I have a concern about small contracts

[rigsby25]

Instead of buying the 100 pt. contract at AKV, we are going to buy 2 50 pt. contracts. We plan on doing this to first be able to leave one to my daughter and one to my son eventually. We are finding out of course, that the smaller contracts are easier to resell as well. Does anyone think DVC will figure this out and do something to prevent small contract resales? I mean, I think maybe people will start to buy small contract resales just to get into the system for the perks - especially the annual pass discount. Is there anything they can do - as in the case of point rentals to - well to put it bluntly - stick it to people who have purchased small contracts or negatively effect resales?

 

[spiceycat]

they are already starting.

new members have to paid closing costs.

also DVC has been pretty good about buying the smaller contracts back lately - to prevent people who only wanted the discounts to own at DVC.

you know when DVC was new - I was told I was foolish to buy smaller contracts because when I tried to sell them - buyers would want a big contract....

but I brought what my budget allowed me to buy!!!

 

[dianeschlicht]

I agree with Pat that they are starting to crack down on new buyers getting small contracts already. I think there may come a time when non-members will not be able to purchase a resale contract that is smaller than the minimum offered by Disney. That is easy for them to control with their ROFR. If the bidding party is not a current member, they could just reclaim the contract and sell on their own.

I keep wondering what will happen to ROFR as we get closer to the ending date for the original DVC contracts. I figure it will be status quo until we reach the 25 year mark, and then I would expect both resale prices and ROFR to drop off significantly.

 

[dtheboys]

What? I just bought an add-on of 50 points from DVC...I did not pay any closing costs???
Confused?

 

[korbbec]

What? I just bought an add-on of 50 points from DVC...I did not pay any closing costs???
Confused?

If you bought an add-on fron DVC you are not a new member and therefore this would not apply to you.

 

[dtheboys]

Sorry, the "new members" is the magic word!!
I had no idea that NEW MEMBERS w/ DVC had to pay a portion of the closing costs now!!!
I have not paid attention to what is going on for NEW DVC members....

?...how much is NEW members paying on ..Let's say 150 point contract?

 

[pilferk]

Sorry, the "new members" is the magic word!!
I had no idea that NEW MEMBERS w/ DVC had to pay a portion of the closing costs now!!!
I have not paid attention to what is going on for NEW DVC members....

?...how much is NEW members paying on ..Let's say 150 point contract?

I think the closing costs are right around $200.

 

[Loco4Disney]

Sorry, the "new members" is the magic word!!
I had no idea that NEW MEMBERS w/ DVC had to pay a portion of the closing costs now!!!
I have not paid attention to what is going on for NEW DVC members....

?...how much is NEW members paying on ..Let's say 150 point contract?

I just bought 200 Pts. for SSR from DVC and paid $124 and some odd cents for closing.

 

[utahkennedys]

DVC may buy back the smaller ones through ROFR, but it doesn't mean you can't resell them??? There will always be high demand for DVC contracts that are small even if DVC exercises ROFR on them. DVC can't legally prevent anyone from selling a small contract.

 

[kdzgon]

I just bought 200 Pts. for SSR from DVC and paid $124 and some odd cents for closing.

Did you finance the purchase? I understand the closing costs are greater (~$200-$250) if financing, less if full purchase.

BTW, it was not Disney's idea to start charging closing costs to the buyers - they were told they could no longer pay them on behalf of the buyer - something to do with the legality &/or propriety of it.

 

[NurseKim]

I'm hoping to buy a small resale contract to start off with. It's what I can afford. I don't have the liquid $$ to buy a full contract with Disney (and I refuse to finance). That would allow me to buy what I can afford and add on when I can save a chunk of $$.

 

[rchristiansen]

I can't see why DVC/WDW would want to prevent people from buying small resales. In fact, I think WDW would welcome it - here's why:

1 -- We purchased a 100 pt contract mid 2004 because that was all we could afford. Result: DVC got a new member, when they otherwise would not have.

2 --- We have been able to use that contract very creatively and re-visit WDW many times. Result: We've spent more money in the gift shops and on tickets because we had the accomodations paid for.

3 --- This year, we purchased an annual pass (which we wouldn't have done other wise) and are planning to return again this year with it. Result: Additional revenue for WDW in the 4th quarter of 2006.

4 --- We're going again in May wih my parens: Result: WDW is also getting more revenue from us because of an extra Dining Plan purchase (that includes 2 more people on this next trip than who usually comes with us.).

5 --- We purchased a small AKV add-on, now that we can afford more points. Result: More revenue to DVC 1st quarter 2007.

Another point - let's say someone sold their 2 small contracts at 100 points each to two different people. That means a net gain of 1 DVC member. Those new members probably will use their points to stay in a Studio, where the past member stayed in a 1 bedroom. This means an additional week of revenue for WDW because a whole extra family is using the DVC membership.
Any more members they can get to actively visit WDW means more money for WDW as a whole. Whether or not you are staying in a Studio or Grand Villa, food, souveniers, and tickets all cost the same each day for each person no matter in what accomodations they are staying.

 

[Dean]

The admin costs on a 25 pt contract are essentially the same as a 500 pt contract, likely more in many cases. But this doesn't really affect selling nearly as much as it does buying. I think the chance of getting a smaller contract will always be a draw to many.

 

[Loco4Disney]

Did you finance the purchase? I understand the closing costs are greater (~$200-$250) if financing, less if full purchase.

BTW, it was not Disney's idea to start charging closing costs to the buyers - they were told they could no longer pay them on behalf of the buyer - something to do with the legality &/or propriety of it.

Oh, no it was not financed. I didn't realize that closing costs were more if you financed.

 

[cmkallen]

I own a 250 BWV contact august UY. 2 months ago I bought 2-45 point BWV contacts off EBAY. Both passed ROFR. I got lucky they are both August use year also. I Just purchased a 50 point SSR contract (also August) from the TSS. I hope this one passes!