Most Economical DVC to Buy Fall 2021

[DVChris]

https://www.dvcresalemarket.com/blog/best-economical-dvc-resorts-to-purchase-fall-2021/No surprises here. Thoughts?

 

[HIRyeDVC]

What a swift rise for CCV. No wonder Disney's been buying them back with a vengeance. Riviera's avg price at $155 seems really high. It would probably rise to the top if it sold for more reasonable prices considering the resale restrictions.

 

[Zpaladin]

So the obvious issue with these rankings is that they value a 2022 point as equal to a 2062 point. No one would trade 100 2022 points for 100 2062 points. We can tell that current points are more valued than future points by the price difference of stripped and double contracts. Over the life of the contract the difference is very small but there can be a substantial price difference in the initial contract.
This oversight of basic behavioral economics causes the long contracts to appear more valuable than they really are.
I would suggest a 5-8 percent discount rate, similar to a longterm mortgage rate. This would suggest that 3.5-12 2022 points are worth 100 2062 points, which still might be overstating the value of future points.

 

[gskywalker]

Only problem is disney has been buying every ccv contract so I can't buy it

 

[swaysui]

Only problem is disney has been buying every ccv contract so I can't buy it

Well that's not good. Im waiting for ROFR, so maybe I shouldn't keep my hopes up.

 

[zavandor]

So the obvious issue with these rankings is that they value a 2022 point as equal to a 2062 point. No one would trade 100 2022 points for 100 2062 points. We can tell that current points are more valued than future points by the price difference of stripped and double contracts. Over the life of the contract the difference is very small but there can be a substantial price difference in the initial contract.
This oversight of basic behavioral economics causes the long contracts to appear more valuable than they really are.
I would suggest a 5-8 percent discount rate, similar to a longterm mortgage rate. This would suggest that 3.5-12 2022 points are worth 100 2062 points, which still might be overstating the value of future points.

I agree 100%. If anyone has still any doubt, OKW extendend is worth only $7 more than OKW expiring in 2042. So 15 years worth of points that are 20 years in teh future are only worth less than $0.50 per year.

So let's take CCV, which expires in 46 years, but really, the last 26 years are worth max about $12. So people are paying $141 for the next 20 years of points. The Pt. Per Year from Price should be $7.07.

The broker's analysis gives too much weight to the lenght of the contract.

 

[gskywalker]

Well that's not good. Im waiting for ROFR, so maybe I shouldn't keep my hopes up.

I would suggest not keeping your hopes up ever when sending for ROFR, but it doesn't mean it won't happen. I saw Disney bought CCV up to $170 that I know of a couple of weeks ago. But it happens, someone just got Baylake for $150 and I wouldn't have thought it would make it through.

 

[swaysui]

I would suggest not keeping your hopes up ever when sending for ROFR, but it doesn't mean it won't happen. I saw Disney bought CCV up to $170 that I know of a couple of weeks ago. But it happens, someone just got Baylake for $150 and I wouldn't have thought it would make it through.

Haha. Very true.

 

[RoseGold]

IMO, this is full of surprises. Resale pricing is still going up! The post COVID price jump was big and it keeps going. Aulani and BW resale scraping against the new direct pricing. RIV holding strong and VGF out of control.

It shows that even with all the uncertainty and change, demand for DVC is still there! As an owner of a lot of DVC, that sounds good to me.

I guess we will see if suspending APs and the new aulani firesale pricing changes this math.

 

[HIRyeDVC]

I agree 100%. If anyone has still any doubt, OKW extendend is worth only $7 more than OKW expiring in 2042. So 15 years worth of points that are 20 years in teh future are only worth less than $0.50 per year.

So let's take CCV, which expires in 46 years, but really, the last 26 years are worth max about $12. So people are paying $141 for the next 20 years of points. The Pt. Per Year from Price should be $7.07.

The broker's analysis gives too much weight to the lenght of the contract.

But the initial cost is to buy for the length of the contract. Wouldn’t that be the only way to gauge what we’re paying for is worth?