Big Direct Price Increases Coming

[cbnsoul]

Tim posted this on DVCnews.com earlier today:

http://dvcnews.com/index.php/dvc-program-51703/financial-75803/news-19220/2794-price-increases-for-sold-out-resorts

Still might get another 25 BCV points before the price jumps. I assume you are guaranteed the current price as long as you wait list prior to the increase. When the last price increase at the "sold-out" resorts occurred, there seemed to be some ambiguity about that.

 

[jerseyduke]

wow.

I got VGF at 150 18 months ago.

now they want 155 for 2042 resorts?

I guess resale prices will be going up

 

[newfangled]

oh!!!! newbie question here - Does this usually result in any increase in price in the resale market?

My hunch says not in the long term because I understand the going rates for resorts like OKW or VWL and others are selling close to their original PPP that folks paid when buying direct (excluding the variance that occurred during the "great recession").

But then I would think a move like this would drive more people to explore the secondary market and since more buyers = more demand, this would drive higher prices.

What say you who have been around for prior Disney price increases?

 

[chalee94]

oh!!!! newbie question here - Does this usually result in any increase in price in the resale market?

it's possible but it depends on overall demand. the problem as i see it is that overall demand isn't that strong right now.

http://dvcnews.com/index.php/dvc-program-51703/financial-75803/news-19220/2782-monthly-sales-decline-in-november-2014

My hunch says not in the long term because I understand the going rates for resorts like OKW or VWL and others are selling close to their original PPP that folks paid when buying direct (excluding the variance that occurred during the "great recession").

nah, OKW started selling directly for $48 and VWL started in the mid-$60s:

http://www.disboards.com/showthread.php?t=2823943

we are way past that now...

But then I would think a move like this would drive more people to explore the secondary market and since more buyers = more demand, this would drive higher prices.

i suspect resales are probably not going to see much of a bounce from this price increase, but if a lot of people are looking at buying DVC and would have considered buying directly at more reasonable prices, then resale is increasingly looking like the only realistically-priced game in town.

 

[KingRichard]

So Disney can't sell Hawaii and GFV total price is out of range for many.

They can sell a lower point resort and push the lower over all cost to buyers.

I see a lots of buybacks coming soon!

 

[lovin'fl]

As my mother always says...'are they out of their gourd'?

 

[newfangled]

nah, OKW started selling directly for $48 and VWL started in the mid-$60s:

http://www.disboards.com/showthread.php?t=2823943

we are way past that now...

Ooooooh ...thanks for link. Good to know!!!

 

[jerseyduke]

At 155 per point on 2042 resorts, that comes out to:

5.54$ per point per year

Grand Floridian (48 years left, 180 per point)
3.75$ per point per year,

That is just WAY out of wack.

I do not think it will affect the resale market much however, most of those resorts are not bought direct anyway


Oh yea, and that means VGF has gone up 20% in 18 months. 150 to 180

 

[dsnydaddy]

My guess that while the price increases at Disney are not going to translate to higher resale prices, they will serve to keep resale prices from dropping. The way I see it, resale just became an even better deal.

 

[bookem]

I'm glad I bought before prices start to increase!

 

[MountainMouse]

Long time owners would know much better than me, but I think an increase in direct prices would result in an increase in resale costs. Not dollar for dollar but an increase.

 

[BWV Dreamin]

Long time owners would know much better than me, but I think an increase in direct prices would result in an increase in resale costs. Not dollar for dollar but an increase.

The last price increase (direct) did affect resales prices. Not only that the resales inventory was affected as well.

 

[MountainMouse]

The last price increase (direct) did affect resales prices. Not only that the resales inventory was affected as well.

Yea, honestly, I don't see how resale wouldn't go up. Higher direct makes resale more appealing, more buyers to resale drives down the inventory and up the price until it evens out.

 

[supersnoop]

Yea, honestly, I don't see how resale wouldn't go up. Higher direct makes resale more appealing, more buyers to resale drives down the inventory and up the price until it evens out.

The purpose of raising prices, at least in my mind, is to reduce the demand and slow down sales of VGF, while keeping the revenue steady. They want to keep enough inventory to last until Poly starts selling, while also keeping the same amount of money coming in.

That could cause more buyers to consider resale, but it could also cause potential buyers to reconsider the purchase or just push their buying decision to a later date. I don't think it will drastically increase demand in the resale market, but I'd expect about a $5/point increase for most properties.

 

[julluvsdisney]

After it was reported that november had been thier slowest month for sales since reporting began, im really surprised that this is their move. Seems odd to increase the price at this point .

 

[MountainMouse]

After it was reported that november had been thier slowest month for sales since reporting began, im really surprised that this is their move. Seems odd to increase the price at this point .

Where did the report of price increase come from? Maybe DVD wants to spur sales before the end of the year?

 

[KAT4DISNEY]

After it was reported that november had been thier slowest month for sales since reporting began, im really surprised that this is their move. Seems odd to increase the price at this point .

If I'm recalling correctly they did this before VGF went on sale. Bump everything up and then discount the new one to make it seem like a bargain. It's more about establishing the mark for the new resort than anything else IMO.

 

[heynowirv]

If I'm recalling correctly they did this before VGF went on sale. Bump everything up and then discount the new one to make it seem like a bargain. It's more about establishing the mark for the new resort than anything else IMO.

Makes sense,poly is just around the corner.

 

[Msmithmd]

Really appreciate Tim's link. While DVCNews is very reliable, I don't know a thing about the site that he got the info from. And the member site has nothing. One would think if they were indeed raising the prices they would be inundating our inboxes and shouting it from the rooftops, in order to drive short term sales.

So it seems a bit odd. Anyone know the reliability of the original source, as the rentals site doesn't state where they got the information, just states it as "fact...?"

 

[DougEMG]

Och, why would anyone buy a 2042 resort at those prices instead of something with 50 years on it? Makes no sense to me.