New restrictions on resale contracts coming!?!? (Nothing official)

[southerngirl528]

Disney has long gained world wide acknowledgement as one of the top service industries on the planet. It is their prowess at "creating experiences" (and I do mean positive ones) that garners them such repeat business and loyalty. So in fact, they ARE in the business of creating magical experiences and being the "happiest place on earth" because THAT makes for a very nice bottom line, year after year.

 

[JimMIA]

1)They can't change the 11-month booking priority for home resort

Of course they could. The only restriction is that they have to maintain at least a one-month home resort booking advantage. As long as they maintain at least a one-month advantage, they could make the booking windows anything they want.

2)They can't remove any of the existing DVC clubs from the "club"

Of course they could. It would require a vote of the owners to remove a resort from the "club," but they could do it. However, removing a resort would also mean that the owners of that resort couldn't use their points anywhere else.

3)They need to offer something to transfer out to, i.e RCI or interval

It's a good sales tool, but not necessary. They could eliminate exchanges altogether if they wanted to, but it wouldn't make any sense to do so.

They only thing I could see them messing with is the 7 month window for non-home resort reservation, perhaps reduce it to 5 or 6 or resale contracts. All that would do is reinforce that you should buy were you want to stay.

Legally, they can't do that. As Dean said above, they can't change the rules for one class of existing owners without changing everyone. I'm sure that's why they grandfathered in all existing resale owners when they put restrictions on resale points back in 2011.

What they probably could do -- other timeshares have -- is create some new level of ownership requiring direct purchase, and give that new level special benefits. Wyndham has actually tried 3-4 different strategies like that, but I'm not sure they've found the magic formula yet.

 

[ffwillie]

As a brand new owner of resale it seems to me that hurting owners of resales only hurts DVC in the long run. If Disney isn't willing to buy ownership rights back and hurts the resale market through making ownership to burdensome or changes the privileges of resale owners to much, why would anyone buy new knowing that it would be almost impossible to ever sell if they got tired of it.

To me if they want to control the resale market they need to start exercising their right of first refusal and buy more properties back. This would likely inflate the market overall at least for a while and make buying direct more attractive.

Disney can obviously do a lot of things that could make buying resale less palatable but I think they would only hurt themselves in the long run since I would expect sales to come to a screeching halt if it is to drastic. I would have never bought if I thought I was going to throw away $20K. I didn't expect a return on my investment but I sure don't expect it to be gone for ever unless I keep the property through the end of my contract which it probably not likely given my age.

 

[Dean]

As a brand new owner of resale it seems to me that hurting owners of resales only hurts DVC in the long run. If Disney isn't willing to buy ownership rights back and hurts the resale market through making ownership to burdensome or changes the privileges of resale owners to much, why would anyone buy new knowing that it would be almost impossible to ever sell if they got tired of it.

To me if they want to control the resale market they need to start exercising their right of first refusal and buy more properties back. This would likely inflate the market overall at least for a while and make buying direct more attractive.

Disney can obviously do a lot of things that could make buying resale less palatable but I think they would only hurt themselves in the long run since I would expect sales to come to a screeching halt if it is to drastic. I would have never bought if I thought I was going to throw away $20K. I didn't expect a return on my investment but I sure don't expect it to be gone for ever unless I keep the property through the end of my contract which it probably not likely given my age.

I don't agree. While that's likely true for a very small and educated set of buyers, history of both DVC and other timeshares as well as common sense interpretation of people's attitudes towards Disney says otherwise. Even timeshares that can be bought for free are still successful with retail sales. Plus we see all people routinely here who are willing to pay twice as much to either get the new resort on the block and/or because they trust Disney or want easy financing. Every single resale is a potential lost retail sale and that includes those that say they wouldn't have bought unless it was resale. ROFR done in this way means they're paying more for the resale than the retail cost them. Plus most don't go in expecting to sell later, nor should they. Disney's ideal situation is the perception of resale without the reality. So far they haven't done anything of consequence to resale buyers and overall they've likely done them a favor by slightly reducing prices and forcing them to evaluate what they'r really getting by buying in.

 

[JimMIA]

To give you an idea of how naive timeshare buyers can be, take a look at this great bargain from eBay.

47 Park Street, Grand Residences by Marriott

Here is your chance to own thisMembership (Expires 2050) at a bargain price. A One Bedroom with One Bathroom Premium Unit (Sleeps 4), (Deeded as Unit 0015; Weeks 17, 18, 19)at the 47 Park Street - Grand Residences by Marriott a Premier Luxury Resort, located in Mayfair, London. All fees are current with mortgage paid in full, you will receive clear title guaranteed! The New Member is entitled to use the one bedroom executive residence for 21 nights arranged in whatever way is most convenient, from single nights to a block of 3 weeks straight. Usage is annual and will start next year in 2015. Maintenance fees are billed annually in the amount of $10,474. The 2014 maintenance fees have been paid in full; therefore the new member will be responsible for these maintenance fees beginning February 1, 2015. This ownership is subject to MARRIOTT'S RIGHT OF FIRST REFUSAL (if Marriott exercises it's right, you will receive a full refund immediately). Become a member of this resort NOW at a fraction of the developer price.

 

[JimMIA]

How much? $210,000 US, with annual MFs (in case you missed it) of $10, 474.

And that is presented as being "...a fraction of the developer price."

 

[lawboy2001]

DVC salespeople are generally pretty good, but when the topic of resale comes up, they become your standard timeshare salesperson it seems. I wouldn't put any stock in what the salesperson said. If and when new resale restrictions are adopted, I'm sure DVC will either do it without notice, or will provide some official notice.

As other posters have commented, I don't understand why DVC would be bothered by resales. They have the opportunity to sell 100% of the resorts...no one else can sell the points in the first instance. And a vibrant resale market ensures there are no unhappy DVC members - if you don't want your DVC, you can sell it, probably without losing any money!

The only restriction on resale that I believe would make any sense is prohibiting resales while a property was still being actively sold by Disney. Resales while a property was being sold might well undermine Disney a bit. But afterwards, no. I use an analogy of a condo apartment building...why on earth should the developer care if the original owners sell their condos after several years?? Why would original owners be enthusiastic about buying in if they see that the developer is keen at undermining their ability to resell!

If Disney doesn't like resales, then fine, agree to buy back all contracts at a fair price and resell them themselves!

 

[agie65]

He's a timeshare salesman. You can rest assured that everything he says falls somewhere between "stretching the truth" and "outright lie."

I feel the same way. More and more guides are talking this language to new buyers.

 

[disneynutz]

DVC salespeople are generally pretty good, but when the topic of resale comes up, they become your standard timeshare salesperson it seems. I wouldn't put any stock in what the salesperson said. If and when new resale restrictions are adopted, I'm sure DVC will either do it without notice, or will provide some official notice.

As other posters have commented, I don't understand why DVC would be bothered by resales. They have the opportunity to sell 100% of the resorts...no one else can sell the points in the first instance. And a vibrant resale market ensures there are no unhappy DVC members - if you don't want your DVC, you can sell it, probably without losing any money!

The only restriction on resale that I believe would make any sense is prohibiting resales while a property was still being actively sold by Disney. Resales while a property was being sold might well undermine Disney a bit. But afterwards, no. I use an analogy of a condo apartment building...why on earth should the developer care if the original owners sell their condos after several years?? Why would original owners be enthusiastic about buying in if they see that the developer is keen at undermining their ability to resell!

If Disney doesn't like resales, then fine, agree to buy back all contracts at a fair price and resell them themselves!

Disney only sells what makes them the most money, they don't want to waste time selling resale when they can get people to buy active projects at a much higher profit. IMO they also need to justify to the higher ups that they are doing their job, selling active projects are tracked and reported differently than resales.

As far as keeping members happy, why would they take the time? Once a contract is sold, they have Disney customers for the life of the contract no matter how we are treated. We tend to accept what ever is dished out. The website doesn't work but rather than putting pressure on Disney, we learn workarounds and other ways to make reservations. Years ago it was common to hang up on MS Advisors that didn't know their stuff and call back until you got one that knew how to do their job.

Bill

 

[supersnoop]

Thousands of timeshares sell for tens of thousands of dollars direct, but won't move for $1 on the resale market. Sure, Disney could move in that direction, but then their whole business would shrink dramatically. I hope the higher-ups are smart enough to realize that.

 

[keishashadow]

There was rumors when VGF came online of new restrictions. Nothing ever materialized. I really don't see what they could do to restrict resale further.
1)They can't change the 11-month booking priority for home resort
2)They can't remove any of the existing DVC clubs from the "club"
3)They need to offer something to transfer out to, i.e RCI or interval

They only thing I could see them messing with is the 7 month window for non-home resort reservation, perhaps reduce it to 5 or 6 or resale contracts. All that would do is reinforce that you should buy were you want to stay.

Many who purchased & own at the popular DVC resorts have found that it is increasingly more difficult to book their home resort shortly after the 11 month window, let alone after 7 months. I'd venture they would welcome the 7 month window being adjusted to 5 or 6 months for all non-home resort bookings, let alone resale.

 

[disneynutz]

Many who purchased & own at the popular DVC resorts have found that it is increasingly more difficult to book their home resort shortly after the 11 month window, let alone after 7 months. I'd venture they would welcome the 7 month window being adjusted to 5 or 6 months for all non-home resort bookings, let alone resale.

DVC is designed to be booked 98% of the time, The booking windows, 60 day transfers to CRO and other inventory adjustments makes that happen. For most members even if their preferred dates aren't available, they will stay during non preferred dates even at resorts that aren't their favorite. Renting brokers have increased the number of rentals so my guess is that more owners are renting.

Bill

 

[River Country]

I tried reading all of this but does everyone see how putting restriction on resales hurts all owners. if there is no resale market then my TS is nothing more than pre paid vacations but if it were a marketable security then it makes it more attractive to purchase. I agree that there should be slight differences from direct to resale but I think there is enough

 

[disneynutz]

I tried reading all of this but does everyone see how putting restriction on resales hurts all owners. if there is no resale market then my TS is nothing more than pre paid vacations but if it were a marketable security then it makes it more attractive to purchase. I agree that there should be slight differences from direct to resale but I think there is enough

Disney with their name recognition can close a sale with the fast majority of buyers not researching prior to buying. Adding restrictions allows the guide to tell the buyer that they can used their points at all of these wonderful worldwide destinations but only if they buy direct from Disney. Many posters have stated that they understand the restrictions but that they would feel better buying direct.

Add the 90 day delay to close on a resale and the fact that most buyers want to book now, Disney's control of the market guarantees hundreds of millions of dollars in continued direct sales.

Bill

 

[tjkraz]

Disney gave no warning prior to the previous re sales contracts restrictions ( actually I did a month prior here on the DIS).

DVC absolutely did give advance warning before the prior restrictions. More than 2 months warning. It was posted on DVCMember.com, covered by the Orlando Sentinel and numerous other outlets.

http://dvcnews.com/index.php/dvc-pr...atement-on-resale-direct-purchase-distinction

 

[tjkraz]

As far as keeping members happy, why would they take the time? Once a contract is sold, they have Disney customers for the life of the contract no matter how we are treated.

Actually, they don't have customers for life. And this very topic of resale prices pressuring the marketplace is a perfect illustration of why Disney must put effort into keeping owners happy. Disgruntled owners means more resale contracts on the market. That drives resale prices down. And it could also mean fewer buyers if potential owners see great dissatisfaction in the ranks.

This whole "DVC doesn't care about owners" is sort of a tired old generalization. It really doesn't take much effort to pinpoint perks which have no direct financial benefit to Disney. Some of them are little touches, things like MagicBand sliders, free posters on Star Wars Weekends, or balloon animals & buttons handed out at check-in. Owners receive free resort movie rentals, priority booking for runDisney events and Food & Wine Fest sessions and access to a growing selection of exclusive dining and recreation events. Sure many of these events are profit centers for Disney, but that doesn't change the fact that non-owners have zero access to participate.

Discounts programs offer 10% shopping discounts at EVERY WDW location and 10-20% dining discounts at a wide variety of locations including most DVC resort restaurants. A cynic may suggest that these discounts are offered only to drive additional purchases. But if that were the sole motivation, why wouldn't similar discounts be given to ALL hotel guests, ALL theme park guests or why wouldn't they simply lower prices across the board?

Ticket discounts, touring discounts, recreation discounts, spa discounts...there are dozens of examples of owner perks which run-of-the-mill day guests would LOVE to have.

 

[disneynutz]

Actually, they don't have customers for life. And this very topic of resale prices pressuring the marketplace is a perfect illustration of why Disney must put effort into keeping owners happy. Disgruntled owners means more resale contracts on the market. That drives resale prices down. And it could also mean fewer buyers if potential owners see great dissatisfaction in the ranks.

This whole "DVC doesn't care about owners" is sort of a tired old generalization. It really doesn't take much effort to pinpoint perks which have no direct financial benefit to Disney. Some of them are little touches, things like MagicBand sliders, free posters on Star Wars Weekends, or balloon animals & buttons handed out at check-in. Owners receive free resort movie rentals, priority booking for runDisney events and Food & Wine Fest sessions and access to a growing selection of exclusive dining and recreation events. Sure many of these events are profit centers for Disney, but that doesn't change the fact that non-owners have zero access to participate.

Discounts programs offer 10% shopping discounts at EVERY WDW location and 10-20% dining discounts at a wide variety of locations including most DVC resort restaurants. A cynic may suggest that these discounts are offered only to drive additional purchases. But if that were the sole motivation, why wouldn't similar discounts be given to ALL hotel guests, ALL theme park guests or why wouldn't they simply lower prices across the board?

Ticket discounts, touring discounts, recreation discounts, spa discounts...there are dozens of examples of owner perks which run-of-the-mill day guests would LOVE to have.

I agree that discounts are nice but you have to spend money to get the discount. My comment about DVC/Disney not caring is more along the lines of minimal info coming from the higher ups. Disney has always been tight lipped about certain things but wouldn't it be nice if they would give specific info about the room refurbishments, schedules, AP or ticket specials coming up, status on fixing the website, getting DVC to better interface with Disney's websites and processes. I grow tired of something not working right and a Disney CM telling me that, "oh your DVC, that doesn't work", or "oh your DVC, sorry but we can't move you to a better working room".

I guess what I am saying is that I would rather have them fix the core functions instead of trying to sell me bowling or fishing.

Bill

 

[disBOBney]

I don't know of other possible restrictions, but one perk I would love is that direct purchasers get online reservation access at midnight in stead of having to wait until 8 am.

 

[Dean]

I tried reading all of this but does everyone see how putting restriction on resales hurts all owners. if there is no resale market then my TS is nothing more than pre paid vacations but if it were a marketable security then it makes it more attractive to purchase. I agree that there should be slight differences from direct to resale but I think there is enough

Disney isn't concerned if changes hurt owners, only how it affects their options and bottom line. The only way to make significant strides is to make it hurt to be a resale owner and not have qualified points. There isn't nearly enough they can do that will add to retail without hurting non qualified contracts.

 

[supersnoop]

I don't know of other possible restrictions, but one perk I would love is that direct purchasers get online reservation access at midnight in stead of having to wait until 8 am.

Access to inventory is part of your deeded right; they can't give any preference to direct owners in relation to the underlying real estate interest.