New policy for using or buying a few points??

[Chuck S]

I would think they would be happy with less competition on the resale market.
If there were no resales, they would be selling more points.

MG

But that really has no bearing on whether they care if one individual sells over another. For any timeshare there will be those that "expect" more than it is and sell their ownership. If someone consistently needs 5 ponts, Disney would make more profit simply selling them a 25 point add-on at $100 per point than "renting" them 5 points annually at $100...at least in the short term. It would take them 25 years to make that $2500 gross, and cost them more long term.

And you are assuming a substantial number of people would sell their entire membership because they are 5 points short, rather than getting a transfer from another member, or renting a cash room for one night, or even renting a one noght reservation from another member.

 

[Dean]

I don't know why so many people seem to think Disney actually cares if an individual sells their contract or not. DVC does not have to exercise ROFR...and the seller is obligated to pay the dues until the contract sells, then the new owner is obligated.

If they do exercise ROFR, they likely would sell it for more than the price they ROFR'd...so it is additional profit, and likely more than the $100 or so they'd make from renting out the points one time to an existing owner. DVC really doesn't care whether it is you, or the person you sell to, that continues paying the dues...as long as they are paid.

If anything, I suspect they'd prefer it. From what I can gather a long time DVC members generally spends less on a given trip than a new member. The ONLY reason I'd expect they'd care is if members were leaving in large enough droves to truly affect retail sales. They could eliminate banking, borrowing, transfers, all perks and require a 5 day minimum and I doubt enough people would sell to reach this level. The park system would likely do it but then they wouldn't care for different reasons.

 

[TisBit]

True, but again, it just isn't something I see DVC doing. Not when it is more to Disney's advantage to rent a full night for cash, rather than a handful of points @ $10. I mean, if someone were 5 points short, that would be $50, much less than even a value room for the night. Even at $15 per point, it would only be $75.

I think the point would be that a member that is 3 points and have borrowed everything from their next use year will probably not pay cash for the last night, but rather just not book the last day or maybe move to an off site, etc. I think there would be a huge benefit to a small point transaction, it will have to cost enough that you don't want to pay for too many, but not overprice the room. I it would definitely quell the irritation of people that are now 2-5 points shy of what they want for their vacation due to the reallocations.

 

[BEASLYBOO]

I wonder how many people who actually threathen to sell DVC because they are fed up or displeased actually do, and I'm sure DVC doesn't care one way or the other. I do think it would be in DVC's favor to make it available to purchase those few points one might need to complete a reservation. I've read many post where people were sold on the idea of buying as many points as they needed and due to the 2 point reallocations, they are now short and very unhappy about it. Personally I constantly borrow from the next year and I don't have issues doing it but I can see where others may. Offering people more options could be a good thing!

 

[wendypooh]

I like the idea - but with reservations or rather restrictions applied to it. It would have to be a limited amount of pts. we are talking about - say up to 7 per member per use year and at a price that isn't over inflated - but not ridiculously low either.

I agree with the OP who said that members likely would just NOT book that extra night - I agree with that and I assume others agree as well - I think Disney would WANT people in those rooms that extra night - I mean if you are THERE - then you are spending $$$$ there.

 

[SuzanneSLO]

I like the idea - but with reservations or rather restrictions applied to it. It would have to be a limited amount of pts. we are talking about - say up to 7 per member per use year and at a price that isn't over inflated - but not ridiculously low either.

I agree with the OP who said that members likely would just NOT book that extra night - I agree with that and I assume others agree as well - I think Disney would WANT people in those rooms that extra night - I mean if you are THERE - then you are spending $$$$ there.

I am sure that DVC really cares whether you book an extra night or not. Let's imagine you need 30 points for that extra night and you only have 25. If you use those points for your extra night next year, someone else is almost certainly using points for that room this year, so it is a wash from DVC's perspective. If you let those 25 points expire, then DVC benefits from having more inventory to sell to the cash paying public.

Still, it would not surprise me if DVC does offer to rent points directly to members because Disney is generally very good at offering many different ways to liberate your money from your wallet. I would expect that the price per point will be higher than most of us on these Boards will think is reasonable and that the price point alone will be enough to keep most members from using this option except on rare occassions. -- Suzanne

 

[hellerjw]

I would expect that the price per point will be higher than most of us on these Boards will think is reasonable and that the price point alone will be enough to keep most members from using this option except on rare occassions. -- Suzanne

It wouldn't surprise me if they intentionally set the price point pretty high to encourage the frequent takers to do an add-on as a way to "save" money. I could see the marketing folks jumping all over this, both from selling the increased flexibility of the system to tracking those who are frequently buying these extra "cash points" in order to push add-ons.

 

[Maistre Gracey]

The ONLY reason I'd expect they'd care is if members were leaving in large enough droves to truly affect retail sales. They could eliminate banking, borrowing, transfers, all perks and require a 5 day minimum and I doubt enough people would sell to reach this level. The park system would likely do it but then they wouldn't care for different reasons.

Dean, would you be so kind as to pass that pipe in my direction?

(For clarification, that was said with a nice tone.)

MG

 

[keishashadow]

I don't know why so many people seem to think Disney actually cares if an individual sells their contract or not. DVC does not have to exercise ROFR...and the seller is obligated to pay the dues until the contract sells, then the new owner is obligated.

If they do exercise ROFR, they likely would sell it for more than the price they ROFR'd...so it is additional profit, and likely more than the $100 or so they'd make from renting out the points one time to an existing owner. DVC really doesn't care whether it is you, or the person you sell to, that continues paying the dues...as long as they are paid.

problem with traditional real estate market is many owners aren't living up to their obligations

so many are walking away from mortgages where they are under water. it's not a stretch to see a buyer doing the same w/TS. It can take a year+ for a lender to evict a homeowner depending on the state, then even longer to resell with a huge overhead of unpaid taxes, insurance, legal fees, etc. Im not judging, yet many decide to stay & live rent-free for as long as possible until actual foreclosure.

I've wondered how many do finance DVC (perhaps w/a CC as down payment), use 2 or 3 years worth of points then walk, certainly haven't crunched the numbers as to actual loss in such a dirty scheme. Probably issues of buyer's remorse where folks just walk away if they can't re-sell too.

i have no idea how the general mortgage crisis applies to TS in general or what % of contracts DVC is taking back, but it is time consuming & costs are incurred to turn over a contract.Renting points in 'limbo' (before it is repackaged & sold-who knows what inventory they are currently holding) to members may very well churn some revenue, if it's legal.

 

[BostonDisneyKid]

Maybe the "change" will be in relation to other recent changes. Maybe not but hear me out...

I assume Disney saw the Dadio's of the world (commercial point renting services) making money off the rental of points. They have changed a few rules of recent to limit and/or prohibit this in large numbers (transfer rule change couple years back, redefineing commercial renting a few years back, limiting associate members, point reallocations of past couple of years). So maybe they will start a similar program to eliminate the competition all together in this area by offering a member point exchange program of sorts. If they allowed members to sell points back or even "loan" points (deposit 15 pts this year, receive 15pts the following year) in to a pooled system were other members could use those points by charging a rental for a fee $x per point + transaction fees. This would provide more flexability to the members with point overages, provide a service to those members in need of points while providing yet another revenue stream which they currently dont have access to by managing those points of its members internally.

Just a thought...

 

[nunzia]

Hmm..not a bad idea..and hey, where did those Dadio ads go??

 

[Chuck S]

.....and hey, where did those Dadio ads go??

The Rent/Trade board.

 

[oct2014]

Maybe the "change" will be in relation to other recent changes. Maybe not but hear me out...

I assume Disney saw the Dadio's of the world (commercial point renting services) making money off the rental of points. They have changed a few rules of recent to limit and/or prohibit this in large numbers (transfer rule change couple years back, redefineing commercial renting a few years back, limiting associate members, point reallocations of past couple of years). So maybe they will start a similar program to eliminate the competition all together in this area by offering a member point exchange program of sorts. If they allowed members to sell points back or even "loan" points (deposit 15 pts this year, receive 15pts the following year) in to a pooled system were other members could use those points by charging a rental for a fee $x per point + transaction fees. This would provide more flexability to the members with point overages, provide a service to those members in need of points while providing yet another revenue stream which they currently dont have access to by managing those points of its members internally.

Just a thought...

I agree that, if anything, it is more a reaction to the rental rather than the resale business. I have never rented points, but from what I have seen on the boards it seems like renting directly from DVC (even at a premium) might be attractive to DVC members, particularly if they only need a few points or want to be able to modify their reservation without going through another DVC member or service. I would imagine that the rented points would belong to you like transfer points.

Caroline

 

[Chuck S]

I think a few legal questions would need to be addressed before they allow "renting" a few points directly from Disney. First, define renting vs. transferring. Renting a reervation has always been at least one full night. If that holds true, then they would actually be "transferring" points, which ccording to their own published rules, is not allowed for money. It would also give them the ability for "multiple transfers" per use year, meaning a violatin of another rule that could be a legal glitch, especially as some states hold the developers use of points to the same standards as those of owners. It couldn't come from undeclared inventory, as those units don't actually have "points" until they are declared part of the condominium, so again, they'd be limited to full nights.

 

[Dean]

I think a few legal questions would need to be addressed before they allow "renting" a few points directly from Disney. First, define renting vs. transferring. Renting a reervation has always been at least one full night. If that holds true, then they would actually be "transferring" points, which ccording to their own published rules, is not allowed for money. It would also give them the ability for "multiple transfers" per use year, meaning a violatin of another rule that could be a legal glitch, especially as some states hold the developers use of points to the same standards as those of owners. It couldn't come from undeclared inventory, as those units don't actually have "points" until they are declared part of the condominium, so again, they'd be limited to full nights.

I don't think they'd have any issues for limited "rental" in such a situation. I don't think any of these issues would be significant hurdles for such a program. As for how to do it, there are many scenarios that would be workable. They could pull from the pool of points given up for exchanges, breakage inventory, points owned by DVD or even undeclared inventory. Breakage can be anticipated so you're not restricted to 2 months out. Undeclared inventory can be crossed over any way they want as there's no rule that would keep them from using such inventory for the good of the members. Obviously there would have to be some method to monitor the resort totals to be sure the room occupancy (number of rooms for the year) wasn't exceeded but that's an easy and small task overall.

As I mentioned earlier, many systems do this. Some do so in whole night increments some don't. In a sense DVC already does this by renting extra nights. RCI does this where you can rent up to 50% of your yearly allotment to complete a reservation which means in some cases you can rent all the points for a given reservation.

 

[Chuck S]

As I mentioned earlier, many systems do this. Some do so in whole night increments some don't. In a sense DVC already does this by renting extra nights. RCI does this where you can rent up to 50% of your yearly allotment to complete a reservation which means in some cases you can rent all the points for a given reservation.

Where would this extra 50% of points come from if a resort is fully sold and Disney holds only about 4%? Wouldn't that, in effect, be overselling the resort?

As you said, Disney does this with whole nights, but those would be rooms that DVC estimates to be not rented on points (breakage). They can't just remove rooms from member inventory to rent or member cash willy nilly, any more than they could suddenly add a lot of points to sold out resorts. They have to come from somewhere.

 

[Dean]

Where would this extra 50% of points come from if a resort is fully sold and Disney holds only about 4%? Wouldn't that, in effect, be overselling the resort?

As you said, Disney does this with whole nights, but those would be rooms that DVC estimates to be not rented on points (breakage). They can't just remove rooms from member inventory to rent or member cash willy nilly, any more than they could suddenly add a lot of points to sold out resorts. They have to come from somewhere.

I'm not suggesting DVC allow rental of such large numbers of points, merely pointing out that RCI does it. They use a pool of points similar to what DVC would have to use. Any rentals are subject to availability of the points so there is not an issue of overselling, if there are no points in the pool, you can't rent points. Ignoring undeclared inventory but taking into account breakage inventory, unsold but declared and exchanged points that are planned to be converted to cash, I'd estimate that around 8-10% of the total points could be available for such a program. It could be a win-win since so many of the points are wasted now trying to turn them into cash. DVC only gets around 40 cents on the dollar currently for such points. The current cash room rentals comes from more than just breakage and such a program would pull from the same pool as cash rentals through MS and COULD pull from the other pool that is currently available through CRO only though that would take a little more tweaking. Done in a limited fashion there is great potential benefit to the membership as a whole and almost no downside other than the administrative issues of setting up, running and paying for such a program; all of which I thing would be minimal but given the devil is in the details issue, you never really know. Ultimately I suspect it simply would take DVC/DVD deciding they wanted to offer this option to make it happen. I would expect it would be a small to moderate size project for middle and upper management, the question is simply whether they want to put the effort into it. Given we don't have the program currently I'm guessing they do not.

 

[dudleydog]

Something will be announced by DVC very soon.

 

[boardwalk prof]

The figures I've gathered indicate there are about 1,572,000 points held by DVC/DVD in the resorts on property; (4% of the total points).

Assuming the maximum 'rental' by DVC of 5 points, it would take about 314,000 of these 5 point rental transactions to use up the 4% of points held back in each resort. Even with a 10 point rental transaction average, the members could never use up the avialable inventory.

I haven't seen a recent total members figure for a while, but there are certainly enough points available, even without considering exchanges, defaulted contracts, etc. to make this work from the points side of things.

With that said, I'm not sure I am in favor of this. It would seem that this could result in less availability.


Boardwalk Prof

 

[Chuck S]

The figures I've gathered indicate there are about 1,572,000 points held by DVC/DVD in the resorts on property; (4% of the total points).

Assuming the maximum 'rental' by DVC of 5 points, it would take about 314,000 of these 5 point rental transactions to use up the 4% of points held back in each resort. Even with a 10 point rental transaction average, the members could never use up the avialable inventory.

I haven't seen a recent total members figure for a while, but there are certainly enough points available, even without considering exchanges, defaulted contracts, etc. to make this work from the points side of things.

With that said, I'm not sure I am in favor of this. It would seem that this could result in less availability.


Boardwalk Prof

It seems with about 150,000 to 200,000 members, they could burn through those points pretty quickly.