Points versus Cash

[Boardwalk Garry]

I was just going over our plans for our stay next week at VWL when I noticed something I hadn't before. The difference between a studio and a 1 BR in points is double (134 vs. 270), yet cash-wise, it's only about 1/3 ($304 vs. $415).

Does this make sense? Just struck me as strange...

 

[Boardwalk Garry]

Wow, am I the only one that thinks this isn't a good deal????

 

[Richyams]

I agree, just look at how expensive the studio is in cash compared to how cheap the one bedroom is on points....wow, they really do charge a lot of cash for those studios. I am glad the points for the one bedroom are so reasonable.


The cash price for the studio shoud be much lower...and it looks like the points for the one bedroom should be higher, makes you feel good about owning DVC and getting such a bargain on such great units.

The one bedroom is way more than twice as big and we are only paying double points, yet the studio is less than half the size and they have the nerve to be charging 2/3 the one bedroom price.

Yes, I fully agree, the cash prices on the studios are too high and the point cost of the one bedroom is too low.

 

[CarolMN]

I think both cash rates and point rates are ultimately set by supply and demand.

No matter how we might rationalize what the cash rates "should be" (based on factors such as size or amenities), the rates will settle at the point people are willing to pay. Case in point: all of the WDW lodging discounts available this year. It seems that fewer people are paying rack rate than ever before.

DVC's job is to spread demand for resort rooms equally throughout the year. IMHO, DVC has determined that to best match demand to the available rooms, the 1 bedroom units need to cost the member double what the studio rooms cost. Demand for point rooms is probably easier to manage in today's environment than is demand for cash rooms.

FWIW, unless there are consistently empty studios (doubt it), I don't think the cash rate is too low. (Discounts are harder to obtain at VWL than they are at WL). If CRO is able to rent out all of the DVC rooms for good prices, perhaps we'll get a better deal on the non-DVC options next year.

 

[Boardwalk Garry]

So what I gather from all this is that the 1BR is in higher demand with DVC members than a studio and vice versa for cash customers? I could rent 2 studios with points for the cost in points of a 1BR. I know the 1 BR is more than twice as large, but with two studios I would have two microwaves, two refrigerators, two bathrooms, etc.

I know there are many ways to look at the points versus cash situation, but my initial reaction was that someone was getting a bad deal depending on how you did look at this. Figuring the $10 a point going rental rate (I know this changes with each transaction), the studio is a much better bargain using points than the 1BR (versus the current rack rates).

Wow, my head is spinning trying to figure all of this out!

 

[Cruelladeville]

If you had an annual passport that studio could be gotten for $198, and the one bedroom for $234 in cash, which on the weekends isn't such an awful thing. Paying cash for the weekends may allow you to take an extra vacation each year, so there are reasons why someone would pay cash. Hey, you could save some of those points to get a grand villa next year on points! (not at VWL though)

 

[Kick it up a notch!]

Rich, great viewpoint!!!

Gary, there is always a studio to stay in.

 

[dvcChrisVWL]

Garry, try this:

Calculate how much your points are worth (based on cost over time) and then see what the cost difference is.

For example, if you bought 200 points for $80 / point with 40 years to go in the program, then your points are worth (80 * 200 = $16,000 for 40 years = $400 / year = $2 per point. plus the cost of maintenance = 3.81/point for 2002) under $6 per point ($5.81).

So, if a week at VWL is (studio = 104) (1BR = 200) (2br = 270), then you are looking at costs of
studio = $604.24 (rack rate=269/night = $1883),
1br = $1162 (rack rate=370/night = $2590), and
2br = $1568.70 (rack rate=520/night = $3640).
These are current value season rates.

Unless you can get a really sweet deal on reservations (like 50% off), then points seem like an awesome deal to me.

Is my logic flawed somewhere? I did not compare high season rates and I did not break out the weekend versus the weekdays. Maybe that would provide a different answer for weekends as some have suggested (points for the week, cash for weekends)? A little point value program / spreadsheet would be handy in figuring this out...

 

[Boardwalk Garry]

No, I don't think your logic is flawed, it's just one of many ways of looking at the big picture. I'm not questioning the value over the long haul, otherwise I would not have joined. It just struck me as strange that points are doubled for 1 BR over a studio, yet the cash rate is only 33% more (looking at July rates).