New $500 Resale DVC Transfer Fee

[airjay75]

I wonder at what number it would make sense

I ran the numbers at some point. I want to say, to put the yearly cost per point somewhat on par with CCV/BLT/SSR, it need to be down to $10 or $20 per point. Don't remember exactly though. I think even direct RIV/PVB points come out to a better cost per point per year than VB resale at current prices. That said, I didn't account for time value of money or financing costs, and there are definitely other ways to analyze it.

 

[Girlstar30]

I ran the numbers at some point. I want to say, to put the yearly cost per point somewhat on par with CCV/BLT/SSR, it need to be down to $10 or $20 per point. Don't remember exactly though. I think even direct RIV/PVB points come out to a better cost per point per year than VB resale at current prices. That said, I didn't account for time value of money or financing costs, and there are definitely other ways to analyze it.

Yes the 2042 part kills it for me as well, it needs to be free

 

[muppets3d]

Yes the 2042 part kills it for me as well, it needs to be free

If this $500 fee increases over time I could see it happening to VB and a few others given enough time, especially CFW. It could seriously cool demand for a lot of points out there, or at least depress pricing.

 

[VGCgroupie]

I wonder at what number it would make sense

None.

 

[Girlstar30]

None.

Dream killer

 

[muppets3d]

None.

If you only need a contract for a few years, or at worst case until VB expires - you could make the argument. Especially since DVC seems bound and determined to make resale more and more unpalatable as the years go by. The argument of "Buy SSR today and sell it in 2042" may not work out. I certainly wouldn't figure possible future resale value into any of my purchasing decisions of DVC because while it may never be truly zero, it may be close enough to where it basically is. Like a car - they will always have some value to someone, but at a certain point it's sometimes better to just sell it to a junkyard for $500 and be done with it.

 

[muppets3d]

I must of missed that the $500 is on top of the estoppel.

So basically it's money for nothing.

It's money to punish resale and depress the market. If it were actually tied to the cost of doing business it would not be $500.

 

[VGCgroupie]

If you only need a contract for a few years, or at worst case until VB expires - you could make the argument. Especially since DVC seems bound and determined to make resale more and more unpalatable as the years go by. The argument of "Buy SSR today and sell it in 2042" may not work out. I certainly wouldn't figure possible future resale value into any of my purchasing decisions of DVC because while it may never be truly zero, it may be close enough to where it basically is. Like a car - they will always have some value to someone, but at a certain point it's sometimes better to just sell it to a junkyard for $500 and be done with it.

The MF make VB a no go even if the price is $0 per point. Regardless of its expire date.

 

[airjay75]

I feel like one or two years worth of bad dues increases at VB could very quickly push the resale value over the cliff. I think the only real way I could see buying VB is if you knew you wanted to use those points for beach cottage stays through 2042. Not sure there is any category of room there that you can't get into with other DVC points if you're at least minimally flexible on dates of travel.

 

[Girlstar30]

I feel like one or two years worth of bad dues increases at VB could very quickly push the resale value over the cliff. I think the only real way I could see buying VB is if you knew you wanted to use those points for beach cottage stays through 2042. Not sure there is any category of room there that you can't get into with other DVC points if you're at least minimally flexible on dates of travel.

I think when I go back id want to try for one of those cottages, but id want it during turtle season, good luck to me

 

[muppets3d]

I feel like one or two years worth of bad dues increases at VB could very quickly push the resale value over the cliff. I think the only real way I could see buying VB is if you knew you wanted to use those points for beach cottage stays through 2042. Not sure there is any category of room there that you can't get into with other DVC points if you're at least minimally flexible on dates of travel.

Yeah a lot of people have been buying VB as SAPs due to the low buy-in so that has made it reasonably easy to book at 7 months.

 

[Mikey15]

In a way, I think Vero Beach is an alternative to points rental for people who don’t already own DVC.

Say rental brokerages are paying owners ~$16pp for a <7mo rental, but they’re getting a middleman cut and charging ~$20pp to renters. For a renter, a $40pp Vero buy-in is $2.50pppy (16 years of points forthcoming, assuming none borrowed), plus the $14.89 MF. It’s not much savings off of paying $20pp for points rental, but it’s still there on paper. Plus, if they’re not already DVC owners, it’s their foot in the door to better offers (& loan rates) for buying direct than if they bought direct as their first DVC.

I think closing costs and a $500 fee make the math harder to justify than it appears on the surface. But maybe this is the year VB dips under $40?

 

[Cfabar1]

In a way, I think Vero Beach is an alternative to points rental for people who don’t already own DVC.

Say rental brokerages are paying owners ~$16pp for a <7mo rental, but they’re getting a middleman cut and charging ~$20pp to renters. For a renter, a $40pp Vero buy-in is $2.50pppy (16 years of points forthcoming, assuming none borrowed), plus the $14.89 MF. It’s not much savings off of paying $20pp for points rental, but it’s still there on paper. Plus, if they’re not already DVC owners, it’s their foot in the door to better offers (& loan rates) for buying direct than if they bought direct as their first DVC.

I think closing costs and a $500 fee make the math harder to justify than it appears on the surface. But maybe this is the year VB dips under $40?

Yes, buying VB seems to be similar to playing a game of Hot Potato doesn't it....

 

[Sandisw]

It's money to punish resale and depress the market. If it were actually tied to the cost of doing business it would not be $500.

Do you really think it costs $150 to process estoppel?

Or that the closing costs that are charged, even by title companies don’t include profit?

Yes, they could have started lower, but it’s not like this is the only thing that DVC or Disney charges higher prices for.

This isn’t going to make a difference to drive people direct. It makes more sense that, like I just posted, was to capitalize on money they were leaving on the table.

 

[walt34]

Do you really think it costs $150 to process estoppel?

Or that the closing costs that are charged, even by title companies don’t include profit?

Well, there is a market for title companies, that keeps prices reasonable. I believe there is a legal limit to how high the estoppel fee can go? Is there a limiting factor for this new fee?

What I'd be interested in is how much time we believe it actually takes Disney to process contracts. My guess it's less than and hour and 80% profit would be a reasonable assumption.

 

[Sandisw]

Well, there is a market for title companies, that keeps prices reasonable. I believe there is a legal limit to how high the estoppel fee can go? Is there a limiting factor for this new fee?

What I'd be interested in is how much time we believe it actually takes Disney to process contracts. My guess it's less than and hour and 80% profit would be a reasonable assumption.

Yes, the law limits estoppel to $150…but let’s be honest it doesn’t cost that much.

Of course market for title companies, but my point is that DVC is still a for profit agency which isn’t any different than any of the others.

The POS allows for the charge but it doesn’t cap what can be charged to owners by the board, DVC, WDPR or any of the others listed.

Let’s wait and see if these quick turn around continue because if they do, at least it supports the information that was put out that it was to help with the volume of contracts being processed.

I just don’t think the motivation behind this was to depress resale…just to allow them to keep more of their profits by charging for something they were doing for “free”.

 

[walt34]

Let’s wait and see if these quick turn around continue because if they do, at least it supports the information that was put out that it was to help with the volume of contracts being processed.

I just don’t think the motivation behind this was to depress resale…just to allow them to keep more of their profits by charging for something they were doing for “free”.

I don't think it was about depressing resale, either. I still believe it's just a money grab - even if they doubled their staff for this I'm still convinced this is mostly profit.

 

[VGCgroupie]

I don't think it was about depressing resale, either. I still believe it's just a money grab - even if they doubled their staff for this I'm still convinced this is mostly profit.

They are a business so they are allowed to profit. If they keep the quick processing times I think the fee is 150% worth it even if it doesn't really cost them $500 to make things this efficient. If they go back to 30 days ROFR 3-4 weeks for transfer of points then I will take an issue with the fee.

 

[Sandisw]

They are a business so they are allowed to profit. If they keep the quick processing times I think the fee is 150% worth it even if it doesn't really cost them $500 to make things this efficient. If they go back to 30 days ROFR 3-4 weeks for transfer of points then I will take an issue with the fee.

At least, the processing should continue to be reduced because waiting a month for points should Not be the norm.

It was one of the biggest frustrations for resale buyers.

 

[walt34]

They are a business so they are allowed to profit. If they keep the quick processing times I think the fee is 150% worth it even if it doesn't really cost them $500 to make things this efficient. If they go back to 30 days ROFR 3-4 weeks for transfer of points then I will take an issue with the fee.

I prefer businesses to come up with new products that I want to buy (in my case Disney is usually reasonably successfully with this) instead of monetising products that I already bought with fees that weren't mentioned in the contract but I respect your position.