I am on the fence on buying into DVC-Help...

[CMCSDM]

I like the idea of owninga DVC but my question is why buy when I can rent points? It saves me $4 X the number of points I own in membership dues per year and gives me more flexibility. I did a little math and here is what I came up with. I have included 10-year and 20-year lenghts which I think are realistic.

300 points @ $86 = $25,800

Cost Of Ownership (10 years)
$2580 per year + $1200 (dues) = $3780 per year

Cost Of Ownership (20 years)
$1290 per year + $1200 (dues) = $2490 per year

Rental:
300 points @ $10 = $3000 per year

Would there be any advantage to buying more points and renting a portion of those points out to pay for the yearly dues? Also, I checked on some of the resorts in the exchange program and it seems you can rent directly for less. i.e Royal Resorts in Cancun. You can typically stay there for $1k or less a week and it would cost approx 160 DVC points to get a unit (160 X $10 = $1600).

I guess I need some help in finding the way here. We will be at DW at the end of the month and will get a better feel if its something we want to do but the yearly dues and the fact that they WILL go up at some point has me worried. In addition to that I feel like we could rent a unit without much trouble. Maybe that changes when our kids are in school? If it matters our kids are 4,2 and 6 months.

Any suggestions/help would be appreciated.

 

[starwood]

Another consideration is - if you decide to sell you will get a portion of your purchase price back. Thereby lowering your yearly costs.

I also use my Disney Visa Reward points to pay a portion of my maintenance. We only have 135 points so maintenance is around $600. I had over $300 DVRD and only paid around $270 this year.

Maybe you don't need 300 points?

 

[CMCSDM]

Thanks for the reply. You may be right on the points, I do not know how many we would need. I do know that I see people talking about adding more points all the time though. I owuld rather have too many then not enough. I would like the flexibility of owning enough points though that I could get a grand villa if needed so other family members could enjoy a vacation with us.
I do have the disney reward cards, do they let you use the points to pay the dues? I had not htought of that. Will they let you use points to pay for part of the sale? Also, why does it seem that people own points in more then one resort? What is the advantage of this?

 

[CMCSDM]

Another question? What are the advantages of buying three (3) 100 point contracts versus one (1) 300 point contract for the sam resort? Does it have to do with the time of the year you receive the points? Does it add some kind of flexibility?

 

[starwood]

The only advantage to owning at more than one resort is that you can book at the 11 month window. Depending on when you are going I don't think there should be a problem at the 7 month window.

I'm not sure about using the reward card for the purchase price but I call them when I get my dues bill in January and tell them how much I have on my rewards card and give them the number. They process it and then tell me how much I have left to pay (which I put on the Disney Visa for more points!)

We started with 100 points at OKW which was enough for a week in a studio. When we got home DH said we should get more points - so we bought another 35. From banking our unused points for the past 3 years (we stayed 1 week at OKW, and 4 days at Beach Club) we have enough points (by borrowing 10 from next year) to get a 2 bedroom in April at OKW this year.

 

[alldiz]

I also struggled with the rent/buy scenerio....

I kept coming back to....Do I want to be an owner...

or a renter...No stress with owning....

I never liked renting....so here i am waitin for my 150WLV pts to close
good luck
kerri

 

[pilferk]

I like the idea of owninga DVC but my question is why buy when I can rent points? It saves me $4 X the number of points I own in membership dues per year and gives me more flexibility. I did a little math and here is what I came up with. I have included 10-year and 20-year lenghts which I think are realistic.

300 points @ $86 = $25,800

Cost Of Ownership (10 years)
$2580 per year + $1200 (dues) = $3780 per year

Cost Of Ownership (20 years)
$1290 per year + $1200 (dues) = $2490 per year

Rental:
300 points @ $10 = $3000 per year

Couple things:

First off, the rental rate is unlikely to stay at $10 a point for 20 years, so that will go up. It's already started to creep up, with more rentals at $11 and $12 a point. So there's that to consider.

Second, the dues will likely increase, too, but probably (if history is any precendent) not as quickly as the rental rate will. Doing a year by year comparison, like you are, needs to take into account those changes.

THIS year, it may be that it's cheaper to rent points than it is to buy them (using one of your breakdowns).

10 years from now, it may be chepaer to rent points than it is to buy them (using one of your breakdowns). But it might NOT be cheaper to rent points than it was to buy them 10 years ago. Follow me? You're really paying a bit more now to lock in those rates for 50 years.

Not to mention the DVC point rental market vastly undervalues itself. You can get 1 week in a studio for around the price of a value.

 

[Anal Annie]

The prices keep going up both to buy and to stay at the resorts...we bought in order to lock in the price for our accomodations and to have something to leave to our DS when he's grown. We figured this might be the only way our grandkids can afford to go to WDW one day!

As far as trading out & using II goes...I think it depends when & where you want to go. If you're looking to go someplace that's very posh or expensive like Hawaii where the rooms can easily run in the $400 / n range then 160 pts for a week in a 1 bedroom is a real bargain... (I would not use 160 pts. to go to Ocean City, MD!!)

 

[Mtnman44]

As mentioned already, you are not including the remaing value of your contract at the 10 and 20 year marks. Based on what DVC has done historically, in 10 years you will likely be able to sell an SSR or AKV contract for around $110 per point. At 20 years, that's a little more iffy but it will almost surely be more than $86 per point but just say $86 for now. Put those sales numbers into your figures and you will see something "magical". Keep in mind of course that money you sell for in 20 years is not the same as 2007 dollars, but still you are getting back something.

 

[vandy]

Another question? What are the advantages of buying three (3) 100 point contracts versus one (1) 300 point contract for the sam resort? Does it have to do with the time of the year you receive the points? Does it add some kind of flexibility?

The main reason for having multiple contracts is for the ability to sell part of your points should you decide you did not need so many. Using your example of 3 100 point contracts; maybe you decide that 200 points per year is plenty with banking & borrowing. Now you can sell off one of the 100 point contracts and keep the other 2.

 

[CMCSDM]

Why not just rent out the other 100 points to pay for maintnenace fees...??

 

[crisi]

Some people do that and find it a reasonable approach.

There are people who rent out there points and find it not a big bother. Other people don't believe it is worth their effort to do so - or not on a regular basis. You get to decide what sort of person you are (but you may want to talk to a few people who have done it).

There are people who rent points and find it to be a wonderful deal. Other people find the stress of not controlling their own reservation too great. You get to decide what sort of person you are.

There are people who own only enough points for themselves to use at WDW and try to get the best value for those points - they don't use them to trade out and often stay somewhere else on weekends - then there are people who own points for vacationing - if a cruise isn't a "good use of points" they don't really care - they use them anyway. Guess what - you get to decide what sort of person you are.