How can disney sell taken contracts

[MouseOfCards]

1. Seven of the 10 deeds were add-ons; three were new VGF master contracts. As @supersnoop posted, DVC members routinely add on small deeds to supplement the points they already own.

DVC deeds show the contract number of the owner(s) in the upper left hand corner of the deed. New master contracts, meaning the buyer is establishing a new DVC account with this deed, will have a contract number with a suffix of .000, such as 13123456.000. Add on deeds will have a number like .001, which signifies the first add on deed to that DVC account. In this batch of deeds, there is a member who is adding on their first deed (.001) and there is another member who is adding their 24th (.024).

Also (because too much info is never enough), the contract number will tell you where the member bought their master contract. All VGF master contracts start will 13, so if you see a contract number such as 13123456.007, it means that the member is adding on his 7th deed and that his first deed was for VGF. The lead number will tell us which resort is (or was) the buyer's original home resort.
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Also, its not surprising that one buyer bought two deeds. This could be because they wanted to break up their purchase into two deeds. Or it could be because DVD did not have 255 points available in a single Residential Unit. Thus, it offered the buyer 165 points from VGF Unit 03B and 90 points from VGF Unit 03E.
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Yes, these numbers are similar for other DVC resorts that are labeled as "sold out." I report monthly sales for all DVC resorts except VGC on another site.

Thanks! Some more questions/observations:
1. Wow, you were able to break down the records into lots of (detailed) information!
2. Someone added their 24th deed! Curious as to what size deed it was?
3. Interesting about selling points to a buyer from 2 residential units using 2 deeds (would never have occurred to me that that might be the reason for the 2 contracts).
4. Why not include VGC data? Is recording info in CA not easily accessible?
5. Do you also include Aulani data?

 

[wdrl]

Thanks! Some more questions/observations:
2. Someone added their 24th deed! Curious as to what size deed it was?
3. Interesting about selling points to a buyer from 2 residential units using 2 deeds (would never have occurred to me that that might be the reason for the 2 contracts).
4. Why not include VGC data? Is recording info in CA not easily accessible?
5. Do you also include Aulani data?

2. It was a 50 point deed. The fact that someone adds on a deed numbered ".024" doesn't necessarily mean they currently own one master contract with 24 add-ons. Members buy and sell deeds all the time and DVD doesn't reuse numbers if a member sells a deed.

3. It happens frequently, especially for the "sold out" resorts.

4. VGC data is available from the Orange County (CA) Clerk Recorder's Office. When searching its database, users can see a header line that shows the record number, type of record, Grantor, and Grantee. But to see the number of points and Residential Unit number, you need to purchase the document at a cost of $1 a page. Thus, I can track the number of VGC deeds sold by Disney, but I don't capture any data regarding the number of points sold.

5. I track Aulani data as well, but there are limitations in what I can track. Like for VGC, the Hawaii Bureau of Conveyances does not let me view the actual deeds unless I pay a $1 a page. However, HBC shows a header line for each record that displays a lot of useful information. The header line indicates the Residential Unit and the number of points on the deed, so it allows me to track current point sales. It does not show the Use Year, nor does show if the deed is a Guaranteed Week deed. One drawback to the HBC database is that there was a gap of several months in 2010 and 2011 where the header line did not display the Residential Unit or number of points on a deed. So, I could only track the number of deeds sold for those months, but not the number of points sold.

HBC's database is not updated as timely as the Orange County Comptroller. As of this morning, OCC is verified and updated through April 8; HBC is only updated through February 22. I just posted an article on DVC direct sales for March 2016, but the Aulani data only goes through January 2016.

FYI: You can tell which DVC resort was a member's original Home Resort by looking at the first one or two numbers of the Contract number.

OKW = blank
Vero Beach = 2
Hilton Head = 3
Boardwalk Villas = 4
Villas at Wilderness Lodge = 5
Beach Club Villas = 6
Saratoga Springs = 7
Animal Kingdom Villas (Jambo House Residential Unit) = 8
Animal Kingdom Villas (Kidani Village Residential Unit) = 9
Bay Lake Tower = 10
Villas at Grand Californian = 11
Aulani = 12
Villas at Grand Floridian = 13
Polynesian Villas & Bungalows = 14

Since DVD sequentially numbers deeds within a resort, you can estimate how long its been since someone bought their deed. The very first OKW deeds sold in 1991 have double digits, such as 25.000 or 26.000. I've never seen deed number 1.000, so I don't know if Disney used it for the general public. Today, a new OKW master contract is up to about 45000.000

 

[mustinjourney]

2. It was a 50 point deed. The fact that someone adds on a deed numbered ".024" doesn't necessarily mean they currently own one master contract with 24 add-ons. Members buy and sell deeds all the time and DVD doesn't reuse numbers if a member sells a deed.

3. It happens frequently, especially for the "sold out" resorts.

4. VGC data is available from the Orange County (CA) Clerk Recorder's Office. When searching its database, users can see a header line that shows the record number, type of record, Grantor, and Grantee. But to see the number of points and Residential Unit number, you need to purchase the document at a cost of $1 a page. Thus, I can track the number of VGC deeds sold by Disney, but I don't capture any data regarding the number of points sold.

5. I track Aulani data as well, but there are limitations in what I can track. Like for VGC, the Hawaii Bureau of Conveyances does not let me view the actual deeds unless I pay a $1 a page. However, HBC shows a header line for each record that displays a lot of useful information. The header line indicates the Residential Unit and the number of points on the deed, so it allows me to track current point sales. It does not show the Use Year, nor does show if the deed is a Guaranteed Week deed. One drawback to the HBC database is that there was a gap of several months in 2010 and 2011 where the header line did not display the Residential Unit or number of points on a deed. So, I could only track the number of deeds sold for those months, but not the number of points sold.

HBC's database is not updated as timely as the Orange County Comptroller. As of this morning, OCC is verified and updated through April 8; HBC is only updated through February 22. I just posted an article on DVC direct sales for March 2016, but the Aulani data only goes through January 2016.

FYI: You can tell which DVC resort was a member's original Home Resort by looking at the first one or two numbers of the Contract number.

OKW = blank
Vero Beach = 2
Hilton Head = 3
Boardwalk Villas = 4
Villas at Wilderness Lodge = 5
Beach Club Villas = 6
Saratoga Springs = 7
Animal Kingdom Villas (Jambo House Residential Unit) = 8
Animal Kingdom Villas (Kidani Village Residential Unit) = 9
Bay Lake Tower = 10
Villas at Grand Californian = 11
Aulani = 12
Villas at Grand Floridian = 13
Polynesian Villas & Bungalows = 14

Since DVD sequentially numbers deeds within a resort, you can estimate how long its been since someone bought their deed. The very first OKW deeds sold in 1991 have double digits, such as 25.000 or 26.000. I've never seen deed number 1.000, so I don't know if Disney used it for the general public. Today, a new OKW master contract is up to about 45000.000

Thanks so much for sharing all of your knowledge. I must admit, the thrill of the hunt is quite fun.

As you noted earlier, the public data only tells us contract price point point -- which does not give us any idea as to how many points are banked or available at time of transfer. Is there any way to look this information up?

Also -- how do you personally value contracts based on the points available?

What I did to normalize all of the various listings was to value the "extra banked" points at $13 a point (value to me if I just sold them to david's rental). If any points were missing off the current use year, then I subtracted value from the contract in a similar fashion (kept it at $13 a point to keep simple). I treated all UYs the same (probably not perfect, but I couldn't figure out a good discount factor). I did have to tweak a few listings if they had 2014 banked points that were expiring fairly soon -- they got valued at $6-7 a point.

I'm curious to know if my thoughts lined up with yours -- and if I'm missing something.

For these properties essentially being a commodity -- I found that the adjusted price per point varied quite a bit. With that said, the ones that were lowest were the ones that sold the fastest (even though they might have had a higher listing price per point).

 

[supersnoop]

What I did to normalize all of the various listings was to value the "extra banked" points at $13 a point (value to me if I just sold them to david's rental). If any points were missing off the current use year, then I subtracted value from the contract in a similar fashion (kept it at $13 a point to keep simple). I treated all UYs the same (probably not perfect, but I couldn't figure out a good discount factor). I did have to tweak a few listings if they had 2014 banked points that were expiring fairly soon -- they got valued at $6-7 a point.

While this approach and valuation seems to be the most reasonable, the market doesn't seem to agree. Banked and missing points only seem to be valued at $5 or $6 each. It's much better to buy a "loaded" contract than a "stripped" contract for that reason.

 

[wdrl]

As you noted earlier, the public data only tells us contract price point point -- which does not give us any idea as to how many points are banked or available at time of transfer. Is there any way to look this information up?

Also -- how do you personally value contracts based on the points available?

What I did to normalize all of the various listings was to value the "extra banked" points at $13 a point (value to me if I just sold them to david's rental). If any points were missing off the current use year, then I subtracted value from the contract in a similar fashion (kept it at $13 a point to keep simple). I treated all UYs the same (probably not perfect, but I couldn't figure out a good discount factor). I did have to tweak a few listings if they had 2014 banked points that were expiring fairly soon -- they got valued at $6-7 a point.

I'm curious to know if my thoughts lined up with yours -- and if I'm missing something.

For these properties essentially being a commodity -- I found that the adjusted price per point varied quite a bit. With that said, the ones that were lowest were the ones that sold the fastest (even though they might have had a higher listing price per point).

Information about the number of points available for booking on a resale deed is not part of the public record. Thus, there is no way of knowing whether a deed is fully loaded, completed stripped, or somewhere inbetween. There are some sources, such as the Disboards' ROFR thread, where resale buyers self-report the number of points they are receiving on a resale transaction. But, as with any source that relies on self reporting, there may be a significant number of transactions that don't get reported, or that don't get reported accurately.

There is no hard and fast rule on how much value to place on the number of points available on a resale deed. If someone thinks they can rent the excess points for $13, then it makes sense to attach that value to the available points. If someone doesn't think they can rent the points or even use the points before they expire, then I can understand why they attached a very low value to the available points. Basically, whatever works for you in your personal situation should be the determining factor in deciding what value to attach to the points.

Although its important to consider the number of points available when valuing a resale offer, there are other factors that shouldn't be overlooked. Closing costs and the payment of maintenance fees are negotiable items between the buyer and the seller, and these expenses will impact the true acquisition cost of a resale deed. If a seller agrees to pay the closing costs and MFs, a buyer could easily save hundreds of dollars and, therefore, be willing to pay a bit more per point. However, these expenses are never part of the official recorded price, so we can never determine the actual acquisition price on any resale transaction.