Looking for an investment do you consider your DVC purchase

[sphere99]

an investment? Or is it mearly for pleasure? Thanks!!

 

[ScottNBecky]

I think its both. I view it as an inverstment for myslef and our kids since you own it for 50 yrs. It allows you to vacation every year if you want at a very reasonable price. Of course the pleasure value is also tremendous. I mean its Disney and if you love all things Disney there is no better place to spend a relxing vacation every year. Just my 2 cents.

 

[berly1657]

We joined DVC shortly before the 9/11 crisis and we commented on what a good investment we made vs having put that money in the stock market like we would have otherwise.

As a family we can plan on a vacation every year. We know that a hotel is not an expense we need to figure in our budget - because we paid for it all ready. and NO we would not normally stay in these 4-5 star resorts if we were paying cash for it. Hey the All Stars are just fine for me! But I do LOVE the BW, BCV, OKW...

Being DVC's we have shared our vacations with our families and friends...until we found out we like cruising too. Now we are being stingy with our points and saving them for cruising every 3 years.

The DVC is a now investment in to our families NOW lives. It gives us time as a family to have fun togather. If it was in the stockmarket - who knows if we would be able to enjoy it with our kids or if they will be enjoying it without us. Or if the money we invested in the stock m will still be there 38 years from now?

 

[dcfromva]

an investment? Or is it mearly for pleasure?

I consider it a partially prepaid vacation ..... ("partially" only because the largest expense over the life of the contract is the annual dues )

Or, it could be considered a really strong comittment to vacationing for the next 50 years.

But, I don't think of it as an investment....

-DC

 

[DrTomorrow]

My advice to all who ask is that DVC should be viewed only as a partially pre-paid time-share vacation plan that will provide deluxe accomodations on-site at Walt Disney World and two off-site locations for a fixed period of time. And while it is an "investment" in the meaning of "a significant expenditure", I do not believe that it should be viewed as an asset whose value will appreciate. Reasons:

1. The initial investment pales in comparison to the tens of thousands in fees that must be paid over the life of the contract.

2. It has an ending date. At the end of the contract, you have nothing of value remaining.

3. Its value is being maintained at current levels only due to Disney exercising ROFR, which they may cease doing at any time.

I will agree that, theoretically, if one purchased DVC with the sole intent of being a landlord and renting out points, it could be considered a profitable investment. But if you're thinking of buying DVC to use it for 5 - 10 years then selling at a profit, IMHO that's not an investment, that's a gamble. And I'd rather put my money on the pass line .

 

[jcodespoti]

Pre-paid vacation only, do not consider it an investment

 

[tjkraz]

Hard to consider it an investment when there are so many financial requirements to really enjoy it. Even on a minimal contract, you've got $500+ per year in dues. Transportation. Food. If you use your points at WDW, which I have to believe most do, add in park passes. Souvenirs.

If this is an investment, it's the worst investment I've ever made.

But, since we love WDW and look forward to years of trips there with our parents, children and grandchildren, it affords us first class accommodations for a fraction of the cost. Geez, I wish I'd invest...er...spent more money on points.

 

[manning]

Any financial adviser worth his salt will advise you, rightfully so, that no timeshare purchase should be considered as an investment.

 

[doubletrouble_vb]

A second excellent way to take a prepaid vacation for most of the rest of my life. Even if its only good for 10 more years its pretty good. Doesn't hurt that I could sell it now and break even on the principal but that doesn't mean it'll be true down the road a piece.

 

[AnnaS]

Definitely for pleasure - a luxury item for us - yet an investment for our enjoyment now and for many years to come.

 

[queenof4hearts]

I don't consider it a financial investment but a family investment.

 

[crisi]

I consider it an "asset"

Investments I make to watch the value in them grow (expect them to grow, obviously, sometimes they don't) and cash them out over time. They'll pay for retirement, kids college, etc.

Assets are things I own that I could, if I needed to, sell. I don't consider my house an investment even though its worth twice what I bought it for because I have no intention of selling (and not immediately buying another house for as much or more money- if I ever sold it!). But it is an asset - if I had to sell it, I could, and move into something smaller. Likewise, I have no intention of selling DVC, and by the time I do sell it, I expect the contract to have devalued due to the fewer years remaining.

 

[elfbo]

DVC Debate <==Link

This page has some break outs cost wise of the DVC, It is a couple of years old though, and does not have information about SSR, but it might help you answer some questions about the financial impact.

We think of it like we do our car. It *probably* wont make us any money, but we will get years of good value out of it. Upgrade in accomidations. A reason to go on vacation every year, and when we have kids, the means and another reason to take them. This is also allowing us to take our family for a nice trip togther next year rather than 3 years from now.

I mean yes, if the resales keep going up, then if you decide to sell you could make the money back on your initial purchase and have only paid your yearly dues for accomidations each year, but dont let this be a deciding factor.

One thing our guide told us, was to factor $5.50 for each point when determing accomidations(This was for SSR, other resorts would be different). If you would spend that much or more then you will save money over the life of the program. (the 5.50 is determined by dividing the purchase cost of the points by the #of points and divide by 50 years, then adding in the per point maintance fees) Its really 5.6 for SSR, but easier to do the math with 5.5.

 

[CarolA]

Timeshares (including DVC) are generally lousy investments. I would not consider DVC and investment.

 

[CarolynFH]

If you plan to go to Disney every year or 2 for a long time then DVC is a very smart buy.

In the November 2004 issue of Smart Money they have an article on "Destination Disney". it report that in the past 5 years room rates for the Grand Floridan have increased 33%, Polynesian 27%, Port Orleans 8%, Contemporary 21% and at the All Stars 22%.

We lock in our cost almost 7 years ago and yes the dues have increased, but not that much.

 

[sjcampbl]

Originally posted by berly1657
The DVC is a now investment in to our families NOW lives. It gives us time as a family to have fun togather. If it was in the stockmarket - who knows if we would be able to enjoy it with our kids or if they will be enjoying it without us. Or if the money we invested in the stock m will still be there 38 years from now?

This is a great way of looking at it. Our kids will only be 2, 5, and 8 years old for a year. They'll only be children for a few. I love this idea of an investment in the NOW.

Additionally, while DVC is really not an investment vehicle for reaping cash profit in the future, it is an asset. It likely will be a non-depreciating asset for years to come, if not clear to the end of the contract due to steadily increasing cash resort prices.

Finally, the fact that you can either rent your points for cash or quickly sell out on the secondary market is a hedge against any personal, life-changing, or financial issues.

I have an awful lot of friends who spend lots of money on nice cars, boats, motorcycles, and other toys. Those are all depreciating assets that are much more difficult to liquify.

 

[Beca]

I am TOO scared to consider DVC an "investment"!!!

I have friends who own at DVC. They bought when their children were small...now, the oldest is 16. The kids are involved in multiple activities costing big bucks each month. They know the worth of their DVC, and ALMOST decided to sell it for the money they could've made on it. They instead decided to rent out their points for the next 3 years and take the profit to help pay for their childrens' activities. It was really hard for them to think of selling, but it was equally hard for them to think of keeping when they, "have made so much money on it". If they couldn't have made a profit on it, they wouldn't have considered selling (some of their points were bought in the $50 per point range).

That's what scares me...I hope I NEVER "have" to think of my DVC as an asset. I hope I can (for the next 38 yrs) think of it as something of no real value that is "attached" to my family and cannot be sold, transferred or given away...which must be used to have amazing family vacations for as long as my contract lasts!!



Beca

 

[DeeCee735]

Definitely not considered an investment, other than an investment in great family vacations til I die! As far as the maintenance fees go, I think the annual amount for my contracts are comparable with other timeshare ownerships such as Marriott or RCI. We liked to stay at the deluxe resorts (like the Poly), during school vacation times before we purchased DVC, which I believe is high season, so even with paying the maintenance fees, I'm still saving over $1,000 a trip - not bad (not even taking into account increasing room rates). Then take into account the fact that we are in at least a one bedroom with a washer/dryer & jacquzzi tub - so the fact that we are committed to annual maintenance fees isn't so bad.

 

[mom2rb]

It is an investment in family time. I don't want any reason not to take my family on vacation. Sometimes it is too easy to say not this year or I will think about it in a few months. Well I don't want to wake up one day and my kids are grown and we never got around to it. I am cheap and nothing makes me more upset than wasting money. If I paid for it we are going to use it, no excuses.

 

[dmoore22]

I consider DVC as a hedge against inflation, ie. the rising cost of vacation accomodations. I sold some of my shares of Disney stock to make my purchase. I purchased a resale and, interestlingly enough, the going rate for resales has appreciated more than my shares of Disney. In the time since our purchase. To paraphrase a line from Mr. Blandings Builds His Dream Home, "Sometimes the best decisions are made with your heart."