stay".
3) You do not believe this is necessary.
4) Not now maybe, but eventually, it could be a must.
5) While they keep building, there is excess capacity.
6) Once they stop, capacity and points are equal.
7) When they are equal, there might not be 7-month availability.


8) It is simple math - (assume 10,000 points total resort)
. . . "10,000' points total capacity
. . . "10,000' points sold to members
. . . capacity full

9) Let's look at another scenario
. . . "10,000" points total capacity
. . . "10,000" points sold to members
. . . "100" points banked to next year by one member
. . . all other members did not bank or borrow
. . . "10,100" points needed next year
. . . not enouigh capacity

 

[pam66]

I liked reading all these posts. I would really like to buy into DVC, but won't be in a postion to purchase until the Fall. We have a young daughter and my DH LOVES the Beach Club so we will probably look into a resale.

 

[Tramp68]

8) It is simple math - (assume 10,000 points total resort)
. . . "10,000' points total capacity
. . . "10,000' points sold to members
. . . capacity full

9) Let's look at another scenario
. . . "10,000" points total capacity
. . . "10,000" points sold to members
. . . "100" points banked to next year by one member
. . . all other members did not bank or borrow
. . . "10,100" points needed next year
. . . not enouigh capacity

This isn't accurate as DVC is never "sold to capacity" There may be a limited number of points but there is a reserve amount kept..I can't remember the percentage but I read it somewhere... 3% seems to stick in my mind...

Also, you assume that everyone is going to use their points in their home resort in a given year. Simple truth is, If everyone tried to use their points they would find times of the year open that they were not able/willing to use and therefore would have to seek alternative vacation plans anyway...

Think of the nightmare if EVERY DVC member decided to Bank their 2007 points, borrow their 2009 points and try to use them all in a DVC resort in 2008!