DVC resale rising prices

[PearlyJoy]

It feels like the DVC resale is following the inflating housing prices. Aren't the prices increasing because there are too many buyers and less sellers ? (besides ROFR of course)

What if the buyers decided all together to curb the addonitis and let the listings sit for a while. Would the seller's marker turn around then ? I am talking fantasy now, but I have always felt, the seller's market is usually due to buyer frenzy

Thoughts ?

 

[fgaini]

At the moment the market is driven by sellers. I am a bit surprise too. I was expecting a decline due to COVID economic slow down. So far it did not happen...

 

[Traveling on cc points]

I could be 100% wrong but my thought is that the prices are rising because the demographic of people buying have made and saved a substantial amount of money over the last year.

Every situation is different but most of our friends have a huge surplus of cash do to the fact that they have worked from home over the last year.

No or less expensive vacations.
No child care costs
Minimal commuting costs.
Minimal eating out
Minimal entertainment costs

 

[PearlyJoy]

I could be 100% wrong but my thought is that the prices are rising because the demographic of people buying have made and saved a substantial amount of money over the last year.

Every situation is different but most of our friends have a huge surplus of cash do to the fact that they have worked from home over the last year.

No or less expensive vacations.
No child care costs
Minimal commuting costs.
Minimal eating out
Minimal entertainment costs

You are absolutely right, COVID impacts have been favorable in industries that do not need in person interaction.

 

[Hopfather28]

You're seeing the unintended consequences of pumping stimulus checks into the hands of all Americans without specifically targeting those in need. In theory, it helps the economy because people spend the stimulus on goods and services and thereby helps everyone. However in practice, if you had a job that didn't shut down, you stopped eating out, you didn't vacation, you have that money you saved plus for a typical family of 4 you have received $11,600 in stimulus between first, second and third rounds of checks. When there is more money to go around the buying power of that money drops. While I agree with the stimulus package and believe it was necessary, a generation from now they will use this past year as a case study in inflation.

 

[CSLucas]

I could be 100% wrong but my thought is that the prices are rising because the demographic of people buying have made and saved a substantial amount of money over the last year.

Every situation is different but most of our friends have a huge surplus of cash do to the fact that they have worked from home over the last year.

No or less expensive vacations.
No child care costs
Minimal commuting costs.
Minimal eating out
Minimal entertainment costs

I agree with this, but for what it's worth I think a lot of people who would have never considered DVC before are now buying because they actually prefer the "new" Disney. That's the case for my family - before the pandemic I would have laughed you off the stage for suggesting I would ever buy DVC, but visiting Disney during the pandemic was a game changer for us. Do I realize it will go back to how it used to be (probably) with all the crowds? Of course. But I'm betting on being able to sell my DVC when it gets to the point where I don't like it anymore, and also gambling that now we have taken the plunge that we will go for some long weekends during less crowded times. Before this past year I had not experienced an uncrowded Disney, and that's the type of atmosphere that hooks people for something like DVC.

 

[Hopfather28]

I agree with this, but for what it's worth I think a lot of people who would have never considered DVC before are now buying because they actually prefer the "new" Disney. That's the case for my family - before the pandemic I would have laughed you off the stage for suggesting I would ever buy DVC, but visiting Disney during the pandemic was a game changer for us. Do I realize it will go back to how it used to be (probably) with all the crowds? Of course. But I'm betting on being able to sell my DVC when it gets to the point where I don't like it anymore, and also gambling that now we have taken the plunge that we will go for some long weekends during less crowded times. Before this past year I had not experienced an uncrowded Disney, and that's the type of atmosphere that hooks people for something like DVC.

That's a take I hadn't considered. I for one purchased more than enough points than I needed with the idea of long weekends during off times with low crowds. But I hadn't considered that people who visited in the last few months would have realized the benefits of an uncrowded Disney and purchased as a result.

 

[RoseGold]

This has nothing to do with any particular broker. They're all following pace, and there are quite a few brokers. The market value of resale is pretty clear.

Summer 2020 was one of the only downswings in DVC history, and it's when I bought.

 

[davidl81]

This has nothing to do with any particular broker. They're all following pace, and there are quite a few brokers. The market value of resale is pretty clear.

Summer 2020 was one of the only downswings in DVC history, and it's when I bought.

And honestly the downswing in prices was small if any. We both bought around the same time and there was a majority of people on this board who was convinced prices were going to drop, and they sure as heck did not. I think really what is happening is people are just not selling. Unemployment in higher end jobs has stayed decent (most labor lost has been in the lower income who would not have likely owned DVC) thus we never got the "dump" of resales on the market. Combine this with the influx of cash either via stimulus or people just not spending vacation funds in 2020 and here we go. Its simple supply/demand economics at play. Demand is outpacing supply.

 

[DVCsloth]

There may be some resales available for a decent price in the near future if people used stimulus money but didn't count on the dues.

 

[RoseGold]

And honestly the downswing in prices was small if any.

Sure looks like a big swing now to me. Check out VGF! I bought in the 150s over the summer.

 

[PearlyJoy]

I agree with this, but for what it's worth I think a lot of people who would have never considered DVC before are now buying because they actually prefer the "new" Disney. That's the case for my family - before the pandemic I would have laughed you off the stage for suggesting I would ever buy DVC, but visiting Disney during the pandemic was a game changer for us. Do I realize it will go back to how it used to be (probably) with all the crowds? Of course. But I'm betting on being able to sell my DVC when it gets to the point where I don't like it anymore, and also gambling that now we have taken the plunge that we will go for some long weekends during less crowded times. Before this past year I had not experienced an uncrowded Disney, and that's the type of atmosphere that hooks people for something like DVC.

Correct, there are so many situations these days due to the pandemic that may not be accurate indicators of reality. Disney park not overly crowded is a very temporary situation.

 

[PearlyJoy]

There may be some resales available for a decent price in the near future if people used stimulus money but didn't count on the dues.

That would be great if happens

 

[PearlyJoy]

That's a take I hadn't considered. I for one purchased more than enough points than I needed with the idea of long weekends during off times with low crowds. But I hadn't considered that people who visited in the last few months would have realized the benefits of an uncrowded Disney and purchased as a result.

Nothing we find out about Disney remains a secret for long, because there are so many Disney YouTubers providing trips, tricks and hacks

 

[Hopfather28]

And honestly the downswing in prices was small if any. We both bought around the same time and there was a majority of people on this board who was convinced prices were going to drop, and they sure as heck did not. I think really what is happening is people are just not selling. Unemployment in higher end jobs has stayed decent (most labor lost has been in the lower income who would not have likely owned DVC) thus we never got the "dump" of resales on the market. Combine this with the influx of cash either via stimulus or people just not spending vacation funds in 2020 and here we go. Its simple supply/demand economics at play. Demand is outpacing supply.

I'm not sure I'd say it was small. It was short lived but not small. ROFR stopped and we saw ridiculously low prices getting through. I myself bought Poly for $120pp and there were low cost BLT passing left and right. It did, however last only a month or two and then rebounded big time.

 

[dropd]

I got 100 pts at BLT for $140 in July 2020, that price would be absolutely unheard of today. One of the few times I have successfully timed a market for *anything*. If you look at the resale sites, there is simply way less inventory than I ever saw in the last few years since I first got interested in DVC. That lack of inventory is driving prices up. Heck, I bought a small-ish SSR contract in 2019 for $98 and those contracts now are easily going for $110+. That's 15-20% appreciation in < 2 years, much faster than inflation for a product that theoretically depreciates due to years coming off the contract.

I think it's a whole combination of factors, but I would suspect that one component is families who in past years would have felt they'd "outgrown" Disney, or who wanted to sell to just generally take more diverse vacations with their money are instead staying put in their DVC contract because it's more reliable/predictable right now - especially compared to international travel.

 

[PearlyJoy]

I think it's a whole combination of factors, but I would suspect that one component is families who in past years would have felt they'd "outgrown" Disney, or who wanted to sell to just generally take more diverse vacations with their money are instead staying put in their DVC contract because it's more reliable/predictable right now - especially compared to international travel.

Great point and insight!

 

[ILoveMyDVC]

Work from home makes DVC way more attractive

 

[808blessing]

I’m thinking it is more about perceived safer domestic travel vs international.

Family focused spending. Financial priorities have changed to keep an eye on present and future joys vs endless saving.

Overall I think it signifies health of “investment” in families and child-centric entertainment.

I don’t think people are squandering their stimulus checks. There has been a lot of time to think this past year!

As for me, I decided I didn’t need to spend earmarked car savings on a new car afterall and my husband recommitted to do all the maintenance and upkeep of my old but fine and fancy 2008.

 

[LeslieLou]

There is simply way less inventory than I ever saw in the last few years since I first got interested in DVC. That lack of inventory is driving prices up.

this is also exactly the problem in the broader housing market