benefits & Is my math right?update!# 13 Yee Haa!!!

[rie'smom]

Please no flames. My IQ is 151 but sometimes,like right now,it feels like 15. Would you please:
1.Tell me the benefits of DVC ownership.
2. Breakdown the details of buying 500.00 pts w/2500.00 annual dues over 36 years(most DVC) and 48years(SSR).
I keep doing the math and the numbers aren't convincing me that this is a good deal.Maybe I'm doing something wrong. Or is DVC basically a buy with your heart-or as a hedge against rising prices later.
However,if used as a hedgewouldn't be better to invest? You could find something higher than 10%(avg dues+resort price increase) and get a better return or break even staying in a resort with majd service?
500pts x 85.00/pt=42,500
132,500
132500/36=3680.5=yr/7(days vaca)=525.79/night

500 x 85=42,500
2500x 48=120,000
162,500
162,500/48=3385.41yr/7(days vaca)=483.63/night


Thanks

 

[DizneyNutz]

You must decide what kind of accomadations you will be desiring for the next 40-50 years? Are you ok with the standard resort room, or do you want a 1 or 2 bedroom with full kitchen or even a grand villa that sleeps 12. You need to visit the DVC resorts and SEE the difference between accomadations. It also is a hedge against rising resort prices for the next 40-50 years.

 

[Mtnman44]

Interesting to think about. One flaw in your logic that I see is the assumption that all 500 points will be used for ony 7 days. I think the vast majority of people with that many points get a lot more that 7 days use out of them each year. Am I wrong? I am looking at the chart and if I owned 500 points I would AT LEAST get two weeks out of it which drasitically affects your calculations.

 

[salmoneous]

There is no right answer on how to analyze the cost of DVC ownership. There are many of us on this board who work as finance analysts (or similar) and even we have disagreements on how to best view the cost of DVC ownership. But we all agree you can't just multiply the current expenses by the number of years and get a very meaningful number. That ignores inflation (the annual maintenance fees will go up each year), interest, time value of money, etc. We also agree that the exact details of how you run the numbers isn't all that important.

DVC is more a "way of life" than a financial investment. It's great for people who love Disney and taking vacations at WDW. Along with any possible financial benefit, owners take satisfaction in knowing they own a little piece of Disney - in having a place to "go home" to - in knowing that they've decided to vacation at WDW frequently in the future.

Having said that, if Disney is a way of life and you do take frequent, almost annual trips to WDW, the finance of DVW make a ton of sense. It doesn't matter how you do your calculations, what you assume for future inflation or interest rates, etc. Under any reasonable scenario you come out far ahead buying DVC over paying hotel rates to stay at Disney resorts most years for the next 10-20+ years.

DVC isn't for everybody. If don't think you will travel frequently to WDW for many years, or if you are perfectly happy staying offsite or in Value resorts, or if you aren't able to make plans many months in advance, or if you mostly just take weekend trips, DVC might not make sense.

If you do want to see the numbers, check out one of the many threads on the subject we've had in the forum. And if you've got any specific questions, just ask…

 

[rie'smom]

Interesting to think about. One flaw in your logic that I see is the assumption that all 500 points will be used for ony 7 days. I think the vast majority of people with that many points get a lot more that 7 days use out of them each year. Am I wrong? I am looking at the chart and if I owned 500 points I would AT LEAST get two weeks out of it which drasitically affects your calculations.

That's a good point. I was figuring a larger accomodation so DD could bring friends but we could break that up into a couple of trips w/1 friend each trip.
This is why I'm putting my thoughts out on the board. I love having feedback and you all are the experts on the DVC. Thanks!!
I like deluxe.

There is no right answer on how to analyze the cost of DVC ownership. There are many of us on this board who work as finance analysts (or similar) and even we have disagreements on how to best view the cost of DVC ownership. But we all agree you can't just multiply the current expenses by the number of years and get a very meaningful number. That ignores inflation (the annual maintenance fees will go up each year), interest, time value of money, etc. We also agree that the exact details of how you run the numbers isn't all that important.

DVC is more a "way of life" than a financial investment. It's great for people who love Disney and taking vacations at WDW. Along with any possible financial benefit, owners take satisfaction in knowing they own a little piece of Disney - in having a place to "go home" to - in knowing that they've decided to vacation at WDW frequently in the future.

Having said that, if Disney is a way of life and you do take frequent, almost annual trips to WDW, the finance of DVW make a ton of sense. It doesn't matter how you do your calculations, what you assume for future inflation or interest rates, etc. Under any reasonable scenario you come out far ahead buying DVC over paying hotel rates to stay at Disney resorts most years for the next 10-20+ years.

DVC isn't for everybody. If don't think you will travel frequently to WDW for many years, or if you are perfectly happy staying offsite or in Value resorts, or if you aren't able to make plans many months in advance, or if you mostly just take weekend trips, DVC might not make sense.

If you do want to see the numbers, check out one of the many threads on the subject we've had in the forum. And if you've got any specific questions, just ask…

Would you please point me in the direction of one of these threads. I was looking for one before I posted but couldn't find one too easily. Basically,I'm
trying to convince that this is a good idea. We go to WDW every year. This year @ Thanksgiving ohhhhhhh I just got it. I'm spending 8000.00 for a this week. 8000 x 48 = 384,000.00. I told y'all sometimes the IQ drops to 15 .

 

[VrBchJ]

You're right in the first instance. It's buy with your heart.

 

[Mtnman44]

I'm not a DVC member yet, but I do have some experience with other timeshares. Here is how I figure it, is this too simple?

It seems to me that on average, the cost of the annual maint fee and taxes is roughly 1/3 what it would cost you to simply cash pay or rent that condo each year.

So assuming you stay somewhere every year, you have some number of years before that 2/3 savings has made up your initial investment (aka Breakeven), after than you are then saving approx 2/3 of each year of what you would have otherwise spend renting that same room (or equivilant). So in the case of DVC, it seems that for the first 10 years or so, on paper it's hard to jusify exactly. However the next 30 or so years you are doing quite well.

Of course, vacation ownership in general only really makes good sense if you travel and stay somewhere every year and would've spent that resort money anyway. It seems to me, if you don't see yourself staying at Disney Properties at least every other year for 20+ more years, then it makes less sense finanicially.

 

[tjkraz]

132500/36=3680.5=yr/7(days vaca)=525.79/night

162,500/48=3385.41yr/7(days vaca)=483.63/night

Where and when are you planning to stay that you figure you need 500 points for a 7-night stay????

 

[Mtnman44]

Twang! Another convert!

We go to WDW every year. This year @ Thanksgiving ohhhhhhh I just got it. I'm spending 8000.00 for a this week. 8000 x 48 = 384,000.00. I told y'all sometimes the IQ drops to 15 .

 

[rie'smom]

Where and when are you planning to stay that you figure you need 500 points for a 7-night stay????

I was figuring the GF. See,you guys just keep pointing me in the right direction!!! You're the best!!

 

[harra]

You need to take that $3,680.50 per year cost you calculated and divide that by the number of points you get per year (500) to determine your cost per point (should be $7.361/point).

Then you take that cost per point calculation and go to the points guide for the resort you want to stay and and for the period of time and figure out the cost.

Using my point guide for the SSR, it would cost you $2,326.08 to stay at the SSR in a one bedroom during the most expensive week on the books (April 1-14 or December 24-31 2007). Which comes out to $332.30/night. Plus you'd have 184 points left over to use.

If you used all 500 points to stay in a one bedroom during the cheapest times of the year (All of January, All of September, or Dec. 1-14) you could get five stays each consisting of 5 days. Which would cost you $736.10 for 5 days which comes out to $147.22/night. That's pretty good for a deluxe resort. If you used all your points during this time of year, you could get 25 days if you didn't stay Fridays or Saturday.

I'd like to see you get a stay in a deluxe resort for 25 days at a cost of $3,680.50

A quick way to determine you cost per point per year is this:

Take your initial cost per point you paid. In the case of my purchase at SSR that was $101/point

Divide it by the number of years in your deal (mine was 48)

$101/48 = $2.10 per point per year

I was given the cost of $3.98 per point for my dues by our handler. It's simply calculated by dividing your annual dues by the number of points you have per year.

Take this and add it to the other number to get your per point per year cost

$ 2.10
+ 3.98
-------
$ 6.08 per point per year

 

[CarolA]

I am from the "this is not an investment" group. As an Accountant I did the math. There are LOTS of things I could make more money on then my DVC and I could stay in the Orlando area much cheaper. (and have)

However, I decided that this was an investment in "me" vs money.....

 

[rie'smom]

OK,I'm hooked or am I easy? Somebody sweet on the board PMd me the name of their guide. So,during Thanksgiving week,I'm going on tour-I'm kinda hoping for Boardwalk villas.This last trip, my DM was @ the Swan & we took the motor launch.I fell for the Boardwalk .In fact,I think this is when the DVC bug bit.

 

[Tink-n-Belle]

OK,I'm hooked or am I easy? Somebody sweet on the board PMd me the name of their guide. So,during Thanksgiving week,I'm going on tour-I'm kinda hoping for Boardwalk villas.This last trip, my DM was @ the Swan & we took the motor launch.I fell for the Boardwalk .In fact,I think this is when the DVC bug bit.

I fell for it too!! Its my favorite except for the monorail hotels. The location is just perfect for my family of 4. We have 180 points and get to stay between 6-8 days depending on the time of year we go. We usually get a 1 bedroom and whats nice about the BWV is that they have different points values for the 3 different view. Also, if you pick a boardwalk view (which is awesome) its a guaranteed boardwalk view.

One thing to remember is that the BWV are only for another 36 years. However, 36 years is a long time so the times you vacation now (peak or non-peak times) will certainly change as your child gets older. Right now, I think DVC is cheaper because I have 2 school age children (1st & 3rd) and the days of going off peak are coming to an end FAST! So for the next 10-12 years we will be vacation in peak times. It does cost more points, but the cost of a deluxe during peak vacations times would run me $4000 per trip. And since I'm kinda frugal I would only being staying Deluxe a few times.

But the DVC is priceless to me. It lets us experience our Disney vacation in the best accomadations- which adds to the Disney Magic. I have stayed at the values and although they are really cute and themed, they lacked the magic. I'm sorry but staying in a hotel room for 1 week with 4 people is just insane!!! Just knowing I get to go home to the BWV is worth every penny.
My choice to buy DVC was definitely one from the "heart"

Good luck-- Maybe we will see you at the BWV during Thanksgiving as we will be down the week before.

 

[rie'smom]

The 36 year thing isn't a problem for me as I'm 48,so I'll be 84 when my contract expires. I have 1 son who's 31,unmarried,another son,22 also unmarried,and a 12 yo daughter who best stay unmarried for at least and I mean at the very least 10 more years.
One thing that has helped me decide to go for it is my daughter is a WDW fanatic and hopefully,I'll become a grandma one day. My 22 yo took a trip w/friends in June,so he might use it too. Hey,and they could use it for their honeymoon-which I'm sure that I would finance.
Even at the 36 year expiration,my baby will be -gulp-my age!!!! Oh my Lord,I just had a hot flash.

 

[Slakk]

The 36 year thing isn't a problem for me as I'm 48,so I'll be 84 when my contract expires. I have 1 son who's 31,unmarried,another son,22 also unmarried,and a 12 yo daughter who best stay unmarried for at least and I mean at the very least 10 more years.
One thing that has helped me decide to go for it is my daughter is a WDW fanatic and hopefully,I'll become a grandma one day. My 22 yo took a trip w/friends in June,so he might use it too. Hey,and they could use it for their honeymoon-which I'm sure that I would finance.
Even at the 36 year expiration,my baby will be -gulp-my age!!!! Oh my Lord,I just had a hot flash.

If you decide to buy PLEASE do not purchase one 500 pt contract but instead try to break it up into pieces. That way if you find 500 points to be more than you need you can sell off pieces.

If you buy from DVC you will have to buy a minimum of 150 in one contract but personally the rest I would have in 50 point chunks.

50 point contracts are much easier to sell than a larger one.

 

[rie'smom]

If you decide to buy PLEASE do not purchase one 500 pt contract but instead try to break it up into pieces. That way if you find 500 points to be more than you need you can sell off pieces.

If you buy from DVC you will have to buy a minimum of 150 in one contract but personally the rest I would have in 50 point chunks.

50 point contracts are much easier to sell than a larger one.

Thanks so much for the great advice! Will Disney allow me to buy 50 point units once I have a 50 pt contract or do I buy through a reseller?

 

[tomandrobin]

If you buy with Disney, your first contract has to be the minimum of 150 points. After that you can buy contracts as small 25 points (cash) or 50 points (financed). Its really best to have the contracts in 100 point increments or less, if you ever plan to resell.

 

[tjkraz]

I was figuring the GF.

A DVC purchase truly represents ownership in one of the 7 DVC properties. DVC can legally sell enough points for each resort to be fully booked 365 days per year. In other words, for each two bedroom villa that Disney constructs at Saratoga Springs, they can sell about 15,000 points (which is the approximate number required to stay in a 2B for an entire year.)

The total number of points at a resort cannot change. DVC could decide to shuffle the point charts around a bit in the future, but that entire year in a 2B at SSR MUST still remain at the same +/- 15,000 figure it is today.

The point I'm leading up to is that the values to stay at a DVC resort will not see any major changes over the next 40-50 years. In fact they may not see ANY changes at all. A 2B that today costs 27 points for a weekday in September may still cost 27 points per night in the year 2050.

That said, the number of points required to stay at a NON-DVC resort CAN and DO change. Even though you may think of them all as Disney resorts, the Grand Floridian is not a DVC resort. As such, DVC members wishing to stay there must engage in a trade of sorts.

I won't bore you with the details of what happens behind the scenes, but there is a very good reason that the non-DVC resorts require many more points than the DVC properties. The end result is that the 48 points per weeknight it currently costs for the GF in value season may well be 50 points come 2008 and 52 points in 2009. Meanwhile a comparable Studio room at Saratoga Springs for the same dates costs 11 points today and will very likely still cost 11 points twenty or thirty years from now.

Bottom line: if you're going to buy into DVC, you really do need to resign yourself to using your points at one of the DVC resorts the vast majority of the time. It may be comforting to know that DVC points can be easily redeemed for non-DVC resorts, cruises and even trades into Interval International, but it will be much harder to financially justify the purchase if you base your numbers on frequent uses of these non-DVC alternatives.

 

[paults]

The 36 year thing isn't a problem for me as I'm 48,so I'll be 84 when my contract expires. I have 1 son who's 31,unmarried,another son,22 also unmarried,and a 12 yo daughter who best stay unmarried for at least and I mean at the very least 10 more years.
One thing that has helped me decide to go for it is my daughter is a WDW fanatic and hopefully,I'll become a grandma one day. My 22 yo took a trip w/friends in June,so he might use it too. Hey,and they could use it for their honeymoon-which I'm sure that I would finance.
Even at the 36 year expiration,my baby will be -gulp-my age!!!! Oh my Lord,I just had a hot flash.

as others have said don't buy 1 (500) pt contract. You have 3 children and you can leave DVC to them . I would buy 3 contracts in Equal numbers.

3 contracts at 166 pts each x 3 = 498 pts.

we did something like this for our 2 children. So far 150 and a 100 and soon another 50 add-on the equal it out.