Conflicted in joining DVC - UPDATED 6/14

[Geoff_M]

OK, help me out people. I'm looking for a reason to become a DVC member. However, I still can't see the financial advantage in joining. I'm crunched the numbers and I just can't make it work. I agree that it makes sense verses staying at the DVC locations and paying rack rates, but (including our next planned trip) we've been to WDW 5 times in the last 4 years and hadn't once paid anything close to DVC rack rates (or regular room rack rates) using AP rates, teacher discounts, and codes. Granted we've haven't stayed in DVC properties... but we've stayed in POR-FQ, WL, Poly, Dolphin, and YC. We did the DVC "open house" in January of this year and I agree that the villas are nice, but the YC is nothing to sneeze at and it sleeps 5.

Another issue we we have 5 people in our families and the minimum we'd have to rent is a 2 bedroom unit(until the first kid is no longer joining us for vacations... she's 11 now). So unless we want to lay down some big $$$ we'd only be looking at 4-5 nights per year for out payments. I'm just having a hard time seeing paying $16K plus close to $1K a year in fees (that I know will rise with inflation like room rates) for a piece of DVC.

My heart says "Yes", but my brain can't see the financial savings.

Help me out here! What am I missing?

6/14 Update: Update on Page 4!!!

 

[chrispoponak]

This is a big reason why I am only going to buy a small resale. Contrary to popular belief, they ARE out there.

Anyway, while DVC is nice, I believe that you also have a point.

In my situation, DVC is not always optimal. When we go to WDW, we spend as much time as possible going to Epcot, AK, and MGM. We are up in the morning and we don't get back until it is really late at night. All we essentially do is sleep in our room. So, when I did my shopping for DVC, I figured that 60 points would be optimal b/c it would give us a 5-night, 6-day stay in a studio, which is all we need, at most of the resorts during Jan, Feb, and Sept, when we normally go.

I can get a 60-point contract for about $3800. I won't pay interest on a loan...and this is how I look at it. The $3800 for the small OKW contract will pay for itself in about 9 years if I compare it to staying the same amount of time in the AllStars for 475/night for 5 nights. Looking at it that way, it seems logical to buy. Furthermore, you can hardly compare a studio in any DVC resort to the AllStars...DVC makes AllStars look like motel six! However, if I were not looking at DVC at all, I would most likely be staying in the AllStars, so that is why I compare the two money wise. Perhaps a "more fair" comparison would be to AKL, YC, or the Contemporary. Then, the 60-pointer would pay for itself in 4-6 years, dependig on which resort you stay at most frequently.

Plus, dues would be less than $200/year...chump change compared to the dues on a 150-point contract.

DW (her "WDW list" is much longer than mine) also likes to stay at the Polynesian, the Contemporary, CBR, CSR, etc. etc....now I know, I know...you can use your DVC points there....however, I just don't think that using your DVC points at the cash resorts is a worthwhile option. I'd rather pay cash.

Keep this discussion going

 

[Maistre Gracey]

Let's say you pay $74/pt for DVC ($84 less $10 for MB). You can use that point 39 times, so you can spread the $74 over 39 years. This means that point will cost you $1.90 every year you use it. Of course, we must add mtc fees of about $4.00/pt which brings the total cost to about $5.90 per point, per year. A week during Dream season is 123 points for a studio. We now multiply 123 by $5.90 to see how much that studio actually costs us. Total- $725.70 for the week....TAX INCLUDED. Can you get that price for a regular hotel room at Beach Club???

Yes, mtc fees will rise but so what. The price you are comparing it to will also rise. Actually, DVC cost will rise at a slower rate because point cost will never increase, only mtc fees will increase.

Lost interest income- Some factor this in, but I do not for several reasons. I would have bought some other luxury item, so I would not be earning interest anyway.
If you opt to factor it in, please don't over do it, as it is likely not as much as you think.

Hope this helps......

 

[Geoff_M]

If all we needed was a studio, I think we'd sign up.... but with 5 people were staring at a 2 BR Villa vs. a single regular room at the BC. I think we'd still be OK if they'd let us in a 1 BR Villa.

 

[crisi]

It may not make sense for you.

For us, we don't really want to be four people in a studio when the kids are teenagers (we have two kids, currently 3 and 4). We realized our days at the moderates were over. Our last trip (at WL) we had two regular hotel rooms - one for Grandma and Grandpa. This year (with DVC at BWVs) we have a 2 bedroom and have the other Grandma and Grandpa coming. Plus, I'm not a code shopper. Some people don't mind looking for the deal - I'm not one of them - not something I'm willing to spend time on - I'm pretty likely to just book rack rate without blinking.

But if you are happy with five people in a Deluxe room, are willing to look for codes and bet that they are going to be there as long as you need them - I don't think you can slice the numbers to create savings in a 2 bedroom DVC unit (or alternatively 2 studios - which isn't a good option with kids).

That doesn't mean you can't justify DVC. Putting your kids in their own bedroom while you get your own bedroom - and two bathrooms, may be enough justification for you.

 

[Maistre Gracey]

Okay, I admit the five person thing is somewhat of a fly in the ointment, but I think you are still okay.

A 2br in Dream is 314 points. That brings your cost to $1852.60 per week, again TAX INCLUDED.

That price is still comparable to a room at YC, and now you can sleep eight, plus you have a full kitchen and living room.

Good luck......

 

[ClarabelleCow]

there are only 4 of us, I love having the kitchen, that is the selling factor for us on Disney trips. We will usually get a 1 bedroom and have the kids on the couch, but having the full kitchen and washer and dryer are worth it. I never looked at the money dumped into Disney as an investment. but I bought at 66 per point, I know I could sell and make some money, maybe not in 10 years, but if I had to turn around tomorrow and sell, I would be alright, can't say that about the Stock Market! so instead of investing in stocks, we bought DVC!

 

[rtkane]

Think about having a 150 point contract.. it'll cost you about $11k to join (with Magical Beginnings) and then about $650 per year in dues. 150 points would give you at least 7 nights in a studio at BCV in magic season with 16 points to either rent or bank for the next year. Not accounting for inflation, in 10 years you would have spent about $17,500 on the membership and the associated dues. If you rented those extra 16 points per year out @ discount of $8 per point (going rate is about $10), that would reduce the $17.5k figure by roughly $1,300 leaving you with $16,200 spent in 10 years.

If you stayed at a moderate resort at about $160 per night for 7 nights for that same time period, you'll have spent $11,200. At that point, you'd still be short $5,000, but you still have about 28 years left worth of vacation with DVC to more than make up for it.

Additionally, (and I think most people forget to consider this when doing their calculations) since you still own your DVC interest, you could sell it if you wanted to. Certainly in 10 years the price for DVC will have gone up and I would bet you'd at least be able to recoup your initial investment, which would put you ahead $6,000 (which ends up giving you a cost of about $93 per night at the DVC resort for those 10 years worth of trips). Even if you only got half of what you paid for it, you'd still be $500 ahead of the game with DVC.


Again, none of this calculates inflation or what Disney will charge for rooms in 10 years (I think the general consensus is that Disney will increase room rates at an amount that is a few percentage points higher than how inflation rates would affect annual dues) nor does it factor in room quality.

Also, bear in mind that all of the discounts that are currently available aren't likely to last and, in my opinion, comparing DVC rooms to the moderates is a stretch at best. Remember one thing though, only you can decide if it is right for you...if you have doubts and don't see the value, don't do it.

 

[rtkane]

Originally posted by Maistre Gracey
Lost interest income- Some factor this in, but I do not for several reasons. I would have bought some other luxury item, so I would not be earning interest anyway.
If you opt to factor it in, please don't over do it, as it is likely not as much as you think.

The other thing to think about with lost interest income is the fact that if you had $11k sitting in the bank right now, you'd be depleting it each year paying for cash vacations so the interest can't be calculated for the full term of DVC membership.

 

[Maistre Gracey]

Originally posted by rtkane
The other thing to think about with lost interest income is the fact that if you had $11k sitting in the bank right now, you'd be depleting it each year paying for cash vacations so the interest can't be calculated for the full term of DVC membership.

Exactly. That is another reason why I say not to over calculate the lost interest income. Some folks forget to subtract the money they would use for hotel rooms.

 

[TIdoublegaER]

If you are just needing that push to take the plunge into DVC, you have certainly come to the right place! Although ultimately you know what is best for your family. Honestly, there is no comparison between a regular hotel room (at Poly, YC/BC or even GF) to a 2bdr villa. With 3 kids, one of whom will be adult size within a few years (if he/she isn't already) the extra space will be greatly appreciated.

If you guys are themepark commandos who are gone from morning till night, a hotel room is probably all you really need since you will only be sleeping there. But if that's the case, why pay big bucks for a deluxe resort anyway? If you like to enjoy the resort, take off days from the parks, etc. DVC might just be perfect for you.

For us the financial advantage is having our accomodations prepaid. Yes, the maint. fees can and do increase, but they have even gone down in the past. I don't think you will ever see rack rates go down at Disney and while there are some great discounts around right now, we all know that won't always be the case. Having the kitchen is a huge plus for us because we can eat most of our meals in the room and save a bundle on eating out.

Please be sure to let us know what you decide!

 

[KNWVIKING]

Cause it doesn't seem that long ago when an argument against DVC was the lost interest factor. "Put that $11,000.00 in an XYZ account and if 40 years you'll be a gazillionaire" With the market down and passbook interest rate of 1%, you don't hear that argument much.

 

[KNWVIKING]

We bought in '97. DW and I have never enjoyed vacations as much as we do now. With our points basically being use 'em or lose 'em, we religiously book three trips a year at the 11 month window. Virtually all year long we have a trip to look forward too. We head to OKW in a couple weeks. Because our dues are monthly direct debit we don't even notice the money we pay in dues. Because we go often,we have AP's already paid for. Room is paid for.We'll drive down & back for about $100.00. After pay for food and a couple nick knacks, this trip will cost me about $6-700.00 for an 8 nite stay. Kinda makes paying two college tuition bills a little easier.

 

[rtkane]

Originally posted by KNWVIKING
With the market down and passbook interest rate of 1%, you don't hear that argument much.

Wow! You're getting 1%?

 

[disneyberry]

IMHO, i don't think DVC will necessarily save you money. (this might not be popular opinion) you will probably vacation a lot more, and thus end up spending more money on other things like food and tickets.
in the end, i see it as more of a breakeven, not a financial savings.

what DVC will do is allow you to stay in beautiful deluxe accommodations, and give you an "excuse" to go on family vacations regularly (memories are priceless).

you can crunch numbers all you want... (i certainly did a million different scenarios trying to justify it financially) but i found you can really "manipulate" the numbers to make it a great investment or a poor investment. there are just too many factors. don't drive yourself crazy number crunching. (of course, i didn't take this advice when i was trying to decide to purchase. sometimes people just like to learn the hard way, huh? )

 

[JulesMom]

We always spend between $1500-$2500 on rooms--even with AP & code discounts.

Our DVC membership is costing about $2400 this year and that's the same as we would have spent on rooms this year. We get better accommocations for the same price and in a few years when we pay off our DVC loan--we'll only have to pay maintenance fees. By the way, rack rates for our June 2003 trips is over $5300!

This only works for us because we have gone to WDW at least once a year since '96 and plan on continuing to go at least once a year.

 

[littlestar]

Since you have five people and you're happy with the Deluxe resorts that sleep 5, I wouldn't do it. We are a family of four and DVC works great for us. We get three six night trips a year in a studio at BCV and VWL out of our points (we have 260 points).

Boardwalk Villas has some studio units that sleep 5, but I don't think those are guaranteed. Now, if you could buy Boardwalk and be guaranteed the studio that sleeps 5, it would work for you (of course, you'd have to like Boardwalk!).

One thing to think about is that Disney may not continue the great discounts once the economy picks up. I can remember when finding a discount at Easter or Christmas was not possible.

 

[mitcam]

In addition to all the cost savings for annual trips (prepaid DVC) you can't forget the discounts that DVC offers.

Passes, Restaurants, parking etc...

Those all have played a part in our decision.

Good Luck with whatever you decide!

 

[brucec32]

With interest rates so low and investment potential iffy , DVC certainly makes more sense than it did a few years back. For the way we plan to use it (off-season Sun-Thurs night trips only) it's a pretty cheap way to stay on-site. But the following factors diminish that:

1. Weekend stays (roughly double the points needed)
2. Holiday period stays (again, higher points/night required)
3. Larger units required for larger families
4. To a lesser degree, staying at the newer resorts, rather than the "cheaper" OKW.

My wife and I can travel light and are flexible on dates, so a 5 night studio stay when we usually want to go would only be 40 to 60 points for a studio, depending on the place and view. Other than the jacuzzi tub and washer/drier, a bigger unit just wouldn't matter much to us. But we can live w/o those to save the points.

Buy 150 points, use 60, and rent 90 for $900 and you really reduce your costs.

I would also urge those considering DVC to consider resale value, and not assume they're going to be using it 40 years from now. A lot of things change in that much time. If you hit it right, the value of your points may be about the same in up to maybe 20 years as today, but will plunge in value the closer you get to the end of the program. If you use the points for 15 years or so while your kids grow up, then sell them and break even, it's probably a lot cheaper than riding them to their death in 40 years.

 

[cdy16zz]

For the sheer luxury of it!!!!
A studio is fine, if all you do is sleep in the room. We go on vacation to relax, enjoy the slow pace, and family togetherness!
We think it would be exhausting to get up each morning and go, go, go.......... until late at night. We usually get a 2 bdrm or GV and have the grown kids and their little ones with us. We usually eat breakfast in, (kitchen, diswasher , nice! ) go to a park, come back and rest up. The little ones take a nap. Then go out for dinner, & head for another park. When we get back, I may throw in a load of laundry. If the grown kids want to go out, the little ones are in their own beds. We have a living room, kitchen, luxury bath, and can watch TV or talk over the great day, plan the next one, without worring about waking the little ones.
We are SPOILED!!! My kids are SPOILED!!! They would never want to go and stay in a studio or regular room ever again!!
We were the during hurricane Floyd. All the parks were closed.
Trust me, a home away from home os nicer!

Yeah, We are just SPOILED!!
It's wonderful to be able to pamper ourselves!