Does anyone else think the OKW 15 year extension will add value?

[thelobstershanty]

Dean makes some very good points.
But, I am among the camp, that will most likely not be here after 2042, let alone any post 2042 date. Of my 2 adult children,at this point, only 1 is interested in a DVC membership. She already knows if her family wishes to extend my DVC contract--the decision and the purchase price, is entirely theirs.
God willing that I am still on this earth in 2042----I honestly believe at that point---I will have had my fill of Walt Disney World! LOL!!!

 

[BUDDYBEAR]

IT DEPENDS ON ROFR : IN 2057 I WILL BE 115 YEARS OLD I AM NOT SURE I WILL BE THERE

 

[goldilocks_63]

I voted yes for the resale value...

I had posted a thread earlier, and 2 of the people buying said that they would have purchased OKW if it had the later expiration date. Everyone else said no (for valid reasons I believe)...

But....

To give you perspective on my thinking, I just sold my townhouse. I found out I made 2 mistakes - didn't buy the golf course view becuase it cost 20K more (15 years ago - didn't have the $$), and made 3rd room into a loft verses bedroom.

I don't want to look back 5-10 years from now when I sell, and say I wish I had bought the extension. And I guess I'm a contrarian, so since everyone is saying don't do it, I do the opposite.

I know it's a risk. If I'm wrong it's not the end of the world. I think I'll get at least half of the $15 back, if not more.... But at least the contracts will sell, and still at a profit.

I'm looking at this as a way to protects me so when I need to sell, I'll be able to..

JMHO, Goldi

(Flame away)....

 

[rayelias]

I don't know if DVC will sell (buy/add on) at OKW with the option of the 2042 or 2057.

If they do, I doubt highly there will be a $15 difference.

I also doubt that there will be a $15 difference in ROFR.

I also doubt that there will be a $15 difference in resale value.

The smart money says decline the $15 offer.

 

[tvwalsh]

Many people today cannot sell their homes. These are nice homes but in a market that has too many homes for sale and too many warry buyers. This could be the situation owners of OKW2042 contracts could find themselves in if DVC continues to do things that devalue the product, or if they reduce ROFR purchases, or if the economy take a serious dive south! At least OKW2057 contracts will sell first, at some price, and the owners will be able to get their money out.

If this seems too pessimistic for the Christmas season, I do apologize!

 

[BWV Dreamin]

In general I don't agree that the decision to extend flows from the decision to own. IMO, the $$$ vs benefits are FAR different for the extension than for buying in currently even at the current retail price. Personally I'd be very comfortable extending any contract if I felt the $$$ justified it and I'm pushing 50. I simply don't think the $$$ justify the decision for anyone to extend and that's true for anyone where buying in makes sense and regardless of their age including those in their 20's. I think it's an easy decision at $5 pp and an iffy one that depends on circumstances at $10 per point and absolutely no way to justify $15 per point. IMO of course.

Do you think at some point Disney may just mandate this extension if there is not enough response to extend? Not a good analogy, but Vista is not being incorportated into the business world as Microsoft thought. They have extended support for XP, however it will go away at some point. Thus, Vista will be forced on the consumer and business world. Just wondering if Disney might just flex some muscle on this in the future, either thru lower rofr, increased buy backs, or just something that will devalue the 2042's.

 

[dianeschlicht]

Do you think at some point Disney may just mandate this extension if there is not enough response to extend? Not a good analogy, but Vista is not being incorportated into the business world as Microsoft thought. They have extended support for XP, however it will go away at some point. Thus, Vista will be forced on the consumer and business world. Just wondering if Disney might just flex some muscle on this in the future, either thru lower rofr, increased buy backs, or just something that will devalue the 2042's.

How will that change the value for those of us who plan to keep it until the 2042 cut off date? I don't see this as an issue at all for those of us who keep our contract through to the end. Besides, they can't catagorically change that contract without some action from us.

 

[BWV Dreamin]

How will that change the value for those of us who plan to keep it until the 2042 cut off date? I don't see this as an issue at all for those of us who keep our contract through to the end. Besides, they can't catagorically change that contract without some action from us.

The probability that you will sell is higher than if you won't. I'm sure there are some statistics on the buy, sell,and hold of these timeshares. Also, nothing is absolute. A good example....Eminent Domain.

 

[PBader]

I extended my contract mainly because I use all our points every year and I am used to planing that way. I also think that the points per night will be more at the Hawaii DVC and as I get older, I want the flexibility of planing extended stays-3 weeks or longer. I know that I will be pretty old in 2042--but I hope still able to travel and I hope able to travel past 2043. I just don't want half of our points to suddenly vanish in 2042 and the extension was a very inexpensive way to increase the years. Now if I am not able to use them due to health reasons--I hope my son and his future family does or they can be sold.

 

[Dean]

Do you think at some point Disney may just mandate this extension if there is not enough response to extend? Not a good analogy, but Vista is not being incorportated into the business world as Microsoft thought. They have extended support for XP, however it will go away at some point. Thus, Vista will be forced on the consumer and business world. Just wondering if Disney might just flex some muscle on this in the future, either thru lower rofr, increased buy backs, or just something that will devalue the 2042's.

Technically and legally they cannot. What they could do would be to extend for free, still not a bad deal for Disney given they get someone else to cont to pay the maintenance, generate an additional amount of a captive audience, make money on the maint contract, and help keep the maint fees of the other units lower. It is also my opinion that doing the lien against those that don't extend or decline is not supported by the POS and I really wish I still owned OKW so I could test that theory.

Increased buy backs wouldn't hurt the value and would likely increase it. I'm sure they will have a different ROFR though I will be it'll be far less than a $15 pp difference. All they have control over is the price and perks and while they could offer perks to one group and not the other, I doubt they'd go down that road.

The really interesting twist to this is what happens with points that last year for the 2042 folks at any resort that have a mixture of those that expire in 2042 vs later. While we could have the same discussion now for 2057 that we've had for 2042 in the past, this extension does open up some possibilities and removes the certainty of some type of prorated option the last couple of years though it's still a possibility.

I also feel it's a certainty that current members will have the option to extend at a later date for what is effectively less than the current special price on an adjusted basis.

 

[goldilocks_63]

Dean, I don't understand what your saying re:
"I also feel it's a certainty that current members will have the option to extend at a later date for what is effectively less than the current special price on an adjusted basis."

Disney said that the $15 rate will go away, and if you do it later, it'll be $25 per point. Also, traditionally the first price DVC puts out is the best, and only goes up....

Maybe I'm just wearing my rose colored blinders (since I'm obviously in the minority with extending).

Can you tell me how you think a better effective offer will come down the pike?

Respectfully, Goldi

 

[sjdisneywedding]

It will only add value if you plan on selling your contract someday. I will never sell mine, so no, it does not add any value to my contract.

not necessarily true

someone is getting 15 more years of vacations out of those points

thats an added value

 

[simzac]

not necessarily true

someone is getting 15 more years of vacations out of those points

thats an added value

Not if your dead

 

[Dean]

Dean, I don't understand what your saying re:
"I also feel it's a certainty that current members will have the option to extend at a later date for what is effectively less than the current special price on an adjusted basis."

Disney said that the $15 rate will go away, and if you do it later, it'll be $25 per point. Also, traditionally the first price DVC puts out is the best, and only goes up....

Maybe I'm just wearing my rose colored blinders (since I'm obviously in the minority with extending).

Can you tell me how you think a better effective offer will come down the pike?

Respectfully, Goldi

I wondered if I wasn't being clear so I'll try again. I doubt DVD will ever off at less than $15 and possibly not again to those that decline at that price though it wouldn't surprise me if they did. My point was more related to the time value of money and that $15 in 2035 will be worth far less than $15 is today. So even if they offer at $25 per point in 2035 it will effectively be cheaper than today. One can also likely buy a new contract resale later in the game effectively cheaper than the value of the $15 spent today but with the later expiration.

Disney is not going to want to get half of the OKW points back that late in the game. They have to pay dues on them just like the rest of the members and it's unlikely they'll be able to effectively rent them out, they can't do it today. Trying to resell them isn't going to be that helpful. Not many people who aren't already members (at least at heart) are going to want to buy them, esp at a price high enough to justify the effort plus if they're selling full contracts elsewhere every sale is a competition and lost revenue to the new property. And regardless of what many here think, I can't see wanting to own a 50-65 year old wood structure where I don't own the land, 50 is about the limit in my book. I realize that they can be kept up to make them worth owning but at what price (maint fees) and will they keep them up late in the game.

I see DVD being desperate and the only group they can sell to without investing much time money are the then current members. So I do think we haven't seen the last of the specials to extend. Possibly an extension of the offer as well or a second chance. It should be fun the next few years as this not only impacts OKW but the other 2042 resorts as well. BTW, I don't think we'll see VB or HH extended and likely will the rest but we shall see.

 

[JimC]

I wondered if I wasn't being clear so I'll try again. I doubt DVD will ever off at less than $15 and possibly not again to those that decline at that price though it wouldn't surprise me if they did. My point was more related to the time value of money and that $15 in 2035 will be worth far less than $15 is today. So even if they offer at $25 per point in 2035 it will effectively be cheaper than today. One can also likely buy a new contract resale later in the game effectively cheaper than the value of the $15 spent today but with the later expiration.

Disney is not going to want to get half of the OKW points back that late in the game. They have to pay dues on them just like the rest of the members and it's unlikely they'll be able to effectively rent them out, they can't do it today. Trying to resell them isn't going to be that helpful. Not many people who aren't already members (at least at heart) are going to want to buy them, esp at a price high enough to justify the effort plus if they're selling full contracts elsewhere every sale is a competition and lost revenue to the new property. And regardless of what many here think, I can't see wanting to own a 50-65 year old wood structure where I don't own the land, 50 is about the limit in my book. I realize that they can be kept up to make them worth owning but at what price (maint fees) and will they keep them up late in the game.

I see DVD being desperate and the only group they can sell to without investing much time money are the then current members. So I do think we haven't seen the last of the specials to extend. Possibly an extension of the offer as well or a second chance. It should be fun the next few years as this not only impacts OKW but the other 2042 resorts as well. BTW, I don't think we'll see VB or HH extended and likely will the rest but we shall see.

DVD has another problem. If they are having difficulty selling extensions to us; they will have even more challenges selling to a non-OKW owner (at least until 2042 when the new owners could use the points). So they either sell OKW owners the extension or exercise ROFR on every unextended contract and attach the extension then sell. Even then there are owners like us who plan to hold until termination in 2042. This is the real dilemma for DVD -- the cost of sales for a 15 year contract on a 50 year old resort -- the pricing on that would likely cut into any newer projects.

 

[Dean]

DVD has another problem. If they are having difficulty selling extensions to us; they will have even more challenges selling to a non-OKW owner (at least until 2042 when the new owners could use the points). So they either sell OKW owners the extension or exercise ROFR on every unextended contract and attach the extension then sell. Even then there are owners like us who plan to hold until termination in 2042. This is the real dilemma for DVD -- the cost of sales for a 15 year contract on a 50 year old resort -- the pricing on that would likely cut into any newer projects.

Yes, that's what I was referring to in the last paragraph about. I don't see ROFR being the answer though because the $$ are too high for them to come out even with the added extension and will get higher if they take that approach. Plus the other things I mentioned above including paying dues on those points and trying to rent the points. It'll also put them in the situation of possibly going for the better times of year to rent them.

 

[BWV Dreamin]

DVD has another problem. If they are having difficulty selling extensions to us; they will have even more challenges selling to a non-OKW owner (at least until 2042 when the new owners could use the points). So they either sell OKW owners the extension or exercise ROFR on every unextended contract and attach the extension then sell. Even then there are owners like us who plan to hold until termination in 2042. This is the real dilemma for DVD -- the cost of sales for a 15 year contract on a 50 year old resort -- the pricing on that would likely cut into any newer projects.

All of these dilemma's are why I posed the question of DVD somehow forcing this extension on to owner's, either thru voluntary incentives, thru special assessments, or for "free" as Dean has brought up. While I'm not an OKW owner, the outcome will have an impact on the other 2042 resorts.

 

[Dean]

All of these dilemma's are why I posed the question of DVD somehow forcing this extension on to owner's, either thru voluntary incentives, thru special assessments, or for "free" as Dean has brought up. While I'm not an OKW owner, the outcome will have an impact on the other 2042 resorts.

They couldn't force it but they could make you an offer you couldn't refuse along the lines you state.

 

[sjdisneywedding]

Not if your dead

no this is not correct either!

the question is: does the contract have more value with an extension?

whether you sell, dont sell, or are dead or not it makes no difference

the contract is certainly more valuable. its really not a debate type situation

now whether the person paying for the extension gains or loses in the long run is debatable

 

[sjdisneywedding]

DVD has another problem. If they are having difficulty selling extensions to us; they will have even more challenges selling to a non-OKW owner (at least until 2042 when the new owners could use the points). So they either sell OKW owners the extension or exercise ROFR on every unextended contract and attach the extension then sell. Even then there are owners like us who plan to hold until termination in 2042. This is the real dilemma for DVD -- the cost of sales for a 15 year contract on a 50 year old resort -- the pricing on that would likely cut into any newer projects.

this is a good point

Although I would think in 2042, DVC might set a new term on all the expiring contracts.

So those wont go for sale for 15 years now, but maybe 25. It all depends on what they want to do for the future

I dont worry about about the structure getting old, there are wood buildings that have been around for hundreds of years. tons in the North East and thats dealing with the severity of New England weather. Yes these buildings have a ton of use attcahed to them year in year out, but with proper construction and proper maintenance they will last forever if you wanted them too

I worry more about what WDW will be in 50-60 years.