Inventory This High?

[Sandisw]

Sure! But I think some people gladly give up some level of control over the reservation, if it meant saving thousands of dollars buying resale. I think the market is fertile for it, especially as we see more restricted resorts coming onto the fold.

I was never suggesting that this is what people should expect, prior to buying resale. I'm just pointing out that it's a possibility. Charging a nominal transactional fee might be a decent business model and rely on sheer volume of trades. I don't know. If I had it all figured it out, I probably wouldn't have blasted it over disboards and worked on the project quietly for my own benefit! It's too bad I'm not that ambitious.

Right now, it’s RIV. So not a big deal in that occasional trade. But in two years from now, it might be three resorts.

In 2042, it could most likely be all the Epcot area resorts. And, you are going to have to have owners who want to trade out too and those won’t be those with direct points because they have access to all.

So, in reality will there really be that many owners wanting to trade the points everyone wants for stays at resorts most don’t?

Just doesn’t seem like a very likely and cost effective way to do it if your goal is to have access to all.

 

[HIRyeDVC]

Right now, it’s RIV. So not a big deal in that occasional trade. But in two years from now, it might be three resorts.

In 2042, it could most likely be all the Epcot area resorts. And, you are going to have to have owners who want to trade out too and those won’t be those with direct points because they have access to all.

So, in reality will there really be that many owners wanting to trade the points everyone wants for stays at resorts most don’t?

Just doesn’t seem like a very likely and cost effective way to do it if your goal is to have access to all.

Definitely not a cost effective way for those looking to buy direct. But if those direct owners ever decide to sell, it would be the ONLY way for those that choose to buy from the direct owners. If I were a Riviera resale owner, I would love the ability to use my points somewhere else other than Riviera. The same applies to future VDH, and possibly Poly2 resale owners. In time, (albeit a very long time), ALL resale contracts will inevitably be restricted to it's home resort. That tells me the market would be ripe for something like this to happen, not diminish it. Just my opinion.

 

[Chili327]

Definitely not a cost effective way for those looking to buy direct. But if those direct owners ever decide to sell, it would be the ONLY way for those that choose to buy from the direct owners. If I were a Riviera resale owner, I would love the ability to use my points somewhere else other than Riviera. The same applies to future VDH, and possibly Poly2 resale owners. In time, (albeit a very long time), ALL resale contracts will inevitably be restricted to it's home resort. That tells me the market would be ripe for something like this to happen, not diminish it. Just my opinion.

Doesn't that also bring the overall value of DVC down.? That's my biggest issue, is the resale value is what sets it apart from other timeshares. I mean if the resale value isn't there why not just get a Marriott, Hyatt, Hilton, etc. and have millions of options for locations.? (maybe i don't understand how timeshares work. lol)

 

[Sandisw]

Definitely not a cost effective way for those looking to buy direct. But if those direct owners ever decide to sell, it would be the ONLY way for those that choose to buy from the direct owners. If I were a Riviera resale owner, I would love the ability to use my points somewhere else other than Riviera. The same applies to future VDH, and possibly Poly2 resale owners. In time, (albeit a very long time), ALL resale contracts will inevitably be restricted to it's home resort. That tells me the market would be ripe for something like this to happen, not diminish it. Just my opinion.

Or, it makes the reason to buy direct more beneficial for owners?

I wonder whar we might see instead is people doing more buying if multiple resorts vs trading?

Just like now..my guess is the majority of RIV resale owners, like me, have other points to use when they trade.

Trades also need to consider value of points and it may not be as simple as it sounds to find someone who thinks the value of your points is the same as the value that you think they are.

What is more likely IMO is that DVC will add an element to BVTC of allowing owners to trade points with them for a fee at the 7 month window.

 

[HIRyeDVC]

Doesn't that also bring the overall value of DVC down.? That's my biggest issue, is the resale value is what sets it apart from other timeshares. I mean if the resale value isn't there why not just get a Marriott, Hyatt, Hilton, etc. and have millions of options for locations.? (maybe i don't understand how timeshares work. lol)

this has been debated to death in the past. IMO, yes, it would bring the long-term value of DVC down. Disney in the past, has been able to separate itself from your traditional sleazy timeshare programs. But the truth is, DVC has always been valuable and unique because it used to be small. Being a member meant somethingl. Now it's huge with thousands and thousands of members, direct and resale, with plenty of new resorts yet to come. Membership and it's perks are diluted. How can it not? With a huge membership base, it's no longer financially tenable for Disney to offer special perks like MLM, APs, etc. DVD is only doing what they think they can to shut down it's main competitor. And Marriott, Hilton, and Hyatt are NOT it's competitor. It's the DVC resale market (not the board sponsor specifically). The only way they can shut down their competitor is to further distinguish itself from the resale product. What better way to do that than to create a system that would severely restrict resale points from being able to use on the network. So sure, it will probably devalue the overall DVC product. Disney probably knows this. But they're also probably ok with it, as long as they can continue to churn out new resorts and make profits selling direct.

 

[Sandisw]

Doesn't that also bring the overall value of DVC down.? That's my biggest issue, is the resale value is what sets it apart from other timeshares. I mean if the resale value isn't there why not just get a Marriott, Hyatt, Hilton, etc. and have millions of options for locations.? (maybe i don't understand how timeshares work. lol)

While resale has been a nice plus, it isn’t something one should ever rely on and since 2012, when DVD started to make changes to differentiate resale and direct, it was clear they wanted it to become a different product.

Just look at how much things have changed in the last year. Anyone who bought in the past few years and is forced to sell now because of an unforeseen circumstance is selling at a loss. And, if they haven’t had time to use the contract much, the value of trips may not even be there to offset that loss.

 

[HIRyeDVC]

Or, it makes the reason to buy direct more beneficial for owners?

I wonder whar we might see instead is people doing more buying if multiple resorts vs trading?

Just like now..my guess is the majority of RIV resale owners, like me, have other points to use when they trade.

Trades also need to consider value of points and it may not be as simple as it sounds to find someone who thinks the value of your points is the same as the value that you think they are.

What is more likely IMO is that DVC will add an element to BVTC of allowing owners to trade points with them for a fee at the 7 month window.

All valid points. Especially about how people value different resorts differently. Of course all of this will probably drive more people to buy direct. That's the whole point! And yes, a lot of people inevitably buy multiple resorts. I myself ended up buying 4 more resale contracts, after my first direct one. But I saw little benefit to buying more direct points, once I had my first direct 225. As long as I bought where I wanted to stay, the restrictions became a non-issue for me. DVC can definitely add their own element. But it won't discourage other outside commercial entities from creating a product to meet the market's demand or need.

 

[Cfabar1]

I don’t buy the argument if resale goes down people will buy Marriott or Hyatt instead…. That requires a certain type of consumer who is extremely savvy about their investments and that being a motivating reason for their purchase….

Those buyers likely already understand that they can buy their Hyatt or Marriott timeshares on resale for considerably less money than a DVC timeshare.

I think people buy DVC because they want Disney. They like knowing they might be able to use it in California, or South Carolina, or will be able to use it in Hawaii or in VB, but their primary motivating factor is to be able to stay at WDW.

Funnily I don’t think resale restrictions move the needle “too much” in that regard - because you’re buying into DISNEY, and if you’re restricted and can only stay at your resort, well, you’re staying still at Disney, and not stuck going to say, Topeka. That’s why it’s worth a 25%-30% premium to buy direct and not even more substantially, as it often is with other timeshare systems.

 

[Epcot Forever Forever]

I don’t buy the argument if resale goes down people will buy Marriott or Hyatt instead…. That requires a certain type of consumer who is extremely savvy about their investments and that being a motivating reason for their purchase….

Those buyers likely already understand that they can buy their Hyatt or Marriott timeshares on resale for considerably less money than a DVC timeshare.

I think people buy DVC because they want Disney. They like knowing they might be able to use it in California, or South Carolina, or will be able to use it in Hawaii or in VB, but their primary motivating factor is to be able to stay at WDW.

Funnily I don’t think resale restrictions move the needle “too much” in that regard - because you’re buying into DISNEY, and if you’re restricted and can only stay at your resort, well, you’re staying still at Disney, and not stuck going to say, Topeka. That’s why it’s worth a 25%-30% premium to buy direct and not even more substantially, as it often is with other timeshare systems.

One could in theory buy a Marriott timeshare for the sole purpose of trading it in for weeks in DVC.

 

[Brian Noble]

I mean if the resale value isn't there why not just get a Marriott, Hyatt, Hilton, etc. and have millions of options for locations.?

That's a good question. But that question has nothing to do with resale values, and everything to do with what sort of vacations you want.

Disney in the past, has been able to separate itself from your traditional sleazy timeshare programs

Disney's Reality Distortion Field strikes again!

DVC has always been valuable and unique because it used to be small.

I don't think that's it at all. Instead, DVC has been valuable because it's (almost) the only game in town when it comes to a seamless, immersive WDW vacation. You enter "the bubble" and never leave again until your vacation is over. The outside world does not exist. And, that WDW vacation is culturally significant in ways that almost nothing else happens to be. It's a rite of passage for kids in a lot of families. For some families, a Disney trip is a marker of class, like a brand-name handbag.

If what you want is "Disney Vacations" and particularly Disney vacations in Florida, then it is the obvious choice, though it's wasteful to use it for anything else.

And that brings me back to this:

Those buyers likely already understand that they can buy their Hyatt or Marriott timeshares on resale for considerably less money than a DVC timeshare.

It's not so much that they are less expensive--and those two aren't particularly cheap even on the resale market. It's that they are providing different things. DVC owners own DVC because they want Disney vacations in particular. People buy into some other timeshare system because they want vacations in general.

 

[HIRyeDVC]

That's a good question. But that question has nothing to do with resale values, and everything to do with what sort of vacations you want.


Disney's Reality Distortion Field strikes again!


I don't think that's it at all. Instead, DVC has been valuable because it's (almost) the only game in town when it comes to a seamless, immersive WDW vacation. You enter "the bubble" and never leave again until your vacation is over. The outside world does not exist. And, that WDW vacation is culturally significant in ways that almost nothing else happens to be. It's a rite of passage for kids in a lot of families. For some families, a Disney trip is a marker of class, like a brand-name handbag.

If what you want is "Disney Vacations" and particularly Disney vacations in Florida, then it is the obvious choice, though it's wasteful to use it for anything else.

And that brings me back to this:

It's not so much that they are less expensive--and those two aren't particularly cheap even on the resale market. It's that they are providing different things. DVC owners own DVC because they want Disney vacations in particular. People buy into some other timeshare system because they want vacations in general.

I agree! And because it’s small and unique! The “unique” part was everything you just said

 

[KAT4DISNEY]

At the margin? Sure. But that margin seems to be more or less inconsequential compared to the overall sales engine. After all, plenty of timeshare developers sell full-freight timeshares in the low-to-mid five figures all the time, despite the fact that resales in those systems are worth a quarter to pennies on the dollar.

A robust and high-priced resale market is not required to sell timeshares.

In fact, it's probably less important that resales be expensive than it is that resales be "inferior products." That's based on watching the players in the market. Nearly every timeshare developer devalues at least some of their products on resale, though some devalue more than others. Over time, developers have added distinguishing features, not removed them--and those distinguishing features tend to devalue resales. Developers are intentionally lowering the value of the resale market in order to distinguish resales from developer purchases.

Either all of those developers are wrong, or that's the more profitable strategy.


Hurts the value for whom? There are three parties to this: Disney, someone who buys from Disney, and someone who buys on the secondary market.

The secondary buyer definitely gets less, because the points can't be used everywhere. That tends to depress resale prices compared to a universe in which resale points were not restricted, and that reduces the value for the direct buyer. But, as I argue above, this is increasing the value for Disney--because it's the same thing all of the other developers are also doing, and all of them make decisions based on their own profits.

So, the value is decreased for two of the parties, but not the third. Guess which one matters to Disney?

DVC is a "boutique" timeshare that only exists and survives at all in the timeshare world because it is onsite next to one of the biggest tourist attractions in the world. And the competition is onsite hotels. So while they are "just a timeshare" they are a timeshare that has a very limited niche that isn't like the larger systems. Now the difference between resale and direct will only affect a minority (which is an argument of why have restrictions since so many buyers don't even know resale exists?) but my casual observations when resale prices drop is that more people state they were looking at direct but couldn't pass up the price. There are those who added value to direct based on buying AP's but that's gone now. And there are some that say they'll pay more for future resorts but as the spread gets wider? Even when they say that they usually list a spread that would lead them to abandon direct. When the product you purchase is for locations all within a 5 square mile radius (or whatever it is) there's going to be a point on the price gap between direct and resale even if no other reason than the onsite hotel price vs resale. In the past decade or so you could purchase direct and have a decent chance of little or even no loss if you were going to sell. If we really hit the typical timeshare scenario where that $30k cost drops in half the second the paperwork is signed but you could purchase something just across the lake that has that loss built in and you could sell it for what you paid? Well, we'll see how that goes. Again, small % fall into this (so why jump thru hoops to prevent it) but the info is not difficult to find for those who think about looking.

With how it's been set up and sold DVC cannot restrict the only thing that really would matter - your ability to book your home resort at the same time as a direct buyer.

Many people also aren't real fond of Disney wielding a big stick. Some are practical and dismiss it as typical corporation but it's against the image they built up and thrive upon - "magic"! DVC is for "magical" vacations. I don't think that's been a slogan for Hyatt or Marriott.

 

[Chili327]

With how it's been set up and sold DVC cannot restrict the only thing that really would matter - your ability to book your home resort at the same time as a direct buyer.

Now that would definitely make a difference, Imagine if all resale were limited to a 7 month window. lol

I guess the reality is that it was a better deal way back and its going to get worse as the “magic” makes it a stronger product.
It just feels like greed (they sold the product already for the price they wanted), & it seems to me that the product would be stronger than ever without restrictions, & if they NEED to make more profits, then they’re saying they didnt charge enough in the first place?
Disney costs more than anywhere, how can they need to make more? (they don't pay the most either)
As someone said its not just one entity that matters, so its probably all just over my pay grade… and i just bought in so i obviously feel its worth it still.

 

[zavandor]

At the margin? Sure. But that margin seems to be more or less inconsequential compared to the overall sales engine. After all, plenty of timeshare developers sell full-freight timeshares in the low-to-mid five figures all the time, despite the fact that resales in those systems are worth a quarter to pennies on the dollar.

A robust and high-priced resale market is not required to sell timeshares.

In fact, it's probably less important that resales be expensive than it is that resales be "inferior products." That's based on watching the players in the market. Nearly every timeshare developer devalues at least some of their products on resale, though some devalue more than others. Over time, developers have added distinguishing features, not removed them--and those distinguishing features tend to devalue resales. Developers are intentionally lowering the value of the resale market in order to distinguish resales from developer purchases.

Either all of those developers are wrong, or that's the more profitable strategy.


Hurts the value for whom? There are three parties to this: Disney, someone who buys from Disney, and someone who buys on the secondary market.

The secondary buyer definitely gets less, because the points can't be used everywhere. That tends to depress resale prices compared to a universe in which resale points were not restricted, and that reduces the value for the direct buyer. But, as I argue above, this is increasing the value for Disney--because it's the same thing all of the other developers are also doing, and all of them make decisions based on their own profits.

So, the value is decreased for two of the parties, but not the third. Guess which one matters to Disney?

I don't necessarily disagree, but DVC is unique in the timeshare world, in the fact that many people who bought direct, and many more who bought resale, could and have sold for more than they purchased it.
Other timeshares lose value to the point that anyone aware of the resale market would be hard pressed to buy resale and never consider direct. So they do they only think they can, devalue the resale product hoping the restriction are bad enough to convince some of the resale purchasers to buy direct, or at least give a weapon to sales guys to counter during a sales pitch.
DVC doesn't necessarily have to do that. They could even use the high resale prices as the counter of why should I buy direct. And actually, some have reported that guides told them exactly that. The blue card was the middle ground: buy direct, get some additional perks and discounts and if you need to sell, you'll get back a fair amount of money.
Unfortunately they decided to go with the industry (low) standard.

I think this is worth a separate post--in part because i tend to focus on the "worth" of all of these things. But here I'm going to do exactly the opposite.

There's a guy on TUG who used to sell timeshares on Key West. He had a very interesting strategy. By his own admission, he was not a very good sales agent. He bought one of those weeks himself, and used it to take vacations. He just told the people he was touring what he personally did--no embellishments, no grandiose pictures that were technically possible but unlikely, none of the usual timeshare sales flimflam.

One thing he didn't do was spend a lot of time on the financial savings of it, even though it was probably there. Reading between the lines, my sense is that math was not his favorite subject in school. Instead, he just laid it out: You have the money to buy this, and if you buy it, you get to come back every year with much lower ongoing costs. Or, you can spend market rates renting every year, and probably skip some years. You pick.

When faced with someone who really wanted to figure out the dollars and cents, he had a very simple answer: "It is a TOY. You are buying a TOY. Treat it like a TOY."

The advantage to buying direct is that you never have to encounter "Oh, I can't do that" later. You want to use your points for Riviera? Fine. Same for any resort Disney ever builds. You want to use them for a cruise? Great! No problem! That's a bad use of points? Who cares! You want to go to the Member Lounge? Sure. Here's a magnet, for free! You belong, you are eligible for everything any Member can have.

Is that the cheapest way of staying in DVC? Probably not. So what? Money is for spending, after all. And, as another good friend puts it: I want to spend every last dime before I die, so that the tears at my funeral are real.

I agree a lot with this.
I enjoy reading all the "calculations" about DVC, time value of money, inflation etc etc.
It's "good fun". But at the end of the day, has it really any value? Once you start to make assumptions, on inflation, increase in rack rates and MF, point usage, how you would have vacationed otherwise etc etc over a long period of time, all those assumptions compound to the point they're really useless.
Most calculation are tweaked to the point they demonstrate what the person actually wanted since the beginning. Flipping a coin is probably as scientifically accurate as any other calculation.

 

[Bmramaut]

I won't pretend to have read this entire thread, but I know my wife and I considered buying into DVC, but without the opportunity to purchase an annual pass, we can't justify it. If they added that ability in, we'd probably jump on it for 2024.

Come to the resale club. You save enough to buy multiple passes… if they were on sale.

 

[CVG]

Resale stock down below 2300 now, so it does look as if the folks who needed to sell have done so and the ones less willing to negotiate are left.

And now below 2200. You lot have burnt thru 5% of the available contracts in one week. Ease up a bit!

 

[AstroBlasters]

Most calculation are tweaked to the point they demonstrate what the person actually wanted since the beginning. Flipping a coin is probably as scientifically accurate as any other calculation.

I respectfully disagree with your statement.

 

[Epcot Forever Forever]

And now below 2200. You lot have burnt thru 5% of the available contracts in one week. Ease up a bit!

My observation is that the sale rate is up a little but the listing rate is down a lot.

 

[AnnaKristoff2013]

Being able to trade down into other resorts like a new OKW, AKL, has advantages, not to mention BC and BW 2.0 in 2043.

If they redo these resorts when the contracts expire you’d better believe the point charts will be as bad or more likely worse than the highest point chart resorts are now. This is the way they do stealth price increases.

 

[CLE2WDW]

If they redo these resorts when the contracts expire you’d better believe the point charts will be as bad or more likely worse than the highest point chart resorts are now. This is the way they do stealth price increases.

That’s one of my biggest disappointments with the new DVC resorts… the extraordinarily hungry point charts. If you are interested in 1 or 2 bedrooms you need a minimum of 400 points and that’s not the case with the BWV or OKW. I get that it’s supply and demand but it’s just another hurdle for DVC to sell direct.