Everyone is O.K. with an 8.5% increase?

[dbkelly]

Just wondering if anybody else out there thinks that 8.5% is much too high. I guess there must be a lot of people who are getting raises higher then 8.5%, unfortunately, I am not one of them. Someone made the comment that it is only an additional $6 per month, but if you add all the other addtional increases in your expenses, they tend to add up!!!! You can't look at just one expense you must look at the entire picture. Are your expenses increasing at a much higher rate then your income? All I hear from my employer is how tight things are and that the inflation rate is only 2 - 3%, so that is what your raise will be. But, my dues are going up by 8.5%, my real estate taxes are going up by 10%, my daycare is going up by 5% and my insurances are going up by 15%. I have yet to experience my expenses as being tied into the inflation rate, but, boy oh boy, my raise is of course tied into the inflation rate. Just call me a loser!

D.B. Kelly

 

[RobDoc]

You can't look at just one expense you must look at the entire picture.

OKW dues went up 1.9% for 2002 and even went down the prior year. Looking at the "entire picture" a larger increase this year does seem OK, at least to me.

We each need to evaluate how these fees affect our leisure costs. If they rise above one's comfort zone, we may have to find other places to spend our discretionary income.

 

[Richyams]

DId you tell your boss that you didn't need as much money last year when dues went down?

Or to skip the raise when dues were unchanged?

They have been so flat that the 8.5 % only brings the average increase up a little.

 

[Disneyaholic]

If you're asking if I like seeing dues go up, the answer would be no.

But since the increase is within the guidelines we were given when we bought our membership AND since the alternative would be a decline the the quality of our membership, I don't have a problem with it.

And, legally, no profit can be made from the dues collected, so we can only trust that the money will be put where it's needed.

We often complain about things that are "going downhill" or benefits taken away, but we have to realize that we can't have it both ways!

Now, if they go up this much EVERY year, well....

 

[vernon]

If the rise was at that level year after year I would be concerned, and there would be a number of questions I'd like answered. but as has already been posted, when looked at over 4 or 5 years the increases are in line ( probably lower) than the national inflation rate.

 

[robinb]

I don't think anyone is happy with the big dues increase in the upcoming year. However, if you look at the long term increase over the last 10 years it's averaged out to only 3% per year. That's acceptable, IMO.

 

[dbkelly]

I am a new owner, so the entire picture for me starts with this year. As for the other comments, are owners saying that the increase is justified, because the prior years were lower? In the many years I have been in business and taught business courses, I don't think I have ever been given that excuse. (Then again one of my 18 or 19 year old students, probably did give that excuse.) The increase should only be justified if the expenses support it.

D. B. Kelly

 

[CRobin]

Originally posted by dbkelly
I am a new owner, so the entire picture for me starts with this year. As for the other comments, are owners saying that the increase is justified, because the prior years were lower? In the many years I have been in business and taught business courses, I don't think I have ever been given that excuse. (Then again one of my 18 or 19 year old students, probably did give that excuse.) The increase should only be justified if the expenses support it.

D. B. Kelly

Very good point. Justifying an increase based upon historical numbers should not, in and of itself, be used as a rationale (although my local school district uses rather similar logic).

In this case, we have to trust the scrutiny under which DVC is placed relative to not being able to profit through dues assessments. While we will likely never be privy to the results, I have to assume that the timeshare budgets are subjected to an audit to ensure that they are in compliance with the rules and regulations.

 

[robinb]

Originally posted by dbkelly
As for the other comments, are owners saying that the increase is justified, because the prior years were lower? In the many years I have been in business and taught business courses, I don't think I have ever been given that excuse.

Well la-dee-dah! I'm glad you're such an expert . I never said that the increase was justified because the average increase has been 3%. I said that the average increase over the last 10 years has been acceptable, even given 2003's high increase. If the dues were jacked up 8% and more every year, then we would have something to gripe about.

The increase should only be justified if the expenses support it.

No one has said otherwise. Sheesh.

 

[dbkelly]

Well said CRobin! Most likely the financial statements are audited even if they are not a public company. A well conducted audit would determine whether or not Disney is in compliance with regulations. But, then again, I don't have as much trust with audited statements as I use to before Tyco, Worldcom etc.

 

[KNWVIKING]

.... because they are-what-they-are and I can't do anything about them. However,I do find it odd that they fluctuate as much as they do. DVC basically knows what is going to be done well in advance,really no surprises, everything is done in rotating cycles. They know that every year they will replace x number of sofas,beds,washers/dryers,etc. Each year x number of villas get new roofs, complete paint, new windows and so on. I would only expect a large increase in the event of an unknown, (storm damage) or a new project,(themed pool). Maybe the larger increase is explained somewhere but I'm just not interested in doing the research.

 

[crisi]

I'm also a new owner and I don't see it as a problem.

We didn't invest in DVC until we were in a financial state that dues, increases in dues, and the vacations we'd take with those dues were "incidental" to our overall budget. I figured it did me no good to own a timeshare in Florida and lack the discretionary budget to pay for the vacation.

I'm sure you are aware, having taught business courses, that the inflation rate is heavily tied to things like the cost of new cars (which are currently bargains), and not adjusted to things like daycare (which our government, in their wisdom, thinks costs 1/3 of what I actually pay). And that a 3-4% raise is the norm - if you want more, you need to job hop or get a promotion.

I am not surprised to see dues fluctuate heavily from year to year. The HVAC costs with DVC must be enormous, and changes in the cost of crude oil, coupled with an unusually hot or cold year, probably makes that itself a huge variable. And if your taxes and insurance are going up faster than inflation - its a good bet that Disney is seeing theirs increase as well.

We, on this board, I think often underplay the huge longterm financial and time committment DVC brings and the risks involved in making that committment. Its one thing to say "if your patterns have been such." Its quite another to look into the crystal ball and say you'd continue to take Disney vacations if airfare went up 30% next year or you got divorced or your health changed or had an unexpected 3rd child or changed jobs or DVC dues increased 8-10% a year for several years.

 

[Disneyaholic]

Originally posted by dbkelly
I am a new owner, so the entire picture for me starts with this year. As for the other comments, are owners saying that the increase is justified, because the prior years were lower? In the many years I have been in business and taught business courses, I don't think I have ever been given that excuse. (Then again one of my 18 or 19 year old students, probably did give that excuse.) The increase should only be justified if the expenses support it.

D. B. Kelly

I don't get your point. Do you think that as a new owner you shouldn't have had that great of an increase?

Maybe you should ask DVC for past dues notices so you can track the way that dues have been used and why there have been increases. Of course, dues actually went down once, because there was excess money in the reserves.

You received the information on how much dues can increase each year. Maybe you were unlucky that your first year had such a big increase, but I'm not sure what you think complaining about it will do. If you're not happy with the increase, maybe buying DVC wasn't the right choice for you.

 

[Fenceman]

I have not seen the breakdown of the expenses but I wager a big portion of the increase is going toward insurance. Insurance premiums have seen double digit increases and Disney Property would be a prime terror attack location.

 

[lehrsj]

Does anyone have the OKW dues by line item for 2002? I'd like to compare it to 2003 but I can't find last year's dues statement.

Thanks

Sherry

 

[doubletrouble_vb]

Other posts have pointed out that about half of the increase came from insurance. Beyond that....do I trust Disney? No. These are same people who charge $2.50 for a $1.25 bottle of soda or water. Am I interested enough to pursue Disney to force them to prove their expenses are as they say they are. No, like the soda the expense is too small to be worth my while. Are timeshares heavily regulated in Florida? Yes. Does that force Disney or any other timeshare owner to be scrupulously honest? No...it just forces them to be much more careful in their accounting practices. They aren't going to get away with anything flagrantly illegal but can get away with things that the little people might consider immoral.

The thing is...as long as the expense is within your tolerance to accept it...it is just a cost of the vacation experience. If you aren't seeking support for an investigation or lawsuit I'm not sure why this stuff is questioned in the first place.

 

[Nink]

...and afterall, didn't we all sign a contract that included the cap amount of 15% and we said that that was OK?

All of us hate to see increases, but anything and everything in our lives is increasing, that is a part of the risk of this vacation investment that me made. Here in Texas, our insurance has increased while loosing a tremedous amount of coverage on mold remediation. Now, living close to the coast does produce a lot of mold, but because everyone has taken advantage of it, our rates have gone up and the services have gone down. Disney is no different. After the last 14 months in our "world" of the USA, a lot of things have changed. True business people will roll with the times and make changes as they see fit. That is why there is annual meetings, lets give a voice and see if anyone is listening.

 

[Maistre Gracey]

Just my opinion, but I've always believed that "you get what you pay for". Does that mean that I will blindly except whatever dues DVC throws at me? No...but nor will I gripe about a couple hundred bucks.
If I didn't trust Disney, I would not have bought DVC in the first place. I blew the big bucks on DVC so I could have a TOP NOTCH timeshare, at my favorite vacation spot. I don't want DVC to do anything that may decrease the quality that members have come to expect. If I was going to complain about high dues, I would sell DVC and buy one of the less desirable Orlando timeshares. Remember..."you get what you pay for".

 

[Chuck S]

If half of the increase is insurance, then that is out of DVD's control - most large organizations get multiple quotes on insurance, I don't KNOW that DVD went with the cheapest carrier, after all there is a lot to consider - the carrier's rep and solvency, etc. Would you rather have cheap insurance from a "fly by night" carrier? Is the percentage increase way out of line with other insurance increases in Florida? I know here in Texas insurance is WAY up with APPROVAL FROM THE STATE INSURANCE BOARD. Another thing to consider is that OKW has recently undergone a rehab - new/recovered furniture and appliances - perhaps that actual cost was a bit more than the estimates that they used for our yearly dues, and they have upped the estimates for the next rehab.

I doubt anyone is THRILLED with the increase in dues, but we were always aware of the possibility.

 

[StevieD]

I haven't seen the OKW budget, but in the 2003 BCV budget, the increase in insurance costs only accounted for about 25% of the overall increase - nowhere near the half mentioned here. I can't imagine that OKW would be significantly different.