Future resale value on restricted resorts?

[Sandisw]

We still have 20 years of the old DVC model for the legacy resorts. I don't think it's fair to fear monger like there is some looming change that's going to impact that.

The old DVC model no longer exists because all resorts are restricted in some way.

People, including you, have said you feel RIV will have a depressed resale value because it has resale restrictions so not sure how its wrong suggesting that a changing program could impact values and there is no way to predict how much or little it does.

Five years ago, none of us would have thought that DVD would put in place resort
restrictions., yet they did.

Plenty of buyers will continue to buy resale but in another 2 years, there is a good chance that we will have three resorts restricted and in 10 years, not only will 2042 will have 9 years less, but we could have even more restricted resorts.

We know DVD has the power to impact the prices because VGF is down quite a bit since a year ago. Why?

Because DVD priced their product low enough that it makes sense to buy it direct with such a small price difference.

In the end, everyone has to decide what is best for them but understanding how things have changed, what could happen, and the potential impacts on all aspects of DVC is not fear. It’s helping potential new buyers understand the program and what can happen over time.

 

[Jlo85]

In the end, everyone has to decide what is best for them but understanding how things have changed, what could happen, and the potential impacts on all aspects of DVC is not fear. It’s helping potential new buyers understand the program and what can happen over time.

I just disagree on the impact, which is why I feel it verges on fear mongering. I don't think that Riviera restrictions have materially impacted resale contracts for other resorts. People know they can't stay at RIV, yet they're still buying resale contracts. DVC resale prices are depressed overall this year, you could argue it's Riviera, though I would say it's more the state of the real estate market as a whole.

I also question whether a buyer today really cares that much about future resorts. Maybe past buyers before Riviera did expect access to future resorts, but going forward I'm not sure any buyer really has that expectation.

Just my whole feeling is that the 'threat' of additional resorts is hyped up. It hasn't really borne out with Riviera.

 

[Sandisw]

Copper Creek was selling for $176/point direct originally.

You are correct. CCV started at $176 in 2017 and people were paying in the $140 resale a few years later around 2019.

RIV started at $185 and selling in the $140s now, on average

So, I’d say RIV resale numbers at this point are pretty similar to what happened with CCVs initial resale value at the start.

Given that RIV is restricted to one resort, so far, and CCV is not, it’s holding its own in comparison to that resort when comparing similar time periods.

It’s just too early in the process to make any real predictions regarding where RIV will eventually settle but for now, it’s performance 3 years in..ignoring that we had the pandemic and all that did to the market…it’s doing basically the same thing most have done this early in the game.

This thread is about the resale restrictions and how they might impact future value and if we have learned anything the past few years it is that DVD has a lot of power to make decisions that can change things on a dime.

That is why it’s risky for new buyers not to understand what has and could happen because the worst thing is to go in thinking one thing and realize years later you had no idea XY or Z was even possible.

 

[Sandisw]

I just disagree on the impact, which is why I feel it verges on fear mongering. I don't think that Riviera restrictions have materially impacted resale contracts for other resorts. People know they can't stay at RIV, yet they're still buying resale contracts. DVC resale prices are depressed overall this year, you could argue it's Riviera, though I would say it's more the state of the real estate market as a whole.

I also question whether a buyer today really cares that much about future resorts. Maybe past buyers before Riviera did expect access to future resorts, but going forward I'm not sure any buyer really has that expectation.

Just my whole feeling is that the 'threat' of additional resorts is hyped up. It hasn't really borne out with Riviera.

I don’t think anyone is saying that RIV will be the driving factor moving forward

But rather that DVD has shown it’s willing to change the game to make resale and direct so different that they gear buyers to buy from them.

And, there are definitely buyers who do care about being locked out. Plenty of posts here on the DIS if buyers who ended up going direct because they want the option for staying at all resorts and being eligible for whatever membership extras are offered..even if not guaranteed

I do agree with you that since it’s just one resort , it’s easy to say no big deal and plenty of resale buyers have. But if VDH and Poly tower have them? Resale buyers may have a harder choice to make.

And, regardless of what else happens with the program, BWV and BCV, along with BRV, HH, and VB will no longer exist as part of program come 2042. Whether they come back at all? No one knows. But they will be gone and between now and then, there will be new resorts that are likely to be off limits to todays resale buyer.

But based on the moves DVD has made? There is a high probability they will be restricted. Some won’t care because 19 years of use is a long time.

But some will and may not think about the fact that buying today and having access to 14 other resorts will change unless DVD abandons their current plans.

IMO, better to go in with the “what ifs” evaluated and be comfortable with that then spend a lot of $$$$ assuming nothing can change things and that selling your contract in 20 years is guaranteed to make you money simple because the resale market has been healthy.

It’s like PVB and the new Poly tower. Anyone buying resale today, especially ar PVB, should assume they will be locked out and decide if it’s okay before buying or wait until an official announcement is made.

 

[Jlo85]

You are correct. CCV started at $176 in 2017 and people were paying in the $140 resale a few years later around 2019.

RIV started at $185 and selling in the $140s now, on average

This is misrepresenting the numbers. CCV was selling for $29 less per point 32 months after opening. Riviera is selling for $44 less in the same timeframe. May seem insignificant, but that is a 60% bigger drop.

It's possible new resorts will be restricted but it's no way guaranteed. DVD isn't ROFR'ing PVB, so you could infer that Poly will be an expansion of the existing contract. I think buyers aren't expecting any favors from DVD, but this thread is too much doom and gloom

 

[BeachClub2014]

This is misrepresenting the numbers. CCV was selling for $29 less per point 32 months after opening. Riviera is selling for $47 less in the same timeframe. May seem insignificant, but that is a 60% bigger drop.

So? I sometimes get lost in the never ending debate over whether one resort is performing "better" or "worse" than another based on some snapshot in time. Riviera is nothing like CCV at all, so why is there any expectation that the two would "perform" the same on some fuzzy financial metric like average resale prices at one moment in time?

 

[matt and beth]

All I can say is Personally I Would Never Buy At The Restricted Resort. I’d rather have a white card from any of the others. Even a 2042 expire resort. Personal opinion

 

[Jlo85]

So? I sometimes get lost in the never ending debate over whether one resort is performing "better" or "worse" than another based on some snapshot in time. Riviera is nothing like CCV at all, so why is there any expectation that the two would "perform" the same on some fuzzy financial metric like average resale prices at one moment in time?

Because we’re talking about resale value. Could have bought Boardwalk resale instead of Riviera Direct in January 2020 and be selling at a 10% profit today instead of a 23% loss.

 

[BeachClub2014]

All I can say is Personally I Would Never Buy At The Restricted Resort. I’d rather have a white card from any of the others. Even a 2042 expire resort. Personal opinion

But if you buy resale then you are buying restricted points. I respect your Riviera position as it works for you, but all resale points are restricted, just differently.

 

[Jlo85]

But if you buy resale then you are buying restricted points. I respect your Riviera position as it works for you, but all resale points are restricted, just differently.

Yes, but only Riviera’s resale value appears to be suffering from the restrictions. Riviera buyers want to defend or talk about how future restrictions will depress legacy resort values, but I don’t buy it. And really there is no math to support it - Riviera didn’t.

 

[BeachClub2014]

Because we’re talking about resale value. Could have bought Boardwalk resale instead of Riviera Direct in January 2020 and be selling at a 10% profit today instead of a 23% loss.

But again, that presumes some relationship between the two, which makes no sense. They are two entirely different resorts and in entirely different phases of maturity.

 

[matt and beth]

But if you buy resale then you are buying restricted points. I respect your Riviera position as it works for you, but all resale points are restricted, just differently.

Those are random discounts Disney reserves the right to remove tomorrow with a blue card. No guarantees. The restrictions with RIV are in the contract. That’s a big difference

 

[BeachClub2014]

Yes, but only Riviera’s resale value appears to be suffering from the restrictions. Riviera buyers want to defend or talk about how future restrictions will depress legacy resort values, but I don’t buy it. And really there is no math to support it - Riviera didn’t.

How do you know that the restrictions on Riviera are having any effect at all on the resale price? That's an oft repeated belief and assumption, but based on what?

 

[BeachClub2014]

Those are random discounts Disney reserves the right to remove tomorrow with a blue card. No guarantees. The restrictions with RIV are in the contract. That’s a big difference

Partially true.

 

[havoc315]

Copper Creek was selling for $176/point direct originally.

Not sure what that has to do with anything? Riviera was selling originally for in the 160’s. If you bought direct early, you can already get most of your value back re-sale.

Question of re-sale value retention is to look at current direct price vs current resale price.

 

[Sandisw]

This is misrepresenting the numbers. CCV was selling for $29 less per point 32 months after opening. Riviera is selling for $47 less in the same timeframe. May seem insignificant, but that is a 60% bigger drop.

It's possible new resorts will be restricted but it's no way guaranteed. DVD isn't ROFR'ing PVB, so you could infer that Poly will be an expansion of the existing contract. I think buyers aren't expecting any favors from DVD, but this thread is too much doom and gloom

Based on the data from our resources here, we have CCV going in the $140s in 2019..when the price was $189 direct. $49 point reduction at 2 years in.

In 2020, lots of CCV contracts were sold in the $130s, when price direct was $195.. $65/point reduction 3 years in.

2021 and 2022 has seen it rebound back into the $160s now thst DVC has begun to exercise ROFR…

But, CCV has had times that have seen reductions off direct similar to what RIV has in its short life.

Matter of fact, most new resorts in active sales see this type of reduction until they become sold out.

Now, RIV is different and there is a good chance it’s resale value due to restrictions could be different long term.

But at this point, the info we have at least on this site, has it acting pretty close to other resorts, given its a one resort product.
Of course, no one can guarantee anything until official from DVD.

But the current language of the POS says that all resale points will be restricted from RIV and all future resorts. That’s not speculation. That is what the contracts say.

I’d say it’s certainly prudent for any buyer..direct or resale… to expect that to be the case because those are the terms they are agreeing to when they buy.

Now, in terms of Poly tower? If it is a new association, why would they need to snap up PVB points, especially this early when those points won’t be part of the pool of new points?

So, in one way, you could say the lack of ROFR supports it won’t be part of the PVB because it was to be all one association they’d snap them up right now so they can sell for more later.

I guess I am of the belief that the more info a buyer has about DVC, the better informed they are when or if they buy.

 

[Sandisw]

All I can say is Personally I Would Never Buy At The Restricted Resort. I’d rather have a white card from any of the others. Even a 2042 expire resort. Personal opinion

And isn’t that is why threads like this are so great? They put it all out there and then buyers have it all so they can make the best choice for them.

 

[Jlo85]

How do you know that the restrictions on Riviera are having any effect at all on the resale price? That's an oft repeated belief and assumption, but based on what?

I mean, I just cited numbers on why I think so. It has the lowest resale price proportional to the original direct price (without incentives) of any recent DVC opening over the same time period. And it's by a long shot, IMO.

My main message to buyers is that there are a lot people on this thread saying to be cautious of buying legacy resorts because their value will tank. I'd be cautious of buying Riviera, personally.

Question of re-sale value retention is to look at current direct price vs current resale price.

We're talking about value meaning what will my asset be worth if I sell it. What do I care what Disney is charging? I use the original price sans incentives just to guide where Riviera should be today. IMO, if it behaved like other recent resorts it should be at $160/point resale. But it's not.

 

[Sandisw]

Those are random discounts Disney reserves the right to remove tomorrow with a blue card. No guarantees. The restrictions with RIV are in the contract. That’s a big difference

The restriction for resale they are talking about are the use of points, not the membership extras. Those have nothing to to with where points can be used.

Resale points are restricted from RIV and future resorts. That is in the contract as well because that is tied to the RIV restrictions.

 

[matt and beth]

The restriction for resale they are talking about are the use of points, not the membership extras. Those have nothing to to with where points can be used.

Resale points are restricted from RIV and future resorts. That is in the contract as well because that is tied to the RIV restrictions.

Yep