How is a DVC Purchase Viewed?

[gmi3804]

You believe there is no difference between buying a country property that someone COULD live in vs a timeshare which will mathematically go to $0 in the future because of the expiration?

It’s not what YOU believe it’s what the IRS and/or lenders believe.

 

[Jack Kerouac]

Personally I have no interest in a country property… I’m also not big into a ski, lake, beach, mountain, etc. property. It’s the idea of a vacation “home” that I want to return to over and over again, which for us is DVC. I’m fine spending money on it even though it will go to zero, since that’s not why we bought it. It’s something that we get to enjoy every year and reduces the cost for us to stay on property in 1 or 2BRs, sometimes 3BRs.

My parents have DVC and a couple of vacation homes (IN on a lake and Naples, FL.) Seeing what they have to do to maintain their second and third homes, I have no desire for a second, let alone a third, home. I hate the stress of home maintenance and it would be even more stressful when having to do maintenance while visiting for a vacation. DVC provides me with less stress and more vacation than a vacation home ever could.

 

[AstroBlasters]

Personally I have no interest in a country property… I’m also not big into a ski, lake, beach, mountain, etc. property. It’s the idea of a vacation “home” that I want to return to over and over again, which for us is DVC. I’m fine spending money on it even though it will go to zero, since that’s not why we bought it. It’s something that we get to enjoy every year and reduces the cost for us to stay on property in 1 or 2BRs, sometimes 3BRs.

Oh, I love DVC. I was more questioning someone who doesn’t own (or have a mortgage on a physical home) buying into a timeshare to begin with.

 

[Jack Kerouac]

Oh, I love DVC. I was more questioning someone who doesn’t own (or have a mortgage on a physical home) buying into a timeshare to begin with.

I agree that most people would / should buy a home before buying a timeshare. I guess the outlier might be someone who knows themselves well enough to know they don't desire to purchase a home (due to an unstable career or one that requires a lot of traveling, desire to live in different parts of the country, etc.) But those are rare cases. I would possibly argue that even for those who can buy a timeshare, shouldn't.

 

[RoseGold]

Oh, I love DVC. I was more questioning someone who doesn’t own (or have a mortgage on a physical home) buying into a timeshare to begin with.

Not everyone wants to buy where they currently live. They do gig work or traveling work or want to move from this place in a couple years or whatever. In that kind of situation, DVC makes a lot of sense to me. There's def some superfans who could use Disney as a home base and know DVC is a good long term fit for them, even though they don't own a physical home right now. That doesn't mean they can't afford it or DVC isn't right for them.

 

[Matty B13]

My parents have DVC and a couple of vacation homes (IN on a lake and Naples, FL.) Seeing what they have to do to maintain their second and third homes, I have no desire for a second, let alone a third, home. I hate the stress of home maintenance and it would be even more stressful when having to do maintenance while visiting for a vacation. DVC provides me with less stress and more vacation than a vacation home ever could.

My parents had a second in Saco, Maine for the past 30 years just off the beach. Not only did they have the stress of renting and maintaining it, myself along with my sisters often had to go up and help repair the house as well. I spent every college spring break and most winter breaks up there helping out.

We had some really nice vacations there, and my daughters loved going there, but if they had just put their money into an S&P 500 index fund they probably would have made more money. Luckily they sold 2 years ago and got a great price for it, mostly because my father's health was declining.

Second homes sound great....... but they are a lot of work.

 

[Brian Noble]

If you buy DVC before you own an actual primary residence

There are definitely areas of the US where it makes more financial sense to rent than to buy, depending on how long you expect to be there. Renting does not immediately mean “not of means.”

You believe there is no difference between buying a country property that someone COULD live in vs a timeshare which will mathematically go to $0 in the future because of the expiration?

I think the point instead was “There exist people who can easily afford to buy a vacation home, but for whom renting their primary residence is a financially responsible option.”

See #3 in this article for a simple explanation.

https://www.fidelity.com/viewpoints/personal-finance/rent-vs-buy

There are a surprising number of places in which renting makes sense or is at least in the ballpark based on the 20x annual rent rule.

 

[AstroBlasters]

There are definitely areas of the US where it makes more financial sense to rent than to buy, depending on how long you expect to be there. Renting does not immediately mean “not of means.”


I think the point instead was “There exist people who can easily afford to buy a vacation home, but for whom renting their primary residence is a financially responsible option.”

See #3 in this article for a simple explanation.

https://www.fidelity.com/viewpoints/personal-finance/rent-vs-buy

And would you say that should be considered the base case or the outlier case? I would argue that for the overwhelming majority of cases I stand by my original statement.

 

[Brian Noble]

My home in Ann Arbor is close to the 20x threshold. I could make a good case for renting here—especially if one doesn’t imagine being here 20+ years. If I lived downtown rather than in one of the neighborhoods, renting would make even more sense.

I’d’ve given you more of a pass if you hadn’t been so absolute about it.

 

[AstroBlasters]

My home in Ann Arbor is close to the 20x threshold. I could make a good case for renting here—especially if one doesn’t imagine being here at least 20+ years. If I lived downtown rather than in one of the neighborhoods, renting would make even more sense.

I’d’ve given you more of a pass if you hadn’t been so absolute about it.

Completely fair point. Edited original post to soften the tone.