New Owner - Direct vs. Resale

[kandlsutton]

Advice on the boards and various websites indicate that buying direct at Riviera is a non-starter for a lot of people. However, I”m guessing this advice is probably coming from existing owners that do not have restrictions on their current points.

But as a potential new owner, I have a few other considerations:
1. I am not buying for an investment and don’t plan on selling.
2. I will not be financing the purchase.
3. I will not be around in 2070, but my 3 children will.
4. We still have 20-30 years to enjoy Disney with our adult kids and one day grandkids.
5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.

The resale limitations are probably here to stay. IMO, new owners aren't in the same situation as existing owners who don”t have to worry about point restrictions. All resales are now subject to the “inverse” limitations - resale contracts won’t be able to book at any new resorts and that seems like a big negative over the next 50 years. Granted, the limitations at RIV are harsher because resale buyers here will only be able to book at one resort. I’m not planning on selling but I’m also not planning on buying RIV resale either.

My biggest regret is I didn’t pull the trigger in 2016 for PVB at $168pp. But I can get RIV at $180pp today (5 years later) and I believe $pp will continue to increase as it has historically. I can’t see paying $200pp for Copper Creek when I can get it resale for $140-150.

$180pp is higher than resale, but doesn’t the future flexibilty and additional years on the contract have value as well?

What am I missing?

Thanks for any additional thoughts!

 

[Mkaiser1]

I'm also looking at Riviera (and one or two resale options), but I'm in agreement with you.

The other thing to think about Riviera, is that it is attached to a skyline and central to the action with particularly close proximity to Hollywood Studios and EPCOT. Realistically, Skyliner will get bigger and will include a station near Animal Kingdom Lodge and Animal Kingdom park as there are only buses currently. Meaning you will be able to use the skyline to get almost everywhere. This is Walt's dream too (albeit using a Skyliner as opposed to a Monorail). Obviously that's just my guessing and might never happen.

Prices I think will go up at Riviera despite the resale restrictions. But, like you say, if you're doing it for the holidays anyway then that's fine. And they won't effect you being able to stay elsewhere too.

 

[Turn the Page]

I don't think you're missing anything. This is along the lines of what i'm thinking as well. We will be purchasing direct at RIV here in a couple months.

I think people focus too much on the current value of the points vs future value. It does not make sense to refuse to buy RIV because of resale restrictions then turn around and buy a 2042 resort, unless that is where you want to stay of course. In 10 years the value of the 2042 points will be next to nothing. RIV ma y have restrictions but the long contract is worth something too. And by the time the 2042 resorts expire more resorts will have come on line, likely with the resale restrictions, so RIV won't seem so out of the ordinary.

 

[Eric Smith]

Advice on the boards and various websites indicate that buying direct at Riviera is a non-starter for a lot of people. However, I”m guessing this advice is probably coming from existing owners that do not have restrictions on their current points.

But as a potential new owner, I have a few other considerations:
1. I am not buying for an investment and don’t plan on selling.
2. I will not be financing the purchase.
3. I will not be around in 2070, but my 3 children will.
4. We still have 20-30 years to enjoy Disney with our adult kids and one day grandkids.
5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.

The resale limitations are probably here to stay. IMO, new owners aren't in the same situation as existing owners who don”t have to worry about point restrictions. All resales are now subject to the “inverse” limitations - resale contracts won’t be able to book at any new resorts and that seems like a big negative over the next 50 years. Granted, the limitations at RIV are harsher because resale buyers here will only be able to book at one resort. I’m not planning on selling but I’m also not planning on buying RIV resale either.

My biggest regret is I didn’t pull the trigger in 2016 for PVB at $168pp. But I can get RIV at $180pp today (5 years later) and I believe $pp will continue to increase as it has historically. I can’t see paying $200pp for Copper Creek when I can get it resale for $140-150.

$180pp is higher than resale, but doesn’t the future flexibilty and additional years on the contract have value as well?

What am I missing?

Thanks for any additional thoughts!

I think most people view buying Riviera as a non-starter because of the very severe resale restriction if you ever sold the contract. The fact that the resale buyer can only stay at Riviera instead of being able to stay at all of the current resorts (minus Riviera) will likely hurt Riviera in resale in the future compared to the other resorts. This effect may become diminished after 2042 when some of the original DVC resorts start to phase out if Disney sticks with this restriction. I could see Disney backing off of the resale restriction for future resorts if Riviera doesn't sell out in a reasonable timeframe. Keep in mind, you can buy other resorts direct in order to avoid the resale issues.

Riviera also has an inflated point chart compared to other DVC resorts. That means that your points won't get you as many nights at Riviera as they would somewhere else.

The big bonus of resale is that you can get more points for the same amount of money. When we bought our first contract, we got AKL for $103 per point and the direct through Disney price was $186 per point. That's a significant difference. If you're looking to go with kids and grandkids, you're probably going to want to stay in one and two bedroom units and those cost a lot of points.

 

[bama314]

I personally don't think buying Rivira direct is a bad decision as long as you do the research and understand the restrictions. It looks like you have done that, so I think you will be fine. My biggest reservation with purchasing DVC or any timeshare was the potential lack of exit strategy. Some timeshares go down in value to the point that you can't give them away. I don't see that ever happening with DVC, but Riviera took a step closer to that in my opinion.

We bought BLT resale. The main reason for us was that we wanted the option to sell at any time and get what we paid for it.

 

[Brian Noble]

But as a potential new owner, I have a few other considerations:

I have two thoughts.

First, I'm guessing almost no one *plans* on selling their purchase. Yet, people do---and if they do, it is typically early in the ownership cycle. There are lots of reasons for that, from changing interests, "Disney fatigue", financial disruptions, changes in health, separations/divorces, etc. Some of these are predictable, but not all.

Second, it is probably a mistake to assume your children will definitely want to own this. They might, but then again they might not. Owning DVC is essentially committing to at least semi-annual vacations at Disney. As an owner, the lodging is more affordable (though still not cheap), but you still have to deal with tickets, transportation, and food. Depending on how their careers/families evolve, that may be something that is more a burden than an escape. Furthermore, they may decide they have other vacation priorities. Of my two kids, both in their early 20s, I can see one of them becoming a Disneyphile with frequent visits, but the other is probably going to be a once-a-decade visitor, if that.

So, my advice is to significantly shorten your "planning horizon"---I personally tend to keep my planning to something around 10 years, maybe a bit less. Even when I keep it that short, things often unfold differently than I've planned, and sometimes dramatically so. You might still decide that a direct Riviera purchase makes sense, but then again you might not.

 

[Marionnette]

Advice on the boards and various websites indicate that buying direct at Riviera is a non-starter for a lot of people. However, I”m guessing this advice is probably coming from existing owners that do not have restrictions on their current points.

But as a potential new owner, I have a few other considerations:
1. I am not buying for an investment and don’t plan on selling.
2. I will not be financing the purchase.
3. I will not be around in 2070, but my 3 children will.
4. We still have 20-30 years to enjoy Disney with our adult kids and one day grandkids.
5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.

The resale limitations are probably here to stay. IMO, new owners aren't in the same situation as existing owners who don”t have to worry about point restrictions. All resales are now subject to the “inverse” limitations - resale contracts won’t be able to book at any new resorts and that seems like a big negative over the next 50 years. Granted, the limitations at RIV are harsher because resale buyers here will only be able to book at one resort. I’m not planning on selling but I’m also not planning on buying RIV resale either.

My biggest regret is I didn’t pull the trigger in 2016 for PVB at $168pp. But I can get RIV at $180pp today (5 years later) and I believe $pp will continue to increase as it has historically. I can’t see paying $200pp for Copper Creek when I can get it resale for $140-150.

$180pp is higher than resale, but doesn’t the future flexibilty and additional years on the contract have value as well?

What am I missing?

Thanks for any additional thoughts!

You make a pretty sound argument for you to buy a direct contract at RIV.

Allow me to play devil’s advocate with equally strong arguments to buy resale elsewhere.

1. I am not buying for an investment and don’t plan on selling.
I didn’t buy as an investment, either and had no intention of selling when I made my purchase. But life happens and I (or my kids) might want or need to unload those contracts at some point. So understanding the resale value of my purchase is important in the decision-making process.
2. I will not be financing the purchase.
I didn’t finance any of my purchases either. I don’t see how that is relevant to whether you purchase resale or direct. Having cash in hand only means that you can buy more points on the resale market than you can direct. More points means more flexibility in booking longer stays or larger accommodations or the more point-heavy resorts like VGF and Poly.
3. I will not be around in 2070, but my 3 children will.
I won’t be around by then either. All the more reason for me to purchase a contract that won’t outlast me, leaving my children to either fight over the use of the points or sell the contract (see #1). I feel that we have done quite a lot for our children already...providing them with debt-free educations that set them on lucrative career paths and giving them substantial down payments for their first homes. “Giving” them a timeshare ownership that will cost them money in the future was never part of the plan. If they desire to spend their inheritance money on DVC, that’s a decision they can make when we are gone.
4. We still have 20-30 years to enjoy Disney with our adult kids and one day grandkids.
I own at 4 resorts with at least 20 years of enjoyment left in them. Most expire 30+ years from now. I will also have 20-30 years to enjoy Disney with my kids and any future grandchildren. None of the L14 expire before 2042, leaving anyone purchasing a resale contract plenty of years to enjoy their membership before the pool shrinks.
5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.
How many future resorts do you anticipate being built before your contract expires? Or going back to #1, should you or your kids need/want to sell your contract, how much impact on resale price do you think that selling a RIV contract that cannot be used elsewhere would have? I wouldn’t let my decision rest on what Disney might do in the future. Reflections has already been shelved. No new site development plans have been submitted to Orange County (FL) that would suggest anything different being developed on that site. In the meantime, RIV still needs to come close to selling out and the new Disneyland DVC Tower will be the next offering (originally slated to open in 2023, probably delayed due to COVID).

 

[Sandisw]

I originally said I would never buy RIV because of the resale restrictions and then did a complete turn around,

My adult kids really liked it and I fell in love with it, I sold BWV to buy it which helped reduce my actual cost given the profit I made on BWV.

I did add on this year a resale at BLT and have regrets now in doing it because it is restricted and has made things a little more difficult in using the points in that membership with my SSR points that can be used there.

Personally, I don’t think resale value should be a consideration in purchasing. However, I do think one should evaluate...we did when we joined in 2009..what level of loss would mean if we had to sell in 1 year, 5 years or 10 years. I went with a 50% loss in value and found that compared to cash, we would lose selling a year in, slightly lose selling 5 years in but by 10 years, we made out better than cash.

Sounds like there are many reasons why RIV direct fits your needs.

 

[havoc315]

Advice on the boards and various websites indicate that buying direct at Riviera is a non-starter for a lot of people. However, I”m guessing this advice is probably coming from existing owners that do not have restrictions on their current points.

But as a potential new owner, I have a few other considerations:
1. I am not buying for an investment and don’t plan on selling.
2. I will not be financing the purchase.
3. I will not be around in 2070, but my 3 children will.
4. We still have 20-30 years to enjoy Disney with our adult kids and one day grandkids.
5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.

The resale limitations are probably here to stay. IMO, new owners aren't in the same situation as existing owners who don”t have to worry about point restrictions. All resales are now subject to the “inverse” limitations - resale contracts won’t be able to book at any new resorts and that seems like a big negative over the next 50 years. Granted, the limitations at RIV are harsher because resale buyers here will only be able to book at one resort. I’m not planning on selling but I’m also not planning on buying RIV resale either.

My biggest regret is I didn’t pull the trigger in 2016 for PVB at $168pp. But I can get RIV at $180pp today (5 years later) and I believe $pp will continue to increase as it has historically. I can’t see paying $200pp for Copper Creek when I can get it resale for $140-150.

$180pp is higher than resale, but doesn’t the future flexibilty and additional years on the contract have value as well?

What am I missing?

Thanks for any additional thoughts!

With all the same thoughts, I bought 200 points Riviera direct, a few months ago...

There are many factors in favor of buying Riviera direct:

1 - With incentives, it isn't that much more expensive than resale at some of the more expensive resorts..
2 - Adding on to the value, $180 for 49 more years.. Compared to some resorts that might be $130-$150 resale, but with far fewer years..
3 - And of course, buying re-sale prevents you from using Riviera, which in some ways is currently the nicest DVC resort (room size and quality is top notch, only a couple other DVC resorts compete).
4 - If you're only thinking of the next 5 years, the restrictions of buying re-sale might not seem like a big deal. You're only locked out of Riviera... But as we start thinking of the next 10-20 years, there may be more and more resorts that you get locked out of, if you buy re-sale.
5 - Compare buying direct at Riviera with buying re-sale at GFV: You'll pay about $160 for re-sale at GFV, $180 for direct at Riviera. $20 more per point... for a $200 point purchase, that's $4,000. Not nothing. But for $4,000, you get 6 more years, the ability to use all current and future resorts, and blue card perks. If you actually take advantage of the ability to get a discounted goldpass, purely on the economics, a family could break even in just a few years. Even if you don't take advantage of the Gold pass, it's easy to see $4,000 being worth while... largely because..
6 - The resale purchase restrictions will become more significant as time moves on. Yes, they will hurt re-sale at Riviera --- But they will also hurt re-sale EVERYWHERE. For the next 5-10 years, might hurt Riviera more than others. But if you are planning on keeping DVC for 15+ years.. Imagine it's now 2040, just 19 years from now. Re-sale on all the 2042 resorts will be worthless, even without restrictions. Re-sale at Riviera will be limited to only staying at Riviera. But what about other re-sale? With the expiration of old resorts and addition at new resorts, re-sale purchasers of the grandfathered resorts will likely be limited to only about half the total resorts, and only the older half!

... If you like the Riviera and want it to be your home resort, I see no reason not to buy it direct. The direct prices are quite reasonable compared to other resorts.

 

[RoseGold]

Assuming the Skyliner resorts are your goal, you've made a lot of great points why RIV might be a good fit for you.

The thing I think you need to consider is your estate plan. This is a significant asset, and how you choose to hold it matters, especially with the resale restrictions. I chose VGF resale as the contract I plan to pass down because I do not want it to be a burden to my kids. If Disney is no longer cool, or they move to Singapore, or whatever, I want the Disney timeshare to be easy to sell and move down the road. That's where the O14 are a known quantity, as opposed to the locked down RIV. I actually think RIV and future restrictions will help VGF resale in the future.

If you are buying this meaning for your kids to take it anyway, maybe it makes sense to start in their names anyway, or to make a trust or company. There are a lot more options to do this that your lawyer can help with. Then maybe your kids don't have to figure out how to get a lawyer to probate property in Florida from Singapore when you pass, when the points are rented out to be used in six months.

Since you noted this as a reason to buy, I think it's worth noting that RIV doesn't control future resorts. It's pretty clear that DL Tower and whatever Reflections will be (DVC projects) should play nicely, but that doesn't have to be true in the future. There's no reason Vegas Vacation Club has to play nicely with legacy contracts, just because it has in the past. RIV has shown that DVC is willing to dramatically change the rules at the expense of direct buyers. Even within the current system and the current rules, non-home owners could be forced to pay a premium. Like a VGF surcharge for non-VGF owners. In modern DVC, none of these changes would surprise me at all.

 

[Mkaiser1]

However, I do think one should evaluate...we did when we joined in 2009..what level of loss would mean if we had to sell in 1 year, 5 years or 10 years. I went with a 50% loss in value and found that compared to cash, we would lose selling a year in, slightly lose selling 5 years in but by 10 years, we made out better than cash.

This is one of things I'm literally sat doing right now! More GREAT advice

 

[havoc315]

5. Buying direct will allow us, and my kids down the road, a ton of flexibility for booking all existing future resorts.
How many future resorts do you anticipate being built before your contract expires? Or going back to #1, should you or your kids need/want to sell your contract, how much impact on resale price do you think that selling a RIV contract that cannot be used elsewhere would have? I wouldn’t let my decision rest on what Disney might do in the future. Reflections has already been shelved. No new site development plans have been submitted to Orange County (FL) that would suggest anything different being developed on that site. In the meantime, RIV still needs to come close to selling out and the new Disneyland DVC Tower will be the next offering (originally slated to open in 2023, probably delayed due to COVID).

I'll answer this point solely. Number of new resorts in the next 25 years, let's call it..

Essentially the minimum number:
Disneyland Tower
Beach Club VIllas II
Boardwalk Villas II
Boulder Ridge Villas II
Hilton Head Villas II (unless Disney simply dissolves DVC there)
Vero Beach Villas II (unless Disney simply dissolves the location)

That's 5-7 minimum.

Additionally -- Can expect they will EVENTUALLY return to the Reflections development, and likely build in 1-2 new locations during the next 2 decades.

So how many do I expect -- At the point Riviera contract reaches mid-age, I expect 7-10 new resorts. I expect "original" resorts will be down to 9 resorts.
Meaning, I expect in 25 years, that non-direct purchasers will be limited to only about 50% of the resort locations, including no available locations in the Epcot/DHS area.

 

[RoseGold]

I'll answer this point solely. Number of new resorts in the next 25 years, let's call it..
That's 5-7 minimum.

Except that those don't have to be DVC properties, or they could charge a different price for non-owners even under existing DVC rules. There's no promise that the future resorts will act like the current exchange. These boards act like this has to be true, but the existing resorts don't change whatever future, new timeshare products Disney wants to make. They could easily be like RCI. Sure, it works, technically.

 

[havoc315]

Since you noted this as a reason to buy, I think it's worth noting that RIV doesn't control future resorts. It's pretty clear that DL Tower and whatever Reflections will be should play nicely, but that doesn't have to be true in the future. There's no reason Vegas Vacation Club has to play nicely with legacy contracts, just because it has in the past. RIV has shown that DVC is willing to dramatically change the rules at the expense of direct buyers. Even within the current system and the current rules, non-home owners could be forced to pay a premium. Like a VGF surcharge for non-VGF owners. In modern DVC, none of these changes would surprise me at all.

It's extremely unlikely that "DVC Vegas" would play much differently for direct purchasers. Yes, legally speaking, DIsney could start a secondary timeshare program... Instead of DVC Vegas, they can build Disney Timeshare Club (DTC) Vegas. And existing DVC members can't trade into DTC Vegas!
But if they do that, then DTC Vegas buyers wouldn't be able to trade into DVC locations either..

Which would make it that much harder to sell DTC Vegas!

There really are limits in how far they can restrict future resorts, while still making those very resorts attractive for purchase.

 

[RoseGold]

Which would make it that much harder to sell DTC Vegas!

There really are limits in how far they can restrict future resorts, while still making those very resorts attractive for purchase.

No reason it couldn't charge 20% point surcharge even within the existing DVC network, or make the point swaps gross outside the network (like RCI). They could set up a new Vacation Club while letting your trade in at poor value. Sure, it would still work. They always make the stupid cruise points usage in every pitch.

 

[havoc315]

Except that those don't have to be DVC properties, or they could charge a different price for non-owners even under existing DVC rules. There's no promise that the future resorts will act like the current exchange. These boards act like this has to be true, but the existing resorts don't change whatever future, new timeshare products Disney wants to make. They could easily be like RCI. Sure, it works, technically.

Yes and no. Legally, you are correct: They could decide to stop building DVC resorts, and start a whole new organization -- Disney Timeshare Club (DTC!)

But that wouldn't make much sense. Imagine it's 2042, they are launching DTC with the new Beach Club Timeshare Villas! BCTV!
And DVC owners won't be able to use their points at BCTV! But hold on, that means that direct purchasers of BCTV won't be able to use their points at the DVC resorts either -- trading has to be mutual.
That would really limit the attractiveness of purchasing BCTV... Disney would have to charge a lot less for a single resort, then they would be able to charge for points that cover over a dozen resorts. Sure, Disney could say, "you'll be able to use your points at all future DTC resorts... but we can stop making DTC resorts any time. We can't guarantee that there will be any future DTC resorts. And just like we did with DVC, we might make all future resorts Disney Timeshare Group, the DTG.... so don't expect to use your points anywhere but here"

Point is... it wouldn't be in Disney's interests to get rid of the exchange for future timeshares.

The only exception really being: It's possible that the timeshare model becomes less profitable. So in 2042, Disney gets rid of Beach Club and Boardwalk DVC, replacing it entirely with regular hotel space. Or maybe even they sell Beach Club Condos! Own a condo right on Disney property!

 

[havoc315]

No reason it couldn't charge 20% point surcharge even within the existing DVC network, or make the point swaps gross outside the network (like RCI). They could set up a new Vacation Club while letting your trade in at poor value. Sure, it would still work. They always make the stupid cruise points usage in every pitch.

But then the terrible trade-in program would have to go both ways. It would be equally difficult for DVC Vegas buyers to use their points at WDW, grossly cutting the value of purchasing DVC Vegas.

Cruises are entirely different -- As Disney Cruise Line is NOT part of DVC. Not like there are people who can trade their Disney Cruise for a WDW Villa.

 

[RoseGold]

But then the terrible trade-in program would have to go both ways. It would be equally difficult for DVC Vegas buyers to use their points at WDW, grossly cutting the value of purchasing DVC Vegas.

Cruises are entirely different -- As Disney Cruise Line is NOT part of DVC. Not like there are people who can trade their Disney Cruise for a WDW Villa.

DVC actively promotes using DVC points for cruises and RCI, which I think you would agree is "terrible." There's no reason they couldn't also actively promote another system with a lousy exchange. I think it's fair to say most direct buyers aren't as savvy as those on these boards.

Even within DVC, there's no reason the swaps have to be 1:1. It's in all the current paperwork.

I have no idea what DVC will do in 20 years, and neither do you. Reality is they have a lot of power to do things that do not even resemble the current system. I don't think it's a good assumption to think things will stay the same.

 

[UrsulaWantsYourSoul]

We bought in this year @ RIV with all these thoughts in mind (although don't have children to leave the points to).
Three things to seriously consider if you do buy direct:
1) If you are considering buying resale at a different property, you might buy that first because adding on afterward you can usually get Disney direct to match the use year. Or you can buy direct first but go with a more popular use year to increase your chances of finding matching resale contracts in the future (December and June are two of the most of popular).
2) If you anticipate wanting to often go a particular time of the year, you might consider including a fixed week. In case you haven't heard of them, you pay 10% extra for points but then you automatically get that week every year. The years you don't want to go that week, you just cancel that reservation and can use your points however you want. It's especially handy for December (any room size) or any time of the year for studios especially standard view. There's a very helpful thread about it on here:
https://www.disboards.com/threads/all-about-fixed-weeks-riv-ccv-aul-vgf-poly-charts.3806985/3) If you're buying a good amount of points like 300+ (also helpful to get the bigger discount)... since you have three kids you might consider splitting the points into three contracts. Easy to use the points together for now and also makes it easier to pass them along to your kids when that time comes. Alternately (though yes they won't fetch as much $$ with the resale restrictions) it would make it easy for you to sell part of your points at some point rather than all of them.

And yes, keeping your options open so you can use your points at new resorts like Disneyland Tower would be nice. I mean you could use resale points @ Grand Californian but there are so few villas there that sometimes getting any reservation is difficult so having Tower as an option is great. I. Love. Disneyland!

 

[havoc315]

DVC actively promotes using DVC points for cruises and RCI, which I think you would agree is "terrible." There's no reason they couldn't also actively promote another system with a lousy exchange. I think it's fair to say most direct buyers aren't as savvy as those on these boards.

Even within DVC, there's no reason the swaps have to be 1:1. It's in all the current paperwork.

I have no idea what DVC will do in 20 years, and neither do you. Reality is they have a lot of power to do things that do not even resemble the current system. I don't think it's a good assumption to think things will stay the same.

You are indeed correct that there is no certainty as to what Disney or DVC will do in 20 years, or even 5-10 years. But with that mentality, nobody should buy DVC, period. Not direct or re-sale. Unless you expect to break even within 2-3 years (not really mathematically possible), you really can't rely on anything.