Direct vs Resale vs Renting over 10 years

[Robbie Cottam]

Bought at Riviera 150 points direct. Dec use year and came with '21 points. Worked with Reenier, he was great, took just a phone call and docusign, points arrived asap. They offered to buy the '21 points for $10 a point, but we wanted them. We'll bank them and try to squeeze some extra days out of our first few trips.

The fomo on staying at RR/future resorts and potential blue card perks killed buying resale for us. GF was a very close second place, just prefer epcot, hs, boardwalk area location. All the advice and opinions on these boards really helped.

Did the same but with 200 points…. I think that got me the next tier of discounts….. but it was nice to get the extra 200 points for “free”

 

[sethschroeder]

Been trying to math these options against one another.

With Direct it all comes down to if you can get DVC AP discounts. That is pretty much it from a math side of things.

Renting can be okay at "over priced" DVC like BCV but in reality most place you are better off at least buying resale if you plan on holding 10 years then selling.

 

[Robbie Cottam]

The only caveat with buying resale, is when you do it and what will disney take away next….

if you are happy with always staying where you bought resale is starting to make more scene….

if disney ever brings back member benefit….. and im not holding my breath, they may not offer them to resale…

that having been said, and disney not making another massive resale change, im starting to see some value to resale….

 

[Sandisw]

The only caveat with buying resale, is when you do it and what will disney take away next….

if you are happy with always staying where you bought resale is starting to make more scene….

if disney ever brings back member benefit….. and im not holding my breath, they may not offer them to resale…

that having been said, and disney not making another massive resale change, im starting to see some value to resale….

DVD can't make any other changes to resale and where you can use points within the system for existing resort, without completely dissolving BVTC, and then starting from scratch...even that might not be easy to do.

So, there really isn't much more they can take away from resale. But, being able to use points at RIV and newer resorts in the future is a big deal to many, including me. And, in 19 years, the pool of resorts resale points can be used it shrinks. So, if I was going to buy resale again today, I'd want it at the resort, as you say, that you want to be at. It is why I bought some RIV resale last year because I stay there each and every trip!

 

[RoseGold]

The only caveat with buying resale, is when you do it and what will disney take away next….

There's not much left to take from the O14. I guess the DVD library, which someone actually used lately, and the couple of pools left in pool hopping. LOL

They could do dramatic things, like remove SSR from the point exchange or sell Aulani, but that would be all points, not just resale.

 

[Robbie Cottam]

DVD can't make any other changes to resale and where you can use points within the system for existing resort, without completely dissolving BVTC, and then starting from scratch...even that might not be easy to do.

So, there really isn't much more they can take away from resale. But, being able to use points at RIV and newer resorts in the future is a big deal to many, including me. And, in 19 years, the pool of resorts resale points can be used it shrinks. So, if I was going to buy resale again today, I'd want it at the resort, as you say, that you want to be at. It is why I bought some RIV resale last year because I stay there each and every trip!

We have had this conversation before.

They can, the have, and I’m sure they will again!

What they can not do is make changes retroactive.

The rules that are in place at the time of purchase are the rules that you will continue to enjoy.

They are very welcome to draw a line in the sand and say after this date the rules will be this….

 

[RoseGold]

They are very welcome to draw a line in the sand and say after this date the rules will be this….

Like what? The rest is all in the contracts or the Buena Vista trading rules. The O14 rules are very clear.

The DVD library? So kind of them to let us plebs use that, haha. Seriously, what is your actual example of a change you think matters?

 

[Sandisw]

We have had this conversation before.

They can, the have, and I’m sure they will again!

What they can not do is make changes retroactive.

The rules that are in place at the time of purchase are the rules that you will continue to enjoy.

They are very welcome to draw a line in the sand and say after this date the rules will be this….

Except when it comes to using points to trade into BVTC...staying at other resorts... it is based on the way the POS for the condo association is written and how it entered into the agreement with BVTC. As I said, they can dissolve BVTC, and start again with an all new trading program...

In order to restrict resale points from the O14 from using any other O14 in the future, they have to change the POS for each of those resorts and that would be considered a material change and most likely require a vote from owners.

RIV was a new resort which entered BVTC with a different agreement than previous ones had and why it can be restricted. It is also why they could not apply resale restrictions to the new VGF contracts since being part of the same association, means they have to follow the same rules as the POS of the original VGF.

The only reason that they did not apply resale restrictions to contracts bought prior to Jan 2019 is because of the language that says resorts that enter BVTC should be similar in nature to the rules...by grandfathering everyone in, they limited liability for people claiming RIV should not have been allowed (some still believe that).

 

[DarthDadMan]

Great topic, and a great read, everyone . So many sub topics in this discussion. Bo, like many, I created not just a spreadsheet, but a DVC excel workbook. I'm an IT data nerd, so I get a kick out of it. Or maybe I'm just sick, and that's why I like it. Either way, I've put a ton of time into it over these past years. I have a tab for each most economical buy rankings released by dvcresalemarket over the years that calculates purchase cost based off amount of points (At the time I was focused on most economical purchase). The remaining tabs are by contract/resort and calculate costs per year vs renting with maintenance fee increase, inflation guesstimates built in, total cost of ownership, cash room comparisons, and break even year based on most likely length and room type on trip. Like I said, I'm sick, and I'm not the only one haha. All this spreadsheet has done is remind me of how much it costs in general, that eventually I'll break even, and that my plans have changed too much to plan that far ahead. The only thing that has never changed is my interest in ownership in general. I thought my AKV resale contract was going to be my first and only investment in DVC, and not but a few years later, I'm going to sell it in favor of Poly2, assumingly. Or maybe I'll keep it, and just add on at Poly2. Or add on resale Poly depending association status... I have absolutely no idea. I just know whatever I had planned several years ago was a track I have long derailed from, and will not stop myself from getting more points, or reinvesting in a resort with more years. Or less years, maybe: I have a stay at BWV this fall. I've never stayed there. I may like it so much, I'll sell my contract and buy in there instead, who knows . I have to physically keep myself away from Riviera because I may talk myself into it, instead. Long story short, DVC is dangerous, and the numbers don't matter over the life of the contract, imo.

 

[Bo1203]

Great topic, and a great read, everyone . So many sub topics in this discussion. Bo, like many, I created not just a spreadsheet, but a DVC excel workbook. I'm an IT data nerd, so I get a kick out of it. Or maybe I'm just sick, and that's why I like it. Either way, I've put a ton of time into it over these past years. I have a tab for each most economical buy rankings released by dvcresalemarket over the years that calculates purchase cost based off amount of points (At the time I was focused on most economical purchase). The remaining tabs are by contract/resort and calculate costs per year vs renting with maintenance fee increase, inflation guesstimates built in, total cost of ownership, cash room comparisons, and break even year based on most likely length and room type on trip. Like I said, I'm sick, and I'm not the only one haha. All this spreadsheet has done is remind me of how much it costs in general, that eventually I'll break even, and that my plans have changed too much to plan that far ahead. The only thing that has never changed is my interest in ownership in general. I thought my AKV resale contract was going to be my first and only investment in DVC, and not but a few years later, I'm going to sell it in favor of Poly2, assumingly. Or maybe I'll keep it, and just add on at Poly2. Or add on resale Poly depending association status... I have absolutely no idea. I just know whatever I had planned several years ago was a track I have long derailed from, and will not stop myself from getting more points, or reinvesting in a resort with more years. Or less years, maybe: I have a stay at BWV this fall. I've never stayed there. I may like it so much, I'll sell my contract and buy in there instead, who knows . I have to physically keep myself away from Riviera because I may talk myself into it, instead. Long story short, DVC is dangerous, and the numbers don't matter over the life of the contract, imo.

Haha, yeah I also went way over board on the spreadsheets... I eventually just concluded compared to staying at deluxe resorts on cash or rented points I would break even buying resale or direct in an amount of time I was comfortable with. Purchased the more expensive upfront option RIV, defying the mathematical gods.

 

[CarolMN]

Purchased the more expensive upfront option RIV, defying the mathematical gods.

The heart wants what the heart wants. When there is conflict, the heart usually wins.

 

[scoobdoo]

Like what? The rest is all in the contracts or the Buena Vista trading rules. The O14 rules are very clear.

The DVD library? So kind of them to let us plebs use that, haha. Seriously, what is your actual example of a change you think matters?

The DVD library has been removed at Aulani.

 

[brazzledazzler]

Great topic, and a great read, everyone . So many sub topics in this discussion. Bo, like many, I created not just a spreadsheet, but a DVC excel workbook. I'm an IT data nerd, so I get a kick out of it. Or maybe I'm just sick, and that's why I like it. Either way, I've put a ton of time into it over these past years. I have a tab for each most economical buy rankings released by dvcresalemarket over the years that calculates purchase cost based off amount of points (At the time I was focused on most economical purchase). The remaining tabs are by contract/resort and calculate costs per year vs renting with maintenance fee increase, inflation guesstimates built in, total cost of ownership, cash room comparisons, and break even year based on most likely length and room type on trip. Like I said, I'm sick, and I'm not the only one haha. All this spreadsheet has done is remind me of how much it costs in general, that eventually I'll break even, and that my plans have changed too much to plan that far ahead. The only thing that has never changed is my interest in ownership in general. I thought my AKV resale contract was going to be my first and only investment in DVC, and not but a few years later, I'm going to sell it in favor of Poly2, assumingly. Or maybe I'll keep it, and just add on at Poly2. Or add on resale Poly depending association status... I have absolutely no idea. I just know whatever I had planned several years ago was a track I have long derailed from, and will not stop myself from getting more points, or reinvesting in a resort with more years. Or less years, maybe: I have a stay at BWV this fall. I've never stayed there. I may like it so much, I'll sell my contract and buy in there instead, who knows . I have to physically keep myself away from Riviera because I may talk myself into it, instead. Long story short, DVC is dangerous, and the numbers don't matter over the life of the contract, imo.

Too true! We put an offer in at Vero ..and we haven’t even stayed there

But, it was a small contract with subsidized dues and we go to beaches on the east coast of FL yearly. We couldn’t resist.

DVC is an addiction..because now we’re saving up for Poly2!

(FYI: It hasn’t even been a year since we became members…)

 

[havoc315]

Been trying to math these options against one another. Trying to do about a week long trip once per year. Let me know how you guys would do this different and hopefully this will be helpful for others.

This is an excellent exercise, but only as good as the assumptions are accurate. Which can be iffy....

Assumption #1 yearly dvc dues rising 3%. This is the historic average dvc dues have risen. Newer resorts seem to start higher and rise slower for a period of time.

Feel like this is a fairly save assumption...

Assumption #2 cost for renting points is $3,900 per year rising 3% every year. Last year we rented 12 days at Boardwalk sv studios for $2400. But you could easily spend double that at many other resorts depending at the time of year/view for just 7 days. You could also look at this figure being similar to getting a hotel room at $500-$600 night room.

This isn't quite so safe. It will really be dependent on supply and demand. The supply of points is ever-increasing, as Disney adds more property, sells more points. AND, as "old" owners use their properties less often, and put more into the rental market. Will demand rise to match the increasing supply? Exceed supply? Or go in the other direction? And of course, it's highly variable based on 11 month vs 7 month booking.

Maybe 3% is the best estimate to use, but I could see it being lower over the long term.

Assumption #3 using approximate current resale prices for purchasing now and selling 10 years from now. I don't have a crystal ball.

This is where things get REALLY hazy...

Assumption #4 paying cash, not paying any interest. Although, on a dvc contract with 10% down and a 6%-8% interest rate paid off few years early, about $3,000 in interest could be worked in to this math.

Riveria direct-150 points at $207pp = $31,500 +
10 years worth of dues rising 3% year = $14,444.49 = $45,944.49 RR direct contract and dues over 10 Years

Grand Floridian direct-150 points at $207pp = $31,500 +
10 years worth of dues rising 3% year = $12,060.00 = $43,560.00 GF direct contract and dues over 10 Years

Saratoga Springs Resale - 150 points at $133pp + cc = $21,000 +
10 years worth of dues rising 3% year = $12,610.27 = $33,610.27 SS resale contract and dues over 10 years

Renting/hotel starting $3,900 year, rising 3% per year over 10 years = $44,709.13 Renting or Hotel for 10 years

This is pretty good so far, and brings up an important point -- This is why I think buying 2042 resorts makes no fiscal sense. I believe renting points will ultimately come out even lower than you estimated, especially since you never have "spillage" when renting. And on 2042 resorts, it's unlikely you will have significant re-sale value when there are under 10 years left on the contract.

If you sold at todays prices 10 years from now
Resale RR 150pp $22,500 = $23,444.49
Resale GF 180pp $27,000 = $16,560.00
Resale SS 130pp $19,500 = $14,110.27
Resale renting points $0 = $44,709.13

And here we get really hazy...
For those 3 resorts, it may be a fair assumption. There are those who believe RR will lag behind on re-sale value due to the restrictions (I disagree). All 3 of those resorts have enough years left that the re-sale curve should be similar. If anything, with inflation, re-sale prices will likely be higher 10 years from now.
If anything, I'd expect re-sale prices to be higher than estimated at RIV -- being a new resort, there are is no ROFR yet. Once a resort starting getting ROFR, it drives up the re-sale price a little.

Assumption #5 the longer you run this out, likely the more favorable it becomes for buying dvc

This is almost certainly true. Those purchasing a 2060/2070 resort contract and keeping it for at least 15-20 years, will end up doing the best financially. UNDER THE HUGE assumption that they actually want to keep using the contract annually.

 

[bakerworld]

When I finally maneuvered the better half into sitting down with a DVC guide and the program was explained to him, he turned to me and said "Why didn't we do this sooner?" Well, there were lots of reasons but the biggest one was every trip to WDW was our last one until - after 12 years of going every other or every third year - we started going 2 to 3 times annually. First we continued to stay at the moderates but then I got him into the BC we loved the location and had to find a way to hold the room price, which led us to DVC. He's the numbers guy - not me.

 

[Robbie Cottam]

Direct vs. Resale

For me I like easy. To buy direct I call my guide. Ask him to explain the incentives the currently are offering. Give him my cc for the down payment. The next day I have a FeDEx package. I take it to my bank, they notarize it. I fedex it back.. buy the end of the week I have an email copy of my deed and all I have to do is figure where to get the money from to pay off the loan.

it is easy, I pay more for it to be easy! I get that. But that is why I lease cars. It’s easy.
No back and forth, no broker bs, no rofr… Sign and drive!

i may at some point buy some resale just to rent…

as far as renting points…. I make money renting point

so if you are looking at renting points I’ll gladly buy some resale points and rent them to you…

maybe rent a few times to see if you like DVC, because some people don’t like it, or to find what resort you want to buy at…

but my break even on buying and renting is 12 years…. That means 38 years of free vacations or 38 years of profits to pay for my other vacations….

if you line in the sand is 10 years than yes renting puts you slightly head….
But in a 50 year contract it is somewhat shortsighted……