Price Increases Mid January

[Drewferin]

Just an observation but resale contracts are currently being solid tonight. A Sunday night isn't a normal time for resale brokers to be working. Seems like AKV has sold 4 contracts tonight on the major resale broker I normally watch. Next week will be high activity I'd imagine.

 

[DougEMG]

Agreed. I would not purchase either resale or direct if I were just looking into DVC as a first time buyer right now. It’s just another timeshare with a higher price tag & proximity to theme parks.

I agree!

 

[4luv2cdisney]

Just an observation but resale contracts are currently being solid tonight. A Sunday night isn't a normal time for resale brokers to be working. Seems like AKV has sold 4 contracts tonight on the major resale broker I normally watch. Next week will be high activity I'd imagine.

Yup. I noticed too. And I'm guessing there are new contracts floating out there that we will never see available because they will be sold to people that have already contacted their agent expressing interest. Just as people are rushing to buy, there will be some rushing to dump theirs!

 

[Bing Showei]

Would be interesting to see the point rental market after all is said and done. Those with contracts before 2019 would be able to rent stays at DVC2 locations, which I would assume bring in higher price-per-point value.

The dominoes fall one by one. Each time, we rationalize how the impact may not be that big a deal. The tiered memberships, not a big deal (with grandfathering... I'm not too affected); the reallocation; not a big deal (this will better the greater membership... I'm not too affected); the new resale restrictions, not a big deal (that's ok, we can still rent... I'm not too affected).

What happens when Disney is done crushing the resale market and they turn their sites onto the rental market? What sort of change can take place that will cripple the rental brokers in the same way? It's true today; that we wouldn't have any issues renting our points... but what legal change can DVC do to cripple renting/transferring our points? Fees? Limits?

If it's to be believed (and I personally do) that a healthy percent of DVC sales are direct to people swept up in all the glorious magic that is Disney, who cares if there is no resale market? Who cares if there's no rental market? Most of those buyers didn't even know either of those existed. Hell, most owners today probably don't even know those exist. To that end, every point sold is guaranteed (short of those repossessed by bankruptcy) income for 50 years. Once a point is bought, that spigot doesn't turn off easy.

What is Disney's long term plan? Is to drive all purchases direct? If you believe that, you best believe the next domino to fall will be the rental market and the money Disney isn't making there.

Nothing seems to be off the table. This is getting to be too much uncertainty and risk for my taste.

 

[Mumof4mice]

Guess who just saved $15k by deciding not to add on? Whirlwind of changes too much for my vacation brain.

Not ruling out Riviera resales at $10pp down the track... If the shower heads there are diamond encrusted.

 

[Drewferin]

As I'm watching resale sites, I'm a little afraid by the dropping prices just tonight (Sunday). AKV is selling now numerous contracts with full 2019 and 2020 points for $104 to $105. Hopefully this stabilizes tomorrow and the rest of this month....

 

[Wakey]

If you want to know if Riviera will sell, look on some of the Facebook groups, these people are often current owners, the same ones which lauded the points reallocation.

Sentiment includes:

This is why you only buy direct.
I’d never buy resale and this shows why.
They are doing this to free up 7 month availibility.
This is great news.
I can’t wait to buy Riviera.

Larry really is having a good chuckle.

 

[we"reofftoneverland]

If you want to know if Riviera will sell, look on some of the Facebook groups, these people are often current owners, the same ones which lauded the points reallocation.

Sentiment includes:

This is why you only buy direct.
I’d never buy resale and this shows why.
They are doing this to free up 7 month availibility.
This is great news.
I can’t wait to buy Riviera.

Larry really is having a good chuckle.

That's why I can't do FB. Lol.

 

[DougEMG]

If you want to know if Riviera will sell, look on some of the Facebook groups, these people are often current owners, the same ones which lauded the points reallocation.

Sentiment includes:

This is why you only buy direct.
I’d never buy resale and this shows why.
They are doing this to free up 7 month availibility.
This is great news.
I can’t wait to buy Riviera.

Larry really is having a good chuckle.

Only a sucker would buy Riviera now.

 

[ELMC]

I spoke with my guide this am.

Prices are going up anywhere from 5.00 per resort to 40.00.

Old Key west is going up 5.00.

Grand California was huge as was beach club.

I think he said Beach Club as going to 225.00.

Grand California was like 260.00 or so.

He didn't tell me all the prices but he knew what they were.

He made the comment that Beach club at 225 for the 2042 expiration was crazy.

Anyone else hear prices?

Beach Club for $225 essentially makes the hard cost per point $16 in year one when you combine purchase cost and dues. That is more than what it costs to rent points, and with rental you don't have to shell out the $225 up front.

Something in this market has to normalize. It's clearly not the direct prices as they keep skyrocketing, so when are rental prices going to reflect the modern day purchase costs?

 

[sky2823]

Could they add years on the BCV, BWV on the resales?

I know the OKW extension was a disaster, but is anything stopping them from adding years with the price increase when they sale direct?

$225 for a 20 year contract seems crazy

 

[Bearval]

That's why I can't do FB. Lol.

More like Wastebook not Facebook

 

[Bearval]

Could they add years on the BCV, BWV on the resales?

I know the OKW extension was a disaster, but is anything stopping them from adding years with the price increase when they sale direct?

$225 for a 20 year contract seems crazy

I wouldn't be surprised if all the direct resales for resorts with expiration dates of 2042 were moved to 2057 and all of the other resorts with later expiration dates moved to 2068. This in their minds would help justify buying older resorts direct instead of resale and this could also help push down resale values so they can buy them back cheaper.

 

[zavandor]

The resorts expire because the ground lease expire. If they renew the lease, then the whole resort would expire at the later date, all owners included. For OKW they have tried to force all existing owners to sign a document saying they renounce to the extention, but it has backfired. In oder to sell your OKW contract, Disney requires first to sign that document. But someone think that original owners who keep their contracts until 2042, if they've not signed then they get the extention for free. It is a mess, I cannot see them doing it again. They might try to find a different way to do it, but I think all the 2042 resorts will all expire in 2042, expecially so they can move them to DVC2.

 

[Brian Noble]

what legal change can DVC do to cripple renting/transferring our points? Fees? Limits?

Based on other timeshare systems, the next obvious move would be a fee for guests staying on points and/or point transfers. Given the high underlying nightly rental costs, this probably wouldn't do much to change the equation in dollars-and-cents terms, but it might serve as an intangible discouragement. If anything, it would discourage short-stay rentals.

I don't have an opinion on whether such a move would be consistent with the various legal agreements in place, but I suspect it might.

Edited to add: another possibility (again based on other systems' structures) would be the ability to "re-qualify" resale points with another direct purchase. I believe both Diamond and Marriott do this. Starwood might too with their Voluntary resorts. Wyndham sometimes will, but it is structured a one-off that individual sales locations are allowed to do, not a standard practice with a well-known price.

 

[Brian Noble]

As I'm watching resale sites, I'm a little afraid by the dropping prices just tonight (Sunday). AKV is selling now numerous contracts with full 2019 and 2020 points for $104 to $105. Hopefully this stabilizes tomorrow and the rest of this month....

This probably has nothing to do with this (rumored) change; the time it takes for an owner to make the decision to list and at what price takes a little while. If it's motivated by something intrinsic to DVC, it's more likely the 2020 point charts (and even that is probably too new for most owners to have noticed.) It's just as likely driven by people being spooked by the stock market.

Edited to add: of course, it could also be driven by the dues increase, which for some people might be material. It's also worth noting that year-to-date direct sales are down, and that trend is accelerating. (See the DVCNews monthly reports for this. As of September, they were down 1.9% YoY. October: 2.4%. November: 3.4%. IMO that lends credence to the "general drop in consumer confidence"/"spooked by the market" theory.

 

[Brian Noble]

Re: Current owners being happy about the new sales model, reallocation, etc.

Humans are very good at telling themselves that the decisions they've made and their value judgements are good ones, even (and sometimes especially) in the face of contradictory evidence.

 

[bfiessinger]

So here a question for people grandfathered in. If you buy the exact same resort and use year. Those points roll into your current membership number. How on earth would dvc differentiate between what can be booked at all resorts and what can’t be.

 

[Ben E N]

So here a question for people grandfathered in. If you buy the exact same resort and use year. Those points roll into your current membership number. How on earth would dvc differentiate between what can be booked at all resorts and what can’t be.

The contracts still show up as being different, with a .0, .1. or .2 after them. My .0 and .1 points would still be good, but not my .2

 

[Wakey]

'Thank You DVC, I understand and agree.'

'Glad this is happening, it is a solid property management decision'.

'' I actually love this'
'me too'

The latest posts on the subject on the DVC Neighborhood.

I'm losing the will to live.