Breakeven - GF vs. BLT

[Snurk71]

So I was playing around with some numbers today (that's what I do for a living) and threw some quick/rough numbers together to share on the break even time on our DVC buy vs our previous home of the GF - as many prospective DVCers come here trying to figure out if DVC is right for them. I had done a similar analysis before we bought too - but it's nice to revisit the numbers to feel good about the buy sometimes. I even threw in some relatively strong time value of money on the offset to the up front cost to DVC to be fair and not be too pro-DVC. If anything I may have been too lenient on the GF rack growth rate at 4%. Can you imagine the room rate growing from $465/nt to $660/nt in 10 years? Unfortunately, I think we can.

So...

Comparing standard view GF to lake view BLT studio (probably the most realistic room availability comparison) - 5 years against rack rate (which we paid the last couple stays) and 8 years against a 30% GF discount.

But since we're now spoiled on 1BRs, our break even grows to 10 years against rack rate, 19 years against a 30% discount. It's not really a fair comparison - a 1BR vs a standard room. But that's how the numbers fall.

Just thought I'd share for other fiscal-minded folks.

 

[Malaguti Ball Clan]

How are the 2 bedrooms at GF....or...even better, what about the savanna view 3 bedroom? Man I love my DVC....

 

[arthur06]

i dont really know the cost breakdown, what I do know is I am happy with my purchase! I just need more points!

 

[Crystal_27]

I think it's difficult to compare the GF to BLT, though. BLT's rooms are significantly smaller (400 sf v. 360 sf), and you also have to factor in GF's higher prices due to the fact that it's billed as Disney's flagship resort. Still, I guess for a family that typically stays at the GF but is looking at buying into BLT, it's a fair comparision, but, again, as cool as BLT is, it's never gonna be a GF.

 

[Snurk71]

I think it's difficult to compare the GF to BLT, though. BLT's rooms are significantly smaller (400 sf v. 360 sf), and you also have to factor in GF's higher prices due to the fact that it's billed as Disney's flagship resort. Still, I guess for a family that typically stays at the GF but is looking at buying into BLT, it's a fair comparision, but, again, as cool as BLT is, it's never gonna be a GF.

Yeah, I know they're different resorts, but they also have a lot of similarities (monorail line, "deluxe", etc). It wasn't so much of a comparison of equal resorts - for me it is a comparison of the resort/room we had been staying at (the most expensive standard rooms on property) for years compared to a switch to DVC at BLT. And that is why I threw in the break even comparison for us to a 1BR at BLT, because I doubt we'll ever stay in a Studio (or at least for a long time). So for us it is a breakeven analysis between the GF standard rooms in the outer buildings to a 1BR at BLT. Breaking even in 10 years against the rack rate and theoretically having the next 40 years of stays at the cost of maintenance fees was a pretty strong fiscal argument for us.

I know I'm preaching to the DVC choir on the value. I was just offering some numbers for those fence sitters.

 

[cseca]

Interesting numbers.
The funny thing is that when I bought in initially my vacation habit was value/moderate/occassionally WLV. I couldn't afford the monorail resorts at all. But I fell in love with BW right away. So when I did my numbers I compared the purchase with studios on all 3 resorts and came up with around 5-12 years to break even.
And after that I added on way too many more times... and I don't even bother checking for break even points... It's pretty shameful really...

 

[YourEveryDayAdam]

See this post I made:

http://www.disboards.com/showthread.php?t=2137102

It does something similar...Even goes so far as to compare the value of DVC to the moderate and the value resorts...Compares the worst case of DVC (no incentives, financed at worst rate, etc.) to the best case of cash (40% discount, or equivalent offer).

I then take the numbers, take in to account for an increase in the costs of dues, resort rates, and even potentially investing the money you would have spent on DVC.

DVC comes out ahead... by FAR in almost every case. Even the worst case of DVC just about breaks even with the best case of a value resort over the entire 50 year life of a new DVC contract.

Now... incentives, not financing, better financing rates will tip the scales further in favor of DVC. Also, buying resale will tip the scale in favor of DVC a LOT.

One other thing: The biggest expense in owning DVC will be the annual dues. The annual dues, over the life of the contract, will equal about 7 times the initial purchase price. In the last 5 years of ownership, you will likely pay more each year in annual dues than you did for the initial buy-in... However, we are also talking in terms of 2050 dollars and all prices for everything across the board will be MUCH higher.

 

[texhanddoc]

This is a great discussion about cost and break even points. I actually just did this analysis on my own. There are two VERY large points we are missing or just barely touched on.

1. You are NOT comparing apples to apples. A single room in the GF is NOT close to being equal to a 1BR suite in the BLT. The kitchen alone can easily save you $500 for a week long trip, even more so if you eat all 3 meals out when you are at DW.

2. We have grandparents that come with us a fair amount and we often help subsidize their visit. We figured that every time the grandparents stay with us in a 2BR suite in BLT, it decreases the break even point by ONE YEAR.

For us, we compared what we usually stay at right now: Polynesian Club Level for a week vs. BLT 2BR suite and found our break even point at best 7 years, at worst 10 years depending on how much we save elsewhere. But this is decreased by one full year each time grandparents come with us. So assuming grandparents come with us 50% of the time, we break even at 4 to 5 years.

 

[Snurk71]

The kitchen alone can easily save you $500 for a week long trip, even more so if you eat all 3 meals out when you are at DW.

So far, none of our dining habits have changed - and I don't know that they will. I don't see us really utilizing the kitchen, as in making meals to save $500 on food. For us the 1BR is about the extra space, bathroom, etc. The kitchen with a full-sized fridge, microwave, counter space, dishes & utensils is just an occasionally used bonus. That may be thought of as wasteful sacriledge to some DVCers. But we're still on vacation.

Though if we ever do start eating in, that would definitely continue to tip the fiscal scale to DVC.

 

[stefanospops]

So far, none of our dining habits have changed - and I don't know that they will. I don't see us really utilizing the kitchen, as in making meals to save $500 on food. For us the 1BR is about the extra space, bathroom, etc. The kitchen with a full-sized fridge, microwave, counter space, dishes & utensils is just an occasionally used bonus. That may be thought of as wasteful sacriledge to some DVCers. But we're still on vacation.

Though if we ever do start eating in, that would definitely continue to tip the fiscal scale to DVC.

We just got back from 9 days at a 1bed lakeview at BLT. We started the trip with dinner at the Garden Grill, breakfast the next morning at Chef Mickey's and lunch at the Royal Table. I went back to the room and realized I just spent over $400 (had the Tables in Wonderland card) for three meals. So I cancelled the remainder of our meals and spent $350 on groceries that lasted us more or less the rest of the time. Sure, I could have done more quick service meals to save money, but I would rather have fresh food and the kitchen was awesome for that.

I get that people are on vacation and don't want to cook. I get around it by bringing my mother-in-law, expenses paid, and let her cook. She feels bad that we "spent all this money on her" and is more than happy to cook for us and watch our kids once they fall asleep so my wife and I can enjoy a few dates. So DVC makes total sense for that reason alone.

 

[dbs1228]

We have always stayed at FT Wilderness Cabins for the full kitchens and outdoor grill! We have found it easier to do a big grocery shop for a family of 5 and eat in every morning (not morning people), pack lunches for the parks and throw something on the grill for dinner. We have saved a lot of money doing this but the biggest advantage for us was our time. We feel we had more time to enjoy the parks, pools or just cruising around in the golf carts by eating in. Our kids are now teenagers and they still prefer eating in. We still do a few meals out or in the parks but for us it is a personal decision to utilize the kitchen! Still waiting our 1st visit with DVC and we are excited to stay at new properties every visit so we can explore the "properites" along with the parks.

 

[BigTigger]

DVC time to breakeven is one of those "nice to know" things.

We bought OKW in 1995. I thought it would be 7 years to payback, but it was mid way through the fifth year trip when the lines crossed in my Excel spreadsheet (yup, I'm one of those fiscal guys ). We had the luxury of early buy-in, offsetting of hotel room cost for the visit we bought on against DVC cost, and free annual passes based on room size up until 1999 to make the numbers even better.

We bought BW in 1998 and it was just into the eighth year before the lines crossed and we had "saved" the cost of the investment.

Of course, the breakeven assumes that you use the highest value option (onsite DVC) and don't trade out or use points for hotels. If you use the points for a lot of non core DVC stays then it will take longer to breakeven, but you'll still experience lots of wonderful times for the money invested.

From a pure numbers sense, I always recommend DVC to friends that ask. From a pure experience sense, I also recommend vacationing at Disney to people who ask because someboudy told them I'm the Disney guy

From a pure experience point of view, our first visit was to POFQ. It's not a DVC, but it's still my favorite place to stay (size of resort, amemities (Eliot Dyson!), etc.)