DVC Extras, WHY?

[_auroraborealis_]

The resorts now selling resale like AKV at about $85 are a much better deal than direct at $165 but had you initially purchased at $104 back in 2007 it was a much better deal than resale now.

Most of us will say, though, that you buy where you want to stay, and that how you buy needs to flow from that. If you want Copper Creek, sure, you buy direct. If you want a 25-50 point add on, direct may be your best bet.

For any resort other than CCV and Poly, though, it is hard to economically justify a direct purchase of a larger contract (>50). For those who are really concerned with member benefits, it is rare to find a scenario where a resale + 25 purchase isn't the most justifiable economically.

 

[ScubaCat]

But organic demand is much higher than $30. DVC uses ROFR pretty sparingly. Some would argue that it's just enough to keep resale buyers in check. But resale prices also benefit from the comparison to direct. When Disney is charging $170+, a resale price of $100+ sounds pretty good.

During the recession DVC pretty much abandoned ROFR. Prices did fall, but that was more a function of increased supply and reduced demand.

Without ROFR, the water would find its own level. And as long as DVC is a far cheaper way to vacation than paying WDW hotel prices, there will be buyers.

I'm sure ROFR has a lot to do with what's on their wait list. I doubt they want to hold points on the books very long, but a quick flip at a low price will always be a target. I don't know if "price control" is the right term.. it could be more psychological to keep prices "honest". Sort of like how a speed trap makes everyone watch his/her speed, even if only one in 100 speeders get stopped. Just knowing there is a possibility of ROFR can affect people's bidding.

DVC is a much different offering than standard WDW hotel rooms. I find the price comparable, but that's comparing a regular BC room and a BCV 1BR villa. For comparable prepaid cost, the villa offers a lot more to us (laundry, kitchen, separate room, king bed, tub, etc.) than a regular BC room, so even at a comparable price, it's well worth it for us to buy DVC. (And I don't have to stalk the coupon and pin code forums either )

 

[ScubaCat]

Disney have done a stellar job of putting lipstick on a timeshare.

It was interesting to see the tide turn in attitude a few years ago on this board. It was like a jilter lover where quite a number went from love to hate. But interestingly they started complaining and talking bad about DVD/DVC but most still continued being an owner or even adding on. In many ways we passed the line of reasonableness in terms of product vs cost vs hassle some time ago but yet people keep buying and resale is double what it was at the low point.

We are gluttons for punishment, aren't we? At any other place, that thing we were served at Tony's last September would be the first and last straw (I wouldn't call it a "meal" because nothing we were served qualified as "food"). But we just keep coming back. Despite being almost entirely profit driven, Disney is still one-of-a-kind in so many ways, and we can just never seem to get enough!

 

[Littlelulu01]

Most of us will say, though, that you buy where you want to stay, and that how you buy needs to flow from that. If you want Copper Creek, sure, you buy direct. If you want a 25-50 point add on, direct may be your best bet.

For any resort other than CCV and Poly, though, it is hard to economically justify a direct purchase of a larger contract (>50). For those who are really concerned with member benefits, it is rare to find a scenario where a resale + 25 purchase isn't the most justifiable economically.

Agree. Add to this that many resorts are not even taking waitlists or selling direct. I've asked my guide countless times about adding on at GFV and GCV. No waitlist and no points available. BCV is getting ROFR'd frequently enough as well as BLT so you can get those direct. The BCV high resale prices make me too uncomfortable for a 2042 resort though. When AKV was selling direct at $104 in 2007 there was an $8 per point incentive. Add to that no closing fees for direct at the time and the previous years points with no mf's, current year prorated and you are down pretty much in line with what AKV is selling for now 10 years later on the resale market. If a person wants AKV now and anything over 50 points, yes resale is the best bet. If a person wants CCV now would be the time to purchase. I was just saying that direct purchase seems to always make the best sense IF you want a resort currently actively marketed, AND that resort is a new offering. Aulani at 7 years post offering doesn't qualify. I guess Poly direct is still a better deal than resale given the extra uy points and incentives as well but CCV right now is probably never going to be a looser if you want that resort. I don't know if they are still offering it at $169 for 150 points plus.

 

[tjkraz]

I'm sure ROFR has a lot to do with what's on their wait list. I doubt they want to hold points on the books very long, but a quick flip at a low price will always be a target. I don't know if "price control" is the right term.. it could be more psychological to keep prices "honest". Sort of like how a speed trap makes everyone watch his/her speed, even if only one in 100 speeders get stopped. Just knowing there is a possibility of ROFR can affect people's bidding.

I agree ROFR plays some psychological role but would object to the $171 vs $30 price points cited earlier. Even now, there's a reason that resale prices vary greatly when comparing the likes of HHI vs. SSR vs. BCV vs BLT. Those price variances are driven by consumer demand, NOT DVC's chosen ROFR threshold.

Without ROFR average prices may drop to some degree as buyers test the waters. But ROFR isn't what's keeping Boulder Ridge points at $85 rather than $30 per point.

 

[ScubaCat]

I agree ROFR plays some psychological role but would object to the $171 vs $30 price points cited earlier. Even now, there's a reason that resale prices vary greatly when comparing the likes of HHI vs. SSR vs. BCV vs BLT. Those price variances are driven by consumer demand, NOT DVC's chosen ROFR threshold.

Without ROFR average prices may drop to some degree as buyers test the waters. But ROFR isn't what's keeping Boulder Ridge points at $85 rather than $30 per point.

I agree to a point. ROFR is more of a "nudge" than a control. Obviously they don't want to buy back every contract; more like a small percentage, really. That said, if I made a $30 offer on one BRV contract and an $85 on another, the $30 is a much more likely to be bought back. Granted, that's likely due primarily to a higher margin for them to resell it themselves, but it does have the net effect of curbing low ball contract prices.

 

[Dean]

We are gluttons for punishment, aren't we? At any other place, that thing we were served at Tony's last September would be the first and last straw (I wouldn't call it a "meal" because nothing we were served qualified as "food"). But we just keep coming back. Despite being almost entirely profit driven, Disney is still one-of-a-kind in so many ways, and we can just never seem to get enough!

IMO it's more about expectations than reality. To me, and technically, DVC is simply a timeshare. A nice one basically because of theming and location but worse than many I deal with in function. Disney and DVC create an illusion that's not nearly as true as some seem to think. It's a place to sleep and it can save money over certain options but not many of the options available. I'm OK with that up to a point though it's sad that in all the areas where they fall behind, it's by choice and in most by lack of effort, leadership. It's like someone who has things handed to them and doesn't take care of them.

I agree to a point. ROFR is more of a "nudge" than a control. Obviously they don't want to buy back every contract; more like a small percentage, really. That said, if I made a $30 offer on one BRV contract and an $85 on another, the $30 is a much more likely to be bought back. Granted, that's likely due primarily to a higher margin for them to resell it themselves, but it does have the net effect of curbing low ball contract prices.

ROFR only comes into play when the real price (price people are willing to pay) is close to that level. I'd venture to guess that historically ROFR has had minimal impact on the sale price a fairly small % of the time. All it really does is prevent fire sales and create the illusion of the ability to resell. And in spite of what many think, DVC doesn't really want the points to sell, they want to sell the new development. They tolerate the ROFR points as a means to an overall end and take the advantage to make a few $$$ on them. They do not make a killing on those, the likely make less overall in every case than they do on the new resorts.