Negotiating a resale - where to start?

[Pongo23]

We are getting closer and closer to making offers on resale contracts. I have researched the list prices of multiple brokers, and I have researched the actual selling prices. Here's what I don't know - are buyers going right in with amounts that are close to the actual selling prices, or is the starting point much lower, making the actual selling price more of a middle ground? I am trying to avoid 2 things. 1) Having my inital offer come across as insulting if I go lower than what I'm actually willing to pay and 2) Leaving myself with little room to negotiate if I go in with my "best" offer right off the bat.

Any insight would be appreciated!

 

[DannysMom]

Honestly, I think it depends on your own personal feelings on the subject. How "attractive" is the contract in question to you. How hard is it to find another similar contract if this one doesn't pan out?

There are a lot of SSR contracts out there. WL not so much.

Once I decided that I wanted BCV I started researching what I believed to be fair market value for the kind of contract I was interested in. I opened with what I thought a "fair" price and the seller agreed immediately. Maybe I could have gotten it for a few bucks cheaper. But I do believe I offered a fair price. GL

 

[marynvince]

We are getting closer and closer to making offers on resale contracts. I have researched the list prices of multiple brokers, and I have researched the actual selling prices. Here's what I don't know - are buyers going right in with amounts that are close to the actual selling prices, or is the starting point much lower, making the actual selling price more of a middle ground? I am trying to avoid 2 things. 1) Having my inital offer come across as insulting if I go lower than what I'm actually willing to pay and 2) Leaving myself with little room to negotiate if I go in with my "best" offer right off the bat.

Any insight would be appreciated!

Why would a low price be insulting?

 

[ELMC]

We are getting closer and closer to making offers on resale contracts. I have researched the list prices of multiple brokers, and I have researched the actual selling prices. Here's what I don't know - are buyers going right in with amounts that are close to the actual selling prices, or is the starting point much lower, making the actual selling price more of a middle ground? I am trying to avoid 2 things. 1) Having my inital offer come across as insulting if I go lower than what I'm actually willing to pay and 2) Leaving myself with little room to negotiate if I go in with my "best" offer right off the bat.

Any insight would be appreciated!

There are a lot of approaches to bidding on resale contracts, and you need to find what works for you. You definitely don't want to go in with your best offer, because if they counter then you have nowhere to go.

Also, I wouldn't feel badly about insulting anyone with an offer that is too low. First off, if people actually do get insulted by a low offer, I'm sure they'll get over it. Secondly, it's business, so people really shouldn't be offended. It's not like you called their mom fat or anything. Finally, if you want the best price possible, you're going to have to go in low and be prepared for a lot of rejection. A lot of sellers will refuse to counter a low offer, which sort of puts a damper on the negotiations. Good luck!

 

[disneynutz]

We are getting closer and closer to making offers on resale contracts. I have researched the list prices of multiple brokers, and I have researched the actual selling prices. Here's what I don't know - are buyers going right in with amounts that are close to the actual selling prices, or is the starting point much lower, making the actual selling price more of a middle ground? I am trying to avoid 2 things. 1) Having my inital offer come across as insulting if I go lower than what I'm actually willing to pay and 2) Leaving myself with little room to negotiate if I go in with my "best" offer right off the bat.

Any insight would be appreciated!

There are many variables to consider. The size of the contract, resort, available points and current price trend. All of these items when considered will determine the sales price.

Bill

 

[Sandisw]

When we bought, we based our offers on what we were willing to pay. We had decided on a few scenarios in terms of who was paying closing and MF's. So, we were willing to pay more per point if fees were covered, etc. once we decided what we felt was a fair deal for us, we went in with that. We knew if might take time and on our 4th offer, we found a seller who was willing to define fair the same as ours.

Im not one who wants to play a lot of games so for me, I didn't go in lower to start just for the sake of doing it..

Good luck!

 

[Deb & Bill]

As a member who was lowballed once on a sale of our points and who felt insulted (regardless of what some of you think), the member selling their points has set a price based on what they feel they need to make the sale. More recent purchases may need to get enough to pay DVC what they owe them AND the real estate person helping them. You offer them $10 or more a point less than they are asking and it hurts. Some of them put their heart into this purchase and now they have to sell for whatever reason.

We sold two contracts because we got tired of paying Disney so much money each month. We made money on each of our sales even after the commission was paid. The third one with the lowball offer, we still have. And we've enjoyed those points.

Reading some of the ROFR posts, it makes me feel like some of you would enjoy firing an entire company.

 

[com_op_2000]

Recently purchased an OKW contract. We made an initial contract offer, they countered, we countered their offer, and they accepted.
As PP have said, it depends on resort, contract, any points that had been banked, etc can all effect the price.

 

[Caren90]

Recently purchased an OKW contract. We made an initial contract offer, they countered, we countered their offer, and they accepted.
As PP have said, it depends on resort, contract, any points that had been banked, etc can all effect the price.

Also, are the sellers under financial hardship? Do they owe on a loan and must meet a particular dollar amount? Was there a divorce, illness, death in the family? And a multitude of other factors that will effect the selling price and what one considers a 'reasonable" offer based on their personal/financial situation.

Stephen

 

[DougEMG]

We are getting closer and closer to making offers on resale contracts. I have researched the list prices of multiple brokers, and I have researched the actual selling prices. Here's what I don't know - are buyers going right in with amounts that are close to the actual selling prices, or is the starting point much lower, making the actual selling price more of a middle ground? I am trying to avoid 2 things. 1) Having my inital offer come across as insulting if I go lower than what I'm actually willing to pay and 2) Leaving myself with little room to negotiate if I go in with my "best" offer right off the bat.

Any insight would be appreciated!

Don't worry about what other buyers are doing, because you'll find that some buyers offer $20 under asking and some offer asking right away. Figure out what you are comfortable paying based on what the contract is worth to you. If you are not at the asking price, either leave yourself enough room to counter or tell the sellers this is your best and only offer.

Now if you are trying to get a lowball offer accepted then Be prepared to make a lot of offers, get rejected a lot and take a long time to get a contract.

 

[DougEMG]

As a member who was lowballed once on a sale of our points and who felt insulted (regardless of what some of you think), the member selling their points has set a price based on what they feel they need to make the sale. More recent purchases may need to get enough to pay DVC what they owe them AND the real estate person helping them. You offer them $10 or more a point less than they are asking and it hurts. Some of them put their heart into this purchase and now they have to sell for whatever reason.

We sold two contracts because we got tired of paying Disney so much money each month. We made money on each of our sales even after the commission was paid. The third one with the lowball offer, we still have. And we've enjoyed those points.

Reading some of the ROFR posts, it makes me feel like some of you would enjoy firing an entire company.

Congratulations on making money on your two sales, I don't think that happens for the majority of sellers.

 

[Deb & Bill]

Congratulations on making money on your two sales, I don't think that happens for the majority of sellers.

We bought them years ago and sold when the resale prices were close to what Disney was asking.

 

[ercrbc]

If you read about what price range Disney is choosing to ROFR for each resort, you have a pretty good idea the bottom of that resort's resale price range. How high you bid depends on how important it is to you to get that specific contract. Is UY a factor? Specific number of points? How much is it listed for?

Offer what it is worth to YOU and cross your fingers. It may be worth it to add a couple dollars to the price to guarantee it passes, depending on how much you want that contract anyway. We just lost one to ROFR that we offered the price listed. Now we are starting over with an offer a few dollars above that.

Good luck!

 

[jarestel]

The easiest way to handle resales is to figure out what you are willing to pay for a particular contract, then watch the resale sites for contracts that fit your criteria and start making offers. Member fees and closing costs can be part of the negotiations as well.

There are plenty of contracts out there, so if you aren't successful the first time or two, just keep trying. However, if you feel your offer if fair to both the seller and the buyer, your chances of success are obviously much greater.

Good luck!

 

[AllieV]

It makes your head spin, doesn't it? You want to leave wiggle room to counter but if you start too low, they may not even counter. Argh!

I started about $2 lower per point than what I was willing to pay (which was about $20 lower than asking price). I got no counters, so I moved up a bit (still inside my budget) then finally had to go in with my best offer up front. I did finally get someone to bite on my best offer. This happened twice when I went in with my best offer. All the others rejected or countered too high for my budget. When I started getting interest was when I made offers on contracts where the asking price was within $10 of what I wanted to pay.

 

[Pongo23]

It makes your head spin, doesn't it? You want to leave wiggle room to counter but if you start too low, they may not even counter. Argh!

I started about $2 lower per point than what I was willing to pay (which was about $20 lower than asking price). I got no counters, so I moved up a bit (still inside my budget) then finally had to go in with my best offer up front. I did finally get someone to bite on my best offer. This happened twice when I went in with my best offer. All the others rejected or countered too high for my budget. When I started getting interest was when I made offers on contracts where the asking price was within $10 of what I wanted to pay.

This is great info, AllieV - thanks!

Thank you all for the tips. I can see that the "will the seller be insulted" question is a bit subjective . Although to AllieV's example, when the most success comes when what you're willing to pay is within $10 of what the seller is asking, I think you're taking the "insult" question out of the equation. Please don't get me wrong - my intention is not to break any records by getting a very low price on a resale; I am very prepared to pay in the range of what the majority of resale contracts posted on these boards (and I think that is an important distinction) are going for. I can imagine that there are plenty of people buying resale that are unaware of actual selling prices when heading into this. What all of the info provided by you guys does tell me is that I should probably not bother with, for example, the $90-100 SSR contracts when I'm only willing to pay a lot less for that.

I do find the high price p/p of some resale contracts out there surprising. I understand that people are under water and have loans to pay off, but maybe some people are actually paying these high prices? I would think that the brokers would advise the seller that some of these list prices were too high otherwise, no? Kind of like selling your house - if houses like mine are selling for $300,000, it would be hard to convince an agent to list mine for $500,000. It's just really interesting to see such a wide range of pricing for nearly identical products, which makes the "where to begin?" part a bit confusing.

 

[DougEMG]

This is great info, AllieV - thanks!

Thank you all for the tips. I can see that the "will the seller be insulted" question is a bit subjective . Although to AllieV's example, when the most success comes when what you're willing to pay is within $10 of what the seller is asking, I think you're taking the "insult" question out of the equation. Please don't get me wrong - my intention is not to break any records by getting a very low price on a resale; I am very prepared to pay in the range of what the majority of resale contracts posted on these boards (and I think that is an important distinction) are going for. I can imagine that there are plenty of people buying resale that are unaware of actual selling prices when heading into this. What all of the info provided by you guys does tell me is that I should probably not bother with, for example, the $90-100 SSR contracts when I'm only willing to pay a lot less for that.

I do find the high price p/p of some resale contracts out there surprising. I understand that people are under water and have loans to pay off, but maybe some people are actually paying these high prices? I would think that the brokers would advise the seller that some of these list prices were too high otherwise, no? Kind of like selling your house - if houses like mine are selling for $300,000, it would be hard to convince an agent to list mine for $500,000. It's just really interesting to see such a wide range of pricing for nearly identical products, which makes the "where to begin?" part a bit confusing.

The range of asking prices has always surprised me. If you look at Fidelity SSR contracts have an asking price from $54/point all the way up to $120/point. I can't see that $120/point contract ever selling, even SSR contracts listed in the $90s are going to have a hard time selling.

 

[AllieV]

I catalogued my offer history here, but keep in mind I ended up buying off-site due to my budget constrictions. I didn't have a lot of competition. It may be a little helpful, though.

 

[IllinoisMommy]

I catalogued my offer history here, but keep in mind I ended up buying off-site due to my budget constrictions. I didn't have a lot of competition. It may be a little helpful, though.

Thanks AllieV...as a potential DVC buyer, this is very helpful. I am in the 'thinking about it' stage- so I am pretty confused. So when you said you bought off-site, did you mean HHI or VB??

 

[AllieV]

So when you said you bought off-site, did you mean HHI or VB??

I ended up buying Vero Beach even though it had never entered my mind to do so before. I got 100 points, with 2011 and 2012 points available, for a grand total of $4125. I couldn't have gotten that anywhere else. There are downsides to buying off site and especially at VB, but my intent is not to keep it more than 5-7 years. At that point, it will have completely paid for itself and if I gave it away then, I'd lose nothing. But this choice isn't for everyone. The competition is nil, though, so it's happy hunting. You just can't overpay for VB like I've seen some do recently.