Darn - Resales prices dropped more?

[ChiSoxKeith]

I knew resales existed when I bought two months ago. But there are very few BLT resales.

I will go to the resale market if and when I need more points.

 

[hushupu]

I agree that it is a good time to buy. So many contracts are going to Disney for ROFR at a very low price. People are hurting for money in this economy and they are bailing out of DVC. They know a low offering price will get a bite from some one and even if the person making the offer loses the contract from ROFR the seller still gets their money. I'm not sure how many of these contracts Disney is willing to absorb and some will surely slip through for low amounts. A PP said they bought from DIsney in '99 for $65/point. I believe that someone in this position who sells for $55/point still got a pretty good deal especially if you look at the state of the timeshare market in general.

 

[sssteele]

Crazyduck - leases at BCV expire in 2042, 32 years from now. 8 years down, 32 to go - 20% of value used up, not 33% (1/3). Not meant to be snarky.

 

[hushupu]

that would be 18yrs not 8 and would be more than a 1/3

 

[ToddyLu]

Could these comments be elaborated upon? Our last DVC tour was in 2009, but I do not recall any comments a about 2 years worth of points or financing not on a credit report..... Are these some new features to encourage DVC sales?

Could someone discuss more for me, please? Thank you.

WHen DH and I financed direct from Disney, they looked at our credit rating and we got the preferred rate at 10.75%. Yes, that is a high interest rate but last Summer no one in our community was financing second or vacation mortgages. The one DH did find was at 8%. So we purchased direct. Because the agreement is between you and Disney and they can get the points back they finance your loan and it does not show up on your credit report. If you cannot make payments Disney gets their points back, so they really haven't "lost" or really "risked" very much. From what I understand they also have a higher interest rate for those folks who have a lower credit rating. The process literally took 1.5 minutes.

Because we purchased a Dec UY in June of last year, we got 2008 points because with a Dec UY we were still in 2008. So we bought in with 210 AKV points, received our 2008 points and then also received more points for our 2009 UY on Dec, 1, 2009. 2008 UY starts 12/01/08, 2009 12/01/09, etc. We are the last folks to get our points during the year. If we had purchased Feb UY we woud not have gotten those 2008 points becasue Feb members were already into their 2009 UY. I hope that makes sense. You will see that some folks do not have to pay MFs for those "free" points, but we did. We paid about $500 becasue we had 6 months of the year left and they pro-rated the fees.

 

[3DisneyKids]

Could these comments be elaborated upon? Our last DVC tour was in 2009, but I do not recall any comments a about 2 years worth of points or financing not on a credit report..... Are these some new features to encourage DVC sales?

Could someone discuss more for me, please? Thank you.

WHen DH and I financed direct from Disney, they looked at our credit rating and we got the preferred rate at 10.75%. Yes, that is a high interest rate but last Summer no one in our community was financing second or vacation mortgages. The one DH did find was at 8%. So we purchased direct. Because the agreement is between you and Disney and they can get the points back they finance your loan and it does not show up on your credit report. If you cannot make payments Disney gets their points back, so they really haven't "lost" or really "risked" very much. From what I understand they also have a higher interest rate for those folks who have a lower credit rating. The process literally took 1.5 minutes.

Because we purchased a Dec UY in June of last year, we got 2008 points because with a Dec UY we were still in 2008. So we bought in with 210 AKV points, received our 2008 points and then also received more points for our 2009 UY on Dec, 1, 2009. 2008 UY starts 12/01/08, 2009 12/01/09, etc. We are the last folks to get our points during the year. If we had purchased Feb UY we woud not have gotten those 2008 points becasue Feb members were already into their 2009 UY. I hope that makes sense. You will see that some folks do not have to pay MFs for those "free" points, but we did. We paid about $500 becasue we had 6 months of the year left and they pro-rated the fees.

Toddy already did a great job with this and I will add my experience.

Just a couple of days ago, I added on 200 points at BLT. I have a September UY. Since it is earlier than September, I got all of the 2009 points and I will get all of my 2010 points on September 1, 2010. That means I get 400 points to play with immediately. I could book a vacation for the near future, or I could bank those points for future vacations. Or, I could even rent those points out to defer the cost of my add on. Since the current going rental rate here on the DIS is $10 per point, that would be $4,000 if I decided to rent all of those points. No small savings, if you ask me.

In terms of mfs, I do not have to pay any dues on those 200 points for 2009 (I will have to pay for the 2010 points). At approximately $4.00 per point, this is another savings of $800 (or $4 off per point of purchase price).

Let me see if I can do the math for you. (Warning--I may not be able to! )

Because I got a CM discount and was able to stack the other discounts, my purchase price was $85 per point. At 200 points, that is a total purchase price of $17,000. No closing costs, no dues for the 2009 points, and of course the 200 2009 points and the 200 2010 points.

*NOTE: If I had purchased this resale, the amount of points that came with the contract would be determined by what the previous owners had used. So if they had used all of their 2009 and/or 2010 points, there is a possibility of not having any points available until 2011. By buying direct, I get 2 full years of point. And if there WERE 2009 points left in the resale contract, I would likely have to pay the pro-rated amount of that. Since we are about half way through the year, that would mean I would owe Disney $400. By buying direct, I don't owe anything beyond my purchase price. And while saving $400 does not seem like a lot when compared with the total purchase price, on a $200 point contract, it means paying $2 less per point.

Again, I could choose to rent out all of those points, bringing my purchase price down to $13,000. This would then bring my per point price down to $65 per point. And this is at BLT! Now of course, this would make my new contract "stripped" (meaning no points available until 2011 since I rented them all out). Looking at the resale market, I challenge someone to come up with a stripped contract at BLT anywhere near $65 per point and owing no mfs until January, 2011. You won't find it. You might find some stripped SSR contracts in that price range--but of course BLT is a harder property to book and has more years remaining on the contract, making it a more "valuable" property. (No flaming me--I am not basing SSR. It is my other home resort and I adore it. However, you can't argue that is has one of the lowest resale prices.)

I hope all of this made sense. Please continue to ask any and every question as you consider your purchase.

 

[3DisneyKids]

Here's an example of a current listing:

Bay Lake Tower-$104/pt. February 50 $5,200.00
Notes: 50 points coming on 8/1/12 and 50 points coming on 8/1/13. Priced at $104 per point.

This is an example of a "stripped" contract. Sure, the $104 per point is less than what you would pay than buying directly through Disney. However, you don't get ANY of your points until 2012! (And yes, you could start using them for stays beginning on 8/1/2011 by borrowing, but then you are in a borrowing deficit.) By buying direct from Disney, you would get 2009, 2010, and 2011 points! That is three years worth of points MORE than you would get via this resale contract. That is HUGE. So you have to look at more than the "per point" price.

Edited to add:

Neither of my posts here are meant to dissuade anyone from using the Timeshare Store. They are an incredible and very reputable company! The OP asked why would anyone buy direct from Disney and I gave an example of why/when that would make sense. And then 2BoysMom specifically asked me to elaborate on what I meant by getting extra years worth of points. Certainly, the Timeshare Store has many listings--some of which are "stripped" contracts like the example I posted--but others are "loaded" contracts which means that they have banked points plus the current year's worth of points, etc. My point is--you need to look at more than just the "per point price" as there are several additional factors which should be taken into consideration.

 

[Jason@dvcstore]

Why would anyone buy from Disney?

In my opinion here are some reasons people buy from Disney

1) The way the product is sold. Disney gives a presentation in under 2 hours, throws incentives at you, shows sense of urgency as resorts might sell out and asks you to buy right then. This doesn't give the purchaser a chance to check out other options.
2) If someone does asks about resales the guide doesn't encourage them to check out resales and typically will tell them that Disney buys most contracts back. I totally understand why they say this as trained to do so (I worked for DVC from 1999 to 2001).
3) I also think that some people still don't trust buying from someone not Disney even though thousands upon thousands have done so over the years.

Jason

 

[3DisneyKids]

In my opinion here are some reasons people buy from Disney

1) The way the product is sold. Disney gives a presentation in under 2 hours, throws incentives at you, shows sense of urgency as resorts might sell out and asks you to buy right then. This doesn't give the purchaser a chance to check out other options.
2) If someone does asks about resales the guide doesn't encourage them to check out resales and typically will tell them that Disney buys most contracts back. I totally understand why they say this as trained to do so (I worked for DVC from 1999 to 2001).
3) I also think that some people still don't trust buying from someone not Disney even though thousands upon thousands have done so over the years.

Jason

I definitely agree with #3 here, I have no knowledge of #2, but I disagree with #1.

DVC has a no pressure sales approach. And while I am sure there are some guides who have the more "hard sell" approach, that has never been our experience. Plus, if you read most of the reports on this board, most will agree that it is a really, really low-key approach. Sure, they may use the "you have 3 days to decide" line, but even that is done in a very low key way.

Mostly, though, I think people don't even know that resale options exist.

 

[KAT4DISNEY]

that would be 18yrs not 8 and would be more than a 1/3

FWIW BCV opened in 2002 not late 1991 like OKW. So, technically only 8 years down. It's too bad that they didn't stagger the final dates like they have been doing with the more recent resorts.

 

[disneynutz]

I definitely agree with #3 here, I have no knowledge of #2, but I disagree with #1.

DVC has a no pressure sales approach. And while I am sure there are some guides who have the more "hard sell" approach, that has never been our experience. Plus, if you read most of the reports on this board, most will agree that it is a really, really low-key approach. Sure, they may use the "you have 3 days to decide" line, but even that is done in a very low key way.

Mostly, though, I think people don't even know that resale options exist.

Disney's sales process is a exercise in human psychology. They know exactly what to say, what to do, and even what color to paint the sales center to guarantee the highest close rate possible.

Bill

 

[3DisneyKids]

Disney's sales process is a exercise in human psychology. They know exactly what to say, what to do, and even what color to paint the sales center to guarantee the highest close rate possible.

Bill

I totally agree. My Ph.D. is in Behavioral Science and I teach courses in Persuasion, and you are spot on here--color choices, time of day, background music, etc. all have an impact and I have no doubt that DVC has done the research and knows all about the various techniques and factors that come into play.

 

[lilpooh108]

I totally agree. My Ph.D. is in Behavioral Science and I teach courses in Persuasion, and you are spot on here--color choices, time of day, background music, etc. all have an impact and I have no doubt that DVC has done the research and knows all about the various techniques and factors that come into play.

Really that is SO interesting! I've never been to a sales center (bought resale, sight unseen ), what colors are the walls? What do you mean by time of day, what's the background music? I've only been to a Marriott presentation. It was ok, the beach was the backdrop near the sales center, which really sold itself (we were at the Maui Ocean Club).

 

[A_Princess'_Daddy]

Interesting thread.

We went on a DVC tour last week, but were already well aware of the resale market, had done lots of research about the process, and were interested in hearing Disney's point of view on the process. In many ways, we knew more about the resale market than the direct sales market, so we came at it backwards from many newcomers to DVC.

I will say that the salesperson handled him/herself with the highest ethical standards and did not utilize any of the traditional high-pressure or "sleezy" sales approaches, but they were very good at creating the sense of urgency that has been referenced in this thread and showing their portfolio in the best possible light. There were great incentives to "decide now", but I never felt like they were trying to trap or corner me.

Ultimately, we'll most likely move forward with resale because A) the resort we want is not currently being sold by DVC and the salesperson reported their inventory was "very low, but let's talk about why BLT is an even better fit", B) we have found a contract on the resort that we want that has the current year's points and next year's points intact, so the deal is good for what we want, C) we'll pay cash, so financing through Disney isn't a selling point for us, and D) it'll save us some money over buying directly from Disney.

That having been said, if I wanted BLT, the incentives being offered directly by DVC might be persuasive.

 

[3DisneyKids]

Interesting thread.

We went on a DVC tour last week, but were already well aware of the resale market, had done lots of research about the process, and were interested in hearing Disney's point of view on the process. In many ways, we knew more about the resale market than the direct sales market, so we came at it backwards from many newcomers to DVC.

I will say that the salesperson handled him/herself with the highest ethical standards and did not utilize any of the traditional high-pressure or "sleezy" sales approaches, but they were very good at creating the sense of urgency that has been referenced in this thread and showing their portfolio in the best possible light. There were great incentives to "decide now", but I never felt like they were trying to trap or corner me.

Ultimately, we'll most likely move forward with resale because A) the resort we want is not currently being sold by DVC and the salesperson reported their inventory was "very low, but let's talk about why BLT is an even better fit", B) we have found a contract on the resort that we want that has the current year's points and next year's points intact, so the deal is good for what we want, C) we'll pay cash, so financing through Disney isn't a selling point for us, and D) it'll save us some money over buying directly from Disney.

That having been said, if I wanted BLT, the incentives being offered directly by DVC might be persuasive.

Yup, sounds like resale is the way to go for you! Clearly you have kids, so the only thing I would mention is the extra years. I assume that the resort you want is either BWV, BCV, or VWL (or maybe OKW). If this is the case, realize that the expiration date is 2042. You might not care, if so, great. But since you are a parent, it might be something to think about. For us, the later expiration was important as we want to take our grandkids some day and/or leave our contracts to our kids. Also, these hold their value better if you ever do want/need to resell them.

Again, I am not pushing to buy via Disney directly. I just had this same debate with a close girlfriend who bought BWV resale and thought I was nuts to go through Disney even with a CM discount. But the difference is that she doesn't have kids and we do. I think it is important for potential owners to think about all of the issues--price per point, amount of points currently available, the correct UY for their travel habits, expiration date, and so on. For most folks, this is BIG ticket item to purchase...and it takes time to understand all of the ins and outs.

Hope we can welcome you home soon!

 

[A_Princess'_Daddy]

Yup, sounds like resale is the way to go for you! Clearly you have kids, so the only thing I would mention is the extra years. I assume that the resort you want is either BWV, BCV, or VWL (or maybe OKW). If this is the case, realize that the expiration date is 2042. You might not care, if so, great. But since you are a parent, it might be something to think about. For us, the later expiration was important as we want to take our grandkids some day and/or leave our contracts to our kids. Also, these hold their value better if you ever do want/need to resell them.

Again, I am not pushing to buy via Disney directly. I just had this same debate with a close girlfriend who bought BWV resale and thought I was nuts to go through Disney even with a CM discount. But the difference is that she doesn't have kids and we do. I think it is important for potential owners to think about all of the issues--price per point, amount of points currently available, the correct UY for their travel habits, expiration date, and so on. For most folks, this is BIG ticket item to purchase...and it takes time to understand all of the ins and outs.

Hope we can welcome you home soon!

Thanks. Yes, I realize that about the expiration date. Ironically, I view that as a good thing, as I don't want my children to be forced to inherit my obligations (I also firmly intend to be alive in 32 and 50 years, so it shouldn't be an issue; I'm 34, and nobody in my family has died before 90, so the odds seem to be with me).

If we're gone beforehand, however, the children will be well provided for and can choose to buy in or do something else with their resources. If we're still alive and still loving it in 30 years we'll reassess at that time; likely we will do so well beforehand. We just have little interest in BLT, and our interest actually diminished after the tour. Likewise, AKV feels too remote, so the added years have limited appeal. One thing I've learned from this board is to buy where you want to stay, so that's key for us in this decision. The cost, while not insignificant, is not the driving force in our decision.

Thanks for the feedback, however. Your posts are extremely informative and helpful!

 

[pinnocchiosdad]

I fee sorry for those selling at those low prices. Because in addition to selling for a loss they have to pay a 10% sales commission. So if someone selles in the low $50's they are in reality only getting $40 something dollars per point. But everyone has to do what they have to do. I am sure some sellers are not selling by choice.

 

[ML_LovesDisney]

Could these comments be elaborated upon? Our last DVC tour was in 2009, but I do not recall any comments a about 2 years worth of points or financing not on a credit report..... Are these some new features to encourage DVC sales?

Could someone discuss more for me, please? Thank you.

DVC does private financing. It does not show up on your credit report, ONLY if you default. They do check your credit, but they explained to me, they are a private company that does not report to credit agencies unless you stop paying! We got 2009 points and 2010 points at the same time, and didnt have to pay MF on 2009 points. I think that's pretty standard now from what I gather from others?? Not sure.

 

[ML_LovesDisney]

I definitely agree with #3 here, I have no knowledge of #2, but I disagree with #1.

DVC has a no pressure sales approach. And while I am sure there are some guides who have the more "hard sell" approach, that has never been our experience. Plus, if you read most of the reports on this board, most will agree that it is a really, really low-key approach. Sure, they may use the "you have 3 days to decide" line, but even that is done in a very low key way.

Mostly, though, I think people don't even know that resale options exist.

I agree with Erika, I didn't feel pressured at all, DVC pretty much sold itself being that we had just paid $6000 for our ONE vacation.

 

[Crystal_27]

I definitely agree with #3 here, I have no knowledge of #2, but I disagree with #1.

DVC has a no pressure sales approach. And while I am sure there are some guides who have the more "hard sell" approach, that has never been our experience. Plus, if you read most of the reports on this board, most will agree that it is a really, really low-key approach. Sure, they may use the "you have 3 days to decide" line, but even that is done in a very low key way.

Mostly, though, I think people don't even know that resale options exist.

I think that, while DVC does offer a no-pressure sales approach, when we bought in 2009 (at BLT), when we took the tour, we were specifically told that the incentives we were being offered were only good for 3 days and then they would be revoked. Now, we were informed buyers and we were planning on buying in anyway (although we hadn't planned to do so while on vacation - we took the tour simply to preview the BLT model rooms) but having the Guide tell us that our incentives would be revoked 3 days from the date we took the tour did prompt us to sign that day instead of waiting until we returned home. To me, that's not low-key (even though our Guide was very nice about it). Again, the Guide telling us that didn't make us buy (we were already going to buy direct anyway) but it did make us buy about a week sooner than we were planning on. Just my experience (for what its worth...).

I fee sorry for those selling at those low prices. Because in addition to selling for a loss they have to pay a 10% sales commission. So if someone selles in the low $50's they are in reality only getting $40 something dollars per point. But everyone has to do what they have to do. I am sure some sellers are not selling by choice.

But, there has to be some value given for the vacations that they took during their period of ownership. So, if someone bought at $65/point, took a vacation once every year for 10 years, and is now netting $40/point, I'd say they did okay. Now, for those who are forced to list their contracts at rock-bottom prices to sell because of financial circumstances, it is heartbreaking, and I do feel for them.