Disney's ROFR threshold these days?

[JimMIA]

I don't know... I would think that unused points going to waste must mean rooms someplace not being used, which they could then sell for cash payers. Just conjecture.

Well...this is ALL conjecture! If you get involved in the resale process, you'll wish we had more concrete ideas.

By my comment above, I didn't mean to say that Disney would just throw extra points away. Of course they'll use them. My point, though, is that I did not think they would effectively pay extra to get banked or available points. If they did, you would expect to see them ROFRing any contracts with a bunch of banked points, but I haven't seen any evidence of that. I suspect they are taking the longer range view and basing their decisions mostly on bouying up the sales prices for SSR, and meeting whatever waitlist requests they have.

This makes the advertised cost per point LOOK higher (and makes us feel like we've got a better chance at passing), but the actual cost to the buyer OR to to Disney if ROFR'd remains the same. If I were the Disney ROFR dude, I wouldn't be fooled by this. (I.e., 150 point contract: 1) $75/point, buyer pays $450 closing = buyer ends up paying $78/point; vs. 2) $78/point, seller pays closing; these are the same.)

Yes and no. If you look at it as the buyer, you are 100% right -- the cost to the resale buyer is the same in both scenarios. That's actually the point of the exercise.

But Disney is not in the same position as a resale buyer, even though they are buying the contract. Disney closes their own contracts (I'm sure for virtually nothing). For them to ROFR the above contract, they would have to pay $78...period. Sure, they could require the seller to handle the closing (either by reimbursing them or by actually going through one of the title agencies), but they would still pay $78...which really IS $3 more to them. And that $3 could be what makes the difference in passing ROFR.

In any case, I think it's become clear that as a buyer of a resale contract, haggling over the contract terms matters less than whether Disney will ROFR you if you haggle too well.

Clear to you and me, but you still see a bunch of contracts on the ROFR thread that just make you shake your head and wonder what the people are thinking.

Out of curiosity, has anyone here been around long enough to have a sense of a historical trend (say, over just the last two or three years) of ROFR levels, and concomitant changes in price per point on the resale market?

Tom has, and he says above ROFR rates have risen from about 7% of the contracts to about 15% in his most current analysis. As the cost of new DVC contracts rises, obviously Disney uses ROFR to create a corresponding rise in resale prices. If they didn't, everybody would buy resale and that would undermine their new sales. Disney is going up on their SSR prices in June, and you watch how quickly the ROFR threshholds rise!

ROFR has actually allowed some of the early owners of DVC to make nice profits when they sell - some have bought at $58 and sold at $75-80, which is pretty unheard of with timeshares.

 

[T.E. Yeary]

Tom, with regard to at least BWV,



has it, or does it seem to matter if a contract has any '05 points and/or '06 points coming?

We have researched the deals and NO, there doesn't seem, at this point in time to have a correlation to points period.

Our best guess, and believe me that's what it is, a best guess, is DVC has someone on their add-on list with that particular use year and point structure.

Tom

 

[awatt]

Looking at the BWV recent history from JimMIA is a real eye=opener. Seems as though our bid for $78/point at BWV could go either way with ROFR. Will be happy when we have an answer soon.

 

[T.E. Yeary]

Thanks Tom, for sharing those closng prices pp at BWV. And to Jim too, for adding in some from Beca's list. Since I bought at BWV, I was even more interested!!!!!

As Tom said, my broker told me that she felt $76 a point was scary re ROFR, adn I bumped it to $76.50...Actually, since the contract read that seller would pay maintenance fees...the contract price was $80.50 per point. My reasoning was that the seller had already paid the maintenance in full in January, and I doubted that Disney would reimburse them if it ROFRd (tho I don't this for a fact...maybe Tom could help with this question. But Disney would have to pay them $80.5. My second reasoning was that I had the entire amount of 2004 AND 2005 points FREEEEEEEE!!!!! ( well, you know what I mean!)

I think it has something to do with USE YEAR. For some reason, i don't think old Disney can change the use year of the contract they buy when they sell it. So, if there was a waitlist for my use year and a similar number of points as I had....then Disney might be more eager to snatch it up. My use year, February, doesn't seem to be as popular as some....so maybe BWV buyers weren't waitlisting that use year. And that is all I am going to say about that!

In ROFR, the contract must to be purchased exactly as it is written. If the contract called for reimbursement of maintenance to the seller, Disney would have to honor it and reimburse.

Tom

 

[T.E. Yeary]

Agreed. I was very appreciative as well for Tom sharing the information, but I think we all know that the usefulness of the information is limited, without details on:
- banked / borrowed / remaining in current UY / reservation(?) / held(?) points
- who pays closing costs (default seems to be buyer?)
- who pays transfer fee (default seems to be seller?)
- who pays maintenance fees of current UY (default seems to be buyer?)

I'd be surprised if a realtor / broker could legally (or possibly even ethically) share all the details of the information. On the other hand, aren't some aspects of real estate transactions part of the public record?

All of these are likely to factor in the DVC ROFR Guy/Gal's decision (as well as whether an existing waitlist request matches the contract). (Related to this, it seems people believe that DVC can split and/or consolidate ROFR'd contracts with UY, right?)

I'm developing a paranoia delusion. I imagine the DVC ROFR guy following these posts, and laughing maniacally. Or maybe, sighing with pity as he/she dropped the axe on another one of us.

Joe

I am not at liberty to discuss each ROFR'd contract in detail. All the nitty gritty details are not a part of the public record.

The reason for the post about the latest ROFR'd was to determine if there had been an increase in the number of buy backs.

Which did show, at least by our company records, that in fact there has been an increase, but nowhere near the specualtion, being bantered on the board. Our stats showed a 15% buy back potential.

I have no way of knowing what other Resale companies or FSBO's might be running in their statistics.

Bottom line to anyone purchasing a Resale, make your best offer, and let the chips fall where they may.

Best wishes,
Tom

 

[d-r]

A long time ago this question came up to me, and I've never really heard an answer for it. What if someone wanted to trade me a car, or other property, or live stock, or whatever, for my dvc points? How would rofr handle that?

 

[JimMIA]

A long time ago this question came up to me, and I've never really heard an answer for it. What if someone wanted to trade me a car, or other property, or live stock, or whatever, for my dvc points? How would rofr handle that?

Tom, I swear I did NOT put d-r up to that question!

 

[JimC]

My sense is that all of the factors mentioned are going to factor into the equation and that DVC is failry sophisticated in making those decisions. I expect they have a model that assists them on this.

Essentially DVC wants to know how much it will cost to acquire the contract and how many points they are acquiring, the use year, resort and wait list demand.

 

[isyt]

I had a WL 300 pt property that had 160 banked at $75 a point and Disney exercised their rights ( bah hum bug) Now I'm waiting to hear about a 400pt WL with 400 pts banked. I'm prayn' this goes through. WIsh me luck!!!

 

[Dean]

A long time ago this question came up to me, and I've never really heard an answer for it. What if someone wanted to trade me a car, or other property, or live stock, or whatever, for my dvc points? How would rofr handle that?

I can answer that to a degree and I've posted the info previously. I had a direct trade with me trading a fixed week timeshare even for 50 OKW points. The contract was written that way as the trade. DVC came back and had us put a value on the items. My first inclination was to push it and not put a value but I wanted the points and it was an even exchange. So we just picked a number that was obviously high enough not to trigger ROFR but within a reasonable value for each item. I did wonder what DVC would have done if we'd pushed it. And there are similar approaches like requiring a transfer of points to the buyer by name initially in the contract proceedings but before closing or even ROFR submission. IF DVC took it, the buyer would still get the points transferred. Or specifying the closing company and making it someone DVC would prefer not to work with like Timeshare Transfer, esp since they do their own closings. Or giving the seller a ROFR on top of the DVC one. There are many variations I could think of along these lines.

 

[d-r]

Thanks, Dean