Direct Purchase benefits announced!

[cvjw]

No it's not. I fully intend to keep my contract. IN fact, I had my contract divided into 2 equal smaller contracts so that I could give 1 to each of my daughters should I decide I am unable to enjoy it any longer. I know I have read many other posts from people doing the same. I would say that people like you are most likely in the minority. Not the other way around.

Most people probably buy with the intent to keep their contracts until the end and then life gets in the way - job loss, illness, injury, death, etc. I am planning on keeping my 4 contracts until the end, but am concerned that if I were to need to sell, I couldn't get anywhere close to the money back that we purchased for.

 

[Sammie]

If it is done in accordance with the POS, then no. Once again, people should be doing their homework before buying.

Totally agree. They need to really study up and not rely on what the DVC sales agent will tell them. Because believe me in the past they were really pushing those 800 other places you can stay with DVC and never once said, on yea that might change.

I am just glad we bought ours far enough back we have already recouped what we paid for them and if I ever decide to sell might put mine on
Ebay for $1.00 and let someone have it for the cost of the dues.

Renting them out to David is looking more and more lucrative, Grand Floridian here I come.

 

[Havana]

Freaking out over here! My agent says we should def be through ROFR and closed before the deadline...but still freaking out! And hoping Disney isn't about to ROFR everything they have right now!

I'm right there with you.

 

[NewDCLGuy]

I disagree.

You disagree that owners who need to sell will continue to sell, just at a lower price? What do you think those owners will do?

 

[tjkraz]

Sorry, I must disagree. You bought under certain terms that could or could not change, but if they did, would change for "all" owners. Now there is a differentiation between your direct points and your resales points. They are no longer the " same". Doesn't matter how they are different, whether you care if the differences affect you, or how anyone else interprets these differences. They are now not the same. Your original purchases have been devalued.

Like I said, the only value I ever assigned to the points was what they would get me when redeemed. And that hasn't changed. (Well, I guess it did change during the reallocations but that's another debate. )

I do understand where you're coming from but personally I never had any perceptions of what the points would yield in 10, 20, 30 years. I don't view the contracts as having any sort of cash equivalency.

Honestly if DVC had tinkered with things like booking windows or other more serious benefit programs, I would be more disturbed. Some have said that they could simply be testing the waters with this restriction. Only time will tell whether that's the case or not.

Overall I don't think there will be any dramatic change in resale prices. Sellers control the market more than buyers. A buyer would gladly pay $1 per point if they could. It's the seller who has to choose to accept or decline an offer. I don't think the buyer market will shrink dramatically. If so, prices will ultimately depend upon what what sellers choose to accept.

 

[RescueRanger]

Totally agree. They need to really study up and not rely on what the DVC sales agent will tell them. Because believe me in the past they were really pushing those 800 other places you can stay with DVC and never once said, on yea that might change.

I am just glad we bought ours far enough back we have already recouped what we paid for them and if I ever decide to sell might put mine on
Ebay for $1.00 and let someone have it for the cost of the dues.

Renting them out to David is looking more and more lucrative, Grand Floridian here I come.

Oh Sammie, I totally agree with what you are saying about what Disney was feeding the potential buyer. I am in no way saying that Disney is without fault for giving "misleading" statements. However, when a person gets their contracts and reads through the POS, the buyer then has the blame on themselves if they don't know any better. I have some friends whose relative has owned DVC for years and still doesn't understand you can bank points. Heck, this potential change has been discussed now for awhile and even when the most informed DISers warned that a change could be coming, others blew them off and chose to bury their heads in the sand. I still say this could have been worse, and as you pointed out, more changes may still be coming.

 

[LIFERBABE]

Totally agree. They need to really study up and not rely on what the DVC sales agent will tell them. Because believe me in the past they were really pushing those 800 other places you can stay with DVC and never once said, on yea that might change.

I am just glad we bought ours far enough back we have already recouped what we paid for them and if I ever decide to sell might put mine on
Ebay for $1.00 and let someone have it for the cost of the dues.

Renting them out to David is looking more and more lucrative, Grand Floridian here I come.

I agree Sammie. "Resale Value" as related to timeshares is an oxymoron! Get your money's worth and move on if that day should come.

Not so much in the past with DVC, but the $1 Days are coming!

 

[Sammie]

I don't need anyone to remind me Disney is a business, I know that. However regardless Disney sells emotions. Some can try to deny it but they have not watched any of the Disney commercials lately.

Therefore the emotional part of me hates for this to happen to those in resale limbo right now, waiting to see if they make it before the deadline, hate it for those that trusted a sales agent because they foolishly thought Disney was different from other timeshares and mostly I hate it for the Timeshare Store, they are good people.

I know this is a hectic crazy day for them.

Call me emotional, call me foolish, call me old fashion, I just think there is only so much you can do for the sake of "business" that when you begin to seperate business from caring, it will eventually come around and bite you in the butt.

to all affected in an adverse way.

I just hope that DVC can survive being a stepping stone for JL and his move up the corporate ladder.

 

[tjkraz]

You disagree that owners who need to sell will continue to sell, just at a lower price? What do you think those owners will do?

I disagree with the idea that the net result will be even lower direct sales. Most buyers give no consideration to resale values. Additionally, DVC buyers have demonstrated a somewhat irrational propensity for paying more for modest benefits. Consider buyers who are paying thousands of dollars MORE for a Beach Club Villas contract rather than an Old Key West or Saratoga Springs contract with 12-15 years of added value.

That gives me every reason to think that some buyers will similarly pay thousands of dollars more just to secure the rights to use points for cruises and other non-DVD destinations.

If DVC was able to sell all the points they wanted at the price they want, they would care less about resales, gee that is what happened until now.

If resale had been a problem in the past this would have happened before. If they truly felt that big point holders deserved extra benefits, they would have done that too.

Maybe, just maybe if they had not overbuilt the market, built quality resorts with quality products that did not require them going back in and redo mistakes, if they focused on houskeeping and maintenance, maybe the sales they are so desperately now trying to get, would have come to them easily. Just as they did in the past when the product literally sold itself.

I don't disagree with you, Sammie. However, today's resale market isn't what it was 3+ years ago, either. If the recession hadn't forced THOUSANDS of SSR and AKV contracts onto the market over a relatively short time span, prices wouldn't have fallen as they did.

ROFR never had the impact that some may think it did. Supply and demand largely kept values in check. But desperation among a small number of owners began to drive the entire system down. Every time the market hit a new low, future buyers wanted THAT deal or an even BETTER one.

Even without the economy, the resale market itself has organically grown. If we assume that the percentage of contracts offered for sale at any given time hasn't changed, the total quantity will still increase. In other words "X" percent of 400,000 contracts is a much higher number than "X" percent of 150,000 contracts (where "X" is the percent of owners who are attempting to sell at any given time.)

And then there's the influence of the diminishing contracts. The likes of BCV and BWV maintained their resale value pretty well up until 3 years ago--probably due to the fact that SSR just didn't appeal to many buyers.

But now with BLT and other options available, those BCV, BWV and VWL contracts are settling in to more reasonable prices given the somewhat scant 31 years remaining. So DVC is also competing with market-driven lower prices for a wide variety of older destinations.

I'm sure we will agree to disagree on this one but I don't think member satisfaction is any great driving factor in today's market. Everything from those Market Metrix ratings to DVC's own surveys to posts on the forums suggest that members are largely satisfied with their purchases. In the long run, I'm not really sure what DVC can do to compete with an ever-expanding resale market.

 

[MrShiny]

Wait a minute - for all those folks Disney was talking about all those places you could trade your points for, that DIDN'T (and may NEVER) change. They did not lie! IF you buy from Disney, you still get that. I don't recall anyone from Disney every briging up the resale market! And it will still be true of all who already bought resale and who buy before the announced date.

I think Disney just wants to curb the resale market and drive more sales direct.

In truth, I think it is actually a RELATIVELY little used feature. We used it because it was easier than guessing exchange rates for Disneyland Paris and when they reduced the rates at DLR (before GCV) it was a great way to do GC Concierge (no more!), but in general I'd rather rent my points out and use the cash. For example my July cruise would be 443 points, but it's $3035. I'd rather rent reservation(s) for $4430 and pocket the $1395 difference!

Reminds me of DVR's - when they were showing them the feature that generated the most interest was the ability to pause live TV, but when people actually get a DVR, that's the feature least used!

 

[Dziactor]

Im less inclined to add on at this point even though I have only purchased direct since i do believe this would hurt me if I needed to sell for any reason.

 

[lowe@massed.net]

As a prospective buyer who plans to only use my points at DVC resorts, I'm relieved! I was really worried the change would affect the booking window. And while I wouldn't be losing anything by the benefits they are taking away, I know now will certainly never buy Direct since I feel the value of those points depreciates the minute you drive them off the lot. On a selfish note, I won't be sad if this move causes the market to get flooded with a lot of contracts for me to choose from, right at the time that I am shopping.

I'm in total agreement with you, FindingFigment! I'm expecting lots of resale choices from which to choose in the next couple of weeks - and I suspect lower prices, too!

 

[DVC Mike]

The Orlando Sentinel has an article on this.

I'm quoting part of it, with added emphasis by me.

In a bid to buttress its own sales, Disney's time-share business said Tuesday it will impose new restrictions on buyers who purchase their time shares from existing owners — rather than directly from Disney.

A Disney Vacation Club spokeswoman said customers who bought their time shares directly from Disney have requested such a change.

"Our members just felt that that they should get more benefits when they purchase through Disney Vacation Club than those who purchase on the secondary market," spokeswoman Diane Hancock said. She added that the change aligns Disney with other time-share operators who impose similar restrictions on resales.

But some company followers said Disney is trying to prop up its own direct sales, which stumbled during the global recession and credit freeze. Disney reported lower vacation-club sales during its 2010 fiscal year, which ended Oct. 2.

 

[vicki_c]

Most people probably buy with the intent to keep their contracts until the end and then life gets in the way - job loss, illness, injury, death, etc. I am planning on keeping my 4 contracts until the end, but am concerned that if I were to need to sell, I couldn't get anywhere close to the money back that we purchased for.

But why would you be trying to get "anywhere close to the money back that we purchased for." I don't get that - you didn't buy it to resell, you bought it to use. My expectation would never be that I could use the product for a number of years and get all my money back from it as well.

I know that has happened to some of the earliest owners, but that is not a reasonable assumption. It's not an investment, it's a vacation. When the time comes (if it ever does) that you need to sell, you take what you can get and be done with it, enjoying the value you did get from it, both in taking vacations and by reselling. It is NOT an investment.

 

[chalee94]

A Disney Vacation Club spokeswoman said customers who bought their time shares directly from Disney have requested such a change.

fib. fib. fib.

when those direct customers go to sell their timeshare, they will get getting the same price as those who bought resale since they can't pass along the trade "benefit."

spokeswoman Diane Hancock...added that the change aligns Disney with other time-share operators...

i'm surprised that disney would admit that the "disney difference" is really that dead...

 

[chalee94]

But why would you be trying to get "anywhere close to the money back that we purchased for."

i understand your point - that is the nature of timeshares, that the developer finds ways to suck the value out until you should only expect to be able to sell for a pittance. if you've done your homework on timeshares, it should not come as a surprise.

but with disney's historical attempts to differentiate themselves from other timeshares, you have to admit it's a bit of a drag to have disney get down in the mud with the other hucksters.

all things being equal, why wouldn't you want to have a contract that has more value on the resale market rather than less? you bought a contract with certain perks knowing that they could be taken...but it's still kind of a let down when disney actually takes this sort of adversarial approach.

 

[Sammie]

TJ, I will agree with you that the economy has affected sales. I also think that Disney resorts discounted deals and free dining has affected sales.

Why considering buying DVC when Disney resorts is throwing fantastic deals left and right at consumers even to stay at DVC resorts.

Also I have to think the rental market has to have some affect, I know I would definitely consider renting over owning at this time.

Only time will tell how it all plays out.

 

[palaemon]

Isn't this the 1st major change to DVC in 20 years?

(I don't consider valet parking and DCL booking issues as major changes.)

What makes anyone think this is only "step one?"

If they make changes to booking DVC properties themselves (ie booking windows, banking & borrowing, and only-home-resort stays,) then what kind of "club" would it be?

I am still planning on buying in and taking the consensus advice of "buy where you want to stay." I was also planning to buy 2 smallish contracts and bank-and-borrow, so I can use the 11-month booking window.

Hey - if you have to sell, it might as well be a contract you bought resale anyway, as opposed to a higher priced direct. You'll lose less money.

 

[Sammie]

Wait a minute - for all those folks Disney was talking about all those places you could trade your points for, that DIDN'T (and may NEVER) change. They did not lie! IF you buy from Disney, you still get that. I don't recall anyone from Disney every briging up the resale market! And it will still be true of all who already bought resale and who buy before the announced date.

I think Disney just wants to curb the resale market and drive more sales direct.

In truth, I think it is actually a RELATIVELY little used feature. We used it because it was easier than guessing exchange rates for Disneyland Paris and when they reduced the rates at DLR (before GCV) it was a great way to do GC Concierge (no more!), but in general I'd rather rent my points out and use the cash. For example my July cruise would be 443 points, but it's $3035. I'd rather rent reservation(s) for $4430 and pocket the $1395 difference!

Reminds me of DVR's - when they were showing them the feature that generated the most interest was the ability to pause live TV, but when people actually get a DVR, that's the feature least used!

Actually it is used much more than many realize. Most DISers probably don't use it but others do. If not DVC would not be taking it away if it would have no affect.

I don't use my DVC for anything except booking my home resorts, but I will not be the least surprised to see restrictions on trade outs for everyone in the new tier program.

For one thing it would be something DVC could change that would not cost them anything to use as a benefit to the upper tiers.

This is not over yet.

 

[NewDCLGuy]

That gives me every reason to think that some buyers will similarly pay thousands of dollars more just to secure the rights to use points for cruises and other non-DVD destinations.

Well, sure. This will cause some people that would have bought resale to buy direct. But what happens to the sellers of the contract those people would have bought from? Do they not sell? Or do they find other buyers? And where do those buyers come from.

I believe they find new buyers from people who are on the fence between retail and direct. Before this chance those people would have bought direct from Disney. But now, the sellers lower their price a bit to lure them to resale.

Net result to Disney, no new buyers.

With this next bit, I'm honestly not trying to be argumentative. But I value your input and am curious what you think. You said this change will increase Disney's sales by 2-3%. Where do those extra buyers come from? And if they come from people who would have bought resale, does that mean there are less resale buyers? If less resale buyers, what happens to the sellers?