Buying DVC vs Renting points

[smmora]

lol ... all those rental prices makes me want to buy more ... keep telling myself to wait until the current resale ones are done

 

[Vulnox]

lol ... all those rental prices makes me want to buy more ... keep telling myself to wait until the current resale ones are done

Yeah, haven't even had our first official stay and feeling some addonitis. The more time people talk about historical prices they bought in for, and time being linear like it is, I imagine in 30 years we will be on the VR version of this board talking about the good old days of $200/pt, and those that got in for $100 will be no different than gods.

 

[WxKristin]

When we first began entertaining the idea of buying, I developed spreadsheets that looked at buying vs renting vs rack rate for the 2 bedrooms at the various resorts.
First thing I realized is I could never bring myself to pay Disney Rack Prices on website as $1200 (AKV) -$2500 (GFV) for a 2bd/night was typical (then you still need to add FL hotel tax).
So, renting definitely beats that. But at $17/pt (which may be on the low side now as discussed above), a 2 bd still ranges something like $650 (AKV) -1100 (GFV)/night. Way ahead of Disney rack rate and maybe similar to 2 moderate hotel rooms if you had a group of 6 people. However, as noted earlier there are definite limitations to renting including limited ability to change and/or cancellation. Also for me, having rented previously from the boards, there is a level of trust/risk with the process as a renter.

Owning ranges a bit in price point (depending on resale/direct and when the purchase was made), but it looks closer to $480 (AKV, std view) - $720 (GFV)/night for current resale prices. The biggest considerations are the cash up front (would this be better invested in the stock market???) and the annual increase in dues. I'm assuming the % increase in rental cost will likely stay ahead of % increase in dues, so as a *new* owner if I'm renting out my points when I don't use them I'm likely way ahead.

Finally, the biggest advantage is what I found this last year during the RunDisney Wine and Dine trip... we made a somewhat last minute decision (early Oct for the first weekend in Nov). Nothing was initially available via Disney on property, but a friend was a DVC owner was able to stalk the website and get us nights for the weekend at AKV (savannah) and the GFV via waitlist. We could have never done this if he wasn't a owner and being on property was such a huge step up from the Sheraton and I was sold.

 

[RDMartin]

But if you do rent, which reputable companies do you go to for Rental Insurance?

 

[grahf1234]

Bottom line: unless you're lucky, or are looking to stay at VBR or HHI, using any number less than $20 PPT as a metric for comparing renting versus buying is flawed.

Yeah good observations. It depends on how far ahead you're trying to book if I'm not mistaken. I know David's dvcrequest is $19 for 0-7 and $20 7+ months. Dvcrentalstore seems to be $20 when I was looking for stuff within 7 months, but can go above that for further into the future. I don't know, I never had to pay more than $20 so far, I mean, it's impossible to book something for more than that on dvcrequest really

 

[grahf1234]

Yeah you make some great points. I think it comes down to future needs when it comes to DVC on buying vs renting, and we just don't have the time machine to know what that looks like. You need a lot of points though, clearly. Even with dues increases though, it's possible we will see the cost for rental increase at a decent rate as well. If renting is $6000 in ten years for the same trip but dues are $2200, then the gap in cost is going to keep growing. Assuming you finance, you will have that paid off in ten years (or less) leaving you with just the $2200 in dues, or, still paying $6000+ every year, year after year, renting. That's why they generally indicate DVC won't pay you back immediately, but in 5-10 years depending on frequency of trips, you will at least hit a break even.

If you don't see ten+ years of trips in your future, then it's tough. If you like going without the kids, then probably the best move is to buy 150 points direct and get the blue card, then try to find another 150 on resale, give yourself some wiggle room. In ten years if the kids don't go as much but you do, sell the 150 point resale contract, possibly get your up front cost back assuming resale prices climb in ten years, and keep your 150 direct for you.

Or buy a couple same UY point packages all resale if you don't care about blue card and future resort trading.

But that does bring up the part of the math to keep in mind. If you spend $40k + ($2000x10 = $20k) to buy and pay dues for the next ten years at DVC, then sell the contract at ten years for, lets say $30k. Then it cost you $30k to have ten years of stays with DVC. Let's also say that renting remained static, so $5400x10 is $54k.

Unless the resale market craters or resale just isn't possible, you have the option to recoup a good portion of your cost in ten years. And I think those numbers are pretty low ball for what you might sell the contract.

Bay Lake Tower (BLT) launched in 2012 @ $155/pt. Today on resale it is $150/pt for the absolute cheapest contract I see on resale, and it is only that cheap because it's a 400 pt monster and those are hard to move. More common rates are $160-180. So you would get all your money back if you bought BLT in January 2012 and sold today, excluding dues. I can't imagine it would have been cheaper to rent comparable points at BLT over the past ten years.

Anyway, I can't guarantee the resale market in another ten years, nobody can. But odds are good it will be around, or you can rent out unused points to cover dues, or something. If all of that is gone then we have bigger problems anyway.

Good point, I keep forgetting the opportunity to sell the contract maybe 8-12 years or so after breaking even for probably a not so bad amount.

 

[havoc315]

Yes the 2042 resorts have much different math versus renting. I would not recommending buying a 2042 resort from just a pure economic standpoint. If someone wants to buy BCV because they love it, want to stay there every year for NYE or FW etc and does not want to risk renting and missing out that makes sense to me. The 2042 resorts can still come out cheaper than renting, but the math is much closer and it's not a hill I'm willing to die on. I still think SSR or anything after that the math still very much favors buying.

I think in most cases, the 2042 resorts would be more practical and more economical to rent points.
For SSR and later — I’d agree it’s more likely to be more economical to buy. But still depends how efficiently you use your points, how long you hold them, etc.

 

[vacay77]

My family had a negative experience renting points. The Aulani was literally closed during our planned visit and the rental agency refused to give us a refund despite a clause in the contract that said otherwise. The only thing they were willing to do was give me a credit for a future visit, which I did not want. I ended up disputing it with my credit card company and got my money back. After that experience, we won't consider renting points anymore. Would that same scenario happen again? Who knows. But that's a lot of money on the line.

 

[havoc315]

My family had a negative experience renting points. The Aulani was literally closed during our planned visit and the rental agency refused to give us a refund despite a clause in the contract that said otherwise. The only thing they were willing to do was give me a credit for a future visit, which I did not want. I ended up disputing it with my credit card company and got my money back. After that experience, we won't consider renting points anymore. Would that same scenario happen again? Who knows. But that's a lot of money on the line.

The same thing can happen with owning points. Effectively forfeiting points you can’t use.

 

[vacay77]

The same thing can happen with owning points. Effectively forfeiting points you can’t use.

In my situation, owners were given an extension for their points.

 

[havoc315]

In my situation, owners were given an extension for their points.

Yes, but that extension didn’t solve the issues for all owners. Look at UK owners who still couldn’t travel during the extended window.

Owning does give you a bit more cancellation flexibility than renting. But owning still gives a lot less cancellation flexibility than cash bookings.

 

[JETSDAD]

Yes, but that extension didn’t solve the issues for all owners. Look at UK owners who still couldn’t travel during the extended window.

Owning does give you a bit more cancellation flexibility than renting. But owning still gives a lot less cancellation flexibility than cash bookings.

Yes but at least then you could rent the points out rather than just being out money/points.

 

[Vulnox]

Yes but at least then you could rent the points out rather than just being out money/points.

Yeah it’s all situational. As long as you could cancel outside the 31 day window, you get your points back and can then bank them into the next UY or if they are already banked sell them.

If the claim is that having to use points is still tough since you may not get the time you reschedule for, then yeah, but that’s always been a function of DVC and you know that going in. But if you can’t find a time you want to use the points, then renting isn’t a solution since those you rent from have the same available rooms and times.

Cash will always be the most flexible, that isn’t news. But if all you’re looking for is a room, and that’s it, then DVC will never be cheaper or more flexible than getting a deal at AoA or another value resort. If you want to stay at DVC hotels you have the greatest amount of overall flexibility and risk aversion by owning. There are areas where renting is better, especially if you only intend to go to Disney a couple times per decade. But if you’re going annually or every other year, owning will long term be your best bet.

 

[havoc315]

Yes but at least then you could rent the points out rather than just being out money/points.

Depends. I have a trip planned in 1 month. I'm seriously debating cancelling due to what's going on with Omicron. But my points will expire April 1. So if I cancel, there won't be any real opportunity to rent out the points. It would just be a loss. On the other hand, if cancelling a cash room at this point, I'd simply get a full refund.

 

[JETSDAD]

Depends. I have a trip planned in 1 month. I'm seriously debating cancelling due to what's going on with Omicron. But my points will expire April 1. So if I cancel, there won't be any real opportunity to rent out the points. It would just be a loss. On the other hand, if cancelling a cash room at this point, I'd simply get a full refund.

You can still rent out that room. I just did that due to the complications with traveling from Canada right now. I rented the room out about 2-3 weeks in advance and got just over $16/pt. I also had a single night that I had tacked on that would be trickier to rent so I cancelled it and booked a Standard Studio at BWV for a couple of nights and a Poly studio and rented those out. Yes, cash cancellation is easier but this thread is comparing owning vs renting.

 

[Sandisw]

Depends. I have a trip planned in 1 month. I'm seriously debating cancelling due to what's going on with Omicron. But my points will expire April 1. So if I cancel, there won't be any real opportunity to rent out the points. It would just be a loss. On the other hand, if cancelling a cash room at this point, I'd simply get a full refund.

As an owner, you can be strategic in when you choose a UY, which does limit the risks of losing points.

I agree no option is full proof, but I think risks of owning and losing out are far less than the risk with renting if something happens because you don’t control it.

 

[Brian Noble]

As an owner, you can be strategic in when you choose a UY, which does limit the risks of losing points.

You can if you can predict your future vacation habits with any accuracy. I'm not sure many of us can---at least, I know that my predictions weren't good for more than several years in advance. YMMV.

 

[Sandisw]

You can if you can predict your future vacation habits with any accuracy. I'm not sure many of us can---at least, I know that my predictions weren't good for more than several years in advance. YMMV.

As a teacher, I could for sure Of course, when things changed I did add on a different UY but I didn’t have to visit at the risky times either and stuck with just the one.

Just pointing out that the risk of losing out is not as great as an owner as it is as a renter.

 

[Brian Noble]

As a teacher, I could for sure

I'm a teacher too, but it didn't work for me. For example:

When we started taking regular vacations with the kids, their winter break lined up with my "spring" break. We assumed that would be our "Disney week" for as long as we were interested in going. That lasted about three years before the weeks were uncoupled. So far, they've never been put back together (and both kids have been out of school for a while now).

When the kids reached HS age, they found that they really enjoyed and were committed to various activities---sports, band, etc. During those years, we went from taking 3-4 vacations per year to 1-2.

In the summer of '17, DW and I separated for several years. During that time, we didn't travel together at all.

Looking back on it, I guess I always knew when *I* could travel, but I never really knew who could (or would want to) come with me. And as our parents age and our kids establish their own lives (the youngest graduates from college this year) there will be even more unexpected twists and turns.

That doesn't mean one shouldn't give consideration to a UY. The one I would have picked at first would have been a good fit most of the time. But, my original plan of "always go to Disney in week 8" did not last more than about three years.

 

[Vulnox]

I think the uncertainty would be a bigger reason to keep me out of resale. You may not care about Riviera now but might in five years. You may not think you will keep it for 20 years, but may find yourself in 20 years looking at your dissolving resale contract transfer options wishing you had bought direct when it wasn’t $300/pt.
Direct has more safety nets than resale for changing future needs.

But your personal situation impacts that calculation. If you’re 50 or 60 and buying DVC for yourself and grandkids, then your consideration for 20 years out is probably that you are less likely to care about trading resorts. But if you’re 20-40, then 20 years out May be more relevant. There’s no one size fits all in the math.