Anyone done the math on points as liability to DVC

[ckb_nc]

So with so little usage in 2020 to 2021, it creates this points bubble which is a problem for DVC. DVC as an entity has more points on the balance sheet than availability, and does not have the ability to "raise" prices artificially across the board to eat the points bubble. While DVC can re-allocate points to make more popular times more expensive, it cannot just jack up the entire points need. People owning DVC will be pushing and banking points, meaning this bubble or wave will continue to exist, diminishing some each year.

any data available to suggest how truly big this points bubble or wave is? Frankly we use to always be in a points deficit (December use year) having borrowed, and now face a need to bank points. What makes both interesting and challenging is we and others will either eat points (not good) or keep pushing this wave down the road.

 

[Sandisw]

I have not seen any data about the size of things, but this is the main reason behind the borrowing restriction. It helps keep points in the future.

I also bet there were more owners who simply let points expire because they chose not to travel. While those that participate in the boards are on top of it all, I bet there is large group of DVC owners who simply let points go.

 

[crisi]

I have not seen any data about the size of things, but this is the main reason behind the borrowing restriction. It helps keep points in the future.

I also bet there were more owners who simply let points expire because they chose not to travel. While those that participate in the boards are on top of it all, I bet there is large group of DVC owners who simply let points go.

That will include us. We lost about 70 points due to Covid. Not a huge deal for us, or in the greater scheme of things for Disney, but there will be other people like me which will add up. Every year Disney has small amounts of "breakage" inventory - people who don't use their points. That is likely to be bigger this year. Often its people who are four points over what they need and don't bother to bank. Or people who forget to bank. Or contracts held in probate where no one knows that the points need to be managed. Disney is also likely to have some points available from foreclosures that they may throw into the system (normally they'd sell those via CRO, but my guess is that those points are on the table under the circumstances ). This year it will be people who choose not to go or have other things on their mind.

 

[Travel60]

Let's just all use our points on cruises, concierge, and RCI tradeouts!

 

[Narcoossee11]

It seems like last summer , some one posted that it will be 9 years to get everything back in 'balance'. The post is somewhere in the history under member services.

 

[CarolynFH]

Let me just say that we used all our September 2020 points and all but 9 of our September 2021 points on our December 2020 family visit. So I think we did our part to help availability in calendar year 2021-22.

 

[achinforsomebacon]

DVC as an entity has more points on the balance sheet than availability, and does not have the ability to "raise" prices artificially across the board to eat the points bubble. While DVC can re-allocate points to make more popular times more expensive, it cannot just jack up the entire points need.

Haha good one. Have you been following the 2022 vs 2021 points thread? Seems like they found a way to increase the overall points needed. There are questions on the legality of what was done, but I'll leave that for for the other thread.

https://www.disboards.com/threads/dvc-point-balancing-2022-vs-2021.3820183/

 

[Sandisw]

Let's just all use our points on cruises, concierge, and RCI tradeouts!

That doesn’t change anything because rooms go with the trade. So, when you book a cruise, for example, they take an equivalent number of rooms, sell for cash via Disney, and use the money to pay DCL for your cruise..

 

[Prince John Robin Hood]

No data that I know of but I'm curious what availability is going to look like going forward. I think some resorts and room types are going to be much more affected than others. CCV studios is the first one that comes to mind as being difficult for the foreseeable future.

 

[we"reofftoneverland]

I think people make a bigger deal out of this than necessary. It seems like there is a lot of play in the system for whatever reason. We have always been able to get a reservation, maybe not at our top choice, but still we have never been locked out. I think a lot of people— at least 50%- live on borrowed points. So lots of people don’t even have any points right now to spend. I

 

[ford91exploder]

I think people make a bigger deal out of this than necessary. It seems like there is a lot of play in the system for whatever reason. We have always been able to get a reservation, maybe not at our top choice, but still we have never been locked out. I think a lot of people— at least 50%- live on borrowed points. So lots of people don’t even have any points right now to spend. I

Disagree we had 800 points when we sold in 2017 our loaded contracts as we had 800 points in our UY and another 800 banked. and we were 'locked out' many times. Now DW is a teacher so that limited when we could go but we were completely locked out probably at least a dozen times we were DVC for a long time and things started going downhill in 2012 or so and really went downhill fast 2015 onward. the lockouts began in 2012 so, Before then we could always get something. But after that Disney became quite aggressive about forcing trades into cash rooms (really bad use of points btw) .

Being 'locked out' was one of the primary drivers of why we sold, there was no point in owning DVC if we could not USE our points other than to rent out. We sold our points bought a well used Cessna 172 and what we used to pay in member fees now feed our retirement account. And the Cessna sits ready for another adventure.

 

[ford91exploder]

Haha good one. Have you been following the 2022 vs 2021 points thread? Seems like they found a way to increase the overall points needed. There are questions on the legality of what was done, but I'll leave that for for the other thread.

https://www.disboards.com/threads/dvc-point-balancing-2022-vs-2021.3820183/

Cliff notes version - disney increased the point cost for rooms without changing the declared number of points for a resort a 'price increase' if you will. They tried this stunt back in 2019 before i guess they feel invincible now.

 

[Donna M]

We also have people using points to splurge on units so that they use up the points they would lose otherwise. Thatś the route we took.

 

[ford91exploder]

We also have people using points to splurge on units so that they use up the points they would lose otherwise. Thatś the route we took.

Dont know any DVC members who haven’t done that even bought some OTP once because i was 4 pts short to make an upgrade happen.

 

[ford91exploder]

The lockouts were happening more and more frequently, Since 2015 its been increasingly apparent that DVC is being run for the benefit of Disney rather than the members. Proving that’s another matter entirely which will require whistleblowers.

But the lockouts are probably due to Disney manipulation of breakage. As Disney would rather have a cash guest in the room vs a DVC member because even with a discount rate the cash guest is paying several times what the DVC guest pays in member fees.

remember the agreement says Disney must give you the points, its says nothing about a guaranteed ability to USE those points. The power and magic comes from ‘subject to availability’. Just look at all those DVC’ers losing now.

And Disney’s answer is ‘Tough on you’ you are easily replaced as a customer.

Used to be breakage was at about 30 days at the time of our last stay felt like it was about 120 days.

So if you did not book at 5-7 months out you were out of luck. Being a teacher up north you never really know when the school year is going to end. I think the record up here is something like July 10.

 

[Sandisw]

The lockouts were happening more and more frequently, Since 2015 its been increasingly apparent that DVC is being run for the benefit of Disney rather than the members. Proving that’s another matter entirely which will require whistleblowers.

But the lockouts are probably due to Disney manipulation of breakage. As Disney would rather have a cash guest in the room vs a DVC member because even with a discount rate the cash guest is paying several times what the DVC guest pays in member fees.

remember the agreement says Disney must give you the points, its says nothing about a guaranteed ability to USE those points. The power and magic comes from ‘subject to availability’. Just look at all those DVC’ers losing now.

And Disney’s answer is ‘Tough on you’ you are easily replaced as a customer.

Used to be breakage was at about 30 days at the time of our last stay felt like it was about 120 days.

So if you did not book at 5-7 months out you were out of luck. Being a teacher up north you never really know when the school year is going to end. I think the record up here is something like July 10.

They can take rooms at 60 days or less. They can also anticipate and pull farther out based on trends. So, any trips one wants to take last minute...less than 2 months out..is going to be tough.

I also think that many owners are booking trips with the extra points that may or may not happen because they now have the points to do that. Since the waiving of holding status and the return of borrowed points is going to end beginning May 1st, you may indeed start seeing movement closer to normal.

 

[ford91exploder]

They can take rooms at 60 days or less. They can also anticipate and pull farther out based on trends. So, any trips one wants to take last minute...less than 2 months out..is going to be tough.

I also think that many owners are booking trips with the extra points that may or may not happen because they now have the points to do that. Since the waiving of holding status and the return of borrowed points is going to end beginning May 1st, you may indeed start seeing movement closer to normal.

Thanks, 60 days has been the official 'breakage' since forever, We sold our points as a loaded contract 800 in UY and 800 banked in 2018 largely because we got locked out one too many times so I think the trend analysis at least from 2015 and 2018 was being used aggressively as 6-7 months out was the most we could predict for us being available to go on vacation.

 

[Prince John Robin Hood]

How does breakage work exactly? Does Disney use their pool of points to book at 60 days?

 

[Bobb_o]

The other thing to think about is if people have a bunch of points saved up they may be buying more expensive rooms which usually aren't booked as much.

 

[Sandisw]

How does breakage work exactly? Does Disney use their pool of points to book at 60 days?

No. Breakage are any rooms not booked by owners using points. They sell for cash. We get the income up to a max of 2.5% of the operating budget. The rest of it gets kept by DVCM. Some goes to BVTC as part of that additional.

The rooms Disney books with their own points is just like any owner booking. They can do with those what they want but just have to follow the rules of booking that we all do.