DVC T &C Personal Use - Only Thread to Discuss!

[PolyRob]

I am an associate member under one of their memberships, but not all. Vacations get booked under all of the memberships.

I have no insider knowledge of DVC, but if your parents were somehow flagged and your name came up on a flagged reservation and DVC saw you were an associate member on a separate membership with a different UY I would have to think that would be proof of personal use by the owners.

DVC has the 4000/8000 point limit. It absolutely wants families to come and spend money at WDW. It's marketed as "vacations you never outgrow." I highly doubt DVC would penalize parents from gifting trips to a child.

 

[GrimGrinningGuy]

Man, we just had an AMAZING time at Aulani renting points. Saved a fortune and got free parking and we are already planning to go back 2027. I hope this doesnt screw up our plans

 

[Goofy2015]

Sorry with all of the random questions. I just ask because our DVC membership / contract situation is very complicated. To me, this Personal Use / Commercial Use is very questionable and they made it very unclear. I know we can’t be the only ones in this boat. I have seen families similar to ours at say the Boardwalk that for sure bring an extensive amount of their adult kids with their grand kids. Friends and family may come at separate times from the owners, but they are not abusing the system with renting them to random people.

I am not sure on the best solution. I do agree that the third party companies renting is a problem. Walking reservations seems to be a bigger problem (I know one we have all dealt with for a long time). I am sure there are DVC owners that are major targets that purely rent out to third parties for financial gain.

 

[McCrae]

Possibly, they can change the rules at any time so if you aren't okay with owning that many points I wouldn't buy that many.

Changes in rules apply to all members including Disney. Will Disney continue to rent out their points? Assuming they do how will they legally be able to justify different treatment for individual members?

 

[HFJohnson]

As mentioned in my earlier post I am looking at buying a resale contract with the intention of renting out points. But my primary reason for buying is so I can visit WDW at least every couple of years. I could buy half the number of points and bank/borrow but I also want the option to be able to visit every year if I want to or double up points should I want a bigger room. Based on what I've read so far I struggle to believe Disney will be bothered about a 150 point contract, even if I rent out all the points every other year, as it doesn't fit into the "frequently" definition and while the rental income will likely exceed my annual dues I wouldn't class that as commercial use.

Just my two cents worth but I will keep reading this thread with interest.

 

[Hubalorian]

If they knew this was coming down the pike for months or even years, they could have building a ROFR reserve. If the prices become too attractive, they might finally wake the monster.!

 

[ChipTheRescueRanger]

Has Disney get what the definition of personal is.

as renting points is still for personal use and not commercial.

Very open ended. But hopefully it cuts backs on the LLC and larger renters that are running rentals as a business.

 

[xdan0920]

I would disagree with this statement.

If I am paying the MF fees and “renting” out my excess points to cover my costs, that would absolutely be personal use.

What I believe DVC is looking at is those who use the points as a business. Maybe never using them for themselves.

You can hope this is the case, but I see no reasonable angle of looking at it that makes it so.

But only DVC knows what will meet that requirement.....what do they think is occasional? What do they think it "frequent and regular"?

I think any normal human can determine these things. No reason to over complicate it.

Whew what a thread.

I think this comes down to the question of does a member frequently rent out points for profit…. which to me means more often than not they are receiving more revenue than the cost of their dues.

“We are reviewing owners who seem to own large numbers of points just to make a profit… DVC is actively figuring out ways to go after that, and stop that to the best of our ability.”

So, if someone has 2k points and has dues of $18k then in theory they could rent 1k or less points out at $18 per point and it not be commercial because they are not making a profit.

You can scale that up or down based on # of points.

No chance they look into how much you’re getting for your rental. If you rent every year, or every other year, they are looking at you. It’s straightforward IMO.

As mentioned in my earlier post I am looking at buying a resale contract with the intention of renting out points. But my primary reason for buying is so I can visit WDW at least every couple of years. I could buy half the number of points and bank/borrow but I also want the option to be able to visit every year if I want to or double up points should I want a bigger room. Based on what I've read so far I struggle to believe Disney will be bothered about a 150 point contract, even if I rent out all the points every other year, as it doesn't fit into the "frequently" definition and while the rental income will likely exceed my annual dues I wouldn't class that as commercial use.

Just my two cents worth but I will keep reading this thread with interest.

I wouldn’t do this, based on the new verbiage. But what you’ll use.

 

[AnnaKristoff2013]

Whew what a thread.

I think this comes down to the question of does a member frequently rent out points for profit…. which to me means more often than not they are receiving more revenue than the cost of their dues.

“We are reviewing owners who seem to own large numbers of points just to make a profit… DVC is actively figuring out ways to go after that, and stop that to the best of our ability.”

So, if someone has 2k points and has dues of $18k then in theory they could rent 1k or less points out at $18 per point and it not be commercial because they are not making a profit.

You can scale that up or down based on # of points.

What DVC considers “for-profit” is, of course, very much unknown, but anyone renting points at $18 per point is likely renting them “for-profit” within the meaning of the tax code. Since Disney (intentionally) doesn’t further define what ‘for-profit” is, nor do they really further define “personal use,” they can enforce as they choose to fix the current situation.

 

[AnnaKristoff2013]

As mentioned in my earlier post I am looking at buying a resale contract with the intention of renting out points.

When someone posts on Timeshare User Group about doing this with Wyndham (buying resale intending to rent, but will occasionally use), they are universally told that is a very bad idea. If Disney is indeed going down this path, then I’m going to repeat that advice. What you are describing is a bad idea. Don’t buy with the intention to primarily rent, that’s not what the product is for, and Disney has now made everyone aware of that.

 

[HFJohnson]

When someone posts on Timeshare User Group about doing this with Wyndham (buying resale intending to rent, but will occasionally use), they are universally told that is a very bad idea. If Disney is indeed going down this path, then I’m going to repeat that advice. What you are describing is a bad idea. Don’t buy with the intention to primarily rent, that’s not what the product is for, and Disney has now made everyone aware of that.

I wouldn't be buying primarily to rent though, my main intention would be to use the points myself. However in the early years of the contract I'm only expecting to go every couple of years, probably increasing to every year or using more points on bigger rooms in 5-10 years. Renting is still allowed under personal use and I'm not convinced renting out 150 points every couple of years falls under the "frequently" definition given by Disney.

 

[tx911]

Has Disney get what the definition of personal is.

as renting points is still for personal use and not commercial.

Very open ended. But hopefully it cuts backs on the LLC and larger renters that are running rentals as a business.

I have a different view of personal use. I think personal use is using the points for your own vacations, family, or friends.

Of course you will use the money from renting points for personal reasons, but you aren't using the points personally.

I'm not saying I'm opposed to any and all renting. I just don't agree that renting is personal use.

I think the key words are "frequent" and "regular'. They did not specify the exact definition, but we all know what these words mean. If your rentals are either frequent or regular or both, you may be in violation.

 

[Cfabar1]

A side note... if DVC instituted a 5 night minimum stay requirement my suspicion is the entire system would collapse - far more so than the rental changes.

I think this rental crackdown situation is one of those few instances where the best interests of Disney and the majority of DVC owners are aligned. That said, my concerns are that the commercial renters until they are threatened with something beyond a checkbox aren't going to make any changes. Instead, Grandma Suzie who was thinking of renting her points or trip because of her knee surgery is going to get nervous and think she is a commercial renter and not want to "get in trouble".

While Disney does have the ability to be using all kinds of data from MBs, Park entry, Photopass, etc. in practice, I think they are unlikely to employ that level of sophistication for a while - if ever.

The notion @AstroBlasters mentions referencing a percentage of your points being rented out may be the way Disney pursues this. It sounds like there will be a manual review process, so that will help. I also suspect owners with a small number of points will likely be ignored - at least for now.

My ultimate view is Disney wants people booking from them, not from DVC owners or Rental Store, or whatever. In the end, this is about taking something away from members as an option. However, several members have distorted the market so much, that the majority of us (myself included) are glad that Disney is taking action.

I'm not naive enough to think that all of a sudden 2 BR availability at the BW is going to increase substantially at the 7 month window. I do think owners will be aided by more availability at the 11 month window. But we shall see!

 

[matt_in_nh]

Wouldn't this be worse for Disney if resale has even more attractive pricing?

It would but it also makes it cheaper for them to ROFR...they have been driving down resale prices with resale restrictions and member benefits exclusions. The resale market competes with Disney...if it gets low enough then maybe they buy most resale contracts and they are the ones you need to go to if you want to sell or buy...ultimately that is what they want and why ROFR is built in.

 

[matt_in_nh]

Just wanted to add a quick post. As a pretty new DVC owner, I find all of this fascinating and, unless I'm missing something, nothing but a positive development for us owners who buy points with the planned intention of using them.

Really enjoying everyone's analysis and thoughts. I happen to be a lawyer myself, but this is quite outside my specialty area (I'm a tax lawyer, and even there, I specialize in a very specific area of tax law). I'll just say, I find a lot of @Sandisw posts persuasive, bot legally and practically. Although I have no plan or intention to rent out points right now, I don't see anything here that would dissuade me from renting out points. "Frequently" and "regularly" are open to a fair amount of interpretation, and I suspect this is Disney is attempting to give themselves the ability to crack down on the incredibly abusive owners out there. Sure, some regular, rule following owners might get a little scared about renting out their points, but I just don't think that is who Disney is after, and it wouldn't scare me from renting out my points if I had a year I didn't need them. I think, as long as a I had a reasonable explanation for why I needed to rent out points that year, I wouldn't worry at all.

I agree with you in principle however I think this will drive down resale prices and increase ROFR. So if you want to sell in the future this could limit what you can get. It is hard to know how big a percentage this commercial renting is and how much of an affect it will have on resale. It is definitely good for the vacationer while you plan to use your points. The professional bookers are going to take a hit.

 

[AnnaKristoff2013]

I wouldn't be buying primarily to rent though, my main intention would be to use the points myself. However in the early years of the contract I'm only expecting to go every couple of years, probably increasing to every year or using more points on bigger rooms in 5-10 years. Renting is still allowed under personal use and I'm not convinced renting out 150 points every couple of years falls under the "frequently" definition given by Disney.

You just made two statements that were contradictory so I’m confused as to what your actual plan is. If you’re actually just going to rent out your points “every couple of years” then you’re right, probably ok. If you’re going to spend the first 5-10 years mostly renting points and only occasionally going, then what you are describing is a bad idea.

 

[muppets3d]

All I need to know is, will I soon be able to book value and club studios using my AKL points without needing to refill my Omeprazole prescription?

 

[matt_in_nh]

I personally don’t believe renting out points to cover MF and the cost of my own vacation is “personal use.” Personal use is using the points one buys for their personal vacations whether it’s just my family or also friends…USING the points, not renting them out consistently. Yes, one may rent out your points when you have an occasional need to not use them and they cannot be banked or exchanged, etc. but not to consistently cover your expenses.

Understand your position but I think the person who has one or two contracts and rents to cover dues is probably not the main problem. It is groups of people who have formed a business around renting DVC, have max points per person, rarely uses their points and walks and makes reservations with bot's. I don't believe a random Jane or Joe is causing the problems they are going after...points will be used regardless, that is sometimes the argument you hear.....the issue I think is commercial entities booking the best rooms/dates using technology, they have a "commercial" business around renting DVC points.

 

[Judique]

I found it really suspicious on my VDH rental that the rental store told me that the owner said I have a new reservation number a couple of weeks after booking and to load that one into my disneyland app and get rid of the old one.

Why would this happen? Did they cancel and rebook? Made me feel uneasy and the rental store wouldnt tell me why.

I have rented multiple times from Davids with no issue before deciding to become a member, but the possibility of an issue is turning me away in general (unrelated to what's going on now)

How many nights did you rent? They have had to combine reservations and you got a 'new to you' number after the nights were combined.

 

[AnnaKristoff2013]

All I need to know is, will I soon be able to book value and club studios using my AKL points without needing to refill my Omeprazole prescription?

I suspect that at 11 months your odds will get a lot better. It will probably take a year or two though before it gets noticeably better.