Increase in AP/Ticket prices = Increase in DVC contracts for sale?

[mustinjourney]

Here's my obligatory post about the DVC AP discount only being this massive for like the last 8 months or so, and historically it hasn't been this large, and forecasting the current massive savings out for multiple years isn't guaranteed.

as long as they're trying to hype direct vs resale -- I would expect the savings in APs or other benefits to continue to be there.

Of course -- what new people don't realize is that the gold APs are now priced at what the platinums USED to be just 4 years ago. That is what scares me.

 

[mustinjourney]

If this is their way of trying to make direct look more attractive they must really think the people buying dvc direct are morons...you need 250 points a year to go twice at Riviera "spend $47,000 now and you'll save 1,500 a year for this year and who knows about the future. Also it's worth about $20,000 the second the sale closes...and we want it to be worth $0 so we are working on that every year! Welcome home!"

so much exaggeration in these figures.

First -- if you're buying 250 points -- you can get them for about $169 per point right now -- so the total is closer to $42,500 with closing costs.

Second -- Resale (especially if you were to break the contracts into 100/100/50) are going for between $131-$150 right now -- so the sales price is closer to $35000 (take another 10% off for commissions and closing costs and you end up about about $31,500).

third -- if you're a family of 4 -- that "savings" is $2,000 per year.

Based on those numbers -- it's not all that crazy. After 3 or 4 years, you'll make up the "loss" you'll incur on selling.

Lastly -- if you are dying to buy direct -- RIV is really your best option right now. The delta between direct and resale prices on everything else is at least $50 if not more depending on the property.

 

[Maistre Gracey]

I really doubt these changes were made with DVC sales in mind. Gold pass prices not rising as much as others probably is more related to them still wanting to attract Florida residents. We as members just happen to benefit from it.

Not so sure. There is no reason they need to keep the DVC gold AP at the same price as the resident gold AP.

 

[Ben E N]

Not so sure. There is no reason they need to keep the DVC gold AP at the same price as the resident gold AP.

Other than they have in the past, so why not continue now, for simplicity's sake. If driving direct sales was really their intention, then why would they go through with raising the prices $20 at all, and not just keep them flat, or even cheaper than Florida ones?

 

[Soap_1984]

I agree that Riv is the best option direct right now, but when you add the restrictions there are no good options. Disney raised the prices of other resorts to insane levels just to get people to buy what Disney wants them to buy, not because Riviera is an objectively good value by any stretch.

I have seen the incentives but I haven't seen $169/pp anywhere. I also didn't know you got the incentives if you broke contracts up. If you spent your $5,000 on a vacation and parked your $38,000 with your other investments, you'd earn your $1,500 in about 6 months.

You assume everyone has 4 people in their family to make my numbers look bad, I use the actual number of people in my family, not sure how that is exaggerating.

You don't adjust for time value of money. Also I have seen contracts sitting on fidelity for months, if you financed you are in a hole and have negative equity after day 1 of owning. So according to you you've lost $13k overnight if you paid cash and even more if you financed, but I am the idiot? Also about 5 contracts have sold resale, some even before it opened, once you flood the market with people selling we will truly see where the price lands (I would make a friendly wager it is below $140/pp as you used, but time will tell).

Perhaps some numbers were slightly exaggerated, but I did not spend time running numbers (I did that months ago and realized if I want to stay at Riv, which I don't because its literally in a moderate location at a luxury price, I am better off just renting points), but the only point I was trying to make, which is completely valid even using your more more optimistic numbers, is that by increasing the price of a non gold AP by net $60, that is not going to entice someone to buy Riviera, even at that steal of a price of $42,500. At least you can walk to....Carribbean beach?

 

[Maistre Gracey]

Other than they have in the past, so why not continue now, for simplicity's sake. If driving direct sales was really their intention, then why would they go through with raising the prices $20 at all, and not just keep them flat, or even cheaper than Florida ones?

Heck, why not give them away?

Seriously though, they can have their cake and eat it too.
Make more money, and please the direct buyers.

 

[Sandisw]

I agree that Riv is the best option direct right now, but when you add the restrictions there are no good options. Disney raised the prices of other resorts to insane levels just to get people to buy what Disney wants them to buy, not because Riviera is an objectively good value by any stretch.

I have seen the incentives but I haven't seen $169/pp anywhere. I also didn't know you got the incentives if you broke contracts up. If you spent your $5,000 on a vacation and parked your $38,000 with your other investments, you'd earn your $1,500 in about 6 months.

You assume everyone has 4 people in their family to make my numbers look bad, I use the actual number of people in my family, not sure how that is exaggerating.

You don't adjust for time value of money. Also I have seen contracts sitting on fidelity for months, if you financed you are in a hole and have negative equity after day 1 of owning. So according to you you've lost $13k overnight if you paid cash and even more if you financed, but I am the idiot? Also about 5 contracts have sold resale, some even before it opened, once you flood the market with people selling we will truly see where the price lands (I would make a friendly wager it is below $140/pp as you used, but time will tell).

Perhaps some numbers were slightly exaggerated, but I did not spend time running numbers (I did that months ago and realized if I want to stay at Riv, which I don't because its literally in a moderate location at a luxury price, I am better off just renting points), but the only point I was trying to make, which is completely valid even using your more more optimistic numbers, is that by increasing the price of a non gold AP by net $60, that is not going to entice someone to buy Riviera, even at that steal of a price of $42,500. At least you can walk to....Carribbean beach?

To add, though, a lot of what you are discussing applies to anyone who buys DVC, if they choose to use all of those values...like TV...etc.

I think the point here is that now that the price difference is even a little larger than before will make someone who was weighing pros and cons with direct add that to whatever numbers they are using to figure it out.

To add, you get total incentives when buying direct...even if you break into smaller contracts..price is based on total. RIV appeals to many buyers and for a lot of us, the resale value loss was not enough to outweigh the benefits buying there.

I posted in another thread that any resort bought direct will lose as much if not more on the market as RIV. And, remember, one can buy only 100 points direct to get that AP saving and add the rest resale. It's not an all or nothing situation!

 

[Ben E N]

Heck, why not give them away?

Seriously though, they can have their cake and eat it too.
Make more money, and please the direct buyers.

That would be fine with me!
I agree though that the greater divide between gold and platinum passes will help direct sales, and may have been mentioned in discussions, but there are so many other variables involved in setting these pass prices that I bet DVC was one of many, many voices involved in the decision.

 

[mustinjourney]

I agree that Riv is the best option direct right now, but when you add the restrictions there are no good options. Disney raised the prices of other resorts to insane levels just to get people to buy what Disney wants them to buy, not because Riviera is an objectively good value by any stretch.

I agree that Disney did raise the prices on the sold out resorts to make RIV look better. Word on the street is that new sales are much more profitable per point, so it's hard to blame them for doing this.

I have seen the incentives but I haven't seen $169/pp anywhere.

That's pretty much been the incentive for 250+ points since sales began -- they have just packaged it differently. Right now, if you have a Disney visa card -- you can get 250 points with a total of $7500 discount.

I also didn't know you got the incentives if you broke contracts up.

Now you know.

If you spent your $5,000 on a vacation and parked your $38,000 with your other investments, you'd earn your $1,500 in about 6 months.

Please tell me what I can invest in that is guaranteed to bring in 8% after taxes.

This example also fails to recognize that if this is how you play the game -- then you either have to reduce the principle each time you go on vacation --- OR -- you have to wait at least 18 months to take the vacation so that you're only vacationing on the interest/profits.

But this is also irrelevant to your original post -- you were arguing that buying DIRECT is moronic. The argument you're trying to make now is whether someone should even buy into DVC or not. Completely different topic.

You assume everyone has 4 people in their family to make my numbers look bad, I use the actual number of people in my family, not sure how that is exaggerating.

using an example of 3 people is artificially low for the majority of families. Some people have 2, 3, or 4+ kids. 2 kids is a reasonable approximation and is likely closer to the median.

You don't adjust for time value of money.

I'm not trying to make an argument for buying DVC or not buying DVC. I'm simply trying to make the argument of RIV vs other DVC options...whether they be resale or direct. As such -- TVM is not nearly as much of a factor.

A much bigger factor is the actual number of points needed to make a reservation -- and AKV and BWV are hard to beat there if you can get the lower point rooms.

and again -- I was responding to your post -- in which the topic was buying DVC direct is moronic. If you wanted to say that buying DVC is moronic -- then you should say so.

Also I have seen contracts sitting on fidelity for months, if you financed you are in a hole and have negative equity after day 1 of owning.

I don't think people should be financing DVC -- but that is a completely different topic. And competitively priced DVC contracts (<$155) do not sit for months.

Also -- if you buy direct and finance -- and then have to turn around and sell it within a month or two -- YOU ARE GOING TO TAKE A SIGNIFICANT LOSS NO MATTER THE RESORT.

So again -- if the topic at hand is whether you are going to buy RIV or another resort -- your argument is irrelevant. If you are arguing that buying DVC direct at sold out resorts is more risky financially than buying resale -- then yes, I agree with that assessment.

So according to you you've lost $13k overnight if you paid cash and even more if you financed, but I am the idiot?

I didn't call anyone an idiot. You were the one that said buying DVC direct at RIV to get AP discounts was moronic...or at least you said Disney must think we're morons.

Also about 5 contracts have sold resale, some even before it opened, once you flood the market with people selling we will truly see where the price lands (I would make a friendly wager it is below $140/pp as you used, but time will tell).

this is a valid concern -- but I will note that the doomsdayers predicted $90 a point for initial sales. I said it wouldn't go below $100 b/c the power buyers will come and buy and just rent the points out -- getting an 8%+ return on your money to rent points is not a bad gig.

Perhaps some numbers were slightly exaggerated, but I did not spend time running numbers

when you "slightly" exaggerate numbers on both sides to support your point -- you lose credibility. And for the record, you were off about 10% on the purchase price and easily 50% on the selling price. That's not "slight" exaggeration.

Just admit you threw out numbers to try and fit the narrative you wanted to make.

(I did that months ago and realized if I want to stay at Riv, which I don't because its literally in a moderate location at a luxury price,

With the addition of the skyliner, the Riviera is in a very good location. Yes -- that location is shared with two values and a moderate -- but it is literally faster to get to/from epcot or DHS from RIV than the time it takes for monorail resorts getting to/from MK.

And before you call ******** -- I timed everything my last trip when I stayed at both RIV and VGF. Getting to MK from VGF CAN be quick -- but if the security line backs up, you are SOL -- not to mention the monorail can be full by the time it gets to VGF. And coming back from VGF -- it takes about 15 minutes from when the monorail leaves MK to when it stops at GF. With the skyliner, I was inside Epcot within 12 minutes and about the same for DHS.

I am better off just renting points),

You're assuming you'll be able to easily rent points...point rentals for RIV are likely going to be pricey and might be difficult to come by. We'll see.

but the only point I was trying to make, which is completely valid even using your more more optimistic numbers, is that by increasing the price of a non gold AP by net $60, that is not going to entice someone to buy Riviera, even at that steal of a price of $42,500. At least you can walk to....Carribbean beach?

$500 savings per AP is definitely going to be a nice sales piece. It used to be around $450 savings. At $500 -- it's much easier for people to do the math. Family of four? You'll save $2000 PER YEAR!!! Family of 5? $2500 per year!!!

Will the extra $50 per year of savings get someone off the fence to buy direct now? I doubt it -- certainly not going to be large numbers.