DVC Value

[k3chantal]

I think with DVC you also have to 'look into the future'. These resorts are only going to cost more for each night for cash stays as the years go by; meanwhile our points will remain around the same for each night. The 'value' gets better over the course of time.

My husband and I were only willing to purchase a contract if we could purchase it outright; so that the only cost associated with it would be the yearly dues. So for $1500.00 dollars a year, we get some pretty fantastic experiences. In six weeks we are off to AKL in a two bedroom savanna view room, no way would that cost just fifteen hundred. And even if I factored in the original payment, I have already gone on a 7 night Wonder cruise, a stay at the Grand Californian, two DW full week vacations and a seven day trip to Hawaii. So I think I am getting good value and deluxe accommodations I would never be willing to pay cash for. One past stay at AKL and this upcoming stay, we have had friends come with us. So the gift we are giving to them and the enjoyment we receive going with others ; only brings more value to our trips.

 

[theSurlyMermaid]

When we were considering DVC we hashed out what were the likely trips we would be taking as a family of three which turned into four. However, we have taken friends and family on every trip we've taken since becoming DVC members. We borrowed ahead and got a grand villa for our last vacation and it was an awesome experience I would never have considered if not for DVC. The rack rate for that grand villa would have totaled us about ten grand for the time we were there.....that was half our principle right there (which we paid in full).

DVC just makes gatherings like this possible.

 

[pgowder]

I like playing with numbers and spreadsheets and one day when I was bored I went through each of the DVC resorts comparing the point cost of a studio against the cash cost of the equivalent room for the times of year I normally go. I also compared these numbers to a moderate hotel room at POR since I use to only stay at moderates. Note that the cash cost is paying full rack rate and one should really assume that you would be able to get at least some sort of discount.

For AKV though the numbers worked out to this:

Dec 09-23 (14 nights)
AKV studio standard view 170 points, renting at $10/point = $1700, My costs ($7/point) = $1,190, cash rate $6,503, 30% discount on cash rate = $4,552.

AKV studio savannah view 220 points, renting at $10/point = $2,200, My costs ($7/point) = $1,540, cash rate $7,740, 30% discount on cash rate = $5,418.

POR room cash rate $2,8643, 30% discount on cash rate = $2,005.
Pop Century cash rate $1,854, 30% discount on cash rate = $1,298.


Aug 12 - Aug 26(14 nights) - cash rates are based on current summer discounts of 20-25%

AKV studio standard view 202 points, renting at $10/point = $2,020, My costs ($7/point) = $1,414, cash rate $5,655

AKV studio savannah view 254 points, renting at $10/point = $2,540, My costs ($7/point) = $1,778, cash rate $6,933

POR room cash rate $2,769.
Pop Century cash rate $1,590.


Cash rates were based on going to the Disney site and booking a reservations for those dates. My costs is equal to my annual MF per point + my buyin cost per point (your costs could be significantly higher buying direct)

So there is no doubt in my mind that there is a huge saving with DVC when comparing the equalivalent room. Compared to a moderate room, there is still a savings. And there is no real savings when compared to a value room.

Run some numbers for yourself comparing the room you are getting for $1,100 against what you would be getting with DVC. If they don't work out for you, don't buy DVC.

I didn't buy DVC myself till the numbers made sense for me and for me that meant buying resale only.

Where can I find info on the studio rooms?

They didn't talk about this in our sale meeting.

What is the upfront cost?

 

[pgowder]

When you buy points on resale, can you finance those points?

 

[WsPrincess]

When you buy points on resale, can you finance those points?

The Timeshare Store offers financing but it was really high (I think it was at least 12% but if I remember from my DVC stuff, it wasn't a lot less to finance through Disney). So yes, but it is costly to finance it. I know we could take out a personal loan for a lower % rate.

 

[Dean]

I think with DVC you also have to 'look into the future'. These resorts are only going to cost more for each night for cash stays as the years go by; meanwhile our points will remain around the same for each night. The 'value' gets better over the course of time.

My husband and I were only willing to purchase a contract if we could purchase it outright; so that the only cost associated with it would be the yearly dues. So for $1500.00 dollars a year, we get some pretty fantastic experiences. In six weeks we are off to AKL in a two bedroom savanna view room, no way would that cost just fifteen hundred. And even if I factored in the original payment, I have already gone on a 7 night Wonder cruise, a stay at the Grand Californian, two DW full week vacations and a seven day trip to Hawaii. So I think I am getting good value and deluxe accommodations I would never be willing to pay cash for. One past stay at AKL and this upcoming stay, we have had friends come with us. So the gift we are giving to them and the enjoyment we receive going with others ; only brings more value to our trips.

I would agree you need to make long term assumptions but I'm not personally willing to buy the one that says room prices will rise dramatically faster than maint fees and other costs related to owning DVC. They may but I think the % increase is almost certainly going to be higher for dues than for cash rooms with usual discounts. Actually my assumption is the other way, that there will come a time when owning costs more than it's worth, I'm just hoping it's in the last 1-2 years and not with 20 years to go.

 

[fmer55]

When you buy points on resale, can you finance those points?

bank.....have you seen heloc rates lately? practically free

 

[Dean]

When you buy points on resale, can you finance those points?

All timeshare financing is high. Timesharelending.net looks like they've increased their prices recently. It's now 12.9% and 13.9% depending with 20% o 10% down respectively and a min of $5K I believe. I haven't seen Disney's current rate but it's likely in the same ball park. Financing a luxury purchase is generally a very bad idea.

 

[vicki_c]

Where can I find info on the studio rooms?

They didn't talk about this in our sale meeting.

What is the upfront cost?

I think you might be misunderstanding. A DVC studio requires less points than a larger room. Depending on what conversation you had with your guide, and what you told them about your plans, size of your family, etc., it is possible they only addressed buying a larger number of points than the minimum (I do not know what the minimum is now, when we purchased it was 160 for a new member) with the thought that you needed a 1 BR or 2 BR every year. Or maybe there is/was a special offer going for the purchase of a larger number of points - sometimes they do that.

You should look at the points charts linked at the top of the page here and depending on your family size, see how many points it would take for you to stay in a studio at your desired resort for various times of the year. That would give you an idea of the size of contract you might need. Studio occupancy is only 4 + infant under the age of 3.

The upfront cost for any purchase is simply the price per point x the # of points you are buying, but you may not need as many points as what you were originally thinking. Annual dues are also based on the # of points you have.

 

[ToddyLu]

DH and I committed the cardinal DVC sin and financed our DVC purchase. It was one of our better decisions--to us....

DVC changes your trip to Disney like a Corvette changes your drive to work.

Some things are worth the money to some people. Would I buy a boat (we live on the water) or Rolex? No way....but Disney....ummm..yes.

 

[ToddyLu]

You can also see pricing on DVCNews.com. It is a very good site with FAQs, photos, ammenities of resorts, etc.

 

[chalee94]

Where can I find info on the studio rooms?

here is info about OKW - complete with links to pictures. the other DVC resorts are also linked on the left side.

http://allears.net/acc/faq_okw.htm

They didn't talk about this in our sale meeting.

DVC tries not to sell smaller contracts directly. if you only need 100 pts, you typically have to look at resales.

What is the upfront cost?

varies by resort and whether the contract is loaded (has banked pts) or stripped (only has pts coming in 2013 or so).

 

[pgowder]

bank.....have you seen heloc rates lately? practically free

heloc?

 

[chalee94]

heloc?

through the magic of a home equity line, you can put your home at risk in order to finance your timeshare.

not sure that's a wise move, but some people apparently do it...

 

[fmer55]

through the magic of a home equity line, you can put your home at risk in order to finance your timeshare.

not sure that's a wise move, but some people apparently do it...

A bit extreme don't you think? if 10g is going to risk your house you ABSOLUTELY , IN NO WAY SHAPE OR FORM should even consider buying DVC

 

[DougEMG]

Does your math include total cost of ownership--the upfront costs and the yearly fees?

Yes it does. The "My Costs" figure is based on the total purchase price/total number of points over the life of the contract plus the annual maintenance costs.

My SSR contract has a purchase price cost of $0.99/point and the MF are $4.72/point right now. That gives me a cost of $5.71/point for this year. I've got some other contracts that cost more and have higher MF so used $7 as an average.

 

[chalee94]

A bit extreme don't you think? if 10g is going to risk your house you ABSOLUTELY , IN NO WAY SHAPE OR FORM should even consider buying DVC

some would say if you have to go into debt for a luxury item like a timeshare, you shouldn't buy it until you can afford it.

most who use an equity line for silly purchases don't lose their homes, but a few have job/health/divorce surprises that wind up biting them in the end.

opinions vary. suit yourself.

 

[DougEMG]

It sounds like the calculations are omitting the time value of the up front money (or interest if financed).

Correct, I am not including the time value of the up front money.

The year I bought DVC my investments lost 12%, banks were paying practically nothing on savings so placing my money in DVC worked out better than if I had done either of those.

I have run numbers looking at taking that money that went into DVC, investing/saving it and then using that to pay for vacations and DVC still worked out to be a better deal in the long run.

 

[DougEMG]

However, let me throw in another type of option. For pennies on the dollar and yearly fees around 70% of DVC, one should be able to get a 2 BR off property at a resort at least as nice as the DVC resorts. You'd pick up a better larger room and give up the on property location. Plus you'd pick up a lot more and better non DVC options for other locations. Here are a few examples. Bluegreen 20000 points for essentially free plus closing, likely under $500 total and yearly fees around $1200 would get you a 2 BR locally every year for 7-8 days. DVC dues for a 2 BR for a week would be in the range of $1500 a year. Wyndham could be had for around $1000-1500 at a lower fee resort and give you a 2 BR every year at Bonnet Creek, right by Caribbean Beach and yearly fees in the same $1200 range or just over. Both would give you free RCI with a lot less restrictions than DVC plus both give you a lot of internal exchange options directly for little or no fee. The other option is Marriott which is more of a full week (but not fixed) option. Marriott would be a little more up front and yearly but give you even better and higher end options and still cheaper yearly than DVC for a comparable situation.

There are definitely ways to get nicer accomodation at a cheaper price than at DVC and this is a good example.

I think though most people that buy DVC are buying because they have already made the decision that they want to stay on-site. Their next question is what is the most affordable way to stay on-site for the type of accomodations they want.

 

[DougEMG]

I would agree you need to make long term assumptions but I'm not personally willing to buy the one that says room prices will rise dramatically faster than maint fees and other costs related to owning DVC. They may but I think the % increase is almost certainly going to be higher for dues than for cash rooms with usual discounts. Actually my assumption is the other way, that there will come a time when owning costs more than it's worth, I'm just hoping it's in the last 1-2 years and not with 20 years to go.

Given that a lot of the resorts are attached to hotels, shouldn't the increase in costs be similar for both the resort and the hotel? I've actually never bothered to check, but using BWV as an example it would be interesting to see how much MF have went up annually compared to the annual increases for the hotel room.