Diminishing Value of Renting Points?

[wingkng]

Just wondering what people think. Currently, it seems that transferring or renting points cost about $10 per point. With the cost of everything going up, it does mean that the renter would get a better and better deal to stay at DVC using rental, while the DVC owner renting out the points would get less and less value for the transaction. And now, I am also seeing other DVC owners pricing their points below $10. So, doesn't that devalue your points?

If cost of travel continues to go up, while the price of renting your points out stays the same or becomes less, then the financial benefit of this kind of transaction will slowly erode. It makes less and less sense to get the cash for the points and using it for some other vacation options (for example, cashing out the points to pay for non-DVC resort or DCL, rather than booking directly for them through DVC).

 

[Anthony1971]

I do not think most members are renting to make money they are renting because they can not use the points. as an owner you are under contract to not make money.......or you have no intentions of... even at 9-10 you are making money and your points do not go to waste.
There are lots of people (EBAY) who do sell points or rentals to make money in that case they are getting more then 10 a point
I bought my points to use... I will rent to people I know first if it came down to it I would rent here but this is not why I bought the points

 

[NMW]

I really don't understand why any member would rent points for such a small amount. I think $10 is really way too low, and anything less than that is just crazy.

 

[rinkwide]

...If cost of travel continues to go up, while the price of renting your points out stays the same or becomes less, then the financial benefit of this kind of transaction will slowly erode...

Sure, but it's gonna take erosion like we haven't seen since the Grand Canyon was formed. Price a cruise at $10 per point sometime.

 

[wingkng]

I do not think most members are renting to make money they are renting because they can not use the points. as an owner you are under contract to not make money.......or you have no intentions of... even at 9-10 you are making money and your points do not go to waste.
There are lots of people (EBAY) who do sell points or rentals to make money in that case they are getting more then 10 a point
I bought my points to use... I will rent to people I know first if it came down to it I would rent here but this is not why I bought the points

I don't mean to say that what many people are doing is making money from the points rental. I can totally understand if people can't use all their points for the year and need to rent them out. I see people on the posts saying that they can get a "better deal" by renting their points out and using the cash to reserve nights at a Disney resort. So, my point is that over time, the cash you get from the points will get you less at the Disney resort, assuming people continue to get $9-10 per point.

I for one don't want to deal with this whole process. Not only, does it take too much mental energy to do this, but also, there is the tax involved in getting money from the rental. I just might as well take my vacations with the points and go on with my life.

 

[Anthony1971]

I don't mean to say that what many people are doing is making money from the points rental. I can totally understand if people can't use all their points for the year and need to rent them out. I see people on the posts saying that they can get a "better deal" by renting their points out and using the cash to reserve nights at a Disney resort. So, my point is that over time, the cash you get from the points will get you less at the Disney resort, assuming people continue to get $9-10 per point.

I for one don't want to deal with this whole process. Not only, does it take too much mental energy to do this, but also, there is the tax involved in getting money from the rental. I just might as well take my vacations with the points and go on with my life.

I agree with what you are saying
and I do not wnat to deal with renting either....
I just think most people rent to get rid of points they are not going to use and really would rather make a few $ then a lot and this is why the price has not changed.
I would be part of the renting for 9-10 because I would just want to get rid of them rather then lose them... but this is why i only have 150 points would and almost did buy more a few times but for that year here or there that I will use more.... (right now anyway) i would rather have to borrow and use less next year then rent or be forced to or lose the points.
I dare say there are other places to go
like the Disney cruise
or other cruise lines which we do go on at least every other year...
2 vacation a year (for now thankfully) so we like to do something different
IMO that is why I would be part of the problem anyway
BUT YES THEY ARE WORTH A LOT MORE......
some people do not realize this
Disney is only to happy happy to take your money
they have a lot of mine from my POLY stays
but I love it there and need a break from DVC once in a while and that gives me the cahnce to catch up on my borrowed points

 

[DrTomorrow]

[...] assuming people continue to get $9-10 per point.[...]

While I'm not in the "$10/pt is simply craaaaazy" camp, I can't imagine that $9-$10/point will remain constant over time as CRO rates go up and up and up and....

 

[wingkng]

While I'm not in the "$10/pt is simply craaaaazy" camp, I can't imagine that $9-$10/point will remain constant over time as CRO rates go up and up and up and....

Maybe someone out there can give us a historicall perspective of what people were paying per point in years past....

 

[browniemtb]

Maybe someone out there can give us a historicall perspective of what people were paying per point in years past....

This is a touchy subject that has been debated heavily. $10 a pt has been around for a while...a lot longer then me. Most of the old pro's can sum this question up. But I would agree that $10 a point is low. The renter is getting a great deal. Owners should be like CRO.....base the price on time of year, location, whether your using you 11 month window or not, accomodation size...1 and 2 bedroom price more per pt than a studio. Most under $10 renters are dealing with distressed points, use them or lose them. So the way they look at it $8 per pt is a lot better than $0. There are also others that are very successful at renting at $12+........I believe Greenban has had great success getting his asking price. Sorry to drag you into this Greeban.
Brownie

 

[Steamboat Bill]

As a DVC member for 6 years I have seen DVC prices go up 40% to buy points, but the rental of points on DIS seems to hover around $10 per point. I see an occasional $11 pp, but the $12 pp does not get any bids. I also see people burn points for $9 because they wait until one month before they expire.

 

[mydogdrew]

As a DVC member for 6 years I have seen DVC prices go up 40% to buy points, but the rental of points on DIS seems to hover around $10 per point. I see an occasional $11 pp, but the $12 pp does not get any bids. I also see people burn points for $9 because they wait until one month before they expire.

Agreed. Even if you never intend to rent your points, the underlying rental value is a major driver in the resale value of a contract (others being ROFR, location and dues). I think we can all agree that if a non-owner can rent points for less than the MF then DVC ownershift becomes a liability. Clearly this is not the case now and I would not predict it in the future (although it is possible - look at most other timeshares out there). However, the gap has been closing in my three years of ownership. If rental rates don't soon start indexing with inflation I expect you'll see a lot more of the confirmed reservations posted for sale for peak periods/locations rather than renting points. It really is nuts to pay BCV prices for a resale and not expect to get a premium for these points in a rental.

 

[DISPOP]

We did rent ours last year for $10...we had a ton of responses. Maybe we should have gone to $11. As to why we would rent points: here was our scenario.

Priced a DCL 7 day cruise for $3100.
Same cabin level/date thru DVC was 430 points.
Rented 300 points for $10.
Got the same cruise and "saved" 130 points.

We have been members since 2000 and have only rented our points once. We love the one and two bedroom condos and use them yearly. However, if you consider DCL or the other resorts, you are better off financially to rent the points and pay cash rather than book using points.

 

[OnMedic]

I have been renting at $12/pp on confirmed reservations. I have also noticed many more at $11 and $12/pp then I did last year. I would also be willing to pay $12/pp when I am short and need a top up for a reservation of to rent a few nights!

 

[roadtripper]

I have gotten 11.33 per point for a confirmed reservation, too--one that family member couldn't use. As prices go up, the dining plan becomes an option, and more people hear about the rent/trade board, I think we will see lots more people able to rent for 11 to 12 dollars. There will always be distressed points out there for less, but I think occupancy will dictate whether anyone can actually rent them. With such a small booking window for some distressed points, I imagine that vacancies are hard to come by.

 

[bom_noite]

While I'm not in the "$10/pt is simply craaaaazy" camp, I can't imagine that $9-$10/point will remain constant over time as CRO rates go up and up and up and....

I have been learking around here for 3+ years. And, for a long time I was amazed that the rental rate has stayed constant at $10. Simple logic would tell you that they should increase in step with WDW hotel rates.

Why has it not? Well, it has been 20 years - but I was an Economics major! And to me it is quite obvious that the supply has outpaced or remains constant with demand!

Since I joined DVC has grown by about 30K members. And, in 3 years we should have 30K+ more.

In addition - the DVC membership is changing as the years move along. Kids that were 10 and 12 in '93 are now 26 and 28! So, I can see that some folks just do not use DVC the way they may have in the past.

For example, I have a friend who inherited 600 OKW pts from his deceased father. He uses 300 pts each year and sells the rest. For 3 years running he has sold for $10. He told me that he would like to get more - but - is nervous about raising the price since so many others are selling at $10 and below.

In the end, Buyers and Sellers will make rational choices in the market place. If there were more buyers then sellers - then - the price would increase. I honestly believe that the $10 to $12 will hold constant for a few more years!

 

[trstno1]

I'm not a DVC owner, but I may be one day, especially if the Contemporary rumors prove true. However, I will be a first-time renter in January.

I would definitely pay $11 or $12 per point if that was the going rate. I would probably pay even more. I think, though, that a lot of people are just looking for convenience. They care more about getting something reasonable for their unused points, and getting the transaction done easily. Holding out for an extra $1 or $2 per point is probably not worth the hassle, not as long as others seem so willing to go lower.

Actually, the price probably stays a t$10/point because the math is so simple. If only we had 12 fingers, then you could get $12/point easily.

 

[keishashadow]

Would prefer to see the rented points going for more, think the market would support it @ certain "perceived to be more desireable resorts" & time of year; coupled w/ability to purchase DP w/o tix requirements.

Would also be nice to see more two-tiered pricing (lower to fellow members - less trouble IMO).

 

[PamOKW]

It's all "what the market will bear". However, I really don't understand why folks rent "per point" anyway. Most people renting don't have a clue what that means. Seems like it should be priced out per night or for a full week (and then you could include weekends as well). Seems like there'd be more room for negotiating prices that way rather than being locked into "per point".

Disney constantly warns not to count on renting as a way to make money or compete with what they offer. It's better than totally wasting points but I'd rather share them with friends and family (even for non-Disney use) than rent whenever possible.

 

[wide awake]

I haven't rented points from anyone...but I think TrstNo1 has a point...if it is use or lose...whatever the market will bear. We got SO close to buying...but didn't...but now I always have in the back of my mind...I'll rent points for Vero or Hilton Head...sorry, we'll stay at SOG for on site unless a great deal like free dining. I think DVC needs to do a California or Hawaii site to stay competitive...that is why we didn't buy. Hawaii...always wonderful...California...tons to do w/o the parks, but w/ the parks...makes the points worth renting for a decent price.

 

[bongo59]

I really don't understand why any member would rent points for such a small amount. I think $10 is really way too low, and anything less than that is just crazy.

that is why i am now at 14 a point....................