Calculating the savings with DVC

SL6827

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How do you guys calculate your savings with DVC? I am thinking that you take the total of the complete initial purchase price, plus dues each year and compare those numbers with what you would have payed rack rate? Am I correct? I looked at the figures on a possible Hilton Head contract for myself and it looks as if I will break even at 4 years, and start the savings portion at 5 years.
 
I prefer to use current rental rates rather than rack rate for comparison. ROI should be around year 9.
 
How could I find out rental rates? As I look into this more I'm wondering if it'd be wise for us to actually buy MORE points than we'd use and plan to rent out some of them each year to help cover our maintenance costs?
 
I track both the cost of getting the room through Disney and the cost of getting the room by DVC rental (approx 15 per point for example), versus the amount of money we put up (I factor in inflation, but I don't think it is all that necessary). Looking at the "Disney" cost (even throwing in a generous discount) looks so nice on the spreadsheet, we were ahead in just a few years. Comparing to DVC rentals, the pacing is slower, but will get there.
 

Don't forget to include the high HH dues and special dues assessments due to storm damage. In addition once a DVC owner you tend to take additional vacations so add that cost.

:earsboy: Bill

 
Don't forget to include the high HH dues and special dues assessments due to storm damage. In addition once a DVC owner you tend to take additional vacations so add that cost.

:earsboy: Bill
Question here. The extra amount that was added to the dues at Hilton Head for the damage of Mathew, will that amount ever be removed or is it forever?
 
How could I find out rental rates? As I look into this more I'm wondering if it'd be wise for us to actually buy MORE points than we'd use and plan to rent out some of them each year to help cover our maintenance costs?
I was thinking the same thing, in case I can't find the small amount of points I want on a contract. Just possibly buy more points and rent them out.
 
/
Yeah, Disney inflate the cost of the villa units as a sales item for DVC.
I was thinking that as well. Right now, during June, the weekday studio rates are $455 (tax included) each night. I just wonder how much the rates will rise in the future? At some point surely they will realize there might just be a ceiling to the price. At some point, prospective buyers may look at the cash prices and realize that they are beyond realistic and that Disney is just doing that to justify the increases in the yearly dues
 
Rental rates are around $13/point. Buying extra to rent is typically a bad idea for two reasons. One, the ROI is too far out for this type of investment. Two, you're probably going to decide to use those points instead of renting them out.
 
Rental rates are around $13/point. Buying extra to rent is typically a bad idea for two reasons. One, the ROI is too far out for this type of investment. Two, you're probably going to decide to use those points instead of renting them out.
Ya, I can totally see using them instead of renting. Lol.
 
Ya, I can totally see using them instead of renting. Lol.
We bought the right size contract for us, but had about 100 points in 2017 that we weren't going to use. We could have rented them, but instead, that turns out to be enough for 2 shorter trips (a 6-day and a 5 day) in 2018 if we bank them. So guess what we are doing... ?
 
I don't calculate it. Because I don't save money.

DVC has changed how we vacation at Disney. We wouldn't have paid for rooms for friends and family without DVC. We wouldn't stay in a two bedroom unit for the four of us without DVC - we'd be in a hotel room. We wouldn't go as often.

So any comparison we'd do is apples and oranges.

If you take pretty much the exact same trips that you'd take without DVC - you stayed in a regular hotel room before, you stay in a studio now. Or you rented points and now use your own points. You go the same amount. The lack of hotel bill and frequent trips don't encourage activities you wouldn't have done. You don't take guests - then you can compare and figure out how much you save. I think there have been half a dozen people on this board that say that describes them. For most of us, its at best a fun exercise in math and accounting, and at worse, a justification to overspend.
 
Do you actually ever pay rack rate? Calculate the "savings" based on the trending discounts that have happened over the years during the time you typically travel.

I have yet to see any potential savings because we use the military discount which is 40% for Deluxe/DVC.

DVC is on the back burner until such a time as Disney decides to discontinue all discount offers.
 
I calculate the savings based on the absolute highest rack rate that I can find for the same room then I subtract the dues times the number of points used for the actual time I am going. For example at the BWV New Years or Christmas eve costs $649 for a standard room. When I go at the beginning of Dec, 1 week night costs 10 points times $6.47 is $64.70. My savings are $584.30 per night. I just purchased another 150 BWV points and there were 150 banked points that expire July 31. I just got access to them and booked 1 night at the Poly bungalows, since the points were going to expire anyway, I figure that is a savings of $4302 based on the Christmas rate. The contract also has 150 banked points for 2017 for a total of 300 2017 points. I figure I saved $21,831.00 alone by purchasing the new 150 point contract.

That's what I told my wife.
 
I calculate the savings based on the absolute highest rack rate that I can find for the same room then I subtract the dues times the number of points used for the actual time I am going. For example at the BWV New Years or Christmas eve costs $649 for a standard room. When I go at the beginning of Dec, 1 week night costs 10 points times $6.47 is $64.70. My savings are $584.30 per night. I just purchased another 150 BWV points and there were 150 banked points that expire July 31. I just got access to them and booked 1 night at the Poly bungalows, since the points were going to expire anyway, I figure that is a savings of $4302 based on the Christmas rate. The contract also has 150 banked points for 2017 for a total of 300 2017 points. I figure I saved $21,831.00 alone by purchasing the new 150 point contract.

That's what I told my wife.
:rolleyes1:rotfl2:
 
I agree with others that you really need to compare it to the cost of renting DVC points. If you do the back of the envelope math for buying DVC (purchase price divided by years remaining plus MF) you will generally come out to an effective cost of $8-11 per point per year depending on the resort. Note that this doesn't factor in opportunity costs, so add on another $1-2 if you like.

You can rent points for about $13 from a number of places. So, by buying you are saving $1-4 per point per year. BUT, renting comes with one perk that you can't get with buying-- an effective 11 month priority window at every resort.
 
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How do you guys calculate your savings with DVC? I am thinking that you take the total of the complete initial purchase price, plus dues each year and compare those numbers with what you would have payed rack rate? Am I correct? I looked at the figures on a possible Hilton Head contract for myself and it looks as if I will break even at 4 years, and start the savings portion at 5 years.
As was said earlier, I don't think this is the best comparison as it skews the numbers towards purchase maybe a little too heavily. I think the best comparison is the next best alternative to DVC, whether that be renting points or 30% off room rate promotional savings. What I haven't seen discussed is that by buying at HHI you will not have a home resort advantage at ANY WDW property. This might be an issue if you are particular about your accommodations or want to travel at some of the busier times of the year.
 
I don't calculate it. Because I don't save money.

DVC has changed how we vacation at Disney. We wouldn't have paid for rooms for friends and family without DVC. We wouldn't stay in a two bedroom unit for the four of us without DVC - we'd be in a hotel room. We wouldn't go as often.

So any comparison we'd do is apples and oranges.

If you take pretty much the exact same trips that you'd take without DVC - you stayed in a regular hotel room before, you stay in a studio now. Or you rented points and now use your own points. You go the same amount. The lack of hotel bill and frequent trips don't encourage activities you wouldn't have done. You don't take guests - then you can compare and figure out how much you save. I think there have been half a dozen people on this board that say that describes them. For most of us, its at best a fun exercise in math and accounting, and at worse, a justification to overspend.
Crisi it's all how you look at it. You are saving money. In fact, you are saving money five or six extra times per year! :) Before DVC we spent a lot of money to go to Disney. Now we spend half as much five times as often. That works, right?
 
How do you guys calculate your savings with DVC? I am thinking that you take the total of the complete initial purchase price, plus dues each year and compare those numbers with what you would have payed rack rate? Am I correct? I looked at the figures on a possible Hilton Head contract for myself and it looks as if I will break even at 4 years, and start the savings portion at 5 years.
IMO there are only 2 ways to reasonably calculate the savings or added value of DVC. Those are what you'd pay if you didn't own DVC or the private rental price. In my view using DVC rack rates is a fools comparison unless one would have paid cash directly. One would compare that to the "cost" which is the upfront cost, dues indexed for inflation, any interest paid and the Time Value of Money/Opportunity cost. So it's a comparison of the cost to the savings using these variables. So the long term cost of 100 SSR points resale plus dues is somewhere in the $80K range. I used a return of 4.5% and dues inflation at 3% and used 2053 as the end point. Using Rentals and the same inflation, the savings is somewhere in the $20K range in future dollars using $15 per point. So roughly breaking even if you add in the long term risk but you do have more control and more options but also more commitment and long term risk.
 



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