Looking for formula to calculate point value

[barrie]

I am thinking about using my points for a trip to a non-disney location. I know the points are more valuable at disney but I'd like to figure out exactly what it would cost me to use points versus cash somewhere else. Does anyone have a formula to figure out the actual monetary value of each point?

 

[wdwendyd]

We paid cash for ours but this is how I figured it:
1)Take the number of years left when you bought it and multiply by how many points per year you purchased.
2)Now take your original purchase price (including all closing costs if it was a resale) but don't include the maintenance fees and divide that by your total number of points from step 1.
3) Add your maintenance cost per point (ex. 3.13 for OKW)
This should give you an approximate value per point (unless I messed something up!)

 

[TnRobin]

Here is what I did - it is very similar to the one above.



Total Purchase Price divided by number of years in my contract = price per year.

Price per year divided by number of points in contract = Price per point per year.

Price per point + Maintenance Fee (per point) = Total Cost involved in DVC point.




I consider the loss of interest to be offset by the inflation factors in all hotel accomadation - so I do not try to factor that in, but you can if you want. I just rounded up to the nearest $ to help offset this economical cost. My "cost" is around $5.


Now the value of the points is based on "what the market will bear". This calculation is more complex and I will not try to recreate one for you. It seems to be a concensus on this board that the rental value of a point is around $10.

 

[barrie]

Thanks! That's exactly what I was looking for. And such quick replies.

wdwendyd - I live in Portland too!

 

[Dennis the Menace]

I have a little different approach to establishing the value per point. I think that $5 per point is too low. My calculation determines how much it costs me to use a point. Here is the way I figure it:

Step 1: Multiply the amount you paid for each point by the rate of return you could have gotten had you invested the money in a fixed income investment.

Step 2: Determine your yearly dues per point.

Step 3: Add the amounts from Step 1 & 2.

Example:

Step 1: Paid $75 per point for VWL $75 x 6% = $4.50
Step 2: Yearly dues at VWL = 3.63
Step 3: Total cost (value) per point = 8.13

This is only one way to make the calculation and it admittedly, doesn't take into consideration the number of years that you will own the property or how much you can resell it for.