Data on Contract Sizes?

[oldwash]

Any data out there showing percentages of contracts owned by size?

 

[jerseyduke]

Oldwash, what is it exactly you are trying to do?

I did a quick check on the Orange County Comptrollers web site, and there did not seem to be a way to search on value of the deed.

There are 100,000+ dvc members, so that is 100,000+ contracts.

Using a resale aggregator, I looked at the WDW properties for sale(Florida Only), excluding the Poly since it is new, and virtually all studios, so I think that might skew the data:


There are 662 contracts for sale.

10 are in the 400-499 point range.
11 in the 500-599 point range (one of which is a fixed week at VGF)
2 in the 600+ point range.

That means 3.47% are 400 points or more. Granted, this is a small sample space, but it is a start.

1.96% 500 points or more.

 

[oldwash]

Thanks for all the info on both threads. Just trying to get an idea of the demand for a large contract. Don't want to purchase something that 10-20 years down the road, I'll have a hard time getting rid of. Going to have to search for that resale aggregator.

 

[jerseyduke]

I would not go too crazy about 10-20 years down the road. Barring any major earth changing event, I would imagine the discount you would get buying it now, would be given back later. But that is less money out of pocket now, and time value of money, money now is worth more than money later.

The thing that I think is more important to weigh is how likely are you to just want to downsize in the future? Might you be better off paying more now for a 400 point contract and a 100 point contract, than a little less than a 500? This might be a small bump in price that gives you 2 benefits, the ability to downsize, and two, a 400 pointer is probably going to be easier to sell than a 500....but perhaps only moderately so.

***BAD WORD ALERT****
Also, if you plan on financing, you are almost certainly better buying a smaller contract now, then another one in a few years. The modest discount of a larger contract would be lost in interest.

 

[oldwash]

Resale is my main concern. Seems to be a rather large demand for rental points, so to me that's a way of downsizing. Definitely not financing.

 

[Dean]

Thanks for all the info on both threads. Just trying to get an idea of the demand for a large contract. Don't want to purchase something that 10-20 years down the road, I'll have a hard time getting rid of. Going to have to search for that resale aggregator.

While the demand for small contracts won't change, larger contracts are historically cheaper per point and more difficult to sell. Arbitrarily I'd say anything over 250-300 would be considered large and anything above 350 maybe Jumbo. If you're looking for an exit strategy, I'd stay under 250 if possible though one would have to take the specific situation into account. Larger contracts at the newer more expensive resorts will likely be a little more forgiving. I think my question would be similar to above. What do you want to accomplish and how do you plan to use it?

 

[oldwash]

While the demand for small contracts won't change, larger contracts are historically cheaper per point and more difficult to sell. Arbitrarily I'd say anything over 250-300 would be considered large and anything above 350 maybe Jumbo. If you're looking for an exit strategy, I'd stay under 250 if possible though one would have to take the specific situation into account. Larger contracts at the newer more expensive resorts will likely be a little more forgiving. I think my question would be similar to above. What do you want to accomplish and how do you plan to use it?

So with a Jumbo contract I have less money "invested" per point. So it follows that any points I use cost me less and any points I rent provide a better "investment" return. I hesitate to use "investment" since one takes a 10% hit just in broker fees, then there's always the chance the contract could go down in value, or one uses more points than they would have because they are there. Thinking of a jumbo Saratoga or Aulani. I don't think there's as much downside risk with Saratoga, but Aulani points would command more of a premium from what I understand.

 

[Dean]

So with a Jumbo contract I have less money "invested" per point. So it follows that any points I use cost me less and any points I rent provide a better "investment" return. I hesitate to use "investment" since one takes a 10% hit just in broker fees, then there's always the chance the contract could go down in value, or one uses more points than they would have because they are there. Thinking of a jumbo Saratoga or Aulani. I don't think there's as much downside risk with Saratoga, but Aulani points would command more of a premium from what I understand.

To a degree. If you truly need THAT MANY points at THAT resort, never plan to sell and can pay cash with no other consumer debt; it's not a bad choice. However, those are some large ifs. I don't believe buying extra to rent them out is a good choice as a long term plan and it does mean that one could be missing the opportunity to own more than one resort for close to the same investment. Further for SSR esp, the more expensive options that provide a better rental return are more difficult to secure. For Aulani, I'd say similar unless one plans to go there fairly regularly but I'd ONLY consider points there if they were subsidized, same for VB. I'm still trying to figure out what you're truly trying to accomplish to best know how to frame responses.

 

[CarolMN]

So with a Jumbo contract I have less money "invested" per point. So it follows that any points I use cost me less and any points I rent provide a better "investment" return. I hesitate to use "investment" since one takes a 10% hit just in broker fees, then there's always the chance the contract could go down in value.........(snip)......

Respectfully, there is a very, very good chance that the contract WILL go down in value. IMO, it is an unreasonable expectation to assume a contract will retain its nominal value. It is much, much more likely that it will go down in value, especially if one factors in inflation. A dollar today is worth more than a dollar will be 10 years from now.