Increase in minimum number of points for initial purchase

[RobDoc]

Do you think DVC will do away with members calling to purchase 25 point add on's? Is that why DVC has been grabbing up a lot of the smaller contracts? Just curious and have been thinking about sometime because I don't see any thing different if DVC is trying to get away with small contracts if they get the points and turn around and sell them to exsisting members as small contracts. I am also surprised that they just raised the first point purchase by 10 points. Wondering if all this helps us as we hold older contracts that will sell sooner than the new resorts. Hope some of this makes sense!!

No, I don't expect that either. Initially, DVC did have a (sales) restriction that add-ons could be as few as 25 points at your home resort but minimum at another resort was 50 points. That, like the minimum buy-in, has been relaxed over time. They could certainly change the minimum add-on if they feel a need, but I don't see any benefit for DVC in doing that - and most likely, it would simply increase demand (and pricing) for small contracts at the current resorts, including SSR.

If they really want to halt the resale of small contracts, they will need to exercise ROFR to do so. If that is a goal, then they could also raise the minimum add-on. Those aspects are not protected by the POS and can be changed at any time.

In one respect, they have already been leading members in that direction with lower pricing for add-ons of 50 or more points and even lower for 115 or more points - but there has been no move yet to raise the minimum add-on.

Stay tuned!

 

[UConnJack]

I for one think people are reading into this too much. Disney was lowering the minimum buy-in for a while to keep interest and sales strong, even as 3 higher priced (BWV, VWL, and BCV) resorts were coming on line after the generally cheaper originals (OKW, VB, and HHI). Now that DVC is simply a juggernaut, I think they know they can increase the minimum buy in without scaring people away.

I also don't think VAKL are going to be THAT much more expensive than the others. Certainly on-par with BCV, BWV, and VWL, but maybe a little more. We may see a new more expensive room category, but I don't think it is going to be drastically different overall. While booking other resorts a 7mths isn't something that's guaranteed, it is a heavily pushed benefit to the program, and I don't think we will ever see huge differences in point structures as it would cause too many imbalances.

 

[LIFERBABE]

I agree that it has to do with exchanges.

The minimum to exchange thru II is 160 points. Those 10 points can really hurt if you want to do an exchange.

They have been pushing exchanges and trying to keep that option lucrative, but it really is not working for DVC. On top of that, they are shooting themselves in the foot by selling short, so for those that want to trade, find out later they dont have enough points to trade.

There is borrowing, but most dont like to borrow.

I think raising the limit is due diligence on DVC's part to ensure that all new members have access to the bare minimums of each aspect of the program.

Lowering to 150 was doing more harm than good. My guide did advise us to purchase 160 and we took that advice for all our master contracts. Our add-ons are all small.

 

[JimMIA]

If they really want to halt the resale of small contracts, they will need to exercise ROFR to do so.

True, and this is exactly what they've been doing for a number of months. They have been ROFRing small contracts left and right, even at some pretty high prices. I suspect they do that because small contracts have the same administrative costs as large contracts and it's just advantageous to get them out of the system if an owner sells one.

I think it's a great strategy for many people to start out with a 25-50 point contract and then add on as funds become available, but I can see where that would not be in Disney's interest.

 

[dumbo71]

Congratulations Tom. I think you just got a few more resale buyers!!!!!

Unless.............. DVC exercises ROFR on all contracts under 160. In that case I'm very sorry Tom. Either way our sponsor will be affected by this change.

edit: Does TSS still get comision from DVC if they exercise ROFR? I believe so from the seller, so in that case we are back to congratualtions TOM!!!!

 

[jemiaule]

Do you think DVC will do away with members calling to purchase 25 point add on's? Is that why DVC has been grabbing up a lot of the smaller contracts?

Hrm, I just took a glance at the Anyone made it thru ROFR thread and a 50 pt contract just made it through on the 24th. I know two 50 pointers I sold made it thru this month also. Looking at the list of ones that did not pass...nothing on the list since November! Now I know that list is just a sampling and not all contracts sold - but it is interesting.

 

[jemiaule]

edit: Does TSS still get comision from DVC if they exercise ROFR? I believe so from the seller, so in that case we are back to congratualtions TOM!!!!

I would have to look over my contract for one I sold recently to say yes for sure but I do recall they get paid their commission if it is ROFRd. The commission is always paid by the seller, not the buyer.

 

[Dean]

Could Disney ever enforce a minimum buy-in via resale? Is there any way they could refuse to put someone in the system unless they purchased at least some minimum number of points? We've seen some evidence they are trying to make it harder for people to buy in with a small contract, so I've been wondering if ROFR is their only option or if they could in fact put some limits in place.

I'm also wondering if this 160-point minimum is an indication that the points required to stay at AKV will be higher than the other resorts.

DVC could easily enforce the min by buying all contracts submitted for ROFR not to an existing member and added to an existing master contract. I doubt the increase in min if accurate, is an indication of an increase in points for AKL. Frankly I'm surprised they didn't raise it long before. They should have done so when OKW was sold out and they announced the next resort which would have been VWL.

 

[Dean]

Congratulations Tom. I think you just got a few more resale buyers!!!!!

Unless.............. DVC exercises ROFR on all contracts under 160. In that case I'm very sorry Tom. Either way our sponsor will be affected by this change.

edit: Does TSS still get comision from DVC if they exercise ROFR? I believe so from the seller, so in that case we are back to congratualtions TOM!!!!

With DVC the resale company would get their proceeds out of the closing, technically paid by the seller who would get the rest of any money available. The only timeshare resale where I know of a problem with the resale company getting their commission is Westgate. Westgate has essentially taken ROFR a step (or two) further than anyone else. Not only do they tend to step in and say they have ROFR (whether it's in the documents for that resort/ownership or not) but also they have taken the stance they should get the sales commission as well. Of course the seller doesn't want to pay twice so that creates a problem. I haven't heard how this battle has been going lately but last I knew essentially all resale companies were cutting down or stopping Westgate resales.

 

[Splash Mountain Fan]

This makes sense. I think AKV will be a higher status place. I am not thinking Disney is going to have 50 point addons. It is getting everyone ready for the 160 minimum. I gather the SSR newbies would be very upset to think that in a couple of months their points would not be able to get them into AKV. So, it appears that the points of 160 will be the minimum number needed for the new resort. Get ready guys for a buy in of 160 points for AKV. I do not think we are going to see the 50 and 100 points there. So, look deep into your pocketbooks. It all makes sense.

Judy

I agree. I'm guesssing since SSR is getting closer to being sold out, Disney knows there will be enough demand for AKV to raise the buy-in by 10 points. My wife and I were just wondering how many points per night AKV will be than the others. We both think mucho!

 

[keishashadow]

True, and this is exactly what they've been doing for a number of months. They have been ROFRing small contracts left and right, even at some pretty high prices. I suspect they do that because small contracts have the same administrative costs as large contracts and it's just advantageous to get them out of the system if an owner sells one.

I think it's a great strategy for many people to start out with a 25-50 point contract and then add on as funds become available, but I can see where that would not be in Disney's interest.

it's the best kept secret

 

[KingOMiami]

EEEKKKK!!! After reading these posts, my head is spinning. We just sent in the deposit and initial paperwork to TSS on a 50 point VWL contract. The major thing for us doing it is that our finances simply do not allow a purchase from Disney of the size they require. There is a better chance for us to add on points as we go along as opposed to one lump sum.

I have spoken to our associate @ TSS & seen the post on ROFR and I was feeling a lil good about our chances but after all these posts, now I don't know. I understand Disney is looking for their best interests and fiduciary responsibility to shareholders, etc., but right now this is our best chance for becoming part of the magic. If we get hit by ROFR, it will pretty much dampen some of the happy, fuzzy feelings we have towards the Mouse.

Now I am getting those nervous feelings that others have posted about while waiting on whether their contract passed muster.

AAAAAAAAAAAAAHHHHHHHHHHHHHHHHHHHHHHH!!!!!!!!!!!!!!

 

[LisaS]

EEEKKKK!!! After reading these posts, my head is spinning. We just sent in the deposit and initial paperwork to TSS on a 50 point VWL contract. The major thing for us doing it is that our finances simply do not allow a purchase from Disney of the size they require. There is a better chance for us to add on points as we go along as opposed to one lump sum.

I have spoken to our associate @ TSS & seen the post on ROFR and I was feeling a lil good about our chances but after all these posts, now I don't know. I understand Disney is looking for their best interests and fiduciary responsibility to shareholders, etc., but right now this is our best chance for becoming part of the magic. If we get hit by ROFR, it will pretty much dampen some of the happy, fuzzy feelings we have towards the Mouse.

Now I am getting those nervous feelings that others have posted about while waiting on whether their contract passed muster.

AAAAAAAAAAAAAHHHHHHHHHHHHHHHHHHHHHHH!!!!!!!!!!!!!!

I couldn't find your contract info on the ROFR thread. What are you paying (price/pt) for that 50-pt VWL contract? You should consider posting on the ROFR thread because it helps everyone to have up to date data on what it takes to get past ROFR.

The folks at TTS have a lot of experience with what it takes to get past ROFR so you're in good hands.

 

[doubletrouble_vb]

I dont think Disney is anymore worried about the small contracts than they were before. More likely raising it to 160 ensures a member has access to all the benefits as mentioned before AND they will most likely wind up with fewer owners at AKV. That's a huge benefit when it comes to administrative costs right there....and its a benefit that will cascade over to the existing resorts for those who must have an older resort.

 

[greenban]

You guys are so naive!!!

About 50% of contracts are for 150 points or less. These members naturally talk to other members while sitting in the Jacuzzis, or pools and when watching thier offspring play in the play areas.

Well, this is just brillant marketing by the Disney Geniuses (Jim Lewis perhaps?).

Just imagine the pressure, the embarrasment of POINT ENVY.

There I said it, and I hope I don't get banned again, "POINT ENVY"

50,000 contracts X 10 measly points to relieve those POINT ENVY symptoms and you get 500,000 points sold. Let's us real world numbers, and only half of the 50K buy, that is still, 250,000 DVC Points sold with almost no marketing expense by TPTB. Brillant I say!

-Tony

 

[Starr W.]

Point Envy

Too bad they don't have a laughing smiley spraying coffee on their keyboard.

 

[BUDDYBEAR]

GOOD LUCK HOPE IT WORKS OUT

 

[UConnJack]

I doubt the increase in min if accurate, is an indication of an increase in points for AKL. Frankly I'm surprised they didn't raise it long before. They should have done so when OKW was sold out and they announced the next resort which would have been VWL.

I agree. VAKL will likely have a point structure similar to VWL, BCV, and BWV pref. Possibly a little more expensive, but not so much that would be directing the decision to increase the minimum points.

 

[Beca]

50,000 contracts X 10 measly points to relieve those POINT ENVY symptoms and you get 5,000,000 points sold. Let's us real world numbers, and only half of the 50Kbuy, that is still, 2,500,000 DVC Points sold with almost no marketing expense by TPTB. Brillant I say!

-Tony

Okay, I know you were kidding, but the above statement is what I was thinking, too. With AKV right around the corner, DVC might want to have a final "push" on the SSR rooms. If every new buyer had to purchase 10 more points, it is not going to keep anyone from purchasing, but will certainly sell a lot more points in a short period of time.

Of course, the exchange thing is a really good point, too.

 

[CarolA]

Could Disney ever enforce a minimum buy-in via resale? Is there any way they could refuse to put someone in the system unless they purchased at least some minimum number of points? We've seen some evidence they are trying to make it harder for people to buy in with a small contract, so I've been wondering if ROFR is their only option or if they could in fact put some limits in place.

I'm also wondering if this 160-point minimum is an indication that the points required to stay at AKV will be higher than the other resorts.

There's a theory that DIsney is partially enforcing a minimum buy in. The ROFR thread seems to indicate that lots of smaller contracts attempting to get purchased by first time owners have been ROFR'd unless the price is really high!