Info on Rack Rate for Rooms

[cpc430]

Is there a website or post here that gives what the standard rack rate is for rooms/villas at various times of year? I am hoping to play with the numbers to calculate our break even amount (just for my own curiosity).

I'm no mathematician though... I'm sure it's a lot more complicated to figure out than I think!

 

[vicki_c]

Mousesavers.com

 

[DebbieB]

Is there a website or post here that gives what the standard rack rate is for rooms/villas at various times of year? I am hoping to play with the numbers to calculate our break even amount (just for my own curiosity).

I'm no mathematician though... I'm sure it's a lot more complicated to figure out than I think!

Here's some quick math - my studio at BWV for 6 nights last month was rack rate $2,715 incl tax. I used 91 points. I value my original points at $1.55 per point (cost paid / years left / points purchased). Plus dues of around $6.00 for 2014. So it cost me $7.55 x 91 = $687, about 75% off.

 

[beer dave]

It depends on what your buy in was and how many years of points left-- my buy in was about 2.00 a point each time i use one, and with mf at 6.00 now, it costs me 8.00 a point-- at that cost, it's about 33 % of what the rack rate is-- so if you use 200 points a year, (1600 cost) you are getting 4800 in reservations at rack rate-- so you make up 3200 a year... but no one pays rack rate....so... as DVC members we get rooms discounted 25 %.... that changes the percentage to about 43 % .... so that becomes 3721 in reservations at discounted rate.... so you make up only 2121 a year...... but if you use the bounce back offer....... .... never mind.

40 years of points at 6.00 mf costs over lifetime (200 point contract) 64,000.00.

so 13.3 years of paying rack rate would cover 40 years of DVC.....

or 17.2 years of paying 25%discounted rate.

Maintenance fees will rise, but so will rack rates.......

I don't know if any if this makes sense-- I need a beer now.

 

[beer dave]

Here's some quick math - my studio at BWV for 6 nights last month was rack rate $2,715 incl tax. I used 91 points. I value my original points at $1.55 per point (cost paid / years left / points purchased). Plus dues of around $6.00 for 2014. So it cost me $7.55 x 91 = $687, about 75% off.

wow and I thought I got a good deal....I guess my ssr points cost that--- so maybe 25 %.....

 

[skier_pete]

There is also a list of rack rates right here on the DIS under Resorts.

I have to tell you though - if you compare DVC to rack rates at Deluxes, DVC will compare EXTREMELY favorably. However, you SHOULD take into account that it is very rare that you should ever pay full rack rate for a room at Disney, except maybe certain very popular times of year. (Christmas/Easter.)

 

[MountainMouse]

There is also a list of rack rates right here on the DIS under Resorts. I have to tell you though - if you compare DVC to rack rates at Deluxes, DVC will compare EXTREMELY favorably. However, you SHOULD take into account that it is very rare that you should ever pay full rack rate for a room at Disney, except maybe certain very popular times of year. (Christmas/Easter.)

Good point, you'll rarely pay rack rate. In addition to high demand Christmas and Easter, you might pay rack rate to get free dining. I'd say depending on the resort you can get 20-25% off rack rate pretty regularly. To bound it, 35% is probably the higher end discount. More is probably possible, but rare.

 

[skier_pete]

Back when I did my cost calculation vs DVC (in February of this year) - I assumed 9 nights stay at the different room price levels deluxe ($300 per night) moderate ($200 per night) and value ($120 per night). That base rate is not the highest nor the lowest for staying at those type of resorts, so I didn't worry about discounts, I just assumed an "average" price.

For the DVC side, I also assumed buying resale 160 points at $75 a point, and a 10 year HELOC at 4% interest on the buy-in. (Paying cash would of course work out better for DVC.) 160 points should get me 9-nights in the equivalent of a studio for most point seasons.

For renting DVC - I used $13 a point and assumed the same 160 points.

I also assumed 5% inflation of room rates, DVC maintenance fees, and point rental rates. (Hard to predict long-range costs, but I figured this is the "fairest" method.)

I got break-even vs deluxe rooms right away.
Break-even vs renting DVC points at 10 years
Break-even vs staying moderate at 11 years.
Break-even vs staying value at 31 years.

The interesting thing is what happens AFTER the break-even point. In year 12 I am saving almost $1,500 per year versus staying at a moderate. In year 20, I'm saving $2,500 per year versus staying at a moderate. By the end of my contract (when I'm an old man) I've saved $139,000 by buying DVC versus staying at a moderate. Versus deluxe I save $292,000.

If I instead bought points from Disney at $165 a point and did the same calculation, I get:
Break-even vs deluxe rooms at 12 years.
Break-even vs renting DVC points at 18 years
Break-even vs staying moderate at 21 years.
Break-even vs staying value at, well, never.

These calcs I'd done before, and was why for years I resisted DVC UNTIL I discovered the resale option. A 20-year break-even point was too far out for me.

But either way - the fact is, the longer term you look at DVC, the better a value it is.

 

[DenLo]

Good point, you'll rarely pay rack rate. In addition to high demand Christmas and Easter, you might pay rack rate to get free dining. I'd say depending on the resort you can get 20-25% off rack rate pretty regularly. To bound it, 35% is probably the higher end discount. More is probably possible, but rare.

People often pay rack rate to get "free" dining. But for me I wouldn't be staying at a deluxe resort without DVC. I couldn't justify the cost per night even with 35% off. We would stay at a moderate and use the discounts for that resort.

 

[disneynutz]

Back when I did my cost calculation vs DVC (in February of this year) - I assumed 9 nights stay at the different room price levels deluxe ($300 per night) moderate ($200 per night) and value ($120 per night). That base rate is not the highest nor the lowest for staying at those type of resorts, so I didn't worry about discounts, I just assumed an "average" price.

For the DVC side, I also assumed buying resale 160 points at $75 a point, and a 10 year HELOC at 4% interest on the buy-in. (Paying cash would of course work out better for DVC.) 160 points should get me 9-nights in the equivalent of a studio for most point seasons.

For renting DVC - I used $13 a point and assumed the same 160 points.

I also assumed 5% inflation of room rates, DVC maintenance fees, and point rental rates. (Hard to predict long-range costs, but I figured this is the "fairest" method.)

I got break-even vs deluxe rooms right away.
Break-even vs renting DVC points at 10 years
Break-even vs staying moderate at 11 years.
Break-even vs staying value at 31 years.

The interesting thing is what happens AFTER the break-even point. In year 12 I am saving almost $1,500 per year versus staying at a moderate. In year 20, I'm saving $2,500 per year versus staying at a moderate. By the end of my contract (when I'm an old man) I've saved $139,000 by buying DVC versus staying at a moderate. Versus deluxe I save $292,000.

If I instead bought points from Disney at $165 a point and did the same calculation, I get:
Break-even vs deluxe rooms at 12 years.
Break-even vs renting DVC points at 18 years
Break-even vs staying moderate at 21 years.
Break-even vs staying value at, well, never.

These calcs I'd done before, and was why for years I resisted DVC UNTIL I discovered the resale option. A 20-year break-even point was too far out for me.

But either way - the fact is, the longer term you look at DVC, the better a value it is.

And there's the rub, I would guess that 10 years is about the average length of ownership.

Bill

 

[MountainMouse]

And there's the rub, I would guess that 10 years is about the average length of ownership. Bill

I think it's still beneficial at ten years ownership though. You're so far not giving away points so you get money back.

 

[JimMIA]

I would not use rack rates in a purchase decision -- unless you have a consistent history of actually paying rack rates for Disney deluxe resorts. To do so is nothing more than trying to construct a phony scenario where "I win."

If you want to buy DVC, buy DVC.

But if you're trying to actually figure out the math, use a rational and honest comparison.

 

[beer dave]

I would not use rack rates in a purchase decision -- unless you have a consistent history of actually paying rack rates for Disney deluxe resorts. To do so is nothing more than trying to construct a phony scenario where "I win."

If you want to buy DVC, buy DVC.

But if you're trying to actually figure out the math, use a rational and honest comparison.

Such as? Compare to the other vacation locations that are similar to WDW?

I think this thread has compared DVC to the full range of available Disney accommodations and discounts on rack rates.

In the case of supply and demand, sometimes "what it costs" overrides "what it is worth".