Help I Need to Know the GOOD, BAD and the UGLY about Purchasing DVC!

[Andrew015]

4% is a pretty good figure for arguments sake. Looking at the past 5 years of VWL maintenance fees, the average YOY change is 3.5%, with the lowest year being a 2.7% increase and the highest being a 5% increase.

If you really dont care where you stay and have lots of flexibility, then I would agree that renting points is a pretty good way to go. For someone like myself who has to be at a certain resort, I dont want to roll the dice and hope/pray Ill be able to get what I want.

I crunched some numbers assuming a 4% annual MF increase for the DVC portion, and figured $14/point on the rental side of things, and my breakeven point came out to be 9 years on DVC vs Renting. I did not factor in any annual price increases on rental points, as sometimes, you might be able to get them cheaper (say renting them direct vs using a broker, or catching one of the last minute deals")  so I kept that number static.

I bought my DVC prior to the price increase, and got VWL at the very low-end of what was passing ROFR, so I suspect your break-even point might be even further out. Curious to know what you came up with!

 

[dmunsil]

I was really just wondering why people used the cash number instead of the renting points number.

I don't think comparing to renting is wrong, but there are reasons why people would compare to discounted cash rooms. The experience of paying cash is the most similar to the experience of booking DVC, though obviously they're all a little different. With cash booking you can cancel up to 5 days before arrival with a full refund, and with DVC you can cancel up to 30 days before arrival with no consequences, and less than that with relatively minor consequences (holding points).

With renting, you have a somewhat more convoluted process, you generally can't cancel or change the booking at all, and there's some small risk of getting scammed. You can't see availability online. To even check if something is available you have to pay a deposit, when using the largest rental broker.

So while in the end you still get the same basic room whether you pay cash for it, rent points, or own DVC, the experience and risk factors are all slightly different and those differences are worth some amount of money. I mean, you wouldn't rent points over paying cash if it only saved you $10/night, right? If you figure out what amount of discount makes renting worth it, you now know what the flexibility and convenience of cash payment is worth to you.

 

[Deb & Bill]

I have a column for MF's and I add 4% every year to it, since I thought I heard that seems to be the average. I was really just wondering why people used the cash number instead of the renting points number. I guess if nothing was available on the points side you would have to pay cash, but I doubt I would...Comparing it that way (renting points) I certainly don't break even for a while, but I am ok with it since I am 99% guaranteed VGF in December if I want it

Member fees are allowed to go up 15% each year without including taxes in the increase. So your 4% might be low for future years.

 

[jillmc40]

4% is a pretty good figure for arguments sake. Looking at the past 5 years of VWL maintenance fees, the average YOY change is 3.5%, with the lowest year being a 2.7% increase and the highest being a 5% increase.

If you really dont care where you stay and have lots of flexibility, then I would agree that renting points is a pretty good way to go. For someone like myself who has to be at a certain resort, I dont want to roll the dice and hope/pray Ill be able to get what I want.

I crunched some numbers assuming a 4% annual MF increase for the DVC portion, and figured $14/point on the rental side of things, and my breakeven point came out to be 9 years on DVC vs Renting. I did not factor in any annual price increases on rental points, as sometimes, you might be able to get them cheaper (say renting them direct vs using a broker, or catching one of the last minute deals")  so I kept that number static.

I bought my DVC prior to the price increase, and got VWL at the very low-end of what was passing ROFR, so I suspect your break-even point might be even further out. Curious to know what you came up with!

I guess this would be the "Ugly" that the OP was referring to I actually only have 3% increase not 4, dang I thought I did 4. OK, with 3% I hit break even at 23 yrs...4% I got nauseous and stopped counting at 40yrs... I will say though, I kept the rental at 14.00 pp which it will surely go up, especially if in 40 yrs the mf is 21.00 pp So basically I have no idea when I will break even BUT, I can't not look at the AP discount, since we were buying ap's before being dvc. I know it could go away at any time, but for the years that I get it, I will add it to my spreadsheet...

dmunsil, I see your point about renting. I was thinking the likelihood of being able to rent points to stay at VGF would be slim. Not impossible, but slim, and I have stayed at GF before waiting for the AP discount and that in itself is enough to make me lose my mind! That is what made me buy VGF. So maybe I should add in some cost of anguish into my calculation (or I guess the cash price has that built in)

 

[Andrew015]

Keep in mind, the numbers that I used in my calculation to generate a 9 year pay-back vs renting are based on buying VWL via resale @ $50/point. When plugging in the cost to buy VGF direct from Disney, the numbers begin to jump off the spreadsheet!

 

[chainkid]

I think the value of DVC means different things for different people. Since I bought several contracts in 1999 when they were fairly cheap compared to today, I can honestly say I could sell all my contracts for alot more than I paid for them right now. I have had wonderful family trips that my points have paid for. I could not possibly have paid for my whole extended family to go on vacation together in deluxe resorts. Have I saved money...no not at all. The kicker is that I would never go to disney as much as I have if it was just my DH and I and we had only in the past been able to afford the parking lot view at a moderate resort. DVC has changed my life in a very good way. I have lived the good life at a cost far less than the good life costs at disney. My family who could never afford disney even in a value resort have been several times as my guests and the joy of seeing all the cousins bonding is worth more than money could buy. So while the lodging is far better than i could afford on a cash basis, the frequency of visits , the air fare and all the other things the mouse extracts from your wallet are a big drain.

I could afford to pay cash for DVC at the time and the dues are so far manageable but to say owning DVC has saved me money..that would be a NO

 

[Andrew015]

I think the value of DVC means different things for different people. Since I bought several contracts in 1999 when they were fairly cheap compared to today, I can honestly say I could sell all my contracts for alot more than I paid for them right now. I have had wonderful family trips that my points have paid for. I could not possibly have paid for my whole extended family to go on vacation together in deluxe resorts. Have I saved money...no not at all. The kicker is that I would never go to disney as much as I have if it was just my DH and I and we had only in the past been able to afford the parking lot view at a moderate resort. DVC has changed my life in a very good way. I have lived the good life at a cost far less than the good life costs at disney. My family who could never afford disney even in a value resort have been several times as my guests and the joy of seeing all the cousins bonding is worth more than money could buy. So while the lodging is far better than i could afford on a cash basis, the frequency of visits , the air fare and all the other things the mouse extracts from your wallet are a big drain.

I could afford to pay cash for DVC at the time and the dues are so far manageable but to say owning DVC has saved me money..that would be a NO

Chainkid  I really do understand your perspective, as I have the same argument with my sister all the time, who insists that Kohls Cash is the best thing ever. I got a 25% off coupon, and I had $50 in Kohls cash  It was such a good deal! she cries, after spending $250 on un-needed clothes that she probably already has in every color of the rainbow. My response is something to the effect of It would have been a helluva lot cheaper if you just stayed home!

Sure, staying at home is always the cheaper option. But I don't really think that's the argument at hand. We're discussing the pro's and con's of DVC, and if someone "fits" the proverbial DVC mold, then we're probably already talking about someone who likes to visit WDW at least once a year in Deluxe accommodations. If you don't fit this criteria, then chances are, DVC might not be the best move for you (even though many who don't still purchase and proclaim happiness).

So by virtue of your very argument, you absolutely are saving money with DVC if you are going to make that annual trip regardless. If my sister didn't spend $250 at Kohls, she probably would have blown $350 at Macy's because she's a compulsive shopper who needs her credit cards cut to shreds.

In talking about "Value" rather than "Cost", you are 100% spot on that DVC means different things to different people. The value that DVC brought to you by affording you the ability to bring your entire family was priceless, much like it was for me when I took my Father back for his first visit in 10 years. He was like a kid in a candy store, and I will take that memory to my grave. It just happened to be a plus that I saved money in the process over what I would have paid on a cash reservation

 

[dholmes1950]

We've been DVC members for several years. Our home resort is SSR and we love it and DVC. I've read through all the pros and cons in these threads and agree with most, so you have to make a decision that is right for you.

However, on the pro side - we usually manage 2 to 3 trips a year to Disney with our 320 points. A little advance planning goes a long way and even though sometimes I've not been able to get a reservation at another resort for the time I want, usually I can get a reservation at SSR anytime I've tried (unless it has been totally at the last minute). When that happens, I wait list and usually have something come thru. Also, because we are DVC members, we can buy annual passes so we don't need to buy park tickets each time. That way we don't feel like we are wasting money if we don't "do" everything each time we go and we can go to one of the parks just for dinner. You also get discounts on purchases, some dining and on the tours and special events when you are a DVC member as well as some other perks.

 

[jillmc40]

So by virtue of your very argument, you absolutely are saving money with DVC if you are going to make that annual trip regardless. If my sister didn't spend $250 at Kohls, she probably would have blown $350 at Macy's because she's a compulsive shopper who needs her credit cards cut to shreds.

Andrew...Are you my brother??? I have 20.00 Kohls cash burning a hole in my pocket

I agree...It is not the best financial decision I have ever made, but it the best decision for our family. We love Disney, we want to go over and over again, and the older I get the more I want to stay in nicer hotels (not just Disney, I use my Marriott timeshare as well). I did the cheapies when I was young and it was just DH and I roaming around the country. But now, we have kids, and when I travel I like to set up house and be comfortable. So for me, that makes DVC a wise decision.

Timeshares can be a good thing, as long as you know how to work them!

 

[chainkid]

As it turns out for our family, the DVC investment was my smartest decision because everytime I decided to put the money in a mutual fund it lost money. I don't think I could buy in at the new resorts prices as I'm too old to really get the value long term and I love my home resort BWV . if the resale market hits with the poly then I'll sell my AKV points to buy there as my heart loves that resort . It would be an impulse buy that really makes no sense but you can't put a dollar value on emotions

 

[shaycamp21]

OP here, it has been a long time since I posted as I have continued to research and figure out what is going to be best for our family. I just wanted to thank everyone for taking the time to share their perspective and insight about purchasing DVC.

So if I sum things up:
The GOOD is : Getting to visit WDW yearly and always stay in a deluxe villa accommodations. This is something I look forward to, in our younger years I was ok with staying at a value resort (and moderate resorts) but now that we are in our 40's and more comfortable financially, we really want to enjoy staying in nicer places. Also having teenagers who understand what is going on (if you know what I mean), it would be amazing to have the privacy of a one or two bedroom. This summer we went to Jamaica and got two connecting rooms at our resort and it was wonderful to close the door and have our own space. The two year old is still little and in in her pack n play and goes to bed early so it's fine if she's in our room for now.

The BAD is : The accommodations cost is only a small part of a WDW vacation which is only what purchasing DVC will cover. Then add on airfare, park tickets, dining etc... For us airfare is something that is covered by our Visa points--we put absolutely everything on Visa gas, groceries etc. (and pay it off each month) and usually have enough points to for a at least one free flight a year for our family and usually enough for another flight for DH and I. Park tickets are expensive and go up every year but we go to Disney anyway so we would spend that $ regardless. Also we have been to Disney enough that going to each and every park is not mandatory. Some years we've only purchased a two day ticket or a hard ticket event (MVMCP). There is so much to see and do at WDW, some cost $ but I think we would also just spent more time relaxing at the resort. Having a villa accommodation we would probably save money on food and at the very least by the fact that we would be able to reheat leftovers. Can't tell you the number of times we have only finished 1/2 of our meals and not got a doggy bag because we didn't have a microwave to reheat it. It is a vacation so not sure how much I would want to cook but it is nice to have that option.

The UGLY: I guess is the yearly maintenance fees which go up every year and which will cost you way more than your purchase in the long run. It's just one of those things that you just have to accept with any timeshare. For us it would not be a financial hardship and it is a price we'd have to pay to stay in a villa at the happiest place on earth. SSR seems to have the lowest maintenance fee which is a plus.

Dh is now less on the fence about purchasing so my question is it feasible to be able to purchase at SSR (we would not be financing) and be able to use the points to vacation this March? I would be fine for this trip just staying in a studio at OKW which I actually prefer in terms of theming (LOVE the KEYS) but since there is less time on most OKW contracts I think SSR would be better bang for our buck plus from what I have researched it seems OKW has the least issue with availability.

 

[timandjanl]

To answer your question about using the points for a trip in march, that depends on how quickly you buy and the availability for when you want to go. If you find a resale SSR contract that fits you and you're able to get an offer accepted right away plan on 8 weeks to close (assuming Disney waives ROFR). You can't make the reservation until the points have transferred to you (I think that's right) so best case scenario you're looking at early november and booking a march trip about 4 months out.

 

[Deb & Bill]

...Dh is now less on the fence about purchasing so my question is it feasible to be able to purchase at SSR (we would not be financing) and be able to use the points to vacation this March? I would be fine for this trip just staying in a studio at OKW which I actually prefer in terms of theming (LOVE the KEYS) but since there is less time on most OKW contracts I think SSR would be better bang for our buck plus from what I have researched it seems OKW has the least issue with availability.

One thing you are not considering. SSR one bedroom villa only officially sleeps four. There is no sleeper chair in the SSR one bedroom. OKW does have the sleeper chair in the one bedroom, so there are sleeping spaces for five. Once your little one turns three, you will need to forgo studios (except maybe GFV which really require a lot of points) and move onto one bedroom villas. With OKW, AKV and BLT, you will always have a bed for all three kids.

 

[KAT4DISNEY]

There are extended OKW contacts that expire in 2057. Listings on the resale websites say if it's a contract that expires in 2042 or 2057. That way you would own at a resort that sleeps 5 in a 1 bedroom. Although you may just be planning on 2 bedrooms in the future and SSR would work just fine.