Disney's Long Term DVC Strategy

[byurick]

Really curious to see how LSL plays out on these boards between the constant posts about restrictions being bad while also being excited about a shiny new resort with a lazy river. I bet a lot of people here will secretly buy it and not admit they did

 

[haletiki]

You bought it cheaper, but you also bought a less flexible product, as it lost some "functionality" in the resale as the restrictions came into force. Good for you, if this is the only thing you want (which appears to be the case for you). Not so good, if someone would have liked flexibility at a lower price.

Cuts both ways right?

Those who want flexibility at a lower price have choices to make in regards to where they buy if they buy resale. You still have the option of getting one of the O14 resorts on resale for instance. If the prices are still not low enough then maybe the product isn't for them or they need to have some discussions about what they are able to give up to get the product they want.

For my wife and I, resale was always going to be the play if we ever took the plunge simply because there is no way we could afford direct. So, we made our peace with it and we know there will be things that we will miss out on because of that. The goal like @Brian Noble said

The name of the game is taking affordable vacations, and this is helping me do that.

 

[Brian Noble]

I was never against restrictions, and we have always been at war with Eastasia.

(In other words, I once believed I would never buy from the developer, and I would never buy RIV. Yet, here I am.)

 

[byurick]

..... we have always been at war with Eastasia.

Which bus driver told you that? Name names!

 

[Brian Noble]

I don't remember much of 1984, but I definitely remember that passage where the orator switched enemy states mid-speech.

 

[Mirabell Rose]

While a couple of the new resorts don’t currently allow you to book them with resale points, there is no guarantee this will be the case in the future. Just like the poor value of points conversion for cruises and the exchange hotel option, Disney could institute the same sort of exchange rate for resale points. For that matter they could have the rate be different for each resale resort depending on how much availability they want at a particular DVC resort for cash guests, and how well they are filling the restricted resort. No need for a trust for the older resorts under such a model.

 

[tx911]

I'm wonder whether they would ever move to incentivize direct purchases by implementing tiered perks based on total number of direct points owned. These would obviously have to have teeth to be effective. I'd wager that something like free annual passes at a certain direct ownership level might move people to purchase more direct points above and beyond the 150. However, I personally hope they don't ever go this route!

 

[Sandisw]

I tend to agree with this analysis but I also think the resale product being 50% of the value of direct will hurt DVC’s direct sales over time—maybe there are enough new people to churn through over time, but I think a lot of people who joined before 2020 or so are much more comfortable financing and buying more because they assume they can always get back out and resale values will go up over time…as recently as last year people were still arguing on these boards it would continue on that way and that the past few year “dip” was simply a short term slump—but it doesn’t appear to be going back up even in a good economy and even as inflation was high in ‘22-23, I think direct buyers of new restricted resorts are likely to be underwater for at least a decade or two, if not the life of the contract (at least adjusted for inflation).

In my opinion, it will hurt Disney most with sophisticated affluent repeat buyers like many on these boards. We might keep buying enough direct to qualify for Y card benefits, but unless there’s some benefit to buying more than 350 (the current amount I have), I don’t see myself buying a restricted resort at $200/pt that I will be lucky to resell at $100/pt unless I absolutely have to stay there (so basically new BCV or front of Epcot resort are the only possibilities for me ever buying restricted). For now, if I ever need more points, they’ll be resale at BCV/VGC or maybe AUL if they dip low enough.

That makes sense but I also think there are a lot more owners who do not care about resale value to the degree that some here do.

Where they want to stay outweighs that. Just like you mention that you might consider if they fit your needs to overlook them.

I think a lot of us who ended up buying RIV did so because once we stayed, we realized it is well worth it.

Every buyer who has bought a resale contract at a restricted resorts did so because they want exclusivity at that restricted resort.

I think it will come down to each resort and how thet sell it. LSL has some things people are looking forward to and it may be enough to overlook it as buyers have with RIV and VDH.

 

[Sandisw]

You bought it cheaper, but you also bought a less flexible product, as it lost some "functionality" in the resale as the restrictions came into force. Good for you, if this is the only thing you want (which appears to be the case for you). Not so good, if someone would have liked flexibility at a lower price.

If someone wants flexibility, then a restricted resale product isn’t the right now.

Of course, as more resorts are restricted, and resorts expires, buyers are going to have to choose whether resale provides what they want.

Which is exactly why DVD has done it…over time, direct wlll be the way to go for those who want that flexibility and resale wlll be for those who are okay with staying at one place.

 

[Girlstar30]

I think that in 5-7 years it won't matter that there are restrictions and that Riviera will start holding its price higher as the 2042's dwindle (and it gets a refurb) and direct prices keep rising with the inevitable restrictions. The product was always a timeshare with all that goes with that but for about 30 years Disney was able to sell the 'club' idea.

It will be interesting to see if once these og contracts start expiring, if the price of resale goes up as more restricted resorts are built.

I always think there will be a high demand for Disney and I dont think those of us that have restricted contracts will have it devalued as much as people think. As long as the price is cheaper than renting/rack rate/promotions, I definitely wouldnt sell my points for cheap and I dont think a lot of other people will either.

With the billions they are pouring into Disney forward, I feel very confident with my direct choice and although it is a timeshare, I honestly forget that's what it is at times. My biggest fear buying into DVC is that they were going to not care about us anymore once they "got us" That couldnt be further from the truth. I do feel valued as a member when I stay at the resorts and I do think they fulfilled all of my expectations and even more.

I cant wait for my first trip to Aulani and getting to share that with my sister and nieces and my wifes birthday celebration coming soon with friends! Disney promised to create memories and I think theyve done a fantastic job at that!

I will still feel like im in a club as long as i get to swap out some resorts and with the sense of community we have going on here and the events they provide us

 

[Girlstar30]

I think that in 5-7 years it won't matter that there are restrictions and that Riviera will start holding its price higher as the 2042's dwindle (and it gets a refurb) and direct prices keep rising with the inevitable restrictions. The product was always a timeshare with all that goes with that but for about 30 years Disney was able to sell the 'club' idea.

It will be interesting to see if once these og contracts start expiring, if the price of resale goes up as more restricted resorts are built.

I always think there will be a high demand for Disney and I dont think those of us that have restricted contracts will have it devalued as much as people think. As long as the price is cheaper than renting/rack rate/promotions, I definitely wouldnt sell my points for cheap and I dont think a lot of other people will either.

With the billions they are pouring into Disney forward, I feel very confident with my direct choice and although it is a timeshare, I honestly forget that's what it is at times. My biggest fear buying into DVC is that they were going to not care about us anymore once they "got us" That couldnt be further from the truth. I do feel valued as a member when I stay at the resorts and I do think they fulfilled all of my expectations and even more.

I cant wait for my first trip to Aulani and getting to share that with my sister and nieces and my wifes birthday celebration coming soon with friends! Disney promised to create memories and I think theyve done a fantastic job at that!

I will still feel like im in a club as long as i get to swap out some resorts and with the sense of community we have going on here and the events they provide us

@Brian Noble detailed a lot of the steps Wyndham took in the past. The one thing I absorbed is that it seemed pretty thorough with regard to how owner's renting out was hobbled. Perhaps he would be willing to repost his knowledge. My thoughts are that as more resorts become restricted and DVC has moved towards the industry norm they will insert stronger language in their contracts to benefit their side. They are pretty much guaranteed to have an edge so long as they keep the parks viable. It's all about money, corporate money and Disney is no different. We just get sold the pixie dust angle and we like it.

As long as Florida laws allow for renting i would think they cant do anything to completely stop that. Im no expert and could be wrong. If renting wasnt allowed i would sell some of my contracts and it definitely would not encourage me to buy more direct dvc down the line. We want to do other vacations besides Disney and my dvc points whether used, swapped, or sold are for my vacation purposes only

 

[Girlstar30]

Does Universal have a timeshare?

Aside from that point. Universal isn't the same as Disney. Disney has a hold on many people, there is something with the nostalgia that takes hold in a way that Universal cannot and will never be able to replicate.

I would be in trouble if they did because I would want to own at Portofino

 

[walt34]

Which is exactly why DVD has done it…over time, direct wlll be the way to go for those who want that flexibility and resale wlll be for those who are okay with staying at one place.

My guess is that they'll offer a way to 'wash' resale points as other timeshares have done before we reach the point of every resale being restricted to one resort, maybe even before 2042.

 

[Girlstar30]

I've seen it in several YouTube videos. It was random, then it was on the activities calendars and I think it went back to random.

Ive seen them at riv and vero beach

 

[Brian Noble]

My guess is that they'll offer a way to 'wash' resale points as other timeshares have done before we reach the point of every resale being restricted to one resort, maybe even before 2042.

Maybe, but I have my doubts. To misuse a meme at Coasterbuzz: If they thought they needed to wash resale points, they'd already be doing it. In particular, I think it is VERY unlikely that DVC will go the Marriott route where even with washing, resale is significantly less expensive than direct. I expect that for DVC any hypothetical mechanism might ultimately save a little. It will not save a lot.

I bought restricted resale points under the assumption that their booking privileges would never be expanded. If there is some way to expand them (and it is not rapaciously expensive) I will be pleasantly surprised.

 

[Girlstar30]

Disney is a money making machine. There's no way they'll extend current owners on those low point charts. If anything, they'll refurb and sell it on a new point chart, closer to Poly Tower, I'd bet.

Bwv and bcv are two of the most popular resorts. They will def be resold with higher point charts if they stick around.

 

[Girlstar30]

Exactly, that was what I was thinking. Putting aside the changes they have made to increase revenue, I haven't personally seen a dip in quality even at SSR or OKW. I don't see them suddenly doing that but open to hearing why someone else thinks that they might.

I would say bwv used to have more offerings in the past (way more options on the boardwalk), same with vb (better activities) and ssr (a huge spa) and akv had sv at night. I think getting rid of these offerings does make the resort decline but not by way of upkeep, just it used to be better with more offerings when it was on sale or newer than now. I think there are some major flaws with vdh that theyre not trying to hide or not doing a very good job of it if so and it is actively on sale so theres that, but I also think the fl dvc resorts are run way better than California

 

[walt34]

Maybe, but I have my doubts. To misuse a meme at Coasterbuzz: If they thought they needed to wash resale points, they'd already be doing it. In particular, I think it is VERY unlikely that DVC will go the Marriott route where even with washing, resale is significantly less expensive than direct. I expect that for DVC any hypothetical mechanism might ultimately save a little. It will not save a lot.

I bought restricted resale points under the assumption that their booking privileges would never be expanded. If there is some way to expand them (and it is not rapaciously expensive) I will be pleasantly surprised.

My assumption is that they won't be able to convert every resale owner who might be interested in more flexibility to direct, if that involves selling the resale points and buying direct. Offering them a way back into the system at somewhat better conditions might also improve the booking chances of direct members at other resorts (as resale owners won't be moving at 7 months).

In the end, it's an untapped potential to make some money with little effort and there might be a point when someone in DVC management decides to grab the opportunity.

But I'd of course also never buy points with the expectation that the system might change to my advantage.

 

[Girlstar30]

Of the two, I think Vero is more likely to survive if you had to pick one... why?
- Closer to the Orlando mothership for synergies
- A larger property
- Has a full-service spa, restaurants
- Oceanfront location
- In my view, tougher to attract a buyer

HHI I could imagine being more attractive to one of the majors who already have significant footprints in HHI...

I don't know if Disney wants to deal with selling VB to a third-rate timeshare operator or hotelier and then deal with headlines about the "former" Disney property...

Now, selling to a developer who would raze the property and put in mega mansions.. that might work for them...

But personally, I think both of them are gonzo come shortly after 2042...

I wonder if it would be a hard sell for them to resale vb after 2042 especially after others see how low its value has gone compared to other 2042s at this stage and the high mf it requires

 

[HyperspaceMountainPilot]

Counterpoint. There are people like myself, who do lots and lots of research, make their peace with the resale restrictions because we decided we love a resort like RIV, and we must have what we want, losses be damned. And, we buy 600 direct RIV points and have no regrets . If I had to sell it all tomorrow or even give it away, I'd be fine. No, not everyone is in that boat, and I'm grateful I am.

I could be wrong but I think having the financial capacity to buy $110,000 of timeshare and then resale shortly thereafter clearing about $50,000 (without your family feeling an economic hit!) is well beyond the vast majority of DVC direct buyers... though if you scale down to a more typical 200 point purchase, then you're talking about 35k and clearing 17k? and that's no different than buying a new car and trading it back a year or two later, I suppose. Also, as evidenced by the RIV foreclosure flow discussed recently, plenty of purchasers who don't have the financial capacity to burn $20-50k do it anyway and I guess Disney isn't worried about that!

Really curious to see how LSL plays out on these boards between the constant posts about restrictions being bad while also being excited about a shiny new resort with a lazy river. I bet a lot of people here will secretly buy it and not admit they did

Just remember, there's already a beautiful resort with a lazy river and unrestricted points (that are also way way way underwater if you bought them direct this decade).

I'm wonder whether they would ever move to incentivize direct purchases by implementing tiered perks based on total number of direct points owned. These would obviously have to have teeth to be effective. I'd wager that something like free annual passes at a certain direct ownership level might move people to purchase more direct points above and beyond the 150. However, I personally hope they don't ever go this route!

I was going to like this post but I hope they do go this route... ideally at a number I already own but I do think somewhere like 500 (far more than I own direct) would be a smart play to get a lot of us "entry level but susceptible to FOMO" owners to get us to swap some resale contracts for new points... frankly, it would cost them almost nothing to say "at 400/500/600 you get to pick one MM event each year, and at 1000 points you can pick 2"... at least, I presume that less than 5% of the membership hits the first threshold and less than 1% of the membership hits the second.