BCV and BWV may have reached peak value

[Redheadprincess]

When we started looking at BCV last December there were around 40 contracts listed for sale. That number plummeted to an average of 15 a day in January through mid March when Disney was ROFRing most of the contracts. The contracts went up from the 150s and low 160s to 175+pp. For the last 2 months, Disney has not ROFRd BCV and barely BWV. The passing prices are really coming down. For the most part BCV is back in the $145-155 and BWV, slightly lower. There are now an average of 80+ BCV and 120+BWV contracts for sale every day for the last month. I think many of these brokers are doing sellers s a disservice by continuing to list these resale contracts based upon a short term buyback period from Disney that has ended. These resorts are down to 19 years at this point, as they are pretty much booked solid through January 2023 except 1 bdrms.

There is still value in these resorts, especially because of their location and 19 years is a long time but not for $175 and $155 anymore.

 

[tjkraz]

Anecdotally, I suspect a lot of people bought 40 years at VGF for ~$190, thinking they could unload their 20 year BWV/BCV contracts for $160-170. But if you're waiting for prices come down, it depends on how desperate those sellers are. Not everyone trying to sell a DVC contract feels compelled to adjust to today's apparent market price. Some will just wait it out. Heck, when you can rent a single year's worth of points for $18-ish, you have alternatives to chopping twenty bucks off the asking price.

 

[SleeplessInTO]

I hope so! I'd love to add on more points at BWV and pick up a BCV contract for cheap.

 

[Great3]

Anecdotally, I suspect a lot of people bought 40 years at VGF for ~$190, thinking they could unload their 20 year BWV/BCV contracts for $160-170. But if you're waiting for prices come down, it depends on how desperate those sellers are. Not everyone trying to sell a DVC contract feels compelled to adjust to today's apparent market price. Some will just wait it out. Heck, when you can rent a single year's worth of points for $18-ish, you have alternatives to chopping twenty bucks off the asking price.

I agree with this!!! This is what is keeping BCV and BWV from coming down crashing in price. If there wasn't a healthy strong rental market, especially for these desirable DVC Resorts, the value would fall quickly as owners try to unload and cut their losses. But with the strong rental market, owners aren't in a bind / hurry to make a deal.

Great3

 

[E2ME2]

I agree with this!!! This is what is keeping BCV and BWV from coming down crashing in price. If there wasn't a healthy strong rental market, especially for these desirable DVC Resorts, the value would fall quickly as owners try to unload and cut their losses. But with the strong rental market, owners aren't in a bind / hurry to make a deal.

Great3

I just need that ONE owner to succumb to the pressure, and list the right number of points at a reduced price, with my use year, of course !

 

[Great3]

I just need that ONE owner to succumb to the pressure, and list the right number of points at a reduced price, with my use year, of course !

Yep, you just need one owner to succumb, but you also need all other buyers not to jump and succumb to the owners . That's the hard part that we can't control, lol! If only we can get all buyers to agree not to make any offers for 3 months, then you will see prices come tumbling down. But then the feds would probably come after us for free market manipulation and put us all in prison !!!

Great3

 

[cvjw]

We just sold our BCV contract in the spring. Sold for full asking price. If it hadn’t sold, we would have just rented out the points every year. When I did the calculations between renting and selling, the $$$ was very close. And BCV points rent same day whenever I have rented them with a broker.

 

[Redheadprincess]

I agree with this!!! This is what is keeping BCV and BWV from coming down crashing in price. If there wasn't a healthy strong rental market, especially for these desirable DVC Resorts, the value would fall quickly as owners try to unload and cut their losses. But with the strong rental market, owners aren't in a bind / hurry to make a deal.

Great3

But buying BCV at $170pp right now puts your cost at $16.49pp, today, not including closing costs. Within a year it two at that price, unless you are willing to rent points yourself and take all the risk, it will not be a slam dunk for renting points at a profit. I just bought 2 contracts at $150 and $145pp. My cost pp is right around $15 until dues go up.

 

[Great3]

But buying BCV at $170pp right now puts your cost at $16.49pp, today, not including closing costs. Within a year it two at that price, unless you are willing to rent points yourself and take all the risk, it will not be a slam dunk for renting points at a profit. I just bought 2 contracts at $150 and $145pp. My cost pp is right around $15 until dues go up.

I am talking about the seller, not the buyer. The seller can probably afford to hold out for a higher price, because they probably brought a long time ago, that initial buy-in cost isn't as high. Besides, it's already a sunk cost. But you are right, buyer paying top dollar may/may not make sense right now.

Great3

 

[Brian Noble]

When I did the calculations between renting and selling, the $$$ was very close.

If you add in the value of your time, that might change some—even an “easy” rental takes some work, year after year. Selling is one-and-done.

 

[cvjw]

If you add in the value of your time, that might change some—even an “easy” rental takes some work, year after year. Selling is one-and-done.

Agreed. That is why we were happy to sell! We do use a broker when we rent points, so that does make it easier.

 

[DisDad-]

I’ll be keeping my BCVs contract to expiration.
I paid $170 pp on a fully loaded with 21 years remaining and the trip I just booked for 196 points was $7000 for 12 nights on the hotel side. (We only stay studios)
Over the remaining life we’ll be saving quite a bit for our BCV stays. And if any owner rents their points out at $18 pp they’re leaving a significant amount of money on the table vs rack rate. Should be more like $25-$27 pp rental based on the demand for these locations and the renter would still get a 20% savings compared to rack rate.
There’s a lot being made about the remaining term left on these contracts but based on the costs of the hotel side, I think owners are in the drivers seat either with savings on their own vacations or a significant rental profit at either BCV or BWV.
We’ll be buying more when either the Yacht Club goes DVC or when BCVs 2 eventually goes on sale. The location and resorts can’t be beat.

 

[Sandisw]

I’ll be keeping my BCVs contract to expiration.
I paid $170 pp on a fully loaded with 21 years remaining and the trip I just booked for 196 points was $7000 for 12 nights on the hotel side. (We only stay studios)
Over the remaining life we’ll be saving quite a bit for our BCV stays. And if any owner rents their points out at $18 pp they’re leaving a significant amount of money on the table vs rack rate. Should be more like $25-$27 pp rental based on the demand for these locations and the renter would still get a 20% savings compared to rack rate.
There’s a lot being made about the remaining term left on these contracts but based on the costs of the hotel side, I think owners are in the drivers seat either with savings on their own vacations or a significant rental profit at either BCV or BWV.
We’ll be buying more when either the Yacht Club goes DVC or when BCVs 2 eventually goes on sale. The location and resorts can’t be beat.

Given the non refundable nature of renting and the inflexibility to change dates easily in most cases, a 20% savings isn’t going to do it for rentals. You can almost always get that with Disney anyway

But, in terms of ownership, it’s all about what makes sense, and congratulations on having a home resort that does that!!

It’s how we feel about RIV!

 

[BruinEd03]

I’ll be keeping my BCVs contract to expiration.
I paid $170 pp on a fully loaded with 21 years remaining and the trip I just booked for 196 points was $7000 for 12 nights on the hotel side. (We only stay studios)
Over the remaining life we’ll be saving quite a bit for our BCV stays. And if any owner rents their points out at $18 pp they’re leaving a significant amount of money on the table vs rack rate. Should be more like $25-$27 pp rental based on the demand for these locations and the renter would still get a 20% savings compared to rack rate.
There’s a lot being made about the remaining term left on these contracts but based on the costs of the hotel side, I think owners are in the drivers seat either with savings on their own vacations or a significant rental profit at either BCV or BWV.
We’ll be buying more when either the Yacht Club goes DVC or when BCVs 2 eventually goes on sale. The location and resorts can’t be beat.

I think the past few years have taught that there is a premium for flexibility. Renting does not provide that. In addition, Disney routinely provides discounts of 20-25% off rack rate. You can easily see that here: https://disneyworld.disney.go.com/special-offers/

You would probably need at least a 30% to 35% discount to entice people.

 

[Epcot Forever Forever]

No one should be paying more than $130 for BWV IMO just given what’s on the market right now.

I can’t make the math work for BCV at current prices - I’d lose money vs just renting points or even in some cases getting cash rooms direct from Disney. For Studios and 2BRs I get to like $150 as when it’s “worth it” and for 1 bedrooms I need the price to be like $120 before the math works for getting enough value vs just getting your average full cancellable 25% off Villa offer from Disney.

 

[sethschroeder]

I can’t make the math work for BCV at current prices - I’d lose money vs just renting points or even in some cases getting cash rooms direct from Disney.

Except does your math account for future increases? Disney seems to be increasing more quickly recently. Cash rates and even rentals will keep going up in the near future.

The primary benefit of DVC is locking in todays pricing for the future. With 20 years left there is still a good amount of future left on the contracts.

 

[Epcot Forever Forever]

Except does your math account for future increases? Disney seems to be increasing more quickly recently. Cash rates and even rentals will keep going up in the near future.

The primary benefit of DVC is locking in todays pricing for the future. With 20 years left there is still a good amount of future left on the contracts.

It would be wildly irresponsible if it didn’t lol. Yes, it does. But it also takes into account that the NPV of future outlays is smaller than their cash value now due to inflation and alternative places to spend/invest money. If you only stay in studios in the summer then maybe it’s fine? But even then, renting points is probably a better option. I don’t know what your threshold is but for the rigidity and capital outlay of DVC, I need to save more than a few percent.

 

[sethschroeder]

I don’t know what your threshold is but for the rigidity and capital outlay of DVC, I need to save more than a few percent.

Actually I would say the most rigid and largest risk comes from renting.

No ability to change reservation, less protections, and likely more lost points long term after 15-20-30 years. Look at all the lost money from rentals during pandemic where as people who owned the points could more easily recover value.

So few percent over rental is actually a good deal to avoid the long term risk of rental.

Oh and did you account for not riding out contract and selling? Another aspect of owning to recover some of the initial input of cash. Which eventually go away but still pretty good for the next 10 years I would say.

 

[MISCdisney21]

It would be wildly irresponsible if it didn’t lol. Yes, it does. But it also takes into account that the NPV of future outlays is smaller than their cash value now due to inflation and alternative places to spend/invest money. If you only stay in studios in the summer then maybe it’s fine? But even then, renting points is probably a better option. I don’t know what your threshold is but for the rigidity and capital outlay of DVC, I need to save more than a few percent.

Seems to me the benefit is booking at 11 months to make sure she get a room around time you want rather than actual financial savings at this point.

 

[DVCanadian]

No one should be paying more than $130 for BWV IMO just given what’s on the market right now.

I can’t make the math work for BCV at current prices - I’d lose money vs just renting points or even in some cases getting cash rooms direct from Disney. For Studios and 2BRs I get to like $150 as when it’s “worth it” and for 1 bedrooms I need the price to be like $120 before the math works for getting enough value vs just getting your average full cancellable 25% off Villa offer from Disney.

Many owners report “breaking even” after 6-7 years.
2042 contracts would still provide 12 years of discounts.
Is this a different type of math or do you mean you see more value elsewhere?
Seems like if someone loves a 2042 resort there is still financial benefit.