Direct Purchase benefits announced!

[Deb & Bill]

What happens if DVC is flooded with ROFRs; they can't buy up everything if that market gets flooded.

Also, wouldn't it be amazing if ROFR suddenly takes about two months to complete so that no one purchasing a resale now closes before the deadline?

 

[Sammie]

They have already limited members from booking the Disney Collection during the last four months of the UY for that same time period. This shouldn't affect me at all. This is just a way to keep DVC from getting stuck with reservations that can't be sold and having to give away OKW and SSR as overbooking for the Value resorts.

If DVC members use their points for DVC, it won't really affect anyone, except for RCI members.

It does not affect us either, as all our points are direct from DVC. I do however think this is just the beginning of things to come. At some point, it will be something we don't care for. But hey that is nothing new either is it.

As long as Daddio stays in business, I am not too worried about it. I love the Polynesian and the Grand Floridian and the Yacht Club.

We don't need all that room and space now.

 

[SanDeeKath]

This affects everyone!

If you need to resell your points for whatever reason in the future, your resale points will be more "limited" in the eye of the purchaser than it is today. PERIOD.

Whether the future owner would use these perks down the road or not is irrelevant. In their eyes, a resale contract as of late March is not as good as a new contract. Therefore it's worth less psychologically and financially.

I promise you that prices for resale contracts will go down in the long run and this will drive more direct sales (the obvious goal of this move by DVC).

 

[McCrae]

This affects everyone!

If you need to resell your points for whatever reason in the future, your resale points will be more "limited" in the eye of the purchaser than it is today. PERIOD.

Whether the future owner would use these perks down the road or not is irrelevant. In their eyes, a resale contract as of late March is not as good as a new contract. Therefore it's worth less psychologically and financially.

I promise you that prices for resale contracts will go down in the long run and this will drive more direct sales (the obvious goal of this move by DVC).

Not sure I agree with this. Don't see it as any worse than removing free valet parking.

People buy DVC to typically have Disney resort vacations. As long as that is not restricted can't see this being a problem. It would be a much bigger problem if the exchange with RCI was stopped.

 

[Maistre Gracey]

First, the ROFR limits how low a price can go.

Huh?? I don't think so. I may have to sell a contract for $20 (exaggerating of course) before anyone will make an offer. Only then will Disney exercise ROFR.
DVC doesn't set a selling price, they only buy it if it gets low enough.

MG

 

[Longhairbear]

I think the part I don't like about the change is the booking options for new resales changing. I own direct sale. I can book the Disneyland Hotel on points when the villas are full. I do this when burning off holding account points etc. We have also had to use up unbankable points before they expired and used them at Paradise Pier Concierge level for a weekend. New resale owners won't have that option, and may lose unused points if they are not careful planners. For that reason alone, I probably would not consider buying resale.
We have been able to buy an add on at our home resort direct through Disney a few times at VWL, long after it "sold out". Which makes me ask if I could do this as it was an add on, and not an initial contract?

 

[palaemon]

So, if I buy resale (after March 20th) and only care about staying at my home resort, then I'll *ALWAYS* get that? That's the one thing they can't take away?

 

[18sprint]

As someone stated 10 miles back in this thread I think the only guarantee any of us have is booking at our home resort, everything else is subject to change.
We bought resale and this news doesn't appear to affect us. I'm cheap, so I always look at value for the points. Using points for "other" types of trips just doesn't seem a wise use of points, at least for us. We looked at using points for a cruise last year, but financially it didn't make and sense to waste the points, so we paid cash. Using points to stay at the Grand Floridian or Poly or even the moderates (which we love) is a waste of points. You probably see a common theme running through this post. (cheap).
Will this effect the resale market? Probably, short term I can see resales slowing, but I believe it will recover very quickly since there is still great savings by going resale.

 

[jsivigny]

This affects everyone!

If you need to resell your points for whatever reason in the future, your resale points will be more "limited" in the eye of the purchaser than it is today. PERIOD.

Whether the future owner would use these perks down the road or not is irrelevant. In their eyes, a resale contract as of late March is not as good as a new contract. Therefore it's worth less psychologically and financially.

I promise you that prices for resale contracts will go down in the long run and this will drive more direct sales (the obvious goal of this move by DVC).

I completely AGREE with this. Whether you plan to sell or not, potential Buyers interest in your Real Estate will be viewed as a having diminished value. If you love Disney, never plan to sell, then it's really not a big change as we're Grandfathered in. However, for the unfortunate folks in today's economy where unemployment is now locked in at around 10%, losing even more on their Timeshare is a real concern. There are PLENTY of timeshares on eBay that you can pick for next to nothing. This only helps Disney, and hurts all DVC members. Does anyone REALLY think this is the end? Classic incrementalism...it'll be this time next year that more "enhancements" are introduced.

 

[Dizny Dad]

. . . . . . Does anyone REALLY think this is the end? Classic incrementalism...it'll be this time next year that more "enhancements" are introduced.

I tend to agree. In small bites our world is changed. Remeber the frog in the pan of water - drop him in boiling water and he jumps out; raise the temperature slowly, and the frog sits in the pot until the pot boils over!

We either speak up or shut up. I said the following back on page three of this thread - To paraphrase Pastor Martin Niemoller, First they came for my cruise perks, but I didn't speak up because my family doesn't cruise . . . .

(I have been a bit surprised at the number of people I have conversation with that read the DisBoards that had no idea what famous quote I was paraphrasing! We are doomed to relive what we don't remember!)

 

[likestravel]

Wow, I just sent the check in on Saturday and we close in mid February I guess I got lucky after just reading this. I told my wife, see I know what I am doing. Look how smart I am

 

[momhmmx2]

Wow, I just sent the check in on Saturday and we close in mid February I guess I got lucky after just reading this. I told my wife, see I know what I am doing. Look how smart I am

 

[RobDoc]

So, if I buy resale (after March 20th) and only care about staying at my home resort, then I'll *ALWAYS* get that? That's the one thing they can't take away?

You'll "always" get your Home Resort - based on availability. At this time, resales closing after 3/20/11 can still use their points to stay at any DVC resort and will still be able to use the World Passport Collection all based on availability. There are no absolute guarantees unlike a fixed week timeshare.

 

[wdrl]

Also, wouldn't it be amazing if ROFR suddenly takes about two months to complete so that no one purchasing a resale now closes before the deadline?

No, DVC cannot take more than 30 days to exercise its Right of First Refusal. In the Preamble to the BLT Declaration of Condominium, section 13.1 states that owners wishing to sell their ownership interest must notify DVD in writing no less than 30 days before the proposed closing date. However, if DVD fails to notify the Owner of its election to exercise ROFR, then the Owner may proceed with the proposed closing date. Although this language is taken from the BLT Declaration, I am sure that it is present in the Declarations of all DVC resorts.

I would hope that resale agents are familiar with the ROFR process and are aware that they can close on a transaction if DVD has been given at least 30 days. If a resale agent lets a transaction sit at DVD for two months awaiting a ROFR decision, then that agent is doing a disservice to the seller and the buyer.

 

[dzorn]

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.

We are in the same boat.

Denise in MI

 

[Carl'n'Ellie'sDad]

This small change in and of itself probably doesn't affect our family. We enjoy our home resort (SSR), wouldn't consider cruising, and understand that ABD is much cheaper by cash than by points. But this small change does make it very clear what many other posters have suggested for some time -- DVD is in the business of selling timeshares, not necessarily the Disney experience. The first-rate customer service we expect from the theme parks and hotels is not guaranteed, and corners will be cut on " semi-promises" made after the fact. My family has been thinking long-term about a resale add- on at SSR to eventually stay two weeks at THV. This move by DVD does make me potentially question whether even a home result resale contract will always have "equal" status to book at 11 months. Possibly a shrewd business move by J Lewis and crew, but I' ll be prepared for other such "benefits" in the future.

Ellie wants to add some "stickers."

 

[chalee94]

I think your resale value is going to be pretty much the same. First, the ROFR limits how low a price can go.

no. not at all.

when DVC has less cash (as during the Great Recession when it could no longer securitize its loans), DVC cannot ROFR very much at all...even if they wanted to.

as VB owners can tell you, DVC has very little interest in using ROFR to prop up prices...and over the last year or so, DVC has had little interest in ROFRing any contracts other than BCV.

as MG put it, if no one is willing to offer more than $20 per pt for your contract, that is all you can hope to get. at that point, DVC will likely have very little interest in your contract either.

the notion that ROFR protects resale prices is just another fib from timeshare salespeople.

 

[Corwin]

Not sure I agree with this. Don't see it as any worse than removing free valet parking.

The difference is that the loss of valet parking affected all owners equally.

With this change, resale purchasers alone are being penalized, and are losing the ability to book outside of DVC.

The consequence to this change is that for all owners (including direct purchasers), their contracts when sold on the resale market will now have less value and will be worth less than before.

Perhaps many people don't care about this, because they never intend to sell. However, I wonder how many people can really look decades into the future and be sure they will never need or want to sell. As others have stated, life has a way of getting in the way of the best-laid plans.

 

[tjkraz]

no. not at all.

when DVC has less cash (as during the Great Recession when it could no longer securitize its loans), DVC cannot ROFR very much at all...even if they wanted to.

as VB owners can tell you, DVC has very little interest in using ROFR to prop up prices...and over the last year or so, DVC has had little interest in ROFRing any contracts other than BCV.

as MG put it, if no one is willing to offer more than $20 per pt for your contract, that is all you can hope to get. at that point, DVC will likely have very little interest in your contract either.

the notion that ROFR protects resale prices is just another fib from timeshare salespeople.

I've said the same thing about ROFR but upon further reflection, I do think it really can have an impact. If DVC starts exercising ROFR--even on a spotty basis--many prices will begin to creep upward in response.

Right now Timeshare Store has listings on AKV which range from $72 to around $85 per point. If DVC began ROFRing most contracts in the $70s, what's going to happen? All of these ROFR threads on the forums will be on notice that offers in the $70s may not pass. The resale brokers will warn clients that they have had clients lose out on offers in the $70s.

While some will still be willing to test the waters, others will take the situation to heart and (IMO) there will ultimately be more offers and even listings in the $80s.

File this under the heading of wishful thinking but IF DVC decides to get more active in ROFR, the market could start to recover nicely.

Upon reflection, 2009 was something of a perfect storm for DVC. If you think back even further to late 2007 and early 2008, DVC got caught in a situation where they actually had almost no inventory to sell. SSR "sold out" (pre-Treehouses) and AKV had limited marketability--Jambo was sold out and Kidani was still more than a year away from opening. For a good 6 months, the only active inventory they had available was OKW ROFR points. (Thus a big part of the justification for the OKW contract extension.)

Long story short, after the shortfall in '07 they overbuilt in '09 and got burned during the recession. It's somewhat understandable that they backed off on ROFR during a period where they were holding MILLIONS of points at FOUR active resorts.

Now consider the next 2-3 years. BLT will almost certainly be gone by mid-to-end of 2011. Given construction timeframes, any new development at WDW wouldn't be ready until 2013 at the earliest. That gives them at least 1.5 years to address SSR and AKV. And with lower overall inventories, hopefully they can justify getting move involved in the resale market. That will be particularly true if this move actually has the desired effect--some upturn in direct sales.

Again, certainly wishful thinking, but I can envision scenarios where both DVC's direct sales go up AND resale prices increase. Depends entirely on whether DVC decides to dip its toe back in the ROFR waters.

 

[crisi]

The difference is that the loss of valet parking affected all owners equally.

No perk change affects all owners equally. Valet parking affected those owners staying at the valet available resorts who drove. People who took ME, people who stayed at SSR or OKW, they really didn't feel the loss of the perk.

People who buy APs love the AP perk, but we "traded" the discount on what used to be the UPH for them. We don't spend enough time at Disney for an AP to be a good deal. So the loss of the ticket discount penalized those of us with a smaller number of points who spend less time at Disney, and rewarded those that spend more of their vacation days (and dollars) at Disney. That seems to have been a good business decision - even if my own family was on the short end of the stick for that one.

We love Cirque, but as of yet, the come and go Cirque discount has never been offered during the times of year we travel. Cie La Vie.

Disney has not made this retroactive (although, IMHO, they could). People who want to use their points for the restricted options who own currently see no change. People who purchase points in the future will need to make an educated purchase choice based on the value of those options. Disney has now made it obvious that cruising on points is not a good deal. If you were looking for a deal, you should have been paying cash to cruise or stay in Disneyland Paris or to book ABD to begin with. If you aren't looking for a deal - then the discount on resale is immaterial and go for the "full value" points.

As to the resale value... Yeah, the past when resales were worth more than we bought them for was nice - how many people get that from a timeshare? But that certainly was never a guarantee. With my BWV contract getting shorter each year, the number of DVC rooms available (and therefore an ample supply going into the resale market - and even the rental market - why buy when there are plenty of people willing to rent at $10 a point) and the effect of the economy - this is small potatoes on my own resale value.