DVC - I Just Don't Get It

[fortwilderness]

Hi,

I have been curious about the whole DVC concept for quite a while now. I read the FAQ but it didn't tell me anything that I didn't already know. I understand about how DVC could look good initially but it seems to me that the addition of the maintenance fees would make it cost so much more than just paying as you go. I just saw a BWV DVC for resale on eBay and the maintenance fees were $3.93 a point per year. If one was to just buy the 150 point minimum in DVC that would be almost $600 dollars a year just for maintenance fees. I just don't get it.

It is just so easy to get really nice discounts on the Disney hotel rooms most of the year. The only times I have ever paid rack rate was during the Christmas/New Years week. Plus the whole thing about the property reverting back to Disney in 2042 would make me really uneasy about buying. Also it seems that you lose so much point value by staying in Disney resorts out of the DVC. Don't you worry that you will get tired of your DVC resorts in the next 40 years ? I know that they just keep building new DVC resorts but don't you hate the restrictions ?

Also the whole thing about the weekends costing so many more points than the weekdays? Why do you think Disney did that to the DVC ? I mean I know why (to make more money) but did they give you an excuse as to why when you bought your membership ?

I am very curious about how people come out ahead with DVC. For example, we usually stay in the Fort Wilderness Cabins for 2 weeks a year at an average rate of somewhere around 250 a night with tax. They sleep 6 adults, have a full kitchen and a private bedroom. I know that I will be going to WDW almost every year for the rest of my life and wonder if I somehow could come out ahead with DVC. Would I be able to get more for my money with DVC than with the Fort Wilderness Cabins ? Am I missing something ?

I thank you in advance for any responses

 

[IslandHap]

Also the whole thing about the weekends costing so many more points than the weekdays? Why do you think Disney did that to the DVC ? I mean I know why (to make more money) but did they give you an excuse as to why when you bought your membership ?

It was explained by my guide that Disney did this to prevent those who live near WDW from going to Disney, and filling up the DVC resorts every weekend. Artificialy, this keeps reservations balanced through out the week.

$250/night (for a Wilderness Cabin) X 14 nights = $3500. That would quickly pay for enough points to enable you to reserve a 2 bedroom villa that would sleep 8. I'll bet you won't be able to get that same $250/night, rate 20 to 30 years from now.

DVC is not for every one. If you are happy with your current vacation habits, I'm sure no one here will try to convince you to change, or buy DVC.

I bought DVC to help pre-pay, and maximize the enjoyment of my family vactions for the next 40 years. If I change my mind, I can always sell my points, and probably make a profit.

Hang around here, ask specific questions, and who knows, you might just change your mind.

 

[IslandHap]

Here's a couple links to sites that pushed me over the buyers edge:

An Internet Debate on the DVC

Comments on A Financial Analysis of DVC Membership

Another Financial Analysis of DVC Membership

 

[Nanajo1]

I bought DVC after planning a family trip. The total of one family vacation was equal to buying into DVC. We plan to take our family (kids and grandkids)every other year. We have enough points for DH and I to vacation every year as well. We don't expect to go to WDW every time. The options are endless.

 

[ZerasPride]

I look at DVC as a prepaid vacation plan, a timeshare yes, but with much more flexibility than the average timeshare. A lady at work bought into a timeshare in Orlando and when she explained all the restrictions (can only go a specific week of the year) and fees (in addition to dues, if she wants to exchange out to another property in the network or even exchange her week it costs quite a bit of money each time). I explained to her the simplicity of DVC and she seemed upset with her purchase. She was obviously not informed going into her purchase and did say she went to the presentation for free Wet N Wild passes not to buy a timeshare.

Anyway, DVC is very different from the average timeshare. Like you, I plan on visiting a Disney resort every year but not necessarily on Disney property. My family purchased a DVC interest at Hilton Head and we love it! When we do want to stay on property there is no exchange fee unlike with the lady at my job. I make one monthly payment and don't have to worry about accommodations. When my mortgage is paid for, yes, I'll have maintenance fees to pay but that's it. Even if I pay, for example, $1,000 in maintenance fees a year, that averages out to about $80 a month. I can handle that. In 10 or 20 years, how much will a room at the Grand Floridian cost? And that room won't have a jacuzzi tub, washer, dryer, refrigerator or the spaciousness of a one bedroom at a Disney resort.

As another poster mentioned, DVC is not for everyone but it works very well for me and my family and I am so glad to be a member!

Lisa

 

[WDWLVR]

I agree with Lisa. We look at DVC as a way to pre-pay for vacation. We were to the point where we were going to WDW every year and it just made sense for us. Now my only regret is that we didn't do it sooner (but to be fair we couldn't afford it sooner).

DVC isn't for everyone and we did a lot of looking into it before we did, but I'm really glad we did it.

An added benefit for us is the ability to bring family. We treated my in-laws to 5 nights at Vero last year and this coming October they are staying in a 2 bedroom with us at Boardwalk.

Yes, weekends are higher because it balances out the weekday points. Sometimes we pay them, sometimes we look at other plans - the best part is we get a choice. That's why we love DVC - because of the options.

 

[crisi]

I'm currently shopping for a resale and haven't bought in yet, but.

I think that for me the kicker was the insurance against room inflation. Sure, there is inflation in the fees, but 5% of $3-4 is a lot less than 5% of $150 (a bargain rate on a Deluxe hotel - we have reached the deluxe hotel stage) - and hotel rooms have historically seen a lot more inflation than the maintenance fees. As we reach different points in life the DVC membership is flexible. We currently will do fine in a studio, and have enough points (at the time of year we travel) to invite friends - in a few years the kids will be old enough that a two bedroom will be wanted

I also don't have to worry about getting the "deal." My point value will stay consistant for the time of year I like to travel.

If I get bored of it in 40 years, I'll sell it, or rent the points out for something more than my fees. Despite the fact that every year is one year less on the contract, the sell value continues to increase on the contracts. A question for you - how do you know Disney will continue to operate Ft. Wilderness and the Wilderness cabins over the next 10-20-40 years? The cabins and campgrounds are a bargain.

I really don't believe it saves a ton of money (a lot of people do), in fact, I think I'm going to come out behind, because now I'll feel the need to take the vacation (and spend the money on airfare, food, tickets) every couple of years, where without the membership, I might have put it off longer. Some people don't think it saves a ton of money, but like the fact that they can pay for their hotel room every month via their fees - kind of like "budget helper" on your heating bill.

It isn't an "investment." But, if you make use of it, and have a certain pattern of travel, it can be a "bargain."

 

[bicker]

Originally posted by crisi
I really don't believe it saves a ton of money (a lot of people do), in fact, I think I'm going to come out behind, because now I'll feel the need to take the vacation (and spend the money on airfare, food, tickets) every couple of years, where without the membership, I might have put it off longer.

And some folks consider THAT one of the greatest ADVANTAGES of DVC.

 

[mikesmom]

You say it's really easy to get nice discounts at WDW. Well, sure, that's NOW - the economy's in the tank and travel is down. How easy was it to get discounts about 3 years ago when everything was booming? And during the boom the rates for hotel rooms went up each year no matter what - and that includes off property!

The DVC keeps a lid on our vacation costs, and gives us extremely comfortable quarters to do it in.

 

[Johnnie Fedora]

With small kids, we decided that DVC would be an ecomonical way to visit WDW, stay on the property and save big $$$ on the food portion of our vacation. Nothing worse than wasting $7.95 for two kids meals that end up in the buspan. I know there are many offsites that offer kitchen facilities, but with DVC we can walk/boat or bus back to our VWL or BCV. for a quick lunch or pool break. The money we save on food during our trips almost pays for the yearly dues.

Example 5 nights at VWL:

Our last trip:
$200.00 for groceries 6 days

If we dine out:
4 people x $10.00/meal X 3meals/day X 6 days = $720.00

Savings: $520.00

$520 pays annual dues for over 135pts.

And that is just one trip. We plan to take 3 or more/year.

Eating in your room also gives you more time in the parks.

And yes, we do also eat some meals out.

 

[RWishbone]

If you are happy with the Fort Wilderness Cabins, then I doubt that joining the DVC is worth your money. However, I have stayed at the Cabins and I now stay at the Boardwalk and there is absolutely no comparison. The Boardwalk offers so much more especially in convenience to the parks and restaurants. Perfrom your same analysis but use a Duluxe resort and you will see the the DVC is a great, no actually tremendous, investment in your future vacations.

 

[Snowgod]

You will need to stay at a DVC resort to really understand why a motel room is not the same. A one bedroon at any DVC is far better than any motel DW and I have ever stayed in. Having our family stay together is a luxury that cannot be valued by cost alone.

 

[DaveH]

fortwilderness I understand your point. For me prior to joining DVC last May, I stayed at the All Stars and was very happy there. So if you take my costs at AS's with 11% current room tax(in other years I can remember it being as low as 8%), I am spending more money. Ok now what are the differences for me?

1. I have a larger nicer room.
2. As a DVC owner on points I do NOT have to pay to use a washer and dryer. I have used them in the past at All Stars.
3. I have my mortgage and dues taken out monthly like any other bill. So for the 1st 10 years I am paying more out of my pocket. The 30+ years after that I am paying less. I spent in the range of $600 or more for a week at All Stars for room only.
4. I have a more places I can stay at and afford with DVC. If you only stay at DVC resorts I currently have 4 resorts (counting BVC) at WDW. I have stayed at all 3 All Stars and the theme is different but the resorts are the same. I have stayed at VWL my home and OKW and they each have a different feel to them.

So I am paying more than I would otherwise but for me I feel I get more bang for my buck.

The only suggestion I have for you is to get a DVC room for 1 or 2 nights during one of your stays to find out for yourself. DVC is not for everyone. I hope this help you understand someother way of thinking about it.

 

[fortwilderness]

Wow, so many responses ! I feel loved

Thank you so much for all of the responses. I loved seeing everyone's reasoning for buying into the DVC. I think I "get it" now !

I thought that it might just be a hedge against inflation but now I see that it is so much more than that. Some people use it as a way to guarantee that they take a vacation, some as a vacation budgeting plan and others to share the magic with friends and family. Plus I agree that DVC is so much better than other timeshare plans since you lose much of the traditional restrictions and extra fees.

DVC is not the right option for me now because I am only 25, getting married in 3 months, and simply can't afford such an investment. But maybe in just a few years a DVC membership would make sense for my family.

I have been wanting to take a trip to Disney's Hilton Head and now I have even more incentive. I want to see what it feels like to be a DVC member

 

[DisneyKidds]

When you consider all the factors (DVC cost, annual dues, the cost of WDW hotel rooms, and inflation) the long term cost of DVC will be less than that for comparable WDW accomodations if you visit WDW once a year.

When I did our analysis, I figured getting some level of discount on rooms and still came up with a break even of 12 years. The types of discounts you get now will not always be available.

Comparable accomodations. That is key as well. If you would always stay in the All Stars then DVC may not present a big savings. I don't believe you can comapre accomodations at Ft Wilderness to a 2 br at any of the DVC resorts.

Years from now, the cost for dues will be lesss than the cost of a hotel room for 7 - 10 nights.

Everyone needs to assess DVC differently. I believe the best way to evaluate the economics is to look at what you would spend on your hotel accomodations each year for as long as you go (use a reasonably discounted rate and add annual inflation of about 5%) and compare that to the initial DVC cost plus annual dues (inflated 3% each year of course) and see how the totals compare.

Do the math, you may be surprised .

Bored with VWL, BWV, BCV? - won't happen to us. Trading out, staying at Hilton Head - there are plenty of options as well.

Food for thought. 2 weeks, avg season at OKW would require approx 500 points. 500 points at $58 plus closing costs is approx $30,000. Dues on 500 points, including annual inflation of 3%, would total approx $135,000 over 40 years. Total DVC cost would be approx $165,000 over 40 years. Take $250 a night, multiply by 14 nights, and inflate 5% per year - you would spend $164,000 in 24 years. A 2 br at OKW and the other DVC resorts go for a lot more than $250 today, even with a discount. Make sense?

 

[morphi]

I've run the numbers and I think you still save money by buying into DVC and using the points at the cabins. If you bought 310 OKW points via resale, you would spend about $20,000 plus annual dues. For this, you could spend 11 nights per year in a cabin in the value season. (This includes the expensive weekend nights.) How much cash would you have to sock away now in order to pay cash for 11 nights in a cabin for the next 41 years? The answer is about $25,000. So, you save about $5,000 in CURRENT dollars by buying into DVC and using the points to stay exlusively at the cabins. You save a LOT more money if you stay in DVC resorts of course, but the point here is that you still save money vs. cash to stay in the cabins.

This financial analysis took account of annual due payments, room rate inflation, dues inflation, rate of return, and sales & income taxes. The comparison against the cash price for a cabin also assumes a very large discount of 40% off of rack rates. (This is the largest discount I have heard of for the cabins and was the AP discount last Fall after 9/11. I doubt the discount will ever be much higher than this for cash reservations.)

So, if you can currently afford to spend 2 weeks per year in the world, look into buying into DVC. You'll save money even if you stay in the cabins.

 

[DebbieB]

Originally posted by Snowgod
You will need to stay at a DVC resort to really understand why a motel room is not the same. A one bedroon at any DVC is far better than any motel DW and I have ever stayed in. Having our family stay together is a luxury that cannot be valued by cost alone.

This is what pushed me over to DVC. I have a friend who is a member and I thought she was nuts spending all that money. Until she invited me to spend a weekend with her and some other friends in a 2 bedroom at OKW. After that weekend, I was hooked. It was so luxurious, the full kitchen, living room, washer/dryer, the master suite. I have since stayed in a 1 bedroom 4 times for 6 nights each. I keep a spreadsheet and the rack rate for those rooms is close to $10,000, over $400 per night with tax. DVC cost me $14,750 for 250 points after magical beginnings (BWV was $65/pt in 1999) and dues are a little less than $1,000 per year. My points are now paid for, so I feel like I'm getting $5,000 worth of rooms for $1,000 per year. I could probably get close to that original money back if I had to sell.

 

[DennisV]

My wife and I bought at OKW in 1993 and have been more than pleased with our purchase. Back then they included park passes until the end of 1999 as an incentive to buy. We saved enough
on park passes alone to pay for my initial investment.
More important though is the fact that we can stay on site in extreme comfort.
We stayed at the Poly in 1992 and wanted to stay on site every time after that. We figured the hotel rates would go up alot more than our annual fee would.
This month we are staying at the GF for 7 nights which would cost
over $ 2800.00 and we are staying for 10 nights in december at
OKW which is another $ 3000.00 or so all for my $800.00 annual fee.
We are doing this by banking our pts from last year into this year.
Our total cost therefore is $1600.00 as opposed to $5800.00.
We started with 190 pts and have added on twice.
We now are proud to own 265.
We would not trade this for anything.
Not to mention that we can use our pts in California and Paris to visit other parks and other timeshare resorts all over the world if we wish to.
Also on the DCL or HollandCL if we wish.
So many options and so few headaches.
Very good idea to buy.

 

[DaveH]

fortwilderness one more piece of info for you. We bought last year, we put down $500 and sold back the first years points to Disney, 150 points. Our total monthly out lay right now is around $200. That is a 10 yyear mortgage and dues.

 

[eva]

I ran an Excel spread sheet that I used for doing my add-on for a purchase of 500 points for you. That will give you at least 12 nights in a 2-bedroom during Dream Season.

Purchasing Add-On at BCV
Number of Points 500
Price Per Point 75
Downpayment (10%) 3750

Purchase Price - Downpayment $33,750.00
Interest 10.5%
Number of Months 120

Monthly Payment ($455.41)
Dues per Month (approx $4) $(166.67)

Total per month $(622.07)
for 10 years

Total for loan & dues for 10 years $(74,648.67)
Total for dues for 30 years $(60,000.00)
Plus Downpayment $(3,750.00)
Total for 40 years of DVC $(138,398.67)

When I used $250 a night for 12 nights a year with a 5% increase in rates per year the total after 40 years is $362,399.32. I guess it is all how you look at things. I feel that a 2-bedroom at one of the DVC resorts will blow your socks off when compared to the cabins at FW.