Boardwalk 2042

[aceshigh73]

April UY is like having an albatross around your neck.

Rime of the Ancient Mariner reference?

 

[AwfulWaffle]

The points chart at BW is nice. I can't justify buying BW for the price right now for a few reasons:

1. Price per point is too high compared to newer resorts when amortized over the life of the contract
2. I am somewhat flexible and have been able to book 1 BR and Studio accommodations at 7 months when I need to.

The wife and I finally get to leave the kids at home and escape a Boardwalk view for a few days. Price justified, Check.

 

[jason423]

While boardwalk is not the most economical purchase (we own there as well) its not a losing proposition and it does give you access to one of the harder to book resorts at disney. There is also a nice side benefit that it gives you a possibility of booking a boardwalk view or a standard view from time to time. We have been able to get a standard view studio for a few trips and the difference in cost pretty much allows us to add an extra day or two to a trip depending on when we go. If you didnt want to use those points you can rent them each year. For example during Christmas week the difference for a standard and garden view is 40 points. You wont always get it but in a year you do thats a little offset that you can have.

 

[Sandisw]

I think the ‘crash’ talk is too doomsday. The old resorts are a better points value than the new ones. Boardwalk and Riviera have similar rack rates, but Boardwalk’s points chart is SO much better, so it evens out.

BWV point chart was created when the cash rate was a lot less….that’s what makes them such a good deal.

The buyer pool though is going to shrink as time goes on, and there are going to be sellers who are going to be willing sell low just to be done…especially if they paid a good deal.

I paid $55/pt for BWV around 2012….if I still owned it and decided to sell it with 10 years left, I’d definitely have no issue selling it that low since I’d be getting every penny back.

That’s part of why I think the price will go down as we get below 10 years.

 

[Abbie485]

Please forgive me if this is a dumb question and already well known, but can someone explain the 2042 date for Boardwalk and Beach Club? I’m assuming this is when many (or all?) DVC purchases expire? What happens with DVC at those resorts after that date? Does it go away entirely? Does Disney, at that point, begin selling direct again?

Sorry, so many questions! I am now starting to explore the idea of buying into DVC based on the number of trips over the last few years, and trying to make sure I understand the ins and outs.

 

[Sandisw]

Please forgive me if this is a dumb question and already well known, but can someone explain the 2042 date for Boardwalk and Beach Club? I’m assuming this is when many (or all?) DVC purchases expire? What happens with DVC at those resorts after that date? Does it go away entirely? Does Disney, at that point, begin selling direct again?

Sorry, so many questions! I am now starting to explore the idea of buying into DVC based on the number of trips over the last few years, and trying to make sure I understand the ins and outs.

Those resorts expire and the properties revert back to Disney. Ownership just ends.

Disney will have choices as what to do. They can redeveloped them as new DVC resorts. They can convert them to hotels. They could knock them down and do something else in the area.

 

[Abbie485]

Those resorts expire and the properties revert back to Disney. Ownership just ends.

Disney will have choices as what to do. They can redeveloped them as new DVC resorts. They can convert them to hotels. They could knock them down and do something else in the area.

Thanks for the explanation! So then does every DVC resort have its own date that the resorts expire? If so, is there a list of some kind anywhere? Or does it also depend on when a DVC “contract” was purchased for the resort?

 

[chalee94]

Thanks for the explanation! So then does every DVC resort have its own date that the resorts expire? If so, is there a list of some kind anywhere? Or does it also depend on when a DVC “contract” was purchased for the resort?

https://www.disboards.com/threads/the-dvc-resource-center-updated-december-2021.3655476/

Post 8 has the expiration dates but lots of useful information there.

Doesn't matter when the contract was purchased.

 

[Sandisw]

Thanks for the explanation! So then does every DVC resort have its own date that the resorts expire? If so, is there a list of some kind anywhere? Or does it also depend on when a DVC “contract” was purchased for the resort?

Yes they all do. When purchased doesn’t matter.

This is a great resource

Thread 'The DVC Resource Center - Updated December, 2021'

Posted link is above

 

[CarolynFH]

That said, I'll be 84 years old in January 2042, I'm just hoping I outlive my contracts. But if I don't, my DS has told me he'll be happy to fulfill my obligation.

We’re with you, although we’re even older, and outliving our contracts is even more questionable! We recently added DD to them, to make it easier if we don’t live to learn the answer to the burning question, “What will happen on February 1, 2042?!” We told her she could hang on to them and use or rent the points, or she could sell them for whatever amount she could get for them then. Either way she won’t have to go through probate in Florida.

Thanks for the explanation! So then does every DVC resort have its own date that the resorts expire? If so, is there a list of some kind anywhere? Or does it also depend on when a DVC “contract” was purchased for the resort?

The first six DVC resorts - actually each is an individual legal entity, a condominium association - all expire on January 31, 2042. That includes OKW, VB, HHI, BWV, BRV, and BCV. Thus the question “What will happen in 2042?” and the recurrent references here to “the 2042 resorts.” SSR was the first DVC to have a new expiration date that was 50 years from its formation, and each DVC after has had its own 50-year lifespan.

 

[cdirazonian]

I just don’t see many owners deciding to “jump ship” just because the contract is nearing its end. If anything, many will buy contracts at other resorts AND keep the 2042 points. Because, as we all know, the longer you hold your DVC the more valuable it becomes.

That’s what we did this year. Even though I’ll be ‘hu hum’ 76 in 2042 the thought of our ownership just vanishing & not owning anything Disney anymore just made me too sad.

So we added on at PVB & VGF this summer, just incase I live to be 100 or so

 

[Genie+]

Welcome Home

We bought a small BWV and plan to use it to the end.

Rental - BW can near $30pp with confirmed reservations due to comparative options. People look up dates and see DVC studios for ~$250 to $500+/nt. On the lower end is SSR, OKW, AKV and BW standard. They sell very easily for $300/nt on 9-10pt nights which occur 25% of the year. Scaling up might be a different story but works well to unload points occasionally.

Selling 5+ years from now - Less years could work in BW’s favor (similar to SSR’s low price now). Smaller buy-in cost makes it more attractive. Easy to digest math. Take 2027 with 15 yrs left, imho likely still sees over $90pp sales. $6pp/py and without decades of TVM and the best near park resort point chart. I don’t think less years will be detrimental and crash the price.

How about BW in 2030 for $90pp (equivalent of $73 today considering 3.5% inflation)?

That’s like BW selling today for $73pp with 12 years left. A 100pt contract for $7,300. Smaller buy-in, less TVM consideration, greater confidence about vacation habits. Will easy to digest short term commitment lure more buyers?

How fast would BW sell today at $30pp with 5 yrs of points left? I think it would fly off the shelves. In 2037 I’d not be shocked to see it selling $50pp. Not life changing numbers for anybody, I just doubt we’ll see the value crash when years left are single digits. I think BW will always sell above $6pp/yr in todays dollars.

 

[TheDailyMoo]

April UY is like having an albatross around your neck.

Can I ask why April specifically?

Rime of the Ancient Mariner reference?

My friend you are identifying an obscure reference in this day and age. Not speaking about those on this board but society in general. Unfortunately classical literature is not faring very well in the age of TikTok and Ai. Teachers are lucky to even get students to read anything or write anything of their own these days much less keep the classics alive...disheartening to say the least.

 

[DanCali]

How about BW in 2030 for $90pp (equivalent of $73 today considering 3.5% inflation)?

I'd have to guess you work in sales - you are tempting me to start looking and re-subscribe to broker email lists!

Here's a thought experiment... For how much would you sell that put option? Meaning, how much would you want someone to pay you today so that in 2030 you'd buy that BWV contract from them at $90 is the market price was below that. The answer to that question reflects the risk embedded in that hypothetical 2030 price... It the price was $100/pt, you're off the hook, but if the price was $60/pt, you'd have to pay $90/pt and keep it or sell it at a substantial loss.

 

[Jlo85]

I think BWV (along with BLT) will actually spike after their refurbs. Partly why I bought both recently. I think prices are slightly depressed right now because of the shabby state of the villas.

 

[AdamsMum]

Can I ask why April specifically?

There are very few April contracts available most of the time, and rarely any smaller contracts. I'm not adding on large amounts at this time, but I would like a few more 25 -50 more points.

 

[AdamsMum]

We recently added DD to them, to make it easier if we don’t live to learn the answer to the burning question, “What will happen on February 1, 2042?!” We told her she could hang on to them and use or rent the points, or she could sell them for whatever amount she could get for them then. Either way she won’t have to go through probate in Florida.

I'm considering doing just that. Being from Canada I'd like my kids not to have to go through probate in Florida. I have a thread bookmarked for when I want to do it.

 

[Genie+]

I'd have to guess you work in sales - you are tempting me to start looking and re-subscribe to broker email lists!

Here's a though experiment... For how much would you sell that put option? Meaning, how much would you want someone to pay you today so that in 2030 you'd buy that BWV contract from them at $90 is the market price was below that. The answer to that question reflects the risk embedded in that hypothetical 2030 price... It the price was $100/pt, you're off the hook, but if the price was $60/pt, you'd have to pay $90/pt and keep it or sell it at a substantial loss.

That’s a good way to think about it. Many things could upset DVC. 3 shakeups already happened in the 2000s. Something could coincide with 2030. I’d expect $4pp/py the bottom for non-catastrophic event, with inflation came in right around your $60pp in 2030. This does leave me questioning myself though. It doesn’t even have to be a world event to impact DVC. Changes to the parks or membership are a risk as well.

For contracts 100pts or less - $10pp. Over 100pts - $20pp. With all the moving parts still feels like a 99% safe bet. Any takers?

 

[crisi]

If the argument is that it's profitable as a rental then isn't almost any other resort even more profitable as a rental (e.g., you can buy PVB or BLT for $11-$12/pt/yr using that math and get the about same rental value out of it)?

Consider that you pay $120/point (what the OP paid) and rent for $10/pt above the annual dues every year. After 18 years, you have a "profit" of $180 (ignoring time value of money and taxes) but you also lost your initial $120 investment (100% loss of "principal") because the deed is worthless at that time. So you put in $120/pt, and you walk away with $180/pt after 18 years. That's just a 50% gain over 18 years, or 2.28% per year annualized (and that's without taxes on the rental profits). So that's not such a great return even if you just rent it out annually...

That math will look a better if that $120/pt is used on a 2060s resort and you have 40+ years to generate that rental income.

People can justify current resale prices with rack rates, "priceless memories", "value is in its use", "keep till the end", "not having to hope getting a room at 7 months is priceless", "I only did it with 50 points" (my own excuse for BRV...) and that's all fine - behavioral economics is an entire specialty field. But it's much harder to justify as a solid financial investment generating rental income at these prevailing resale prices when you know it's worthless in 18 years.

So I figure its worth about $92 a point in present value to me as a rental. That assumes I make about $10 a point over dues (on my existing, paid for, got all my ROI out of it ten years ago contract) and an 8% interest rate. Reasonable assumptions. If I'm willing to spec book standard view rooms and then rent the rooms rather than the points, I can do a lot better than a $10 per point margin. Which means if I'm making only a financial decision, I'd need to net out at $92 a point. With a 10% commission, its not worth it to me this year to sell at less than about $100 a point.

The deal isn't buying up those points to rent, its that if I own the contract, that's what its worth in rental for me to sell. And it ignores the value of those points to me - I may not want to go to WDW much now that my kids are young adults, but we enjoy Hilton Head and used our points at Aulani. A timeshare still makes for a pretty cheap vacation. And there is the emotional ties to having it around. Now, you'll get some people who just want to sell to pocket the cash, and people who aren't informed about the rental market - but I suspect that the floor is around that present value of an annuity with a $10 per point profit.

I wouldn't BUY Boardwalk at $100 a point to rent out, that's not going to work financially unless you are also a reseller and able to make profit buy scooping up cheap loaded contracts, spec renting the points and selling the contract, cutting out the realtor fees. But I'm not selling my Boardwalk for less than that. I would buy BWV for $100 a point - or $120 a point - if I loved the resort and wanted to stay there for most years for the next eighteen years. But like others on this thread, I'm older. In eighteen years I'll be 75. I have no need for a contract with 30+ years of life - I also have no college bills left, no mortgage, and a retirement account that looks pretty good - so I don't feel the need to make financially frugal decisions with my vacation money.

 

[tom1944]

So I figure its worth about $92 a point in present value to me as a rental. That assumes I make about $10 a point over dues (on my existing, paid for, got all my ROI out of it ten years ago contract) and an 8% interest rate. Reasonable assumptions. If I'm willing to spec book standard view rooms and then rent the rooms rather than the points, I can do a lot better than a $10 per point margin. Which means if I'm making only a financial decision, I'd need to net out at $92 a point. With a 10% commission, its not worth it to me this year to sell at less than about $100 a point.

The deal isn't buying up those points to rent, its that if I own the contract, that's what its worth in rental for me to sell. And it ignores the value of those points to me - I may not want to go to WDW much now that my kids are young adults, but we enjoy Hilton Head and used our points at Aulani. A timeshare still makes for a pretty cheap vacation. And there is the emotional ties to having it around. Now, you'll get some people who just want to sell to pocket the cash, and people who aren't informed about the rental market - but I suspect that the floor is around that present value of an annuity with a $10 per point profit.

I wouldn't BUY Boardwalk at $100 a point to rent out, that's not going to work financially unless you are also a reseller and able to make profit buy scooping up cheap loaded contracts, spec renting the points and selling the contract, cutting out the realtor fees. But I'm not selling my Boardwalk for less than that. I would buy BWV for $100 a point - or $120 a point - if I loved the resort and wanted to stay there for most years for the next eighteen years. But like others on this thread, I'm older. In eighteen years I'll be 75. I have no need for a contract with 30+ years of life - I also have no college bills left, no mortgage, and a retirement account that looks pretty good - so I don't feel the need to make financially frugal decisions with my vacation money.

57 makes you a kid from where I stand.