Rejected Offers Thread

[Rex1993]

I agree that the list prices for most VGF out there don't make any sense given where direct pricing is. But, to be frank, no seller should (currently) consider an offer of $115/point either, and I'll explain why below.

One of the tools I find quite useful to look at before making an offer is the "Instant Sale" tool in DVC Resale Market which is basically the price that broker will offer a seller to buy the contract from them (and presumably flip it for a reasonable profit). If a seller takes them up on the offer, the seller also pays closing costs which, for a 160 point contract, probably reduces their sale net sell price by another $5 or so.

The contract you describe prices at $127/point on that tool, so let's say $122/point after closing costs. And since the broker is expected to flip it, that's probably a very lowball offer to begin with... So why should this seller even entertain $115/point from an unknown buyer, who may not obtain financing, or back out of the deal after 1-9 days for some reason?

View attachment 773629
(source: https://www.dvcresalemarket.com/selling/instant-sale/)

I do find some potential flaws in that tool like it values an extra usage year (or stripped year) at just ±$6/point and the difference between Aulani subsidized and not subsidized is only $9/point which makes no sense gives the current $2.5 disparity in annual dues, which will grow over time (anyone looking for a subsidized contract is asked to pay $30-$40/point more). Nevertheless, whether it's a lowball number or a flawed number, it's probably a good place to start before making an offer since sellers have the option to actually sell at that price.

So, it's not surprising to me that at least the sellers with DVC Resale Market would decline many of the lowball offers in this thread since they are probably all aware of the option to sell to the broker at the price outputted by this tool, and many of the offers shown here are substantially lower.

That said, I guess persistence can pay off if the goal is to ultimately find a motivated/distressed/uninformed seller and snag a bargain basement deal, but it can also take a while... Some of you guys are a lot more persistent and patient than me!

Understood, but I don’t see why anyone should be buying that contract at $127/pt given where direct prices are. I think the value of stripped points should be at $22/pt. With that you’re talking about a $10/pt discount for resale. That’s way too small a discount for me. It’s all academic anyway when all of the VGF sellers seem to be listing above current direct prices.

One thing I’d point out is that the instant offer requires the seller to pay all the closing costs, 2023 dues AND a 9.25% commission.

 

[DanCali]

Understood, but I don’t see why anyone should be buying that contract at $127/pt given where direct prices are. I think the value of stripped points should be at $22/pt. With that you’re talking about a $10/pt discount for resale. That’s way too small a discount for me. It’s all academic anyway when all of the VGF sellers seem to be listing above current direct prices.

One thing I’d point out is that the instant offer requires the seller to pay all the closing costs, 2023 dues AND a 9.25% commission.

The $127 in the screenshot was accounting for the stripped points (the tool showed $134 without stripped points). $134 resale vs. $161 direct is a 16% difference that may be meaningful savings for some buyers, especially for those who already own direct and have blue card and Riviera access. Buyers can have different circumstances.

I did mention the closing costs and that it's probably an extra $5/point on a 160 point contract (implied $800 closing costs). However, the broker commission they would pay anyway - whether selling "instantly" or in a traditional fashion, so it's not incremental.

The value of stripped points is a lot more subjective. But if you want to deduct $22/point for stripped points (presumably because you may have to rent points in the meantime), would you add $22/point for banked points?

Regardless of all that, my main point is that as a prospective buyer it's important to be aware of the seller's alternatives. A seller who can already sell they SRR to their broker for $90 after closing costs will probably not take a $70/point offer seriously.

 

[JackosinDIS]

Very useful to know what the brokers are offering though I think. I wonder whether they will always buy at the price shown in the calculator or whether it is just an indicative price?

 

[DanCali]

Very useful to know what the brokers are offering though I think. I wonder whether they will always buy at the price shown in the calculator or whether it is just an indicative price?

I haven't been on that side of the transaction yet, but I suspect they will honor it as long as their conditions are fulfilled (no expiring points within 6 months, no pending reservations, seller pays closing costs in addition to commission and estoppel fees, etc). If it was indicative, you'd expect to see some asterisk about that aspect.

 

[Sandisw]

Very useful to know what the brokers are offering though I think. I wonder whether they will always buy at the price shown in the calculator or whether it is just an indicative price?

When I was selling SSR last year, the instant offer of $118 was the price they would have given me had I wanted it. I decided to at least try to sell it a bit more...but I also wanted a quick sale. The recommendation for list was $135 but I went with $125...got an offer the same day for $120 and took it.

Since the instant offer required me to pay closing costs, I did consider how much a buyer would need to offer to be worth going that way versus the broker.

Of course, we knew $120 was below the threshold happening for ROFR and sure enough, Disney did take it back.

 

[Rex1993]

I did a little math based on these numbers and there is definitely something odd about them. Maybe I’m missing something but if their tool is only valuing points at $6/pt you end up with a situation where you can buy direct, strip the points and then resell instead of renting points. If I had a trip planned and didn’t have the points, it’s basically a wash between renting points with David’s or buying direct, stripping and then doing the guaranteed sale. If there are actually buyers above the guaranteed sale numbers, you could actually come out ahead of renting.

 

[DanCali]

$6 may not always be the right number for you or me but I'm sure there are buyers who don't necessarily need the points immediately and may be ok valuing stripped points for a number in that range, especially if it's contracts that are a good fit for those buyers (the right size in the right use year) and harder to come by.

 

[Sandisw]

I did a little math based on these numbers and there is definitely something odd about them. Maybe I’m missing something but if their tool is only valuing points at $6/pt you end up with a situation where you can buy direct, strip the points and then resell instead of renting points. If I had a trip planned and didn’t have the points, it’s basically a wash between renting points with David’s or buying direct, stripping and then doing the guaranteed sale. If there are actually buyers above the guaranteed sale numbers, you could actually come out ahead of renting.

There has always been a difference between buyers in how to value stripped vs loaded etc.

I also think that as a buyer, one really should not read into the instant sale tool to much.

It’s purpose is to give sellers who need or want to get out of a contract an immediate buyer for less than what they can get if they wait it out for a potential market value offer. So, I would not expect it to value things the same way someone who wants the contract would.

 

[Cfabar1]

Wait the brokers get mad if you make an offer to low?

Do they not understand stand supply and demand?

What is this lecture,

You're joking right?

Something like this....

You need to understand the market... I want to present you in a serious way to this client, and your offer isn't in line with the market right now. In order to make this deal, we have to come as strong as we can. Someday you will be a seller and would want a fair deal. etc. etc. etc.

 

[Cfabar1]

Very useful to know what the brokers are offering though I think. I wonder whether they will always buy at the price shown in the calculator or whether it is just an indicative price?

Yes, but when you make offers in line with what they are offering (I have done so, say $5 more per point, plus paying the closing costs and the dues), they scold you and say "this tool isn't to help you find a price".

 

[cdirazonian]

Yes, but when you make offers in line with what they are offering (I have done so, say $5 more per point, plus paying the closing costs and the dues), they scold you and say "this tool isn't to help you find a price".

Oh noooo…sorry
my flippant side is coming out..

and my answer to that would be ”Why? You’re trying to buy it at that price, why can’t I? And at a little higher at that”

seriously though, I mean why can’t I (we- whoever) They basically set a bottom price

 

[Sandisw]

Yes, but when you make offers in line with what they are offering (I have done so, say $5 more per point, plus paying the closing costs and the dues), they scold you and say "this tool isn't to help you find a price".

I am going to say the unpopular but it really isn’t meant for buyers.

As someone involved in selling, it was presented to me in the fashion that they knew it was well below market but that if I needed or wanted out quickly it was there.

Now, I get a buyer might want to try but if you take my numbers from earlier..had I not been in a rush to sell, and had listed at the sugggested $135, I would not have entertained an offer close to the $118.

And, those offers were almost always below ROFR and most were in jeopardy of being taken..though not something in 2023 is happening.

 

[Robbie Cottam]

You're joking right?

Something like this....

You need to understand the market... I want to present you in a serious way to this client, and your offer isn't in line with the market right now. In order to make this deal, we have to come as strong as we can. Someday you will be a seller and would want a fair deal. etc. etc. etc.

My response

Nope not a joke I have cash your client needs to sell.

Are you refusing to present my offer?
Do I need to find a broker willing to work for me and not themself…. Etc


My father bought and sold used cars for close to fifty years asking prices are guidelines…. I don’t pay asking price buying direct.

I might piss 9 sellers off before I find one that needs the money today. I buy from that person

 

[SD13]

SD13 - BLT - 100 - $135 - $168 - Aug UY - 7/23
Countered with $166 and I walked away.

 

[Sandisw]

Updated!

 

[Bearval]

Yes, but when you make offers in line with what they are offering (I have done so, say $5 more per point, plus paying the closing costs and the dues), they scold you and say "this tool isn't to help you find a price".

I would politely tell them sure it is and thank you for posting such a valuable resource for me to use.

 

[yodapup]

BWV - 150 - Asking $120, we offered $106 and they didn't even counter.
BWV - 200 - Asking $115, we offered $107 and they accepted. Passed ROFR on 6/27.

 

[JackosinDIS]

SSR contract listed at $95 per point with one broker (150 point contract)… partly loaded as well. Any one seen anything listed as low as this? Are we staring to see broker valuations come down slightly?

 

[Robbie Cottam]

My father taught my a lesson in selling cars when I was maybe 10…

We had a car maybe an Iroc maybe a Firebird for sale at our house….

Some body came by to look at the car 3 or 4 days in a row….

My dad had bought the car at auction, bought it right and and put a big price tag (like double what he paid for it) on it to see what happened….

The person showed up on day 4 and offer 1000 dollars less than my dad was asking….

Without missing a beat my dad adked this person if he would buy the car right there on the spot for that price.

The man said yes, thinking he had stolen the car and pulled out cash.

My dad filled out the title and handed it to the man also happy..

Man drove the car off and I asked my dad why he was happy take. Such a “low price” for the car….

My dad simple responded that he had made 2500 dollars in less than a week and all he do was drive the car home ….

Buyer was happy, seller was happy!

You never know why people are selling, you only know that they are selling….

If you make a crazy offer you might find someone that does not need to sell, or you may find someone that need to close out an estate, and the carrying cost of waiting for the prefect deal, make taking the the low ball offer today a better option for them.

Bottom line you can’t win if you don’t play.

 

[Good Ol Gal]

Good Ol Gal- CCV - 125 points - $130 offer - $160 listed - July 2023