if SSR has a new ending date, what will happen to resale prices?

[disneyberry]

lately i've been wondering specifically about the impact of a new ending date for SSR. it'd be a huge impact, wouldn't it?

first, do you think that DVC will come out with 2-tier retail price level if SSR does have a later ending date?

they couldn't possibly sell add-ons at BCV, VWL, BWV, OKW, VB, or HH for the same retail price as SSR, right?

and then, second, what do you think will happen to the resale prices of the original 6 resorts?

in the past, they have risen in proportion w/ the retail price increases, right?
Disney kept the ROFR floor hovering around $15 less than their retail.
and generally, resales sell for prices around that ROFR floor.

 

[ftmyersgirl]

Does you question address the issue of whether Disney is going to change the date in which ownership ends for new purchasers?

If so, I have been wondering the same thing. I mean the people who bought 10 years ago bought for less money for a longer period of time. At what point will they have to change the ownership expiration date and how will that affect those who currently own at DVC?

Any opinions?

 

[tomi]

Why would they do that now? They certainly aren't having any trouble selling BCV. I think it will be quite awhile before they change the ending date (if they do).

 

[disneyberry]

who knows if they'd actually do it (make SSR end later), but there's been a whole lot of speculation and rumors about it happening. i've heard some people say their DVC Guides talked about how they believe it would happen, but again it's all just speculation and rumors! heh.

i bet DVC could certainly sell SSR for a higher retail price if they did change the end date though. more money for DVC, why wouldn't they do it?
i was just worried if that would negatively impact the value of DVC ownership at the current 6 resorts.

 

[RobDoc]

Originally posted by disneyberry

i bet DVC could certainly sell SSR for a higher retail price if they did change the end date though. more money for DVC, why wouldn't they do it?

Your comment suggests that Disney has been losing sales because of the 2042 end date. I don't think there is any evidence to support that, or BCV wouldn't be ready to sell out on the near future.

It will certainly be a factor at some point in time and when it does occur, I expect that DVC may not support resale prices as vigorously as it now does and resale prices will fall into line with other timeshares. Resale prices at this time are controlled by the ROFR and nothing else, IMO.

We'll soon know what the end date will be for SSR. As soon as presales are announced, the details will become public knowledge.

Stay Tuned!

 

[KNWVIKING]

Would there be a legal issue with DVD starting to sell SSR with the 2042 end date, then if sales are way down move the end to 2052 in an effort to kick start sales. I don't doubt they would have to extend the end date for those who purchase SSR early. I'm just curious if they are allowed to change the terms of the public offering-if thats the right term.

 

[RobDoc]

That's a good question and I'm not sure whether the POS can be changed in that fashion.

We've speculated here in the past that they could offer existing members an extension of the 2042 date- and that would certainly be possible.

My guess is that the resort will need to have a firm ending date when sales begin. It would be tough to change it midstream. If DVC senses that the end date will adversely affect sales at SSR, at some point before it is built and sold out, they should probably offer all sales with a new end date (I'd expect another 50 year program from the opening- 2054 in this case). That would, at least, solve the potential backlash from those who purchased just prior to the change. (They could possibly make the change retroactive for all owners at that resort without any legal issues though.)

Stay Tuned!

 

[ftmyersgirl]

I have not seen a DVC sales contract agreement and deed. Those of you who are currently members, is there language that limits your membership to the resorts in existence at the time of sale?

 

[KNWVIKING]

If I understand what your asking,the answer is no. The people who bought when only OKW was availible have the same rights to book and use all subsequint resorts.Any member with a "home" at any resort has full use of all existing resorts with the only restriction being the seven month booking window.Own at one, stay at all.

I can only assume SSR would follow suit.

 

[RobDoc]

KNWVIKING is correct. There is a clause in the contract that provides exchange privileges at any resorts subsequently added to DVC.

 

[disneyberry]

Originally posted by WebmasterDoc
Your comment suggests that Disney has been losing sales because of the 2042 end date. I don't think there is any evidence to support that, or BCV wouldn't be ready to sell out on the near future.

true, BCV is still selling fast. i was merely speculating about why Disney might make SSR end later since someone had asked "why would they do that".
and actually i just meant that Disney could make even more money if they did some kind of two-tiered pricing where SSR was much higher priced.

i certainly don't want to see that happen! as i'm guessing it will "decrease the value" of ownership at any resort that still ends in 2042.

anyway, my original post was just to get some ideas on how significantly people think resales will be affected if Disney does make SSR end later.

 

[Granny]

Originally posted by WebmasterDoc
KNWVIKING is correct. There is a clause in the contract that provides exchange privileges at any resorts subsequently added to DVC.

Doc...I didn't think that DVD was contractually obligated to allow DVC members to book at DVC resorts beyond their own home. I was under the impression that they could (if they thought it was wise and could keep from getting strung up) keep owners to only reserving their own resort if they so choose?


Or maybe I'm confused (gee, isn't that a shock!

 

[RobDoc]

Originally posted by Granny
Doc...I didn't think that DVD was contractually obligated to allow DVC members to book at DVC resorts beyond their own home. I was under the impression that they could (if they thought it was wise and could keep from getting strung up) keep owners to only reserving their own resort if they so choose?


Or maybe I'm confused (gee, isn't that a shock!

Nope! If more resorts become a part of DVC, we already have the ability to exchange to those resorts.

DVD, however, can develop other resorts NOT part of DVC and we'd have no ability to go there.

From Exhibit 10 of the POS:

"In the event DVD elects to develop any additional resorts, DVD in it's sole discretion may deveolp, operate or otherwise utilize such additional resorts as it sees fit, including, without limitation, as follows: (i) DVD may associate the resort with the Club as a DVC Resort, in which case the Owners of Ownership Interests at the additional resort will compete with Owners of Ownership Interests at DVC Resorts for reservations at DVC Resorts through participation in the master reservation system. ... (iii) DVC may create a separate vacation ownership or other similar vacation plan at the resort without associating it with the ckub in any way, in which case the Owners of Ownership Interests at DVC Resorts will have absolutely no rights to reserve th euse of accommodations at the additional resort through the Club. ..."

This would allow DVC to create a new timeshare- with another end date- that would be separate from DVC if they choose and we'd have no access to that program thru our current membership. DVC II !

 

[Maistre Gracey]

I don't think resale prices are likely to fall much in the future. Even without ROFR, the fact that CRO rents these accommodations for big $$$ should keep resale prices respectable.

 

[Dean]

If the resort you own is in the club, you will be able to book at other resorts in the club. The issue is that there are situations where your resort might not be in the club any longer and also the possibility that new resorts may not be added to the club.

As to the ending date, they could not change after there started selling without a major vote by the owners. The issue is truly whether Eagle Pines will happen. If not, no reason to have a different ending date with SS. EP will not be able to be sold out at the current pricing if the resort size is as announced. So if they are going to build EP and it will have a later ending date, may as well have SS with the new ending date and use that as a selling point. You can bet that a later ending date would have some affect on resales but likely not much for a few years. The affect would be more as time went on.

 

[ftmyersgirl]

Webmaster Doc,

Thank you for posting the language from the contract. I have been curious as to how DVD was going to continue to add new resorts to DVC and charge more money for less time. I think at some point, the resorts will not come under DVC.

This may end up enhancing the value of DVC. I say this because want to buy into Boardwalk Villas due to its location. The fact that there are at least four newer resorts has not changed my mind. Indeed, the resorts that come currently under DVC are so strategically located that their value may increase in the long run.

Just one way of looking at it.

The shortened time and resale value is something that is weighing heavily on my mind.

 

[lenshanem]

After reading this thread I'm worried since I just put down deposit for BCV!

 

[ralphd]

Originally posted by Dean
If the resort you own is in the club, you will be able to book at other resorts in the club. The issue is that there are situations where your resort might not be in the club any longer and also the possibility that new resorts may not be added to the club.

As to the ending date, they could not change after there started selling without a major vote by the owners. The issue is truly whether Eagle Pines will happen. If not, no reason to have a different ending date with SS. EP will not be able to be sold out at the current pricing if the resort size is as announced. So if they are going to build EP and it will have a later ending date, may as well have SS with the new ending date and use that as a selling point. You can bet that a later ending date would have some affect on resales but likely not much for a few years. The affect would be more as time went on.

I agree with Dean.

I still think that DVD may offer contract extensions at a future date. This could extend the ending date of existing contracts to the ending date at DVC II resorts. Price ????.

ralphd

 

[DisneyKidds]

I still think that DVD may offer contract extensions at a future date. This could extend the ending date of existing contracts to the ending date at DVC II resorts. Price ????.

I agree that this would make sense. At some point DVC II will exist. The language in the contracts makes it clear that DVD has kept that option open. The question then is what becomes of the DVC resorts in 2042. One option would be to roll the DVC resorts into DVC II. Assume DVC II is selling for $100 a point at the time the conversion is offered and ends in 2054. If they offered DVC members a conversion, you would have to essentially buy the extra 12 years. If DVC II was a 50 year deal, conversions would be to pick up about 25% of the DVC II contract period. It might make sense that they would charge about 25% of the current rate, or $25 a point to extend.

The resale market could get interesting if extensions are offered. You'd likely have people trying to re-sell contracts that end in 2042, as well as contracts that have been extended.

I suppose another option would be to make the old DVC resorts DVC III once the current contracts expire in 2042.

 

[tvwalsh]

I keep waiting for Disney to milk all of us for extensions of our lease! I picture it as an actuary chart in which we are able to select any extension within, say 100 years, and for any number of our points. The chart would show how smart we were being for extending right now. Why should Disney pass up all this free money? With all the self control I have shown in buying 270 add on points, I really hope they never do this. I am 58 years old!