New Resales DVC Rules

[JimMIA]

With all due respect, how would you know this?

Obviously, none of us know this. I said "I think;" I was just expressing an opinion.

I have spoken to 3 separate resellers, and the universal sentiment is that their inventory of "for sale" contracts was at an all time high, but since this announcement their business has picked up four-fold. You think Disney doesn't care about that?

Right -- my opinion is that Disney doesn't care what the resale inventory is, or how strong the resales are...for a two month period. That's a blip on the radar in the life of DVC, and means nothing to Disney.

Sitting inventory means people are not traveling. Their attendance is down, all you have to do is watch TV for 5 minutes and you'll see a commercial advertising "Kids Stay and Play for Free", or "40% off through end of summer".

I'm not sure what "sitting inventory" you are talking about, but it sounds like you are talking about Disney Resorts hotel inventory, not DVC. If you are, you're correct -- Disney Resorts are offering a lot of promotions. But that's not unusual for the summer months (which, here in Florida we call HURRICANE Season), nor is it unusual in down economic times like we're in. I honestly don't think it has a thing to do with the recently-announced restrictions on DVC resale contracts.

I agree that they are doing this for internal reasons. However, I believe those internal reasons are their bottom line, and they needed to create action in the resale market. No matter the result, I hardly think the resales don't matter.

Well, DVD doesn't sell resale. They are the timeshare developer, and they sell directly to the consumer at retail prices they alone set.

I don't claim to be the world's greatest timeshare expert, but most people who know a whole lot more about the subject than I do think that very few DVD customers even know a resale market exists at the time they buy. Very few prospective customers do what many of us did, which was take the tour, come home, Google "Disney Vacation Club" and end up here on the DIS...which is where I learned much of what I know about DVC.

My personal opinion of the new restrictions (and whatever follows) is that they are targeted primarily at existing DVC owners, not new purchasers. Timeshare gurus can talk all they want about various options not being worth the points, the fact is that many existing DVC owners find real value in some of the options outside DVC. DVD wants to retain that customer base for potential add-ons, and for many DVC owners, those options matter.

And, in the unlikely event that someone on a tour says, "But I heard I can buy DVC cheaper resale..." the DVD timeshare salesman can come back with, "Ah, yes you can. But did you know that you won't be able to use those points for a cruise? Or an Adventure by Disney? Or..."

 

[dudelydude]

Hmmm. Well I sincerely appreciate all of the insight. As a matter of interest and my need to babble, here are my thoughts since first posting...

1. What I didn't consider is the increased desire in resale contracts leaves less inventory for me to choose from when I decide to buy. BUT, I have read several posts about how so many people have to sell their DVC contracts...this economy is (and will continue to) hurt people. I'm sure there will be plenty of turnover in the months / years to come.

2. If I bought in April or further into the future, I would not be concerned with my travel habits in 5 years. My travel habits will be bound by the terms of my contract...I mean...I would be okay with settling for that. I've never been a diverse traveler...WDW and DCL make up 95% of my travel and I'd never use points to cruise.

3. I guess one could just look at the list of resales online to see if there is actually an increase in purchasing resale contracts, but I would never trust a reseller that tells me this. While this new set of rules will hurt resellers to an extent, this is also a good selling opportunity for them, so of course they are going to use Disney's doom and gloom info to create demand.

4. And finally, I agree that mass changes will not happen overnight. Certainly, if DVD has a long range plan to do more "cuts" to resale contracts purchased after Mid March (or the next tier cut-off date), it won't happen for awhile if it's gonna happen. And even if they did, what's the next big idea?.....3 tiers of resale contracts....1) standard contract can use their points anywhere 2) The 3/20/2011 resale contracts that cant use point for cruises, concierge club, etc and then 3) The (for a hypothetical example) O.S.A. resale contract that only allows points to be used at OKW, Saratoga and Animal Kingdom. I just can't see them doing another change so soon after the current change. I have time.

Thanks again for the info.

 

[JimMIA]

3. I guess one could just look at the list of resales online to see if there is actually an increase in purchasing resale contracts, but I would never trust a reseller that tells me this. While this new set of rules will hurt resellers to an extent, this is also a good selling opportunity for them, so of course they are going to use Disney's doom and gloom info to create demand.

I think it depends on which reseller you talk to. Certainly the folks at The Timeshare Store have a reputation for being straight-shooters and have a good grip on what's going on in the marketplace -- so I would tend to trust what they say. You can also check the number of "Sale Pending" listings on their website, and if you've looked at that from time to time, you'll see a LOT more sale pending listings now than there were a few weeks ago. Another indicator is the ROFR thread here on the DIS, and activity has picked up there too, I believe. So I don't think there is any question that there is a LOT more sales activity now than there was before the announcement.

As you said, though, that doesn't mean someone should panic. People who want to buy DVC with FULL benefits should be looking closely and buying now. Folks who just want the bare bones DVC are fine waiting, IMHO.

Also, FWIW, I doubt DVC could legally limit certain groups of owners to the kinds of limitations you describe in your "OSA" example. And if they did, I suspect it would hurt their new sales more than it would help.

I'm expecting some kind of tiered VIP program for owners of large numbers of points (like 500+), and specified that those points would have to have been purchased directly from DVD, not via resale. They might even include a provision for existing owners to "trade in" resale points, or buy into the program like Wyndham does. That kind of program would help direct sales and probably have no effect on resales.