rent instead of buy?

[gray]

My husband and I are seriously considering buying into DVC. However, my husband wanted to know why you wouldn't simply rent points to stay at one of the DVC resorts, thus avoiding the maintenance fees and the lump sum buy in amount.

Can anyone tell me if there is any great advantage to buying points versus renting them?

Thanks!

 

[dbkelly]

You somewhat answered your own question. The reason why it is better to buy is because you can rent as the rentor. Let's say you own 200 points and you decide not to go on vacation one year, you now have 200 points that is worth $2,000 in the rental market. Or you can rent your points to pay for a vacation that is not in the DVC network. In essence, you could rent for 6 out of the 40 years and get all of your money back in rent. Or in ten years you could turn around and sell your points at a profit after getting ten years worth of vacations. I bought a resale for $65 per point that the previous owners had for 10 years and they only paid $51 to $55 per point. How can you go wrong if you buy!

I hope this helped.

 

[wdwnut]

hi and welcome to the board. dvc is not for everyone. if you will be going on vacation at least every 2-3 years, this may work well for you. it's kind of the same principle with housing and cars. at the end of the rental or lease, what do you have to show for your money? not too much. of course, you also didn't have to spend too much money hopefully on upkeep. the dues for dvc are quite reasonable when you consider all the upkeep and refurbishing that they do to maintain these places. if you like the value and moderate resorts, dvc may not work financially for you. if you like the deluxes and home away from home type of resorts, dvc will pay for itself in a relatively short time. think of it as a guaranteed "price freeze" for your vacation budget.

 

[mikesmom]

Because you might not find anyone who wants to rent when you want to travel!

 

[Disney Adventurer]

Quick math might help, using todays dollars rental rate is about $10/pt. If you buy, let's say from Disney, you pay $75/pt have it for 41 years, this equals $1.83/pt. Add maintenence to this at $3.63/pt, I think this is the VWL rate. You get a total of $5.46/pt. Of course this does not take into account finance fees, lost interest etc., but you can already see a difference of $4.54/pt. If it takes 200 points for you to vacation that's a savings of $908 with an initial investment of $15,000 ($75 x 200 pts), about a 16 year payback. Then you have 25 years of free vacations. And as I think was already mentioned, you don't have to depend on someone else having the right amount of points for sale at the right time every time you want to go.

 

[gray]

Thanks for some of the helpful comparisons! I work on getting the hubby to agree to DVC every day!

 

[Caskbill]

Actually, it's for the same reasons you might buy your house instead of renting it. If you buy, you have a fixed mortgage rate, only have to worry about taxes, maintenance costs, going up.

But if you rent, that rent is going up every year or so.

Guaranteed....if you rent a house, in 10 years the rent will have gone up much more than the homeowner's taxes or maintenance items would have gone up if you had purchased it instead.

Granted, at the end you own the house. But the math still works out for DVC. I remember back around 1994 points would rent for about $5.00, and now it's about $10.00, which is a 100% increase. Meanwhile, my annual dues have hardly risen at all. ($0.44/point) in that same timeframe.