Math question?

[4nation]

Trying to see if my math is correct for an example in my spreadsheet. If I buy Beach Club resale for a studio at $172 per point x 121 points plus 7.54 per point for dues x 20 years = 39,059 /20 years to be $1953 annually VERSUS $743 estimated per night x 7 nights =$5201 SOOO on average we would save $3248 per vacation?

Why is the 20 years a big deal if we save for all the weeks we can go?

 

[Meglen]

Would you normally spend 750$ a night ? The way I look at things is my years trip will be the cost of dues + yearly finance if you go that way +tickets. If this cost is more than you would normally spend on vacation than you need to weigh that. Not alot of people book deluxe at rack rate

 

[hglenn]

I have the same math as you so if you're wrong, so am I. I don't think 20 years is a big deal if you look at as it applies to your particular vacation and where you would stay anyway if you were paying cash. I think the math gets muddy when you compare the "value" of a 20 year contract to a 40 year contract and looking at the price per point as they compare to each other and the length of time you have to take those vacations. We are in the same boat with BWV. I think BC is very difficult to get into at 7 months so if you are 100% certain you will almost always use your points there, then I'd say have the best 20 years of vacations! But if you consider staying other places, then the price of BC is not as valuable.... that's my take away....

 

[Sandisw]

Disney almost always offers some level of discount so I would use that for the figures vs. rack rate.

Also, they can adjust the point chart values so what may be 121 points this year could be more points in the future. Of course, other times will be go down so adjusting your vacation time can compensate for that.

However, if you only want to be tied to DVC for 20 years and be done, it can still work out.

 

[sethschroeder]

Why is the 20 years a big deal if we save for all the weeks we can go?

What happens in year 21? That is the answer to the question.

With BWV I am done and have nothing but memories. With RIV I can either keep going with that locked in contract or I could even sell it possibly and recoup money.

Also there is lots of other math like inflation, discounts, initial outlier of money that you lose from investment, ect. Basically when you hit year 10-20 you have turned the corner likely and are starting to save money. In year 20+ you are for sure saving even more money because that initial payment is so far in the rear view that it is legit just paying MFs.

 

[RoseGold]

Now try it again with Swan Reserve at $300.

 

[Ruttangel]

If you can rent at $18 then that’s $2,178 so not much difference considering you could invest your buy in

 

[Meglen]

If you can rent at $18 then that’s $2,178 so not much difference considering you could invest your buy in

Is owning dvc for 20 years a good investment? How much inflation over the course of the contract. The longer contract are much more value imo

 

[RivShore]

As others have said, you should compare to what you would usually spend on a room, including discounts. It should still be a savings vs. any moderate room and above just not as great as the DVC marketing would have you believe.

 

[Ruttangel]

Is owning dvc for 20 years a good investment? How much inflation over the course of the contract. The longer contract are much more value imo

I think we are agreeing, BCV worst value and therefore need to compare with how much you would get by investing $30k and just renting when you need to

 

[wnielsen1]

If you are trying to justify the math on a BCV purchase, it is hard to do. However, only you can decide if it is worth it. If being a BCV owner brings you that much happiness, then buy it. Not every decision needs to be financial.

 

[happythoughts & pixiedust]

If you do a proper present value analysis which accounts for the time value of your initial investment, and inflation in dues as well as inflation price of alternate accommodations, you will find BCV ends up costing roughly $16 per point if the contract is held to expiration. It’s among the most expensive contracts to buy and hold due to high upfront cost and short contract duration. Held to expiration, it’s roughly 30% more expensive per point than the cheapest resale options (SS, Aulani, Copper). I’d still say it will end up being about 20% cheaper than renting points and renting points is a hassle - you are definitely not going to get your exact dates every single time you want to rent. If you’re going to use the points every year then buy them - you’ll save over renting and you’ll save over paying cash for hotel rooms thru Disney.

 

[theMoreDisneytheBetter]

Buying BC only makes sense if you want to stay at BC every (other) year for the next 20 years, or intend to rent it to like-minded individuals. It's too expensive for SAP and almost impossible to get outside of the 11m window with any certainty.

Having said that, it is our (extended) family's favorite resort so we stay there every visit. We're starting to introduce the idea of split stays, but the BC part is non-negotiable.

 

[bobbiwoz]

Now try it again with Swan Reserve at $300.

I do not consider that an even swap. You have mentioned it, but it doesn’t work for me.

 

[Meglen]

I do not consider that an even swap. You have mentioned it, but it doesn’t work for me.

They tend to have 20-30% off times where deluxes are 400-600 a night so its def not always 750+

 

[RoseGold]

I do not consider that an even swap. You have mentioned it, but it doesn’t work for me.

Depends on what you value. It might even have some upside over Disney. Cancellation policy, Marriott beds, don't have to book 11 months out. Don't have to come up with five figures to buy a timeshare. Can skip a year, no problem. Housekeeping, toiletries. brand new building...

 

[RamblinWreck]

Is owning dvc for 20 years a good investment? How much inflation over the course of the contract. The longer contract are much more value imo

The problem being that the majority of the cost of DVC (ie. the yearly dues), rises with inflation as well.

 

[Meglen]

The problem being that the majority of the cost if DVC (ie. the yearly dues), rises with inflation as well.

I could never find the value for my family. We normally spend 2-3k on a room for a week. We either rent or book early and check for deals. We didn't need to be at deluxe so dvc just didn't make sense.

 

[hglenn]

Depends on what you value. It might even have some upside over Disney. Cancellation policy, Marriott beds, don't have to book 11 months out. Don't have to come up with five figures to buy a timeshare. Can skip a year, no problem. Housekeeping, toiletries. brand new building...

+Staying for free on points!

 

[4nation]

Thank you all for your feedback. I am an accountant so my brain starts with the math side first. Happythoughts- most helpful!