Farewell, DVC

[gscott8075]

We have been part of DVC since 2001. We started at OKW and then visited HHI and fell in love with the resort. Our family has had wonderful vacations at HHI, WDW and Aulani. We even used the points for a Mediterranean Cruise (yes, it was cheaper then paying cash - was a great deal! )

As of today, we are no longer DVC owners. We have become increasingly concerned with the escalation of maintenance fees and the onslaught of rule changes.

When we started at HHI, the Sunday-Thursday point charts for a 2 BR were 33 points, 66 on Friday and 99 on Saturday. Dues were $3.75 or so which worked out to $124 per night for a five night stay. This was a great value relative to the rack rate and to comparable accommodations.

At some point, DVC redistributed the points and Sun-Thu increased to 41 points per night and Fri/Sat were reduced - this resulted in a 24% increase in points and we added on. Today, that same room costs 41 points x 8.56 or $351 per night. A 183% increase - much higher than the inflation rate. The value proposition has vanished. None of this includes the capital investment in the original points. And, looking at the cost of points today direct, it just no longer makes any financial sense.

Our concerns with DVC continued to grow:

- What happens in 2042 - that's 23 years away.
- The dues increases were increasing as a percentage on an already large number.
- The room renovations were not favorable to us.
- Resale rule restrictions continued to tighten.
- New rules breaking DVC into New and Legacy
- House rules became an increasing irritant.

The straw that broke it was the ridiculous new rule that we can't launch kayaks from the resort anymore. Instead, they require us to drive to a public launch several miles away. This was the center of my mornings when we vacationed at HHI! The reason is nonsense. Very few folks brought kayaks. Others can go to Shelter Cove and rent them and take them to the same area they alleged to have concern about.

It has been a fantastic experience. If anyone asks us if they should buy into it - I would have to say in 2001 - a resounding yes. In 2019, the numbers just do not work.

We are not criticizing anyone who is a member - it gave us unforgettable memories.

Thanks for the ride - the folks on this board have been especially helpful with our DVC adventures....

 

[ELMC]

We have been part of DVC since 2001. We started at OKW and then visited HHI and fell in love with the resort. Our family has had wonderful vacations at HHI, WDW and Aulani. We even used the points for a Mediterranean Cruise (yes, it was cheaper then paying cash - was a great deal! )

As of today, we are no longer DVC owners. We have become increasingly concerned with the escalation of maintenance fees and the onslaught of rule changes.

When we started at HHI, the Sunday-Thursday point charts for a 2 BR were 33 points, 66 on Friday and 99 on Saturday. Dues were $3.75 or so which worked out to $124 per night for a five night stay. This was a great value relative to the rack rate and to comparable accommodations.

At some point, DVC redistributed the points and Sun-Thu increased to 41 points per night and Fri/Sat were reduced - this resulted in a 24% increase in points and we added on. Today, that same room costs 41 points x 8.56 or $351 per night. A 183% increase - much higher than the inflation rate. The value proposition has vanished. None of this includes the capital investment in the original points. And, looking at the cost of points today direct, it just no longer makes any financial sense.

Our concerns with DVC continued to grow:

- What happens in 2042 - that's 23 years away.
- The dues increases were increasing as a percentage on an already large number.
- The room renovations were not favorable to us.
- Resale rule restrictions continued to tighten.
- New rules breaking DVC into New and Legacy
- House rules became an increasing irritant.

The straw that broke it was the ridiculous new rule that we can't launch kayaks from the resort anymore. Instead, they require us to drive to a public launch several miles away. This was the center of my mornings when we vacationed at HHI! The reason is nonsense. Very few folks brought kayaks. Others can go to Shelter Cove and rent them and take them to the same area they alleged to have concern about.

It has been a fantastic experience. If anyone asks us if they should buy into it - I would have to say in 2001 - a resounding yes. In 2019, the numbers just do not work.

We are not criticizing anyone who is a member - it gave us unforgettable memories.

Thanks for the ride - the folks on this board have been especially helpful with our DVC adventures....

Thanks for sharing your perspective and it sounds like you've thought it out thoroughly and this is the right decision for you. One thing you forgot to mention (and another reason for you to sell)...your DVC membership is worth more now than what you paid for it originally! In that regards DVC is a victim of its own success. I bought BWV points in 2012 for $58 per point (resale). If they were worth nothing now then I would be a proud and happy owner of BWV and use it until it runs out without a care in the world. Instead, however, I am sitting on an asset that is worth twice what I paid for it and wondering if I shouldn't follow your lead and sell while I can. You've certainly given me a lot to think about, thank you for sharing your thought process.

 

[jodifla]

Sorry it isn't working for you anymore.

We bought OKW in 1997 and BCV a few years later. We have not loved every change but we have loved staying on property for a fraction of the cost. Just got back from a Poly / OKW trip and DS, a teen, is already talking about when we return.

I am trying to book a couple of weekend trips to Chicago and Niagara Falls and can't believe how much the room rates are. Hotels in general are just very expensive now.

We won't sell because we don't want to regret it a few years down the road.

 

[gscott8075]

Thanks for sharing your perspective and it sounds like you've thought it out thoroughly and this is the right decision for you. One thing you forgot to mention (and another reason for you to sell)...your DVC membership is worth more now than what you paid for it originally! In that regards DVC is a victim of its own success. I bought BWV points in 2012 for $58 per point (resale). If they were worth nothing now then I would be a proud and happy owner of BWV and use it until it runs out without a care in the world. Instead, however, I am sitting on an asset that is worth twice what I paid for it and wondering if I shouldn't follow your lead and sell while I can. You've certainly given me a lot to think about, thank you for sharing your thought process.

Thanks - since HHI is a non-WDW property, there was very little appreciation...

 

[skippytx]

On the plus side at least you were able to get out. How many people buy beach timeshares and get stuck with them when they have almost no value? I was on TUG a year or two ago and there was a timeshare place that would give you the timeshare if you agreed to pay the dues. Other people were paying folks to take their timeshare from them. At least DVC gives us an exit strategy.... for now anyway.

 

[cvjw]

We’ve sold over half our points for some of the very same reasons.

We also find ourselves not interested in visiting Disney world anymore. The huge amount of planning that is now involved, the ever increasing crowds anytime we visit and the non stop price increases on food and tickets are some other reasons.

We are holding onto our BCV and BWV points for a few more years. We are mostly renting the points out to pay for Disney cruises now, coupled with a few days at food and wine.

But, when we do sell our last points, we will make money. At least that is something

 

[we"reofftoneverland]

Thanks for sharing your perspective and it sounds like you've thought it out thoroughly and this is the right decision for you. One thing you forgot to mention (and another reason for you to sell)...your DVC membership is worth more now than what you paid for it originally! In that regards DVC is a victim of its own success. I bought BWV points in 2012 for $58 per point (resale). If they were worth nothing now then I would be a proud and happy owner of BWV and use it until it runs out without a care in the world. Instead, however, I am sitting on an asset that is worth twice what I paid for it and wondering if I shouldn't follow your lead and sell while I can. You've certainly given me a lot to think about, thank you for sharing your thought process.

I would argue not a victim, just a success.

 

[ELMC]

I would argue not a victim, just a success.

Haha, perhaps true. My point is that because DVC has held monetary value for so long, people have expectations that are unrealistic of any other timeshare system as to the future value of their contract. In no other system are the owners talking about reselling, effects of ROFR and restrictions on resale value, expected return when you're done, etc. Just Disney. But to your point, it's because it's such an excellent product tied to such an excellent location. So yeah, a successful timeshare to say the least. Now let's see if Disney tries to change that perception and/or reality...

 

[bumbershoot]

looking at the cost of points today direct, it just no longer makes any financial sense.

Resale rule restrictions continued to tighten.
- New rules breaking DVC into New and Legacy

Not sure why these things would factor in leaving DVC.


I see what you mean about hhi selling amount not being much more than what you bought at.

On the other hand. It looks like you might have made 5/point AND you had all those years of vacations for the cost of dues. Not bad imo.

 

[stewart715]

Not sure why these things would factor in leaving DVC.


I see what you mean about hhi selling amount not being much more than what you bought at.

On the other hand. It looks like you might have made 5/point AND you had all those years of vacations for the cost of dues. Not bad imo.

It's also not remotely true. $188pp for 50 years at a new resort, direct is well worth it in comparison to cash rack rates for deluxe resorts.

 

[gscott8075]

$121 for Hilton Head. $225 for Beach Club - these resorts expire in 2042. Hard to justify the pricing by any metric - at some point, these will become a wasting asset as the capital value will start to decline.

It's also not remotely true. $188pp for 50 years at a new resort, direct is well worth it in comparison to cash rack rates for deluxe resorts.

 

[stewart715]

$121 for Hilton Head. $225 for Beach Club - these resorts expire in 2042. Hard to justify the pricing by any metric - at some point, these will become a wasting asset as the capital value will start to decline.

I don’t understand how direct pricing for sold out resorts affects a long time existing member in any way.

It’s also not an asset. You’re prepaying for vacations. It’s not meant to appreciate or even hold its value. It’s meant to go to $0 on the last year.

But $225 for Beach Club, arguably the least economical resort of them all right now, is still much cheaper than cash rack rates.

 

[gscott8075]

Not sure why these things would factor in leaving DVC.


I see what you mean about hhi selling amount not being much more than what you bought at.

On the other hand. It looks like you might have made 5/point AND you had all those years of vacations for the cost of dues. Not bad imo.

I am certainly not complaining - just sharing my observations as an overall satisfied DVC member as we exit. Those were two of my concerns as we see DVC continuing to increase point costs, maintenance fees, and changing the rules. The Polynesian Bora Bora bungalow bait and switch of magnificent accommodations which charge 200 points for a 2 BR that people will not use them and opt instead for smaller units which places demand pressure on the most popular accommodations.

As far as the split into legacy and new DVC - it does not affect me individually. But, it shows Disney's intent to make changes which could have negative impacts on existing owners. The point chart fiasco from last year is another example. The two combined raised warning signs for our family.

As I have said - it was a great 18 years. It has nothing to do with our experiences, but where DVC appears to be headed.....

 

[RamblinWreck]

I don’t understand how direct pricing for sold out resorts affects a long time existing member in any way.

It’s also not an asset. You’re prepaying for vacations. It’s not meant to appreciate or even hold its value. It’s meant to go to $0 on the last year.

But $225 for Beach Club, arguably the least economical resort of them all right now, is still much cheaper than cash rack rates.

Prepaid expenses absolutely are an asset. If you were accounting for them on a balance sheet, that’s where you’d have to put them.

When people on here say not to treat it as an investment, I think they’re limiting their concept of an “investment” to something that you put money into and hope for that money to grow.

But that’s not really what an investment is. There’s really no way to look at a purchase of a timeshare as anything other than an investment. You are putting money down in the hopes that it will save you money long term on your vacations (or allow you to take more extravagant vacations for the same amount of money).

Or perhaps you’re putting money down because feeling like you own part of Disney has value to you, or any other emotional reasons. You’re investing in your happiness. Even then it’s good to work out the numbers appropriately so you can do an honest assessment of what that is really worth to you.

I guess it just rubs me the wrong way when people say things like this because it encourages people to not really think it through.

 

[stewart715]

Prepaid expenses absolutely are an asset. If you were accounting for them on a balance sheet, that’s where you’d have to put them.

When people on here say not to treat it as an investment, I think they’re limiting their concept of an “investment” to something that you put money into and hope for that money to grow.

But that’s not really what an investment is. There’s really no way to look at a purchase of a timeshare as anything other than an investment. You are putting money down in the hopes that it will save you money long term on your vacations (or allow you to take more extravagant vacations for the same amount of money).

Or perhaps you’re putting money down because feeling like you own part of Disney has value to you, or any other emotional reasons. You’re investing in your happiness. Even then it’s good to work out the numbers appropriately so you can do an honest assessment of what that is really worth to you.

I guess it just rubs me the wrong way when people say things like this because it encourages people to not really think it through.

All of that is fair, and I was brief in my comments because I was typing on my phone. What I meant is, if you spent $20,000 on DVC and then had 20 years of trips on that deed and it then was worth $15,000 - you can't chalk that up to a loss. That's all I meant. It can't be treated as a traditional investment re: 20,000 invested, current value 15,000.

 

[ELMC]

But $225 for Beach Club, arguably the least economical resort of them all right now, is still much cheaper than cash rack rates.

I'm not so sure it is. Even assuming $500 a night cash rate and ignoring dues for the moment, it would take ten years of cash stays just to recoup your initial purchase price. And if you would consider renting, there is no point in the life of a BCV contract that a direct purchase is a cost savings over renting points to stay there. Obviously this is a very oversimplified analysis but I'm trying to take a broader view and not get into a battle of the spreadsheets. But my point has been for awhile that DVC has blown through the ceiling of the value proposition that it was built on, and therefore is a fundamentally different product than it once was. Still a great product, but different.

 

[stewart715]

I'm not so sure it is. Even assuming $500 a night cash rate and ignoring dues for the moment, it would take ten years of cash stays just to recoup your initial purchase price. And if you would consider renting, there is no point in the life of a BCV contract that a direct purchase is a cost savings over renting points to stay there. Obviously this is a very oversimplified analysis but I'm trying to take a broader view and not get into a battle of the spreadsheets. But my point has been for awhile that DVC has blown through the ceiling of the value proposition that it was built on, and therefore is a fundamentally different product than it once was. Still a great product, but different.

Fair points. And yes, vs. renting, it is a non-starter. $225 a point is almost certainly more expensive than simply renting DVC points at $14.50 a point. However, I still maintain that it makes sense for those using a DVC direct ($225 per point) vs. cash rack rate (though resale makes much much more sense).

I do hate the spreadsheet calculations too, I think they can also get a little ridiculous. At end of day, it's a vacation. Anyways, let's just take the first week of October in a Studio. At $225 per point that's $9.70 per point per year remaining. For 2019, that's $16.72 per point including dues. You need 107 points to stay in a Studio Oct 1-8 which comes out to $1,789 for the week or $255 per night. The current cash rate of that room is $4,299 after taxes/fees or $614 per night. The direct DVC price represents a 58% discount on the cash rack rate. In this particular scenario, a savings of $2,510 or $359 per night for a single visit. When you get into 1 and 2 bedroom units, the savings are even greater.

Dues do go up, but so do cash rack rates. So using simplified math, your break even, for 107 points vs. cash rack rate, would be less than 6 years. Then you'd have 17 years remaining of MF only stays.

Do I recommend doing this? Absolutely not. But I am just arguing how direct prices still beat their cash rack rates by a lot.

 

[ELMC]

Fair points. And yes, vs. renting, it is a non-starter. $225 a point is almost certainly more expensive than simply renting DVC points at $14.50 a point. However, I still maintain that it makes sense for those using a DVC direct ($225 per point) vs. cash rack rate (though resale makes much much more sense).

I do hate the spreadsheet calculations too, I think they can also get a little ridiculous. At end of day, it's a vacation. Anyways, let's just take the first week of October in a Studio. At $225 per point that's $9.70 per point per year remaining. For 2019, that's $16.72 per point including dues. You need 107 points to stay in a Studio Oct 1-8 which comes out to $1,789 for the week or $255 per night. The current cash rate of that room is $4,299 after taxes/fees or $614 per night. The direct DVC price represents a 58% discount on the cash rack rate. When you get into 1 and 2 bedroom units, the savings are even greater.

Dues do go up, but so do cash rack rates. So using simplified math, your break even, for 107 points vs. cash rack rate, would be less than 6 years. Then you'd have 17 years remaining of MF only stays.

Do I recommend doing this? Absolutely not. But I am just arguing how direct prices still beat their cash rack rates by a lot.

These are some very generous assumptions and you do sort of get into the spreadsheet battle by highlighting one example and providing numbers as well as by extrapolating a lump sum purchase price in year one over a 24 year period. I do not think you would find anyone on these boards, even the most staunch direct buy supporters, who would support your 6 year break even assumption for a BCV direct purchase. The first week of October is Columbus Day weekend and is also at the peak of Food and Wine Festival. So your $4,300 assumption is not representative of the totality of BCV stays. I can tell you that over the past two years I have stayed at the BC several times for an average of $425 a night all in. So perhaps that would be a more realistic number?

We agree on the rental option proposition as being a nonstarter. I think that if you go back and read some of the historical threads here there is a strong opinion that using cash rack rates is a poor comparison to justify a DVC purchase given the multitude of options available for staying in a Disney hotel room at less than rack rate.

 

[gscott8075]

Fair points. And yes, vs. renting, it is a non-starter. $225 a point is almost certainly more expensive than simply renting DVC points at $14.50 a point. However, I still maintain that it makes sense for those using a DVC direct ($225 per point) vs. cash rack rate (though resale makes much much more sense).

I do hate the spreadsheet calculations too, I think they can also get a little ridiculous. At end of day, it's a vacation. Anyways, let's just take the first week of October in a Studio. At $225 per point that's $9.70 per point per year remaining. For 2019, that's $16.72 per point including dues. You need 107 points to stay in a Studio Oct 1-8 which comes out to $1,789 for the week or $255 per night. The current cash rate of that room is $4,299 after taxes/fees or $614 per night. The direct DVC price represents a 58% discount on the cash rack rate. In this particular scenario, a savings of $2,510 or $359 per night for a single visit. When you get into 1 and 2 bedroom units, the savings are even greater.

Dues do go up, but so do cash rack rates. So using simplified math, your break even, for 107 points vs. cash rack rate, would be less than 6 years. Then you'd have 17 years remaining of MF only stays.

Do I recommend doing this? Absolutely not. But I am just arguing how direct prices still beat their cash rack rates by a lot.

There is no doubt my family derived years of joy during our Disney trips. I can’t put a value on that.

Our decision to sell was a combination of factors - I listed all of them. If you ask what was the most significant it would have to be the dues increases which have been going up at an alarming rate. When I penciled this out years ago, I never contemplated 8.56 a point in 2019.

The second was the increasing frequency of rules changes - like the point chart debacle and the creation of DVC 2. Disturbing trend and we really worry about the future holds.

I would also suggest that rack rate is frequently discounted so I am not sure that’s the correct comparison.

 

[stewart715]

We agree on the rental option proposition as being a nonstarter. I think that if you go back and read some of the historical threads here there is a strong opinion that using cash rack rates is a poor comparison to justify a DVC purchase given the multitude of options available for staying in a Disney hotel room at less than rack rate.

Absolutely, and 100% agree. But for some, renting just doesn't offer enough flexibility. Also, getting rooms via DVC rental during premium times at premium properties isn't always easy. And for many the rooms that are discounted by Disney via promotions just aren't rooms that they want to stay in. Is a cash 2 bedroom at BCV ever discounted by Disney during F&W? Ever? I don't think so at least.

And yes, the dates do matter and the point charts aren't exactly proportionate to the cash rack rate charts. My point is, your break even could be as soon as 5-6 years if you go every first week of October.

I don't think the extrapolation is necessarily generous. I'm comparing a one portion of 23 portions against the 2019 cash rack rate. Yes, you can introduce investment opportunity on the original sum of money along with estimated cost of dues. But, that would require me to estimate what the cash rack rates are in 10-15 years. So, I did some basic math. On 2019 investment. Your initial cost is essentially a portion of your prepayment for your vacation and the MF's are the other portion.