Disney excersicing ROFR driving up resale price ?

[ton80]

Does anybody agree with the above question? Opinions ?

 

[coastalhh]

Thats what rofr is designed for, so things mever hit rock bottom price or they wouls buy it all up and resell it.

With that said-that's not what is causing high resale prices this time. Maybe to a small extent at SSR and OKW. But mostly it is the increase in direct prices. Direct prices have gone up 50+ dollars in a short amount of time. It's only natural that resale prices go up as well and the market corrects itself.

If your option is 165 direct. 90+ resale doesn't seem so bad.

 

[chalee94]

Thats what rofr is designed for, so things mever hit rock bottom price or they wouls buy it all up and resell it.

i don't see why disney wouldn't love for this to happen - for resale values to drop to $1 so they could scoop it all up and sell it directly for big bucks...

i think it's a chicken/egg kind of thing.

some people think that's true (ROFR driving up resale price) - and in small dollar cases, it makes a little sense. it leads some people to go farther and suppose that disney ROFRs resales to prop up values for current owners (which is definitely not true).

in small dollar cases, i would agree that if i wanted to buy AKV and i knew disney was ROFRing AKV contracts below $90 (just a random number), then i might offer $90 per pt when i otherwise would have offered $87-88 per pt.

but if i thought AKV was worth it at $80 per pt, i would be more likely to offer $80 and if it were ROFRed, then i might drop out of the market entirely.

i tend to think disney bases ROFR decisions on a number of factors - that ROFR is designed to give disney more options (to annoy resale buyers and to profit from desperate sellers moreso than any residual effect on resale values). one factor is how well they are selling contracts directly. and to the extent that demand is very strong for direct purchases, i think demand will also be very strong for resale purchases (meaning the resale values would be increasing regardless of ROFR).

so i mostly think the intrinsic value of the contracts (based on supply and demand) does more to drive ROFR than the other way around.

i will add that in the "great recession" disney dropped out of the ROFR business for a year or so (except for a handful of BCV contracts). resale values dropped (as i'm sure direct sales dropped), but didn't completely collapse without ROFR to "prop them up." but disney definitely did not want to get stuck with extra inventory that they might have trouble reselling.

 

[Gryhndmom]

I personally think It is driving up resale prices. Still trying to buy 100 pts, Dec Use year for BLT and prices are going from 127-135. A couple months ago 120 was the average. Resale still cheaper than buying direct at 170 but if resale keeps creeping up then it will be worth it IMO to buy direct for the extra benefits of using points for cruises and adventures by disney etc.

 

[DougEMG]

I think that Disney exercises ROFR because they have a customer wanting points, never just to stop the resale price from dropping. Most people have no clue there is a resale market, so why try and support it.

 

[MxRacer965]

I think demand is just really strong right now. If you look around at some of the major resale sites they have hardly anything available right now. And what they do have most of it shows a sale pending. We purchased 130 SSR around this time last year with UY 2014 and 2015 points available for under $70/pt. We were considering adding ~50 more at AKL since we stay there most (SSR were easier to come by and cheaper so we got SSR) and would like to have the 11 month booking window, along with a few more points so we can perhaps take 2 trips a year. Prices seem a lot higher than last year though, and inventory seems a lot lower than before as well. Basic suppy/demand. No supply, prices go up...