Exploiting the Market - PIT Rentals

[Joroc0801]

I'm curious what the general consensus is around people using their Poly points to book premium timeframes and immediately posting confirmed reservations on different rental forums/group pages. I've seen some listed for as high as $30 per point(20-22 seems to be about average). I thought the equalizer was the point chart, not the rental price per point.

I know I'll get answers about supply/demand and it being a free market. There will come a time where I too need to rent points due to having excess points and I obviously won't be listing at MF cost. I guess it just infuriates me that fellow DVC members who want to experience the new tower will be shut out. It's akin to the third party ticket websites that nab up all the tickets for concerts and immediately post for double the price.

Please call out my hypocricy if needed.

 

[Sandisw]

Honestly, I don't have any issue with it because if I was going to rent, for whatever reason, I might do the same...pick some highly desirably room and offer that.

My feeling is that we bought something that allows for this. Obviously, when a membership is being used only for commercial purposes, that is different...but, renting a confirmed reservation, is within the rules and I am not bothered by it...even if it means I may not always get the view type or room size I want.

 

[JackosinDIS]

I am fine with it. This was always going to happen with the new tower. I have 75 banked points from a resale contract that I probably cannot use before they expire, and if I have to rent them out, I will pick a desirable room and dates and rent a confirmed reservation to make sure all the points are used in one go (although probably not for $30pp!!)

 

[byurick]

It's one thing to rent out excess points you won't use or can't use, it's entirely something else to book a highly desirable rental with the intent to sell it for a big profit. Is it legal and allowed? Yes, but it's still pretty skeevy.

 

[disneylandtour]

Obviously, when a membership is being used only for commercial purposes, that is different...but, renting a confirmed reservation, is within the rules and I am not bothered by it...

I, too, am fine when people have unused points that they rent. Some years you simply can't go to Florida or California. No problem. My issues is that CLEARLY there are some businesses who have amassed contracts either exclusively or primarily to rent as a for-profit commercial endeavor, which is forbidden in the DVD/DVC rules. This behavior has a negative effect on typical DVC owners--in that paid workers or perhaps even a computer program (my speculation) is swooping up some key rooms the moment they are open for booking, thereby blocking out others who are interested. Disney needs to enforce the rules that they have. What they've done is to simply ignore this problem for years. If there are going to be rules, Disney needs to uphold them, especially when it's very clear that a small group of LLCs and individuals are openly and knowingly operating outside of them.

 

[StarCruzer]

My feeling is that we bought something that allows for this. Obviously, when a membership is being used only for commercial purposes, that is different...but, renting a confirmed reservation, is within the rules and I am not bothered by it...even if it means I may not always get the view type or room size I want.

My thought on this: if someone uses their points to book a room with the specific intent of turning around and renting out it for an inflated price, then they are now using their points for commercial purposes, even if it's a one-off. The purpose is profit, not a personal vacation.

It's pretty morally questionable to me--with the caveat of course, that "morality" is highly subjective. As you said, not violating terms and certainly not illegal. But kind of a gross practice that's not really the intended spirit of DVC.

 

[Genie+]

There is a difference between renting ‘unused’ points and buying points to subsidize the costs of DVC.

If an owner buys way more points than they ever use on a yearly basis, that seems like it doesn’t fit ‘personal use’ and is purely for profit. If someone only ever uses 400pts/yr, bought 800pts and rents out the other 400 every year - that is not selling unused points. That is buying points specifically for commercial purposes.

 

[Joroc0801]

This behavior has a negative effect on typical DVC owners

Exactly my thoughts. I know the term "Club" is used in the name but normally a club would have bylaws being executed on behalf of the members.

(although probably not for $30pp!!)

This is exactly my reason for the post. The only reason someone would be asking those prices for rental would be for profit. The more this happens, the more general rental prices will inflate. This causes the rentals to be less accessible to the average renter which in turn makes it tougher for the average rentee. Again, these are free market problems but DVC should put measures in place to prevent this from happening.

 

[Sandisw]

My thought on this: if someone uses their points to book a room with the specific intent of turning around and renting out it for an inflated price, then they are now using their points for commercial purposes, even if it's a one-off. The purpose is profit, not a personal vacation.

It's pretty morally questionable to me--with the caveat of course, that "morality" is highly subjective. As you said, not violating terms and certainly not illegal. But kind of a gross practice that's not really the intended spirit of DVC.

If thst is true then any rental would have to be defined that way and the contract is simply not that.

We can not use our membership for a commercial purposes, which is defined as running a business

The contract says we don’t need permission to rent..and DVc telling us which reservations count and which don’t IMO is a way of asking permission.

Also, since we are expressly allowed to rent, it would be hard pressed legally to say that a confirmed reservation in and of itself violates the terms…and why I don’t ever see DVC take this one because just advertising it doesnt count…its only when the name is changed that DVC can classify it as something else.

I know…people don’t like it…but one rental does not make it a commercial membership.

I am simply not bothered by it because I much prefer the flexibility we currently enjoy in ways we use our membership.

What I can say is that the one thing that might help cut the rates in rentals it is if WDW decides and continues to offer good discounts on cash rate to make the risk not as worth it and for these prices to not be such a great deal.

 

[StarCruzer]

If thst is true then any rental would have to be defined that way and the contract is simply not that.

There is a huge difference between someone who uses their points specifically to book vacations they never intend to use for themselves, in order to "get ahead" of high-demand reservations and reap a substantial profit over regular rental fees, vs someone who has extra points they know they can't feasibly use due to unforeseen circumstances and sell in an effort to not let points expire.

From a functional standpoint, they have the same result. (ETA: and I do agree that trying to "police" what is commercial vs not would be extremely difficult). But from the standpoint of intent (both the intent of the owner, and how DVC points are intended to be used) they are worlds apart.

 

[Sandisw]

There is a huge difference between someone who uses their points specifically to book vacations they never intend to use for themselves, in order to "get ahead" of high-demand reservations and reap a substantial profit over regular rental fees, vs someone who has extra points they know they can't feasibly use due to unforeseen circumstances and sell in an effort to not let points expire.

From a functional standpoint, they have the same result. But from the standpoint of intent (both the intent of the owner, and how DVC points are intended to be used) they are worlds apart.

You are talking though about two different things. One is renting a lot, above what DVc says is commercial, and renting a confirmed reservation.

If I rent a confirmed reservation and you offer your points and rent an on demand one, but we both only rent one that year, then we are doing the same thing…exercising our right to rent.

Now, you rent a ton of confirmed reservations and I rent a ton of on demand rentals, we are both potentially using our membership beyond the scope.

However, if I rent one or two very popular high demand reservations one year but you rent a lot more on demand trips, then I see you as in potential conflict and not me.

Basically, for me, it’s the frequency of how much an owner is renting, whether confirmed or on demand, that crosses the line between what is and is not allowed.

 

[StarCruzer]

Hahaha, I can tell we're in very different tax brackets (point brackets?) just by your point of view here. It doesn't matter if a reservation is confirmed or on demand to me.

If you set aside a certain number of points every year to rent, no matter what the method, that is commercial use of DVC. It means the owner has zero intent of ever using those points for personal use. IMO the purpose of allowing people to rent their points out was never with the intent that the primary reason is profit, because that is the definition of commercial use even if it is on a small scale.

I'm no timeshare expert, but my assumption is that Disney can't legally stop people from renting due to timeshare laws (since you own a piece of the property, and they can't impose certain restrictions in how you legally utilize it). Apparently they once specifically mentioned that "commercial" use from the company's perspective was 20+ reservations in a 12 month period which were not under the DVC member's name.

That seems like a pretty high bar to clear for commercial use, requiring a member only keep to 5% personal use rate for reservations per year. I personally would love to see that number be between 20-30% over say, a five year period.

Again, I'm not a timeshare expert and I'm sure there are plenty of folks who will disagree with me on this one, which is fine. I just think buying huge contracts with the intent that half of your points will pay for the other half is a weird flex and breaks the system considerably for the average contract holder.

Disney likely doesn't want to shake the boat on this because the more points are in the hands of owners, the more MF they get for the resorts. Kicking out high volume points owners, even if they are breaking the rules, will negatively impact their cash flow.

 

[Genie+]

Disney seems to be tightening the ship this year. Wouldn’t surprise me if some meaningful change came to DVC rentals. At the same time I don’t expect it, just wouldn’t be surprised though.

As far as this Membership Magic Beyond goes, it’s clear they are continuing to differentiate resale from direct.

 

[Sandisw]

Hahaha, I can tell we're in very different tax brackets (point brackets?) just by your point of view here. It doesn't matter if a reservation is confirmed or on demand to me.

If you set aside a certain number of points every year to rent, no matter what the method, that is commercial use of DVC. It means the owner has zero intent of ever using those points for personal use. IMO the purpose of allowing people to rent their points out was never with the intent that the primary reason is profit, because that is the definition of commercial use even if it is on a small scale.

I'm no timeshare expert, but my assumption is that Disney can't legally stop people from renting due to timeshare laws (since you own a piece of the property, and they can't impose certain restrictions in how you legally utilize it). Apparently they once specifically mentioned that "commercial" use from the company's perspective was 20+ reservations in a 12 month period which were not under the DVC member's name.

That seems like a pretty high bar to clear for commercial use, requiring a member only keep to 5% personal use rate for reservations per year. I personally would love to see that number be between 20-30% over say, a five year period.

Again, I'm not a timeshare expert and I'm sure there are plenty of folks who will disagree with me on this one, which is fine. I just think buying huge contracts with the intent that half of your points will pay for the other half is a weird flex and breaks the system considerably for the average contract holder.

Disney likely doesn't want to shake the boat on this because the more points are in the hands of owners, the more MF they get for the resorts. Kicking out high volume points owners, even if they are breaking the rules, will negatively impact their cash flow.

I actually don’t rent, and have probably done it with strangers two to four times in my 15 years of ownerships.

So ‘my point of view isn’t based on that. It’s simply that I am not bothered by the rental market, don’t care what other owners do with the points they own and who they do or don’allow in their rooms.

What I love about DVc is the ability to use my point a how I want and for who I want. If that means a robust rental market that has hard to get rooms rented, that is okay.

I can control me and only me and not others. Every time this subject comes up, my opinion is the same…it’s not a big deal to me and I go with the flow when I book my trips.

I do get so e people don’t like it and that is okay too.

 

[CastAStone]

I think it’s gross.

DVC should threaten to boot anyone doing that from the program because it’s such a flagrant violation of the no commercial renting policy. If I was in charge I’d certainly be figuring out everyone who changed the primary guest on a day 1 reservation, and sending them a letter letting them know we’re keeping a closer eye on their rental behavior moving forward.

I have said this before but I don’t think confirmed reservation rental should be allowed beyond 31 days from check in (maybe 60)

 

[ocdb8r1]

I'm ok with it for the occasional owner rental and I think I'm even comfortable with an owner who buys extra points to subsidize their DVC dues on a regular basis. In full transparency, this benefitted us this year as we had to rent out a large chunk of points we had saved, used to reserve a Grand Villa for a week and then had "life" require us to abandon our plans.

That said, I think there is increasing evidence there is significant numbers of renters doing this purely for commercial profit. This varies from owners who are renting all their points out each and every year (which is where I start to get uncomfortable even if it's a small amount of points or they stay below this arbitrary "20 reservations" policy which is what DVC has thus far used as a commercial trigger) to much larger operations that are hiding behind LLCs to rent vast amounts of points. To me, both size and regularity starts to create a slippery slope where a certain group of owners (renters) starts to gain an advantage in manipulating the system due to their the regularity and volume they are able to tax the "reservations pool".

It's a very tough line for Disney to tow. They don't want a full commercial enterprise competing with their normal room rental business, but on the flip side there is a benefit in that it creates another source of DVC demand. If they crack down on these groups, inevitably more contracts will make their way to resale, increasing supply of points waiting to be sold on the market (which they can only counter so much with ROFR and "direct" benefits).

 

[jennypenny]

Back in the day it was kind of accepted/suggested (by guides as well as other members) to buy twice as many points as needed and rent out half to cover dues every year. I remember it also being suggested to us to rent out our points until they were paid off to get to that point sooner. No one really had a problem with it, but that's because there were only 3 DVC in WDW at the time, online booking wasn't available, and internet rentals weren't a big thing then (other than here), so it didn't affect availability that much.

I'm not making an excuse for commercial renters, but in my experience it's not the idea of it but the volume that's a problem now. I imagine there are only fifty or so big time renters who own thousands of points who are clogging up the system. Could it be that hard to crack down on them?

I'm having difficulty booking something at RR next September even though I own there, and I can tell it's renters/walking. I won't buy any more points unless it's a fixed week. I don't enjoy the 8am hunger games (an extra level of games now in addition to preferred dining reservations at 60 days and LLs at 7 days). Maybe people who grew up gaming don't mind it. I find it [bleep] annoying.

 

[CastAStone]

Back in the day it was kind of accepted/suggested (by guides as well as other members) to buy twice as many points as needed and rent out half to cover dues every year. I remember it also being suggested to us to rent out our points until they were paid off to get to that point sooner. No one really had a problem with it, but that's because there were only 3 DVC in WDW at the time, online booking wasn't available, and internet rentals weren't a big thing then (other than here), so it didn't affect availability that much

I just think there’s a big difference between renting out your points based on availability, and hoarding the best rooms to rent them out to non-owners

 

[Hubalorian]

Couldn’t you argue that your intent is commercial if you just bought into the PolyTower and your first move as an Owner is to get a coveted room during a desirable time frame during the Poly Owner exclusive window?

 

[jennypenny]

I just think there’s a big difference between renting out your points based on availability, and hoarding the best rooms to rent them out to non-owners

Agreed. I was only pointing out that it was almost encouraged by DVC at one point. I remember renting from a dentist who advertised on here in 2000. But he wasn't squatting on rooms like is common now.

Apologies to those here who rent DVC points as part of their business model, but I'd be ok with DVC spending some of my dues to crack down mightily on commercial renting, including any and all brokers of such rentals. Then again, I'm also ok with them shortening the 7 month window to extend an owner's booking advantage at their own resort, so I'm sure I'll be run out of here with pitchforks now lol.