Ques about DVC bfts, resale (both ways)

[Colinsmom]

I'm sure that the answers are out there but I just couldn't find them last night. Anyways, I just got a nice, nice bonus at work and we're thinking about using it towards a DVC purchase. I have a few questions that I didn't find answers to last night:

1. What are the other benefits of DVC membership (I saw one thread on reduced AP prices - how about other tickets)? I'm thinking in terms of food discounts, souvenir savings, etc, specifically at WDW.

2. Generally, we can get a better price or more home resort options if we buy a resale (we're in no rush). Is there any downside to this?

3. If we decide several years down the road that *gasp* this isn't right for us, or if for some strange reason we need the money, we'd probably sell it off. How has the resale market been in recent years? Have people done okay on their investment even though they haven't held it for a long time, or is this pretty much a losing proposition? So, say, if we use the benefits for 4 years and then sell it, would we be out a lot of money, or could we possibly break even or so?

Thanks so much!!

 

[tjkraz]

1. What are the other benefits of DVC membership (I saw one thread on reduced AP prices - how about other tickets)? I'm thinking in terms of food discounts, souvenir savings, etc, specifically at WDW.

There are discounts in all of the categories you list--usually 10-15% off at selected establishments. But these perks are not guaranteed to us as members. The list can, and does, change. Someday it could disappear altogether.

Right now the only ticket discount is the AP. We used to get 10% off of the length of stay pass, but that ended on 1/1/05.

2. Generally, we can get a better price or more home resort options if we buy a resale (we're in no rush). Is there any downside to this?

Mostly time and energy. You need to find a contract that suits your needs, negotiate the deal, wait on DVC's Right of First Refusal, go through the closing. If DVC exercises ROFR and buys your contract, you start all over again.

Buying direct you can give a verbal commitment and book your first stay in the same phone call.

Regarding resales, note that the buyer typically pays a fixed price per point, closing costs (plan on $400-500 regardless of the size of contract) and the current year's maintenance (about $4 per point.) When you add all of that up, you may be surprised at how close you get to the current DVC price for points at Saratoga Springs. That's not to say that there aren't deals to be had, but I don't think the price difference is as wide as you may think simply by looking at resale asking prices.

One other potential factor: Saratoga Springs contracts end on 1/31/2054. All other resorts end on 1/31/2042. With SSR you get 12 more years of ownership, which will certainly help the resale value in a couple of decades.

3. If we decide several years down the road that *gasp* this isn't right for us, or if for some strange reason we need the money, we'd probably sell it off. How has the resale market been in recent years? Have people done okay on their investment even though they haven't held it for a long time, or is this pretty much a losing proposition? So, say, if we use the benefits for 4 years and then sell it, would we be out a lot of money, or could we possibly break even or so?

The resale market is pretty good. As long as DVC keeps building new resorts and selling "new" points, they will continue to exercise ROFR to keep resale prices close to new prices. If DVC was to get out of the market, there would be a price adjustment. But as long as WDW is in demand as a vacation destination, there will be demand for DVC contracts.

 

[crisi]

I wouldn't buy expecting a lot of perks. They (as tj said) come and go. Sometimes they seem relatively valuable, sometimes they aren't. There are a few things (like the current dining plan or access to concierge) that you lose access to by staying on points. If discounts are the "make or break" point of your decision, think carefully.

We bought a resale, and I think tj has it right, the only downside is time, and if you are the type, stress. Resales fall through, it can be a while to find the "right" contract, etc. But you can get a decent deal still on a "sold out" resort. Note that if you really want to buy from Disney, sometimes guides can make "new" contracts out of repurchased points at sold out resort - but sometimes you'll wait a while.

Resale values have held well, but remember that, unless you go the "sell it yourself" route, you'll pay a resale commission. So if you buy today and resell tomorrow - even if you get more for your points you will probably end up a little in the hole. If you hold for a few years - and resale prices continue to increase as they have done - you'll do fine.

 

[JimMIA]

I'm sure that the answers are out there but I just couldn't find them last night. Anyways, I just got a nice, nice bonus at work and we're thinking about using it towards a DVC purchase. I have a few questions that I didn't find answers to last night:

2. Generally, we can get a better price or more home resort options if we buy a resale (we're in no rush). Is there any downside to this?

I'll offer a couple of thoughts on #2, and let folks who know more than I answer 1 and 3.

Can you get a better price? Yes, but "...that depends on what the meaning of 'is' is." $90 for 49 years worth of points is $1.84 per point per year. $70 for 37 years is $1.89 pp/py. $80 for 37 is $2.16.

Downsides?

1 - You have to pay closing costs of roughly 3% of the purchase price, as opposed to Disney paying closing on direct purchases. That's a minor cost and is offset by the lower price.

2 - You are only buying points for 37 years, instead of 49. That may or may not be a problem, depending on how long you plan on keeping the contract. At some point, the remaining years on the contract are going to become an issue and the prices of the resales will have to drop. Or...they could be held up by continually rising new prices. Who knows?

3 - You have to consider dues - which include taxes, maintenance costs, etc, etc. Dues on resales vary from just slightly more than SSR [e.g. OKW is $3.86 vs $3.83 per point dues] to WAY above [Vero = $4.87]

4 - The resale process is very protracted, complex, sometimes non-sensical, and can be very frustrating and stressful. Plan on 8-12 weeks from the moment you decide to make an offer until you can make a reservation. Also realize that you may have disappointments along the way, because Disney has the right of first refusal (ROFR) on all resale contracts, and they often exercise it.

Good luck!

 

[JimMIA]

I wouldn't buy expecting a lot of perks. They (as tj said) come and go. Sometimes they seem relatively valuable, sometimes they aren't. There are a few things (like the current dining plan or access to concierge) that you lose access to by staying on points. If discounts are the "make or break" point of your decision, think carefully.

That is some of the soundest advice you will get - whether you are buying direct or by resale. Perks come and go.

Also, we evaluated our DVC purchase strictly based on using the points at the DVC resorts - nothing else. Many people who have used DVC for trades, or even for Disney Cruises, say they got far less value. Many who have done either now say they would have been better off to pay cash and rent their points to cover the cash outlay.

 

[RAD]

One perk that's been offered a couple of times is 'sneek previews' of new attractions (along with AP holders). The next one coming up is for Soaring. They've also done special events, such as the upcoming DVC members only cruise this September on the Wonder. DVC members are taking over the entire ship, the cruise was sold out in about 5 hours!

However as mentioned, I wouldn't join DVC because of the perks that may or may not show up. Purchase if the rooms/resorts meet your needs, the perks are just a nice bonus that show up.

 

[crisi]

One perk that's been offered a couple of times is 'sneek previews' of new attractions (along with AP holders). The next one coming up is for Soaring. They've also done special events, such as the upcoming DVC members only cruise this September on the Wonder. DVC members are taking over the entire ship, the cruise was sold out in about 5 hours!

However as mentioned, I wouldn't join DVC because of the perks that may or may not show up. Purchase if the rooms/resorts meet your needs, the perks are just a nice bonus that show up.

And those perks in particular can be frustrating. If you live near Florida or have a flexible schedule, you might be able to take advantage of their sneak peek. But a lot of members live a plane ride away - and these perks aren't very useful. Likewise the member cruise - I hope cruisers have a great time! - but a lot of members have kids in school in September. There has been a lot of unhappiness from people who can't take advantage of those sorts of perks and think they are "unfair." The member events surrounding the opening of SSR were very cool - if your party was fairly grown up - preschoolers don't enjoy dessert buffets at 9:00 at night (or maybe they do, but it really isn't an event targeted at them).

 

[SoCalKDG]

I bought at BWV 5 months ago, received current points, and its already went up 5-10% in value. If you don't overpay for a resale, it should hold its value. So if you sell in 4 years and pay commission of $1500, you still ended up with 4 vacations for $1500 plus dues, so you should be fine.