Looking to buy, need some feedback, pls

[kdzgon]

We have decided to buy in to DVC, but are in the process of deciding how many points and from where (direct or resale). I know this post is long, but I am hoping at least a few of you will take the time to read & comment!

I am 50, DH is 59. We currently have physical custody of one 3 YO grandson. DH will retire no later than approx 2 yrs from now, at which point we hope to finally move to Florida (in NJ now). We are parents of six (2 his, 4 mine), ea. married or living w/ SO (much more contact with 4, minimal w 2); grandparents to 4 so far (3,3,2,18 mos - 3 families). Two families military, 1 just out (translation: very limited budgets , & all 3 living far from us). DH wants "in", but doesn't care about the details. (As I am a CPA by trade, he tends to leave the "numbers" to me, anyway.)

What I know/have decided:

• DH does luxury - no value or mod resorts for him!
• DH has severe diabetes incl some complications - ECV use is an assumption I need to include.
• Home resort is not critical - esp as we do not anticipate traveling in any "high season", and it appears several resorts would meet our needs
• Home resort does, however, carry some weight - DH is interested in GVs (not so sure kids will agree as fast) +SS has access from ea floor for ECVs
• Price (purch + maint) is a significant factor, though not the only one - looking at SSR & OKW, adding HH as possibility
• We will finance to begin with, but pay off within one (1) yr (awaiting lump sum pmt)
• DH is a "softee", so I anticipate significant "sharing" especially w/grands
• I am looking at starting with 300 points, based on "best guess" possible usage
• "best guess" is we will hold at least 10 yrs (8-10 is avg time of ownership, according to both Disney & TS)
• Ideally, we would like to pass this on to our kids once we are gone and/or can no longer travel rather than sell
• Next planned trip (currently) is Sept '07, with 4 kids' families
• I anticipate we will use points for travel other than WDW in some years, possibly incl a cruise
• Assuming regular visits, the only "real" scenario for us where DVC might not make sense is for trips with kids' families if free dining is offered (late Sept, NOT Aug!) (I figure we'd bank pts or go again - not a financial decision, but hey!)

Other factors:

• We did not "do the tour", so we have no first-hand experience with any of the DVC resorts.
• There is a value to the extended expiration of SSR, but what? I believe it is negligible now but that it will definitely exist should I decide to sell at "avg" time (10 yrs from now)
• Closing costs are more for resales
• Maintenance is higher for OKW & HH (~6.8%)
• Purchase (& use availability) for resales takes longer
• Price is usually but not always lower for resales
• According to TSS, I need to add the maint costs for the entire current yr (2006) to the listed contract price unless otherwise noted on the listing
• Interest rate differences are too small to factor in (for our purposes)
• If I buy too many points, I can rent them (and supplement my cost)
• If I buy too few points, I can buy more, but will have add'l closing costs
• Splitting my purchase in to 2 contracts also means double closing costs, but would make it easier to sell off if we want to cut back

hoping at least some people are still with me.....

My questions to DVC members:

• How difficult is it to rent out points? Does Disney condone this, or just "look the other way"?
• Would anyone agree that considering a 10 yr ownership (min), the 2054 expiration date will have at least some value? (my cost analyses show a $550 - $1,700 premium pd @ 10 yrs, depending on current dues pd/not pd w/ purch.) If so, wouldyou venture a guess on a number or percentage?
• Anyone with 300 points ever decide you own too much?
• Do you agree with the premise "buy as many as you can afford", even if that might be more than what we would realistically need?
• Seems to me buying "extra" points might be advisable if you then rent them out in the yrs you do not need them to subsidize annual costs?
• Would you recommend splitting 300 points in to 2 contracts? If so, would you buy in 2 different resorts/ 2 expiration dates?
• Any other feed back/comments?

I apologize again for the length, but I don't know how else to write.... . I have read lots on this board (very helpful so far), but I really felt I needed to lay this out all together (helps me some too, even if no one else reads it!). Thanks so much for any help!

Laurie

 

[3DisneyKids]

WOW, Laurie! You have really done your research--good for you! Here are my thoughts, given your situation...yes, some will disagree with me, but that is what the DIS boards are all about...gathering a variety of opinions and then going from there.

I think SSR is a good choice for you. You get the added years, which means that resale will be easier 10 years down the road. Or, you can pass it on to those grand babies! In terms of resale, considering DVC just announced AKV, they are showing NO signs of slowing down, so I agree that your resale will be worth something down the road. Granted, most time shares LOSE value...and quickly...but DVC is one of the few that is opposite of that trend and only gains in value. Obviously, this is not a guarantee, just how it has been since early on.

SSR also has the VERY good discount right now (I already sent you a PM about that), which will make it competitive with any resale, plus cheaper closing costs.

I would go with 2 150 point contracts. In case the financial burden becomes too great...or you find that you are not all going the way you had planned, etc. it will be much easier to sell off one 150-pt. contract.

Right now, renting is not hard (as long as both parties are honest...this is not in any way directed at you...just some issues going on in a different thread, so it is worth mentioning). Dinsey allows it as long as it is not considered a "pattern of rental activity" that would look as though you were renting commercially (as a side business for example...yes, there are people who do that). However, if you just have extra points that you can't use, then it is fine to rent them. You may also transfer those points to another DVC member for cash exchange (basically the same as renting, they give you money and you give them points...but you just have MS transfer the points into their account. Obviously, this is much easier than having to rent to a non-owner as you would then have to make ressies for that person, etc. The ability to transfer will not go away, but be advised that you may only transfer ONE TIME per year).

Good luck as you make your decision, and keep asking those questions!

 

[vascubaguy]

I just wanted to comment that you would not necessarily have to pay closing costs twice.

If you purchased direct from DVC you'd have to pay closing for your first contract. So if you bought 150 pts at SSR you'd have to pay closing on that. However, they do not currently charge closing costs for add-ons. So as soon as you close on the first purchase, you could add on another 150 pt contract, or you could even do 3 - 50 pt contracts.... having those smaller add-ons can make it easier to split them up among this kids later on too...

 

[Pocahantas]

Laurie, if you definately want 300 points I would do 1 150 point contact and either 2 75 point contracts or 3 50 point contracts just in case there comes a time when you don't need that many points. Smaller contracts are much easier to sell should you need or want to.

Also, we only own 150 points for now so we only use them Sunday through Thursday to get the most value out of them. We stay at Deluxe or Moderate resorts using AP discounts on Friday and Saturday nights and pay cash. This might be something to consider if you don't want to spend so much up front since you have no experience with DVC. I always like trying something out first before investing alot of money to make sure we like it. You can always add more points later.

Good luck deciding!

 

[mom2dzb]

I'm hardly an expert but I'd like to add:
I agree with those who suggest two or more contracts as opposed to one large contract. With the currrent incentive for SSR of $15 off/point with a referral you could buy your first contract at $86/point. Ad-ons would then be at the price of $101/point if for purchases less than 115 points. If you add on 115 points or more, you get a $15/point price decrease for the same $86/point sale price.
(Took the tour two weeks ago. That's how I understood the current pricing for ad-ons.)

 

[kdzgon]

Laurie, if you definately want 300 points I would do 1 150 point contact and either 2 75 point contracts or 3 50 point contracts just in case there comes a time when you don't need that many points. Smaller contracts are much easier to sell should you need or want to.

Also, we only own 150 points for now so we only use them Sunday through Thursday to get the most value out of them. We stay at Deluxe or Moderate resorts using AP discounts on Friday and Saturday nights and pay cash. This might be something to consider if you don't want to spend so much up front since you have no experience with DVC. I always like trying something out first before investing alot of money to make sure we like it. You can always add more points later.

Good luck deciding!

The downside with adding points later might be we would likely lose the discount, no? Are there incentives on a pretty regular basis, or do they only happen once in a while? Plus, prices are definitely going up, not down.

If this were an investment only, I might consider the possible direction of the economy, but since this really is a vacation AND family issue (many people as possible users) and we can afford the points I'm leaning to buying more, not less.

 

[Pocahantas]

I am not sure how often DVC offers discounts or incentives but I have seen a couple in the last year (if I am remembering correctly). I just added 50 points at BCV and paid $95 per point so I think that is the current price for add-ons at the sold out resorts. Not sure what the price is at SSR.

Does anyone know if you can purchase 2 contracts of 150 points each and still get the $15 per point referral discount??? Or am I dreaming to think DVC would allow something like that.

I hope this helps Laurie!

 

[mom2dzb]

Does anyone know if you can purchase 2 contracts of 150 points each and still get the $15 per point referral discount??? Or am I dreaming to think DVC would allow something like that.

I guess I wasn't clear enough before . . .

With a referral you can get SSR at $86/point (contracts starting at 150 points.) Add-ons over 115 points qualify for the $86/point price, as well. Add-ons below 115 points do not qualify for the incentive, making them $101/point.

So . . . purchase your first 150 contract with the referral and then immediately add on 150 points. Each contract should cost $86/point.

Or maybe I'm mistaken . . . if you "add on" with Disney, it is a separate contract, right? Or, do they add the points to your current contract?

 

[Pocahantas]

I guess I wasn't clear enough before . . .

With a referral you can get SSR at $86/point (contracts starting at 150 points.) Add-ons over 115 points qualify for the $86/point price, as well. Add-ons below 115 points do not qualify for the incentive, making them $101/point.

So . . . purchase your first 150 contract with the referral and then immediately add on 150 points. Each contract should cost $86/point.

Or maybe I'm mistaken . . . if you "add on" with Disney, it is a separate contract, right? Or, do they add the points to your current contract?

Sorry, your post was clear before, I don't know how I missed it!!

 

[LisaS]

So . . . purchase your first 150 contract with the referral and then immediately add on 150 points. Each contract should cost $86/point.

Or maybe I'm mistaken . . . if you "add on" with Disney, it is a separate contract, right? Or, do they add the points to your current contract?

You are correct. In the scenario you describe, the member would have a 150-point master contract and a 150-point add-on contract. Each contract can be sold separately.

And I believe your pricing info is also correct: a member must add on at least 115 points at SSR to get the $86/point incentive price. So buying two 75-point add-ons or three 50-point add-ons would end up costing $2250 more than buying one 150-point add-on. The $15/point incentive is a limited-time offer but I'm not sure of the end date.

 

[kdzgon]

I guess I wasn't clear enough before . . .

With a referral you can get SSR at $86/point (contracts starting at 150 points.) Add-ons over 115 points qualify for the $86/point price, as well. Add-ons below 115 points do not qualify for the incentive, making them $101/point.

So . . . purchase your first 150 contract with the referral and then immediately add on 150 points. Each contract should cost $86/point.

Or maybe I'm mistaken . . . if you "add on" with Disney, it is a separate contract, right? Or, do they add the points to your current contract?

And here I thought I already had all the questions and just needed answers, LOL!

I called to ask. I can purchase multiple contracts (will be just 1 membership #, but separate contracts) at once, and only pay closing costs on the first contract. As long as I am buying all at once, there is no minimum for add'l contracts to qualify for the incentive price. The current incentive will continue until at least mid-November. Once my deed is recorded, I can add on a min of 25 points, but I must buy the incentive minimum (currently 115, but mins. change, apparently). All add-ons purchased from Disney will match your original use year.

 

[greenban]

As an add-on junkie, who often gets his fixes from Tom and Jason of TTS, let me point out that the current Disney SSR incentive at $86.00 includes current year points only.

Right now (October), if you added on our Bought a new December UY, you would have no points until December 1st, 2006.

If you bought a SSR resale contract at $83.00 per point, *WITH BANKED POINTS*, you will come out way ahead even with closing costs. (Or if you bought a Dec UY contract with current points, you would also come out ahead).

It is often not clear which deal is better, until all the minutae are clear, and they change from incentive to incentive.

However, I also agree 3 smaller contracts are better than 1 large, and Disney will allow you to buy 3-50 point contracts (identical names of ownership) instead of 1-150 point contract, and that I strongly suggest!

Hope to welcome you home soon!

-Tony

 

[Caskbill]

To correct one thing, if you purchase resale, you should not have to pay all of the dues for 2006.

Dues are paid on a calendar year basis, not on a use year basis. When someone first purchases Disney, dues are pro-rated by Disney for the remainder of the year purchased. Many sellers forget this fact and try to recoup dues for the full year.

Dues can be negotiated and should be negotiated the same way they were originally paid when the original owner purchased directly from Disney.

If someone says they want all of the 2006 dues paid because you get all of the 2006 use year points, that's wrong. If you purchase a June UY for example, then 5/12ths of the 2006 dues that were paid actually applied to the owner's 2005 UY points, and only 7/12ths of the dues actually paid really apply to the owner's 2006 UY points.

 

[LisaS]

I called to ask. I can purchase multiple contracts (will be just 1 membership #, but separate contracts) at once, and only pay closing costs on the first contract. As long as I am buying all at once, there is no minimum for add'l contracts to qualify for the incentive price.

That is great news! That gives the people purchasing at SSR under this incentive maximum flexibility with no financial penalty.

 

[Mtnman44]

I'm REALLY trying to wrap my brain around this one but I just can't get there...

If someone says they want all of the 2006 dues paid because you get all of the 2006 use year points, that's wrong. If you purchase a June UY for example, then 5/12ths of the 2006 dues that were paid actually applied to the owner's 2005 UY points, and only 7/12ths of the dues actually paid really apply to the owner's 2006 UY points.

 

[LisaS]

I'm REALLY trying to wrap my brain around this one but I just can't get there...

With a June Use Year:
2005 UY runs from June 1, 2005 to May 31, 2006
2006 UY runs from June 1, 2006 to May 31, 2007

Dues are paid on a calendar year basis not a Use Year basis. The dues paid in Jan 2006 cover Jan 1, 2006 through Dec 31, 2006.

So, how do you equate dues to points? Calendar year 2006 overlaps the last 5 months of the June 2005 UY (Jan 1 - May 31) and the first 7 months of the June 2006 UY (Jun 1 - Dec 31). So that is why Caskbill stated that the dues paid in calendar year 2006 apply to 5/12ths of the June 2005 UY points and 7/12ths of the June 2006 UY points. So if you buy a resale contract with a June Use Year and you get all '06 points and no '05 points and you reimburse the seller for all of the '06 dues, then you paid for 5/12ths of the '05 points even though you did not receive them as part of your resale.

Hope this helps!

 

[lisareniff]

I agree with Caskbill and LisaS that the Maint. Fees. should be prorated... However try tell that to the resellers!!

 

[kdzgon]

I agree with Caskbill and LisaS that the Maint. Fees. should be prorated... However try tell that to the resellers!!

I know Disney pro-rates maint fees (for add-ons, etc) and that they are "negotiable" on resales, but I was told to assume I needed to add them on unless noted (or, of course, negotiated away).

 

[LisaS]

I know Disney pro-rates maint fees (for add-ons, etc) and that they are "negotiable" on resales, but I was told to assume I needed to add them on unless noted (or, of course, negotiated away).

Yes, you can certainly try to negotiate the dues when you make an offer. On the other hand, if the contract you are interested in was itself purchased as a resale (rather than directly from Disney) then the current owner may have reimbursed the previous owner for current-year dues at the time of purchase so it might be harder to negotiate for pro-rated dues in that case.

 

[lisareniff]

I know Disney pro-rates maint fees (for add-ons, etc) and that they are "negotiable" on resales, but I was told to assume I needed to add them on unless noted (or, of course, negotiated away).

I'm sorry. I just had a conversation that didn't go very well with a reseller about prorating the MF. He wasn't very accepting of my point of view but never said I couldn't include that in my offer.

You also asked if anyone bought 300pts and thought they bought too many. Well, perhaps we did by a little but everyones situation is different. We purchased one contract of 300 BCV pts intending to stay in a 2 bedroom for 7-9 nights every other year or every 2 out of 3 years. I rounded up from 270 to 300 at the last minute. (Yes, I'm the mom who brings way too many cookies, etc). Having some extra is not too difficult a problem. I have rented point out once from the R/T board and forsee renting to friends in the future. Our biggest mistake is not getting the contract split into two (or three) for the reasons others had mentioned.

It sounds like 300 pts wouldn't be too much for your situation. Every other year for a week+ in a GV (or 2 - 2 bdrms) with the family.