Is DVC a Good Investment

[tecdavidt]

My Wife, Daughter and I just spent a great week at Disney World. We attended a DVC presentation at Magic Kingdom. It sounds like a great deal because we travel to Disney 1-3 times per year.

However, I looked at the numbers and they do not seem to make sense for the type of Disney trip we enjoy. The trip that just ended was at Polynesian concierge lagoon view. The price for the week (room only) was roughly $4000. DVC points for the same vacation would have been 718. If I wanted to buy 718 points in order to use DVC for the same vacation each year, the cost would be in the neighborhood of $75000, which would take many years to justify.

What is wrong with my economics?

Any help would be appreciated.

Thanks - Dave

 

[Parkhopper13]

My first question would be, if you plan at staying at the Poly....DVC is probably not the best deal. If you are comfortable staying at DVC resorts...there are 5 onsite...it would be extremely economical, especially traveling that often.

I would suggest touring some of the DVC resorts when you get a chance, then you will have a better feel for staying away from the Poly. If you are dead set on the Poly....save your money and pay cash for the Poly.

Just my $.02.

 

[Deb & Bill]

You need to use your points at DVC resorts to get the best out of your investment. We always stay in one or two bedroom villas and it makes for a nice vacation. Spoils us for any hotel room.

Non-DVC Disney resorts get renegotiated every year, so the point requirement can go up and usually does. But the DVC resorts stay pretty much the same from year to year except for small seasonal changes (but if points go up somewhere, they have to go down equally some other time). Easter changes every year, so the points required for Easter moves with the holiday.

We have 500 points and usually get two trips a year out of them. For at least a week or a bit longer each time.

 

[Ratpack]

Just subscribing so I can hear all the good feedback as well. We just got back tonight and also attended the DVC presentation. We are on the fence about whether it is a good buy or not.

 

[Im_A_Princess]

Best values are at your own "home" resort.
At the rate we were staying at DW, our DVC will be paid (clear) after going for 10 years. The next 30 are "free" (excluding maintenance/minor point changes/fees). We spend the money at DW anyway so we decided to pay our money toward a longer term goal (DVC). The biggest issue for us was getting the same vacation for about the "same price" 10 years from now as we are paying now.
Wished I would have bought into Old Key West!

 

[RxforDisney]

We are not yet DVC members, but we are seriously considering it, and I have done a lot of research.

All of these responses are spot on. If you are anticipating staying at the Poly using points, it is a bad investment. You likely toured Saratoga Springs or Animal Kingdom Villas while you were there, both of which are fairly out of the way. I believe that these are the only properties Disney is currently selling at WDW. If you are accustomed to the convenience of the Poly you might be happier with the Villas at Wilderness Lodge or Boardwalk Villas or Beach Club villas (Boardwalk and Beach Club are inbetween MGM and Epcot - walking distance to both). You can buy these resale. Or you may even want to hold out for the rumored Contemporary Villas.

My biggest concern is not the purchase price - I can justify that easily. But if you own 500 points, you are going to be paying in the neighborhood of $2000-2500 annually in maintenence fees in addition to the purchase price. That is where my hesitation comes in.

 

[flyerron]

Probably the best way to understand the advantages is to take the tour. You will certainly get great advice, pro & con, on this board however. There is little doubet that if you travel to WDW at least 1 time a year that DVC is well worth it. Your pay back will probably be about 7-10 years. There is a world of difference staying in a hotel room vs a condo. The pros very much outweigh the cons. If,however, you insist on a hotel room(s) then just stay where you want & pay cash.

 

[Fortywinks]

My Wife, Daughter and I just spent a great week at Disney World. We attended a DVC presentation at Magic Kingdom. It sounds like a great deal because we travel to Disney 1-3 times per year.

However, I looked at the numbers and they do not seem to make sense for the type of Disney trip we enjoy. The trip that just ended was at Polynesian concierge lagoon view. The price for the week (room only) was roughly $4000. DVC points for the same vacation would have been 718. If I wanted to buy 718 points in order to use DVC for the same vacation each year, the cost would be in the neighborhood of $75000, which would take many years to justify.

What is wrong with my economics?

Any help would be appreciated.

Thanks - Dave

The economics come into play when you stay at the DVC Resorts. For example, a 2 BR Vacation home (1075 sq ft) at Saratoga Springs (SSR) for this time of year is 316 pts for 7 days. Based on the economics of DVC points most people consider the cost to be ~$8-$10 per point over the life of the contract (47 years left) to be a good comparison. So the cost at SSR would be $3,160 using even the $10 per pt. Also, no tax is charged when using points at any resort. Your week at Polynesian would also include an additional $500 tax (4000 + 12.5%) so your actual cost is $4500. 10 years from now the cost for the same 2 BR at SSR should still only be 316 pts, the price for the $4000 room at Polynesian will probably be at least in the range of $7500-$8000 using very conservitive annual increases.

 

[hope3702]

I just bought in...Saratoga 220 points and we had our first trip in June...I never stayed on Disney...and never saw any of the onsite Disney properties let alone seeing Sarataga Springs...I can honestly say it is some of the best money I have ever spent...

No I wouldn't spend 70k...But with the 20K I spent plus a future add on down the road I couldn't be happier...I had breakfast at the Poly...I liked it but would have no issues staying at Sartatoga over it and just loved the Beach Club Villas...But everyone is different...

Good luck in your decision

 

[Cruelladeville]

Poly is one room, one bathroom, and very cramped for a family. A two bedroom villa has 3-4 times as much space. Also, for $4000 down payment on a DVC contract, you'd get that back plus more--and if you had to sell your cntract, you would find that your investment is returned and more. But, because you rented a room and paid 4000, that money is gone! On top of this, you could rent out your DVC points, and then pay cash for Poly, making this almost a free vacation. I rented out about 1/2 my pointsthis year, and it's paying for airfare and the cash price of those motel rooms, which have free food , and the other 1/2 of my points are for a vacation this fall!

 

[vandy]

Just to echo the previous posts, you need to spend the majority of your vacation time and points at the specific DVC resorts for it to make monetary sense. If cruises and staying at the Poly is what you prefer, then DVC will not be of much help. Taking a cruise or staying at the Poly once in awhile with your DVC points would be OK, but I would only do so sparingly.

Maybe you should consider buying fewer points and bank/borrow so you stay at DVC every other year. On the off year then stay at the Poly or take a cruise. That way you can still have a hedge on inflation with your DVC, but still enjoy other resorts. After a couple of years you can then either add more points to stay at DVC every year, keep things as they are, or sell your DVC for close to around what you paid for it (*based on historical sales).

 

[vandy]

My biggest concern is not the purchase price - I can justify that easily. But if you own 500 points, you are going to be paying in the neighborhood of $2000-2500 annually in maintenence fees in addition to the purchase price. That is where my hesitation comes in.

If you own 500 points then you are staying onsite at WDW for several days a year. What would the normal lodging costs be for those number of days? DVC still turns out to be a better value, especially when compared to the moderate and deluxe resorts. Broken down annually, I know our DVC is even better financially than staying at a value resort (we need two rooms). If you are referring to Deb & Bill's 500 points, we don't know when they purchased them. They may have had these for several years so their cost per year is lower than if you were to purchase those points now. Also consider the ever increasing room rates with sales tax at non-DVC resorts when considering if maintenance fees are too much.

 

[buck4568]

We are not yet DVC members, but we are seriously considering it, and I have done a lot of research.

My biggest concern is not the purchase price - I can justify that easily. But if you own 500 points, you are going to be paying in the neighborhood of $2000-2500 annually in maintenence fees in addition to the purchase price. That is where my hesitation comes in.

We have 600 points and pay about $2600 a year in dues. But, I look at like this. If I bought a vacation home on a lake, or a ski lodge in the mountains, or a cottage on the beach, I would have to pay taxes each year, and the cost to maintain the place each year. And that would be more than I am paying for my DVC.

Now I own all three of those great vacation alternatives through the DVC using my points for trips to Hawiai, Colorado, Europe, PLUS to DVC resorts at Disney World.

So, looking at from that perspective should ease the concerns over the cost of the yearly dues.

 

[crisi]

mousesavers and mouseplanet both have really nice financial analysis. Mary at Mousesavers developed hers with a lot of input from people on this board, and makes nearly every point ever made about this being a savings. Both sites have Excel spreadsheets you can download to change assumptions on.

http://www.mousesavers.com/dvc.html#dvc

 

[flyerron]

mousesavers and mouseplanet both have really nice financial analysis. Mary at Mousesavers developed hers with a lot of input from people on this board, and makes nearly every point ever made about this being a savings. Both sites have Excel spreadsheets you can download to change assumptions on.

http://www.mousesavers.com/dvc.html#dvc

Yes a great site, but there are more reasons to buy DVC than jusr the financial end. The kitchen, dining area, washer & dryer, roominess, etc.

 

[Deb & Bill]

...If you are referring to Deb & Bill's 500 points, we don't know when they purchased them. They may have had these for several years so their cost per year is lower than if you were to purchase those points now. Also consider the ever increasing room rates with sales tax at non-DVC resorts when considering if maintenance fees are too much.

We bought our first 175 for $50 a point in 1997. The most we paid for our points were about $67 in 2002. But, yes, we are paying about $2200 a year in member fees. And we get two vacations a year in a one bedroom for a minimum of a week. We're paying less than $150 a night for that one bedroom villa.

 

[crisi]

My biggest concern is not the purchase price - I can justify that easily. But if you own 500 points, you are going to be paying in the neighborhood of $2000-2500 annually in maintenence fees in addition to the purchase price. That is where my hesitation comes in.

Over time, your dues are going to be your biggest financial committment. You need to make sure the dues are going to be affordable for your family.

500 points is a lot of points - we own 150 and go to WDW every other year and stay for a week in a two bedroom. A lot of DISers go much more often than we do. But there are a lot of people that have even fewer points than we do (purchased resale or one 150 point contract split between two or three families) and get good use out of them. If you can stay 5 days in an OKW studio every year and be happy, your investment is going to be 10% of that 500 points - and your dues as well. At that point it starts looking competative to the value resorts.

However, its still CHEAPER to stay offsite. DVC only makes sense when you want to stay onsite.

 

[CarolMN]

Staying in a DVC villa will not be the same as staying Poly Concierge.

Before you get too deep into the financials, my advice is to do some thinking about how you vacation - what you want and value. If you would really miss the daily housekeeping, the concierge service level, the great location on the monorail and the MK castle views, DVC may not meet your needs.

Good luck with your decision.

 

[Lisa the kute 1]

I am new to DVC and to this forum. Cruelladeville, you seem to have a lot of knowledge about all this and I was hoping you can help me with a few questions. I bought into Old Keys West, and I'm planning an upcoming trip in late Dec.. First of all, they said Disney has waived everything and my final documents will be here in 28 days which that will be this Tuesday (I'M SO EXCITED!). Anyways I worry that I will not find any room by the time all my documents come in, should I be worrying? My other question is are the DVC resorts as filled with Disney magic as the Disney Hotels are? I mean will I still feel like I am surrounded by Disney like I am at the hotels....I'm a little spoiled to that. Thanks for any help and advice you can give.

 

[DisneyConvert]

A family consistently enjoys rooms that are a lot larger than normal hotel rooms.
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We have stayed at a variety of different properties (AS's Pop & Poly) over the past 5 years, a bit more frequently than once/year. In retrospect, we have been able to stay for quite a bit less than the cost of capital + annual maintenance charges that an equivalent DVC membership would have cost.
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My biggest problem around the DVC membership is that otherwise invested, my $20k (or so) can be pumping out close to $1,000 a year in income/dividends which isn't so much less than the room-only rate for a week at a moderate-value resort during the times of the year we like to visit. On top of that are the "maintenance fees of $750~$1,000/year depending on the number of points purchased. Plus, it's nice to have $20k in MY pocket vs. Disney's pocket . . . just in case.
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But, like so many other things Disney, the value is in the "up-sell". We just purchased AP's for the first time recognizing that over the next 12 months - as god is my witness! - we will be visiting WDW for 14+ days. AP holders "get" quite a bit for their/substantial investment. I feel we are just a bit higher on the valued-customer hiearchy. DVC members are the highest of course, and they get discounted AP's and so on.
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A 200+ point membership(s) in DVC is usually for folks who love staying in a larger-than-moderate cubicle for their 7~10 days each year, yes? Is that a waste of money or is it a wonderful luxury that DVC membership makes more affordable Ymmv.