How to identify a good resale deal?

[RachStu]

Hello all, some of the deals that people have posted on the ROFR thread for AKV and BLT (our two preferred locations) are great and far better than what I've seen. Are these predominantly negotiated deals? Do you find that people are willing to negotiate much? I've made a couple of offers, but they have not been accepted.

We are looking to buy a Dec use year so I'm not willing to pay the 2020 dues unless there are 2019 points available (given these points run from 1 Dec 2019 to 30 Nov 2020 and therefore are the points that you would be using during 2020 unless you want to start borrowing). Does anyone think this is an unreasonable position to take?

What sites do people use? I've been looking on DVC Resale Market (seems to have the most listings), DVC Shop and Fidelity (seems a little cheaper than the rest?). Are there any other sites worth looking at?

I note that some people have put that they are international buyers on their transactions. What is the relevance of this? Are Disney more or less likely to exercise their ROFR if an international purchaser is involved? We are from the UK so I would be interested to hear if this has an impact on their decision making.

We are not in a particular rush as we won't travel again until August 2021 so happy to sit tight and wait for the right deal. We're financing the bulk of the purchase by renting our SS 2019 and 2020 points so will need to have the new ones in place before our next trip.

Many thanks in advance for any helpful thoughts or tips.

 

[DVC Fanatic]

To answer parts of your question. I would expect to pay 2020 dues, because those cover 2020 points, regardless of when you UY is. If you are near the ROFR cut line on the resort you choose, that is one thing Disney could use against you. Although I have seen people get double points and make the seller pay all dues and closing costs and still pass ROFR. If you are lucky enough to get 2019 points, those points would be due free to you, as the seller has already paid Disney at the beginning of 2019.

I am not very successful with lower offers with DVC Resale Market, and both of my resale purchases have been through Fidelity. With Fidelity, there is a $195 fee they charge, and either the seller or buyer needs to pay it. That can bring your price per point up.

 

[Minniemoo15]

Look for contracts that have a lot of banked points that you can rent out. Our 250 point Poly contract came with 370 banked points. We paid $148 pp (which is right around average), but once I rented those out it brought the price down to less than $125 pp (a stellar deal).

 

[RachStu]

Thanks, Minnie. I think you're right, it's just a matter of waiting for one with the correct UY to come along with lots of points. Most of them seem to have been stripped of points. Presumably the owners have rented them to cover the costs of the annual dues.

 

[RachStu]

p.s. have you enjoyed the Poly? We were looking at that originally due to the fab pool (I have three boys aged 2, 4 and 5), but I'm not sure the rooms work for us.

 

[DVC Fanatic]

The Poly rooms work great for us having three kids as well (7,5, and 2). The separate shower from the other tub/shower is a great benefit. We are 3 years away from sizing out of one studio because of a 4th little one on the way, but our plan will be 2 studios with our Poly stays.

 

[Minniemoo15]

Thanks, Minnie. I think you're right, it's just a matter of waiting for one with the correct UY to come along with lots of points. Most of them seem to have been stripped of points. Presumably the owners have rented them to cover the costs of the annual dues.

We have our first stay coming up there in 19 days ! We have stayed at many DVC resorts by renting points ourselves. BCV is our favourite but we couldn’t justify the cost per point with the limited years remaining. We took a gamble on Poly since we have never actually stayed there, but we love the theming and transportation options. The split bath looks great. We find a studio works perfectly fine for us, especially in rooms that have the 5th sleeper. We often travel with my parents so the fact that most rooms connect was a draw as well. I figure if we ever want to do a 1 or 2 bed somewhere else it will be easier to switch at the 7 month mark with those room types.

When we first started looking, Poly was never on our shortlist. We actually first tried AKV before it got taken in ROFR. When we took a good second look we realized Poly checked all the boxes for us and actually wasn’t that out of reach if we could find the right contract.

 

[Hjs33]

Hello all, some of the deals that people have posted on the ROFR thread for AKV and BLT (our two preferred locations) are great and far better than what I've seen. Are these predominantly negotiated deals? Do you find that people are willing to negotiate much? I've made a couple of offers, but they have not been accepted.

We are looking to buy a Dec use year so I'm not willing to pay the 2020 dues unless there are 2019 points available (given these points run from 1 Dec 2019 to 30 Nov 2020 and therefore are the points that you would be using during 2020 unless you want to start borrowing). Does anyone think this is an unreasonable position to take?

What sites do people use? I've been looking on DVC Resale Market (seems to have the most listings), DVC Shop and Fidelity (seems a little cheaper than the rest?). Are there any other sites worth looking at?

I note that some people have put that they are international buyers on their transactions. What is the relevance of this? Are Disney more or less likely to exercise their ROFR if an international purchaser is involved? We are from the UK so I would be interested to hear if this has an impact on their decision making.

We are not in a particular rush as we won't travel again until August 2021 so happy to sit tight and wait for the right deal. We're financing the bulk of the purchase by renting our SS 2019 and 2020 points so will need to have the new ones in place before our next trip.

Many thanks in advance for any helpful thoughts or tips.

Look for a contract that has a use year that works best for you. That’s probably the most important thing.

Yes, loaded contracts have extra points you can use right now, but stripped contracts start lower and the owners are a lot more likely to negotiate.

Also, the international seller is relevant because the theory goes that historically Disney does not ROFR contracts from international sellers, so you could in theory negotiate a lower price on these contracts. Just be aware that these contracts will most likely take longer to close. I’m currently in the process of closing on a Aulani contract with an owner from Japan. My other contracts took about two months to close. This Aulani contract is now 3 months in and I’m still waiting for seller to return the documents.

 

[MICKIMINI]

To answer a few questions from an old timer (OKW 1996):

1. 2020 Dues have already been paid or are being paid monthly now so no, you won't get them for free

2. 2019 Dues depend on the UY for viability...if the points are banked they are viable, if they CAN be banked as part of the offer, they are viable and it is not unreasonable for the seller to expect you to pay for something YOU will use or perhaps negotiate for 50% of MF, but look at it from their perspective - they are giving you a "gift". If the points will expire before closing or shortly thereafter and you will never be able to use them, absolutely - don't pay for them and the seller shouldn't expect you to pay for their "screw up" in not banking them (happens all the time)

3. I would recommend bigger resellers for accuracy and timeliness (this is from experience)

4. International sellers sometimes require more time for sending papers and it might hold you (since you are UK) up with no benefit at all

5. ROFR prices depend on DVC's "formula" whatever that is, considering not only price, UY, point availabilty etc so you can use it for a reference but there are other ways to weigh the value of a contract - such as banked points and current points...we have bought 3 years worth of points before and there is REAL value in that

6. I PREPLAN the entire transaction for instance; I write down my desired Resort, UY, number of points and what I feel is a "reasonable" price per point (put the shoe on the other foot - no one will accept a ridiculous offer) and then I search (it takes days, weeks, however long) for a similar contract (bigger rather than smaller) and look for those BANKED POINTS. When you run your numbers and consider those banked points you can sweeten the offer with full price AND possibly ask for free back years points or even offer to pay 50% of those MF and still possibly come out ahead. It has to be desirable for both parties - play nice! Don't get hung up on the "per point" price it is the overall transaction that is important (calculator and lots of paper and a sharp pencil helps). I have even offered OVER full price and flipped the contract for a profit within months - seriously. PRACTICE now with your formula so you will have an instinctive eye out for deals...you can get an EXCEPTIONAL deal if you take time to do the math - simple as that...few people take the time to do all the calculations up one side and down the other until you can figure out the bottom line and that is all the counts.

7. Making the offer: Just change the numbers and run the math from your template and in five minutes you will know if that new listing is a deal or not. With info in hand call the broker and make your offer...I keep a copy of the listing and go over the details one by one - basically making my case. I always have a "back up" bottom line for any offer as the broker will contact the seller and typically you will get counter offer. If you play your cards right they will often immediately contact the seller and spell out your terms exactly as you relayed them and possibly get back to you quickly since you made it easy for them. If they think you are wasting their time, well, you will go to the bottom of the pile...

I know it's wordy, but hopefully it is helpful!

 

[Lorana]

We are looking to buy a Dec use year so I'm not willing to pay the 2020 dues unless there are 2019 points available (given these points run from 1 Dec 2019 to 30 Nov 2020 and therefore are the points that you would be using during 2020 unless you want to start borrowing). Does anyone think this is an unreasonable position to take?

I don’t think it’s unreasonable since MF are based on calendar year, not use year. This is where negotiating may come into play. If you think the seller will want you to pay 2020 MF Fees with no 2019 points available, I’d subtract the 2020 MF points from the total and then make an offer based on that price per point. It’s what i did for my first resale offer:

example:
AKL contract at $110pp, $100 points, Dec UY, no 2019 points. Total is $11,000 plus $767 dues.

$11,000 - $767 = $10,233 / 100 = $102.33/pt
If you considered you should pay for Dec MF, you could instead subtract $703 (11 months of dues) for $103/pt.

I have a Sep UY so I used the above on my first resale to lower the per point I offered based on subtracting out 8 months of MF, and the seller accepted that.

The potential risk is that the lower price per point increases likelihood of Disney exercising ROFR.

 

[Sandisw]

Everything is negotiable and just keep trying. It took me 4 different bids to get a BWV contract years ago.

In terms of MFs, those are based on calendar year, as already mentioned. When I bought, I would only pay for the number of months left in the year, So, when I bought in June, I offered half the dues,

Now, if contract is void of the 2019 points, then just make sure you adjust what you pay to account for that. I always looked at everting..,closing, MFs and price per points and decided what my ideal price was and then made offers to get to that point.

Good luck!

 

[CraigInPA]

Today, February 6, 2020 is in the December 2019 (current) use year. Expect to pay maintenance fees for calendar year 2020, because you will have 11 months to use those 2019 points. If, on the other hand, there are no current points available, refuse to pay maintenance fees, because you won't get any points until December 1, 2020.

 

[RachStu]

Today, February 6, 2020 is in the December 2019 (current) use year. Expect to pay maintenance fees for calendar year 2020, because you will have 11 months to use those 2019 points. If, on the other hand, there are no current points available, refuse to pay maintenance fees, because you won't get any points until December 1, 2020.

Thanks all. That is exactly the position I’m talking about. There are no points available to use on the particular contract I’m looking at until 1 Dec 2020. As such, I offered to pay for one-twelfth of the 2020 dues. I felt this was fair. I think the dues are more for the use of the resorts than payment for the points, if that makes sense. I realistically can’t make use of the resorts until 1 Dec 2020 without borrowing points hence why I was unwilling to pay for the entire year’s dues. Obviously I wouldn’t mind paying if there was a complete year of 2019 points as I’d have the ability to use any of the resorts at any point this year should I chose with those points.

 

[RachStu]

I don’t think it’s unreasonable since MF are based on calendar year, not use year. This is where negotiating may come into play. If you think the seller will want you to pay 2020 MF Fees with no 2019 points available, I’d subtract the 2020 MF points from the total and then make an offer based on that price per point. It’s what i did for my first resale offer:

example:
AKL contract at $110pp, $100 points, Dec UY, no 2019 points. Total is $11,000 plus $767 dues.

$11,000 - $767 = $10,233 / 100 = $102.33/pt
If you considered you should pay for Dec MF, you could instead subtract $703 (11 months of dues) for $103/pt.

I have a Sep UY so I used the above on my first resale to lower the per point I offered based on subtracting out 8 months of MF, and the seller accepted that.

The potential risk is that the lower price per point increases likelihood of Disney exercising ROFR.

Yes, I’ve been trying to use my own formula which is similar. I’ve taken a contract with full points in 2020 as the baseline. So for 200pts at $110 the cost would be $22,000 plus 1/12th of the 2020 management fee ($127.83) plus closing costs ($675). That gives a total cost of $22,802 or $114 per point.

If a contract has 2019 points I calculate the value of these and deduct them from the total price and add in the management fee. I value the additional points at $14.50 per point. So, a contract with 200 2019 points would effectively cost me $22,000 plus management fee of $1841 and closing costs of $675 less the value of the 2019 points of $2900. This gives a total cost in real terms of $21,616 or $108 per point.

If a contract has the 2020 stripped from it I add the value of the points to the purchase price to calculate the true cost of the contract.

The above is a bit rough and ready but is the only way I could think to compare the contracts. I ran the above formula on the contacts listed as being passed on the front page of the ROFR thread and the cost per point for AKL ranged from $97.56 per point to $138.46 per point.

 

[skippytx]

Just buy the right contract for you when it becomes available. The initial point cost of the DVC contract is such a small piece of the overall DVC costs it's not worth your time to stress about 5 or even 10 dollars a point. When you factor in dues, tickets, airfare, and other costs associated with using your DVC membership, a 5 or 10 dollar difference in the initial point cost ends up being a rounding error after 5 years.

Plan on paying dues for the points you get to use.

 

[Sandisw]

Yes, I’ve been trying to use my own formula which is similar. I’ve taken a contract with full points in 2020 as the baseline. So for 200pts at $110 the cost would be $22,000 plus 1/12th of the 2020 management fee ($127.83) plus closing costs ($675). That gives a total cost of $22,802 or $114 per point.

If a contract has 2019 points I calculate the value of these and deduct them from the total price and add in the management fee. I value the additional points at $14.50 per point. So, a contract with 200 2019 points would effectively cost me $22,000 plus management fee of $1841 and closing costs of $675 less the value of the 2019 points of $2900. This gives a total cost in real terms of $21,616 or $108 per point.

If a contract has the 2020 stripped from it I add the value of the points to the purchase price to calculate the true cost of the contract.

The above is a bit rough and ready but is the only way I could think to compare the contracts. I ran the above formula on the contacts listed as being passed on the front page of the ROFR thread and the cost per point for AKL ranged from $97.56 per point to $138.46 per point.

To add, tylocally, even if you negotiate not covering MFs, it will be processed As a credit to you at closing and then you will be the one to actual pay them during 2020.

Basically, its deducted from the amount sellers receive.

 

[sethschroeder]

Just buy the right contract for you when it becomes available. The initial point cost of the DVC contract is such a small piece of the overall DVC costs it's not worth your time to stress about 5 or even 10 dollars a point. When you factor in dues, tickets, airfare, and other costs associated with using your DVC membership, a 5 or 10 dollar difference in the initial point cost ends up being a rounding error after 5 years.

Plan on paying dues for the points you get to use.

I mean getting a good deal up front is the only time you can impact your total costs.

Would like to have 3-4 years of free MFs? Thats what can happen if you don't pay 2020 MFs and have a loaded contract that you can rent out. Then add on a 5-10 savings per point and that's another year of MFs not needing to be paid.

Eliminating 3-4 years essentially is 10-15% of the lifetime cost.

 

[striker1064]

Today, February 6, 2020 is in the December 2019 (current) use year. Expect to pay maintenance fees for calendar year 2020, because you will have 11 months to use those 2019 points. If, on the other hand, there are no current points available, refuse to pay maintenance fees, because you won't get any points until December 1, 2020.

Wait, I think maybe my interpretation of dues may be wrong. I thought dues were for that year of points you received.

For example, in December we paid our 2020 annual dues. Those are for points received in the year 2020. UY doesn't matter. You're still receiving a full year's allotment of 2020 points for paying the 2020 dues, and whether you receive them in February 2020, December 2020, or anywhere in between doesn't matter.

When I've priced both contracts to sell and buy, this is the methodology I've used. Is that not correct?

Yes, I’ve been trying to use my own formula which is similar. I’ve taken a contract with full points in 2020 as the baseline. So for 200pts at $110 the cost would be $22,000 plus 1/12th of the 2020 management fee ($127.83) plus closing costs ($675). That gives a total cost of $22,802 or $114 per point.

In my mind, this is not correct because you're not getting 1/12 of the points in December. You're getting all 200. Therefore, the buyer would pay for all 200 points.

This I believe is how direct purchases work as well. If you buy a December UY in January 2020, you pay dues on the 2020 UY, and receive the 2019 points "free" (because the 2019 UY began December 1, 2019).

 

[Sandisw]

Wait, I think maybe my interpretation of dues may be wrong. I thought dues were for that year of points you received.

For example, in December we paid our 2020 annual dues. Those are for points received in the year 2020. UY doesn't matter. You're still receiving a full year's allotment of 2020 points for paying the 2020 dues, and whether you receive them in February 2020, December 2020, or anywhere in between doesn't matter.

When I've priced both contracts to sell and buy, this is the methodology I've used. Is that not correct?



In my mind, this is not correct because you're not getting 1/12 of the points in December. You're getting all 200. Therefore, the buyer would pay for all 200 points.

This I believe is how direct purchases work as well. If you buy a December UY in January 2020, you pay dues on the 2020 UY, and receive the 2019 points "free" (because the 2019 UY began December 1, 2019).

Almost. Dues are based on the calendar year and not UY so in reality, it’s based on your ownership,

When buying direct, you pay dues from the date you buy, You are correct that you would get 2019 UY points for December, because we are in the 2019 UY still for that month,

But, the reason yoy don’t pay 2019 dues is because we are not in the calendar year of 2019 any longer,

If someone buys in January of 2020 direct, the dues will be calculated from the day of purchase until the end of the year, If you buy in September, you pay dues to Disney only from September, even though you’d be getting all 2019 and 2020 Dec UY points.

With resale, traditional wisdom is that if you get 2020 points, you should pay 2020 MFs, even with. a Dec UY.

But, it is all negotiable with resale so a buyer is free to choose to how and what they want to pay. When I have sold and bought, I based what I paid and accepted on calendar year. When I bought in June, I offered 6 months, even though I got all the points,

When I just sold in November a Dec UY contract with only 64 out of 200 points for Dec 2019 UY I did not pay any 2020 MFs, even when the broker suggested I should cover some since they weren’t getting a full year.

 

[MICKIMINI]

We picked up a 250 contract last year (actually it was 100 and 150 bundled - even better) and we got 2017 banked, 2018, 2019 and of course 2020. We paid $0 dues for 2017, 50% for 2018 and full MF's for 2019 and 2020. We rented over 300 points for about $4000 (pre tax) which was $16 per point savings and had a great family vacation with two villas over Halloween for 50% MF's and gave points to son and DIL for this March (now into 2019), will likely rent two weeks in a studio for a friend (2019 and 2020) and STILL have leftover points (2020)! I truly believe that it is worth looking for those LOADED contracts - patience will pay off!
(first contract 1996 and we have bought loaded - sold for profits many times so we walk the walk)