Considering taking the plunge...

[MrShiny]

After years of trips to WDW and pondering the DVC, am thinking of finally taking the plunge in the next 12 months or so.

I've been doing my homework, but still have some questions.

1) resale - it seems like the way to go - I see there are listings for BWV. We'd prefer that or BCV, but I'm leaning towards BWV because of the possibility of Grand Villas (which would be nice for the occasional big trip). What can I expect for closing fees? Does Disney charge closing fees? If we buy at BWV, what would it cost to add on points at BCV?

2) renting points - this is the clincher for me. I recently rented and wondered what took me so long to find out about it! Are there any limits on renting? Could I buy "extra" points just to rent them out each year to pay for my fees?

3) I guess this will be a general question - if you were in my position just looking at buying for the first time, what would you do differently than you did when you first bought? What are the important things to remember?

Thanks in advance!

 

[MelissathePooh]

Hey Jeff,

I don't have much advice considering we just bought in at BCV last week and hadn't planned on it - just got caught talking to one of the guys under the umbrella and poof - I was writing a very large check! DR headed straight to the Screen Porch to buy a beer afterwards!

BCV is about 60% sold out now - once they hit 98% they will not sell anymore. There are still points at Vero and HH and soon to be Saratoga Springs, but the cost is going up to $84/point in December. I guess if you are going thru a resale that it won't really matter, but definitely buy where you want for your home resort.

Whatever you decide to do and however you do it its a good decision. Keep in mind the 11 month and 7 month booking windows - especially if you plan to use larger units - the longer out you have to book it the better. If BWV is where you really want and there are resale points there that is something you should consider heavily.

Good luck!

 

[Dean]

Originally posted by MrShiny
After years of trips to WDW and pondering the DVC, am thinking of finally taking the plunge in the next 12 months or so.

I've been doing my homework, but still have some questions.

1) resale - it seems like the way to go - I see there are listings for BWV. We'd prefer that or BCV, but I'm leaning towards BWV because of the possibility of Grand Villas (which would be nice for the occasional big trip). What can I expect for closing fees? Does Disney charge closing fees? If we buy at BWV, what would it cost to add on points at BCV?

BWV resale will be a better value than BCV. BWV also has the standard view options which will save money in addition to the GV availability. DVC does not charge closing costs which are typically in the $450 range on a resale. The cost to add on points at BCV would be the going rate at the time if you buy from DVC, currently $80 per point expected to increase to $84 in December. The minimum # of points are 25 if you pay cash and 50 if you finance.

2) renting points - this is the clincher for me. I recently rented and wondered what took me so long to find out about it! Are there any limits on renting? Could I buy "extra" points just to rent them out each year to pay for my fees?

If you read the rules, there are some limitations on renting but they are minor. You could buy extra points to rent but I think DVC is too expensive to make this a reasonable thing to do as a supplement.

3) I guess this will be a general question - if you were in my position just looking at buying for the first time, what would you do differently than you did when you first bought? What are the important things to remember?

My main suggestions would be to buy where you want to stay, get the number of points that will fit your family for a week in at least a 1 BR and preferable a 2 BR.

To add, don't buy DVC with the idea of using the other points options, they are too expensive.

 

[CarolA]

Resale closing is usually around $400. I don't recall paying a closing fee on by BCV add on.

The decision to buy extra points to rent is up to you, but I would think LONG and HARD. There is no gurantee that you can always rent your points and some people have experienced significant problems with payments etc.. I am not sure your math makes sense since you would be paying somewhere between $60 and $80 for points to rent out to cover your fees. So if you bought 100 points to rent out you would be out $7,000. Fees are around $4 a point so at a $10 rental, you would clear somewhere around $6 a point rented. Assuming you paid $70 for the points, it would take you 12 years just to recover your initial investment!

 

[LSchrow]

as you look into the gazillion questions, do add up all costs.
for example, points bought through a resale might be cheaper, but you will pay closing costs (no additional costs if bought through DVC).

also DVC has a magical beginnings program, where they "buy back" your first years points (essentially, giving you $'s instead of you using your 1st year points, tho you can still borrow from the following year. $5 per point at BCV & VWL, $10 per point at HH, $15 pp at VB).


total up the original purchase price, less magical beginnings if thru DVC or adding closing costs if resale.
divide by # of points & see which offers the better deal .
hth,
laurie s

 

[MrShiny]

Yes - that's kind of what I was thinking. We'd most likely go every other year and need about 300-350 points to do it. So I was thinking of getting 250 points and renting out about 90 a year to pay the fees. I can see there might be difficulties with renting, but I'm really surprised more folks don't do it! We also have a a lot of relaties we could potentially rent points out to as well!

 

[mikesmom]

Warning...

You only THINK you'll go every other year...
You only THINK you won't need those extra points...

We ALL think that and find out very, very quickly that the quality of vacation and relaxation level is so good that soon you are using all your points, then borrowing next years points and then , before you know it, looking at buying extra points so you can get a 2 bdr. because "it's just so nice to have the kids in their own room". Or bringing along relatives and needing points for a Grand Villa. Or just the 2 of you slipping down for the Food & Wine Fest or to see theChristmas decorations.

Or you get a couple of days at Vero before one of your WDW vacations "just to check it out" and find you need points there so you can get a nice room at high demand times.

DVC is addictive - don't say we didn't warn you!

 

[MrShiny]

So tell me if I have this right. If I buy 250 BCV from Disney at $84, that would be $21,000, less the $1250 magical beginning, so $19,750.

If I got a BWV resale at say $70/pt, that would be $17,500 plus maybe what $450 closing? So $17,950.

Is there any reason to not take the $1800 savings? That could buy a few years' park passes.

Originally posted by LSchrow
as you look into the gazillion questions, do add up all costs.
for example, points bought through a resale might be cheaper, but you will pay closing costs (no additional costs if bought through DVC).

also DVC has a magical beginnings program, where they "buy back" your first years points (essentially, giving you $'s instead of you using your 1st year points, tho you can still borrow from the following year. $5 per point at BCV & VWL, $10 per point at HH, $15 pp at VB).


total up the original purchase price, less magical beginnings if thru DVC or adding closing costs if resale.
divide by # of points & see which offers the better deal .
hth,
laurie s

 

[DeeDeeDis]

Instead of selling back your points to DVC for $5.00 you can bank those points into the next year, if you buy 250, your first year of actual vacation you could have 500 points. by watching where you stay in what time you go. you can pretty much go a few times a year especially the first like 3 years, then the banking and borrowing will catch up with you, so you either take a year off or do what it seems like everyone else does, Buy More Points.

You are paying to go first class. I don't think you reap any financial benefit until you've paid off the loan.

For me spending time with my three DS and DH, watching them have fun is worth ALOT more than $5.00 a point.

 

[Dean]

I agree that to sell back the points at $5 per point is nuts. I'm also not convinced you need 250 points. While it's true that many need and go more than they thought they would, that's not true for everyone. It sounds like 200 or so points would more than fit what you need right now. You could always add on later and might want to do so an aother resort for home resort priority.

Also, when comparing a DVC sale to a resale, taking the MB into account on one side doesn't maek sense unless you take renting into account with a resale. Once you're looking at a specific resale, then you must also factor the points available (or lack of) into the equation. If you're happy with BW but that's the area you want to be, look for a resale. You should be able to find one for $62-65 per point easily.

 

[joepoe]

Originally posted by Dean
....To add, don't buy DVC with the idea of using the other points options, they are too expensive.

Some people (like me, duh) would say that if you compare a cash ressie to a 5-6 dollar a point cost, you can make a determination on a case-by-case basis on whether or not to use your points for a cruise or the concierge collection.

 

[joepoe]

Originally posted by CarolA
Resale closing is usually around $400. I don't recall paying a closing fee on by BCV add on.

The decision to buy extra points to rent is up to you, but I would think LONG and HARD. There is no gurantee that you can always rent your points and some people have experienced significant problems with payments etc.. I am not sure your math makes sense since you would be paying somewhere between $60 and $80 for points to rent out to cover your fees. So if you bought 100 points to rent out you would be out $7,000. Fees are around $4 a point so at a $10 rental, you would clear somewhere around $6 a point rented. Assuming you paid $70 for the points, it would take you 12 years just to recover your initial investment!

Agree with Carol except Id' like to add that if you assume a cost of around $5 a point and you rent at $10 you are ahead of the game FOR THAT YEAR. If your total cost to buy 100 points for 40 years of use is the initial investment + 40 yrs of fees, I estimate a total cost of $22,000 for 100 points a year. (initial of $7,000 plus $15,000 for 40 yrs of fees.) Therefore it would take you about twenty years just to break renting at $10 per point. After that it would be all profit. Note I am not taking into account the time value of money here for simplicity sake. Have I confused everyone else besides myself?

 

[crisi]

You didn't confuse me, Joe. In addition, you have to figure that your time (to find a renter, make the arrangments, etc) is worth something - and factor in that there may be years where renting doesn't end up panning out - the renter backs out - you have to fire sale your points - or the rental market isn't where it is currently. A lot of DVCers on this board have voiced dismay over DVC not being hardlined enough about charging you for damages - they start getting hardlined, and renting to strangers will take on additional risk (imagine renting your points and then getting a bill for a couple thousand in damages).

Going into the renting points business doesn't look like a good business model to me.

 

[MelissathePooh]

Just wanted to point out that as far as "strangers" renting points - anyone can book a DVC room through CRO now. Whether or not you think they should or not is a different story.
Having been a prior renter of points - a stranger - I can honestly say that it was a good experience for us and we treated the room as we would any other - with respect and without causing any damage.

Anyway - I wouldn't count on renting points as a factor as there is no guarantee. Buy they points you think you need. Keep in mind too with resales that the points may already be banked or borrowed ect... make sure you know what you are getting and what you will have off the bat.

 

[Dean]

Originally posted by joepoe
Some people (like me, duh) would say that if you compare a cash ressie to a 5-6 dollar a point cost, you can make a determination on a case-by-case basis on whether or not to use your points for a cruise or the concierge collection.

Agreed, but the difference in this situation is they can make a determination up front. From a financial standpoint, one would almost always (I can think of no current exception) come out ahead buying less points and paying cash for non DVC options including DC, CC, DCL, etc. One might be able to come up with a limited example that would be an exception like a holiday or premium season where you'd otherwise pay rack rate, but I can't think on one at present. One would need an example where the true value of the points used were at or higher than $10 per point and true over a wide range of days, compared to usual specials for the exchange option in question and I can't think of a single one.

If someone wants to use their points for any of these options, I really don't care. I do care that someone trying to decide whether to buy DVC and how many points knows what their options are. With that in mind, I'd recommend buying the number of points one expects to use at DVC resorts only, with a cushion. The size of the cushion would depend on the number of points, usual travel times, size of family and the like.

 

[Dean]

Originally posted by crisi
A lot of DVCers on this board have voiced dismay over DVC not being hardlined enough about charging you for damages - they start getting hardlined, and renting to strangers will take on additional risk (imagine renting your points and then getting a bill for a couple thousand in damages).

Crisi, I must agree with you on most of the points. If I'm reading you right, I must strongly disagree on one. I believe you are implying that renters do more damage than owners or those that rent directly from DVC. Not only have I seen NO evidence to that affect, my personal experience would suggest that the reverse is true. My impression is that those that say "this is my home I own and I'll do what I want to with it" are far more common than those that say "I'm renting, I don't care". And since the owners far out number the renters, the difference is magnified dramatically. When a DIS member was attacked in the laundry, I believe it was by another member.

My experience is that renters are like owners their first couple of trips, simply in awe. I'm sure there are exceptions but I haven't heard of any. All I've heard is speculation that renters will trash the place because they don't own it and I don't accept that statement as anywhere near the truth. I will agree that the owner has a risk for things done by the renter but I believe the risk is minimal.