Coronovirus and DVC

[Future_WorldPhonencian]

Does anyone think the Coronavirus will have an impact on the price or value of DVC (either in the short or long term?) Has there been any indication that ROFR is being exercised less or people are willing to accept lower offers/ as the virus or fear of the virus spreads? How has it impacted your DVC planning for this year?

 

[Sandisw]

I don’t know for sure, but I am selling a contract and I was offered about $12/point less than asking.

I did not accept, but what they wanted to pay was well below the threshold for ROFR for BWV.

I do wonder if they decided it was worth trying in case I was a seller who was willing to accept a lot lower out of fear!

i do think with thr markets reacting the way they are right now, I have a feeling prices for resale will begin to creep back down.

 

[CmdrThor]

I think there will only be an impact if the parks actually close for an extended period of time. Otherwise the value of DVC is still there.

 

[_auroraborealis_]

I don't think park closings will impact it much in the long term.

 

[mort1331]

Its not the virus that will have a direct effect on resale. It is the markets tanking due to the fear. If the market does not rebound then it could effect the whole economy. Which would have an effect on resale.

 

[LAX]

Its not the virus that will have a direct effect on resale. It is the markets tanking due to the fear. If the market does not rebound then it could effect the whole economy. Which would have an effect on resale.

That's what I was going to say. The virus itself won't impact DVC much if any. But the financial ramifications can be bad and potentially result in a global recession. I am not an economist or investment banker, but I just can't see how Chinese factories being shut down for weeks & international travel coming to a halt won't have an effect on the economy. I think it's just a matter how bad it gets.

LAX

 

[bookwormde]

Anytime an additional or increased risk is identified for an asset its value is negatively impacted

I have already noticed an increase in the number of contracts for sale with the biggest increases on/after the days that stock indexes have dropped.

I have also noticed a drop in rental rates in the short range (less than 30 days out).

This has been limited so far, but if more members start cancelling reservations in greater numbers and the market drops further there could be a much more dramatic impact on both areas as well as direct sales

When this type of situation happened at the great recession ROFR take backs dropped a lot, but it took a few months before it was fully noticed

I bought a contract at about 65% of what it would have been before that downturn, but unless it gets bad enough for people to start losing their houses I do not anticipate that level of drop.

 

[DVCSunDevil]

No, I don't think there will be an impact (particularly a long lasting one). Coronavirus will pass. Right now it is a hot topic (being driven in large part by the media), but that will pass. My family literally JUST had the points added to our account last week from our first DVC contract, so that shows what I think.

 

[Chuck S]

I doubt there will be any noticeable impact. There wasn't during Bird FLu, Swine Flu, or any other viral outbreak. I'm not sure that even 9/11 had a major impact on DVC contract pricing. SImply that the parks were less crowded. If there is any resort impact, it will be on delaying new construction, which is unlikely. I don't think corona virus will be that lasting of an impact. There are signs of it fading in China.

 

[bookwormde]

I doubt there will be any noticeable impact. There wasn't during Bird FLu, Swine Flu, or any other viral outbreak. I'm not sure that even 9/11 had a major impact on DVC contract pricing. SImply that the parks were less crowded. If there is any resort impact, it will be on delaying new construction, which is unlikely. I don't think corona virus will be that lasting of an impact. There are signs of it fading in China.

While it would be great if the data coming out of China was valid, having studied it , it appears to be to good to be true, province of origin has had less than a 10% case rise increase in the last 10 days. even if every family is self quarantining, intra family infection would be far more than that, other provinces are over 90% recovered with death rates of less than 0.1% So far from the mean that it just does not appear possible

 

[Judique]

While it would be great if the data coming out of China was valid, having studied it , it appears to be to good to be true, province of origin has had less than a 10% case rise increase in the last 10 days. even if every family is self quarantining, intra family infection would be far more than that, other provinces are over 90% recovered with death rates of less than 0.1% So far from the mean that it just does not appear possible

I agree with you. We will be able to see the validity of these reports in time as the data is provided from other countries, including this one.

 

[VWLforever]

Its not the virus that will have a direct effect on resale. It is the markets tanking due to the fear. If the market does not rebound then it could effect the whole economy. Which would have an effect on resale.

This is the most important concept to me. I was lucky enough to buy Wilderness Lodge back in 2012, at the tail end of a recession. DVC resales move both faster and deeper in recessions than the rest of the housing sector- people rationally part with their timeshares before their homes. Thus in 2012 I was able to buy BRV at $55 a point loaded. Today, there has been a lot of inflation mostly created by DVC hiking the retail prices a crazy amount.

Therefore theoretically my BRV contract is worth more than it was in '12. But if we enter a significant recession, those resale prices will enter free fall. Will they recover to lofty heights in the year or two after? Probably...maybe...we will see. The sunset is still a ways away, but not really far away, for the 2042 resorts.

 

[Ms.Minnie]

My thought is if I don't sell I won't loose anything. At this time even if the prices did fall I would still make money as I was lucky enough to buy in early and got some pretty good deals. My last addon cost me the most so if I were to loose anything upon selling that would be the one I would probably take a hit on. Since I'm not planning on selling in the near future I don't have to worry.

Now if the prices were to drop low enough maybe I would think about adding on again although I don't think my DH would want to hear about that. He thinks we have enough points now and for the most part I have to agree with him. It nice to dream.