Point transfers and annual dues

[Jeterdog2004]

Hola all. Put together this blurb trying to explain my thought process on this scenario you could use to help pay off annual dues every year without renting out your own points. Technically it violates the rule about point transfers not being allowed to be made for money, but disregarding that little tidbit (since there is a whole giant market of point transfers for payment out there), it seems to work pretty smoothly....

https://jilteddisneybride.com/2020/...member-and-get-your-annual-dues-paid-for-you/

 

[Deb & Bill]

Unless you cancel your reservation at 30 days out and then your points go into holding (once they activate that again). Or you lose your reservation by cancelling it and it goes to the waitlist or to someone else a bit faster than you. And if you can get $19 a point now renting, that's a lot more than most people are getting. With all the online bargain reservations through the brokers, lots of renters are asking to pay $10-12 per point. You can refuse that, but you might find it harder to get renters.

 

[RoseGold]

I deeply disagree with your math assumptions ($12/point?) and what you are perceiving as risk. Buying/renting points is a risk, as sellers usually require upfront payment, and transfer is permanent, so this all better be right. This could be assuaged with escrow, but that adds more cost and complication.

Maybe you bought some $12 distressed points in Covid from a Canadian who couldn't go this summer, but good luck with that every year. But sure, buying distressed points is cost effective.

Just buy a big SSR contract, amortize the closing/commission over the 10 years, and that's how you come out at the 12$/point. The most cost efficient vs cash of all is use any of the cheaper points for the eye-popping rate rooms, like Poly/VGF. The most cost efficient period is to stay at SSR with your SSR points.

This arbitrage only sort of makes sense for you because you are holding overpriced points. You could do the same arbitrage using your own SSR points smartly at 7 months. Then you'd have a few months to keep the 11 month window, you'll never rent for $19 with the wrong timing.

So, if SSR costs $10.26 to maintain, and BW $13.63 (DVC Resale stats) you went through all of that for $5/point. Add in commission to sell and closing cost to buy, and tell me how many years that takes just to break even. If you bought in the 90s, your math is looking better, but maybe still even better to sell and buy a longer contract with 2042 resale prices so high right now. THAT's how you would get actual cash to pay your dues for free. Trade in your BW for some AKL.

Also, this seems to misunderstand the structure of DVC. It was never to "pay a lot of money upfront and never have to pay for a hotel." In fact, DVC's dues are among the highest, if not the very highest in timeshares in general. That is how the system was designed. You can read a lot more about the itemization of these charges, and the minor discrepancies between resorts, and all about the upkeep and servicing of the hotels and related services. If you are looking for a timeshare with minimal dues, they do exist, but this is not that timeshare.

 

[Jeterdog2004]

I deeply disagree with your math assumptions ($12/point?) and what you are perceiving as risk. Buying/renting points is a risk, as sellers usually require upfront payment, and transfer is permanent, so this all better be right. This could be assuaged with escrow, but that adds more cost and complication.

Maybe you bought some $12 distressed points in Covid from a Canadian who couldn't go this summer, but good luck with that every year. But sure, buying distressed points is cost effective.

Just buy a big SSR contract, amortize the closing/commission over the 10 years, and that's how you come out at the 12$/point. The most cost efficient vs cash of all is use any of the cheaper points for the eye-popping rate rooms, like Poly/VGF. The most cost efficient period is to stay at SSR with your SSR points.

This arbitrage only sort of makes sense for you because you are holding overpriced points. You could do the same arbitrage using your own SSR points smartly at 7 months. Then you'd have a few months to keep the 11 month window, you'll never rent for $19 with the wrong timing.

So, if SSR costs $10.26 to maintain, and BW $13.63 (DVC Resale stats) you went through all of that for $5/point. Add in commission to sell and closing cost to buy, and tell me how many years that takes just to break even. If you bought in the 90s, your math is looking better, but maybe still even better to sell and buy a longer contract with 2042 resale prices so high right now. THAT's how you would get actual cash to pay your dues for free. Trade in your BW for some AKL.

Also, this seems to misunderstand the structure of DVC. It was never to "pay a lot of money upfront and never have to pay for a hotel." In fact, DVC's dues are among the highest, if not the very highest in timeshares in general. That is how the system was designed. You can read a lot more about the itemization of these charges, and the minor discrepancies between resorts, and all about the upkeep and servicing of the hotels and related services. If you are looking for a timeshare with minimal dues, they do exist, but this is not that timeshare.

I actually have gotten large transfers for $12 per points every year on each of our contracts, so twice a year, before covid. There are always people willing to do transfers of distressed points in desperate situations if you are patient and know where to look.

 

[Jeterdog2004]

Unless you cancel your reservation at 30 days out and then your points go into holding (once they activate that again). Or you lose your reservation by cancelling it and it goes to the waitlist or to someone else a bit faster than you. And if you can get $19 a point now renting, that's a lot more than most people are getting. With all the online bargain reservations through the brokers, lots of renters are asking to pay $10-12 per point. You can refuse that, but you might find it harder to get renters.

Yes you would never cancel the reservation within 30 days with holding accounts as an issue. That’s where reallocation comes into play for sure. Good point though. I should mention that going forward. Got lazy about that since holding hasn’t been an issue this year

 

[Jeterdog2004]

I deeply disagree with your math assumptions ($12/point?) and what you are perceiving as risk. Buying/renting points is a risk, as sellers usually require upfront payment, and transfer is permanent, so this all better be right. This could be assuaged with escrow, but that adds more cost and complication.

Maybe you bought some $12 distressed points in Covid from a Canadian who couldn't go this summer, but good luck with that every year. But sure, buying distressed points is cost effective.

Just buy a big SSR contract, amortize the closing/commission over the 10 years, and that's how you come out at the 12$/point. The most cost efficient vs cash of all is use any of the cheaper points for the eye-popping rate rooms, like Poly/VGF. The most cost efficient period is to stay at SSR with your SSR points.

This arbitrage only sort of makes sense for you because you are holding overpriced points. You could do the same arbitrage using your own SSR points smartly at 7 months. Then you'd have a few months to keep the 11 month window, you'll never rent for $19 with the wrong timing.

So, if SSR costs $10.26 to maintain, and BW $13.63 (DVC Resale stats) you went through all of that for $5/point. Add in commission to sell and closing cost to buy, and tell me how many years that takes just to break even. If you bought in the 90s, your math is looking better, but maybe still even better to sell and buy a longer contract with 2042 resale prices so high right now. THAT's how you would get actual cash to pay your dues for free. Trade in your BW for some AKL.

Also, this seems to misunderstand the structure of DVC. It was never to "pay a lot of money upfront and never have to pay for a hotel." In fact, DVC's dues are among the highest, if not the very highest in timeshares in general. That is how the system was designed. You can read a lot more about the itemization of these charges, and the minor discrepancies between resorts, and all about the upkeep and servicing of the hotels and related services. If you are looking for a timeshare with minimal dues, they do exist, but this is not that timeshare.

also FYI I’m not sure why you are saying I own overpriced points. We have 300 boardwalk points purchased direct for $65 per point in 1996. Then I have a resale contract at bay lake that was in the $130 range I believe and I very carefully vetted the most cost effective contract given the expiration date, rental appeal, and dues.