rental concerns

[Brian Noble]

One thing that could always come into question is that DVC is the largest owner at any resort and also rents out their own points.

Lots of things can come into question. But (a) the docs have several places where they distinguish between a member and the developer, (b) Disney can interpret many of terms more or less at will, and (c) they have more lawyers on retainer than i do.

 

[BeachClub2014]

I have zero doubt that "commercial renting" is pervasive within the system. There is an entire cottage industry that has grown around renting points. Some owners may never rent, some may only rent 'distressed' or unneeded points, and some owners probably bought, intending to rent every point they have. DVC allows it, and everyone who buys a contract should know that renting exists. It's in the paperwork.

I also get how some folks get frustrated when an owner can't reserve what they want but then see it being offered for rent. It's frustrating, but it is what it is. This entire thread should be subtitled: "Buy where you want to stay and always book at 11 months." This is the oldest and, in my mind, truest piece of advice found here on the DIS. I realize there may still be challenges in getting the specific view or room category even at 11 months, but the odds are infinitely better as every owner has the same opportunity at 11 months.

 

[Sammie]

Complain to DVC they are the only ones that can make changes, but be careful what you wish for.

 

[KAT4DISNEY]

I don't understand your obsession with when the reservations occur. It doesn't matter. Current availability doesn't matter. I never said I felt that the commercial renters are cheating anyone out of a reservation, and I don't have a problem with "first come, first served". You said "That sounds like they're picking up the remnants of availability since that's not even 2 nights total for all the reservations", and I simply pointed out that it doesn't look someone picking up table scraps. Obviously, if I'm trying to maximize profit, I'm going to grab the most lucrative dates possible within whatever limitations I might have. But again, that's not the point.

Once again, (and I really don't care either way), the point that I was making was that there ARE people who advertise numerous confirmed reservations in quantities that scream commercial renting. Whether or not they are made during high or low periods, whether or not someone is complaining that they think they got shut out on a reservation due to commercial renters (something I have never lamented), doesn't matter to me.

The point remains (and it's the only point I've made)that there is at least some presence of commercial renting going on. I don't care if there is or isn't, but people are practically swearing on their first-born that it doesn't exist. If you think that renting out some distressed points is a reasonable explanation for making 35 discrete confirmed reservations, then so be it.

In summary, and this is the only point I am making: there are people out there making dozens of confirmed reservations, most logically as a commercial venture, and that is in apparent violation of the TOS.

That we disagree isn't unusual. And that you go way out there with what I'm saying isn't either.

Of course it's "scraps" if those are the dates there are availability because they aren't high booking dates. Being holidays means nothing. The remainder is supposition on both yours and my part as to the why someone is doing that and I was pointing out that it's possibly not as you declare factual.

 

[Sandisw]

That we disagree isn't unusual. And that you go way out there with what I'm saying isn't either.

Of course it's "scraps" if those are the dates there are availability because they aren't high booking dates. Being holidays means nothing. The remainder is supposition on both yours and my part as to the why someone is doing that and I was pointing out that it's possibly not as you declare factual.

I did have another thought. None of us know when the example trips shared were grabbed…could someone have ended up with a whole bunch of holding points? Maybe these were grabbed within 60 days and someone is trying to recoup?

Even if this actual owner is a serial renter, there certainly exists a possibility that someone could end up renting in this manner and not being one.

Regardless of what any of us think, DVD sets the rules and is responsible for monitoring it. And, none of us know steps they have taken, how many potential memberships have been targeted, or how many memberships are being used in the wrong manner.

 

[KAT4DISNEY]

I did have another thought. None of us know when the example trips shared were grabbed…could someone have ended up with a whole bunch of holding points? Maybe these were grabbed within 60 days and someone is trying to recoup?

Even if this actual owner is a serial renter, there certainly exists a possibility that someone could end up renting in this manner and not being one.

Regardless of what any of us think, DVD sets the rules and is responsible for monitoring it. And, none of us know steps they have taken, how many potential memberships have been targeted, or how many memberships are being used in the wrong manner.

Yes, that also would make sense as a possibility. We just don't know plus we also don't know what is going on with a person's circumstances and why they are renting.

 

[KAT4DISNEY]

Lots of things can come into question. But (a) the docs have several places where they distinguish between a member and the developer, (b) Disney can interpret many of terms more or less at will, and (c) they have more lawyers on retainer than i do.

All true. I think sometimes those lawyers have pointed out to them that what they have done shouldn't be.
Thinking a little further, DVD is actually the developer. DVC is the management company and ends up with ownership. I've had a discussion with DVC to clarify their own booking and was told they are just like any other owner with the same rights to any villa type. (The discussion revolved around the booking AKV Concierge at 11 months for them to rent out). The fact they book their own points in the same booking windows and declared themselves to be owners the same as any other would indicate they may be under more governance by the POS than not. When the units are still owned by DVD then it wouldn't apply.

 

[AnnaKristoff2013]

I also noticed you didn't mention the big DVC rental companies that own their own contracts, charge in some cases upwards of $40+ per point and only pay the owner $12-19 before taxes.

If Disney was going to crack down on something, it would be those companies.

This. I continue to hope that eventually Disney will get around to cracking down on these companies, especially the ones that are buying, stripping, renting, and selling. If that's not "commercial use" then I don't know what is.

 

[AnnaKristoff2013]

I believe Disney could do more, and there are plenty of examples of other timeshare developers who have done more--in some cases, a LOT more. Will Disney? Who knows. However, I would be careful with any assumptions that Disney looks at private rentals with benevolence. Furthermore, if I were a landlord I'd want to make sure that I had an exit plan if for some reason I got caught holding the bag. Those dues payments can be punishing if you suddenly lose your rental income stream.

Yeah, this. The Wyndham megarenters got caught really holding the bag and many took an huge bath. Disney could easily crack down like Wyndham did, and some of these big companies could be pushed into insolvency.

 

[chcknctlt]

Regardless of what any of us think, DVD sets the rules and is responsible for monitoring it. And, none of us know steps they have taken, how many potential memberships have been targeted, or how many memberships are being used in the wrong manner.

I am

This. I continue to hope that eventually Disney will get around to cracking down on these companies, especially the ones that are buying, stripping, renting, and selling. If that's not "commercial use" then I don't know what is.

Hmmmm....is it proven out that rental companies own a lot of the contracts that are then used for gtd reservations? I always assumed it was the case...

 

[AnnaKristoff2013]

Oddly those nights, other than Thanksgiving, are quite easy to book at 7 months and even much further in. Many big holidays are not as popular as is thought. I bet you could find Christmas availability right now. Or you definitely could have 2-4 weeks ago at least. I haven't looked since then to see about possibly changing my resort.
Still seems like a very time consuming way to rent that doesn't affect members looking for long stretches of times.

I agree that Christmas points charts are so steep that it is not hard to book within the 7 month window for all but the hardest to get rooms.

 

[RoseGold]

Yeah, this. The Wyndham megarenters got caught really holding the bag and many took an huge bath. Disney could easily crack down like Wyndham did, and some of these big companies could be pushed into insolvency.

Why on earth would DVC do this? Mega-renters pushed to insolvency sell or are forced to sell en masse. Huge number of resale contracts flood the market bringing down prices and competing with direct, devaluing the whole product. Oh, and in the process they cancel reservations or don't refund or they cancel the whole trip or people show up without reservations, like Wyndham. And it's a whole mess with kids crying on the international news and people leaving nasty reviews about Riviera.

If this is what DVC planned to do, I think they would at least make some noise and take some warning shots, so that the landing wouldn't be abrupt.

And even eliminating the mega-renters won't eliminate the David's business model, which relies on a bunch of mini-renters doing the exact same thing, also on a big scale.

 

[AnnaKristoff2013]

Why on earth would DVC do this? Mega-renters pushed to insolvency sell or are forced to sell en masse. Huge number of resale contracts flood the market bringing down prices and competing with direct, devaluing the whole product. Oh, and in the process they cancel reservations or don't refund or they cancel the whole trip or people show up without reservations, like Wyndham. And it's a whole mess with kids crying on the international news and people leaving nasty reviews about Riviera.

If this is what DVC planned to do, I think they would at least make some noise and take some warning shots, so that the landing wouldn't be abrupt.

And even eliminating the mega-renters won't eliminate the David's business model, which relies on a bunch of mini-renters doing the exact same thing, also on a big scale.

If Disney concludes that renting is costing them direct bookings they will do it in a heartbeat. If DVC concludes that renting is making it harder for their direct purchasers to book rooms thus devaluing the product, they will similarly do it in a heartbeat. The latter is the reason that Wyndham did it. I think that Disney does not care as much about the resale market value as people on here think they do. Direct will continue to sell just fine regardless of what the resale market does, especially as more and more restricted resorts come online and more and more unrestricted resorts approach their expiration dates.

Wyndham resale has effectively gone down to zero, yet their direct sales are doing just fine.

 

[TeamRiley]

I have no idea why anyone would purchase points with the intent to always rent them all. The return on that is terrible compared other very safe investments. A rent, strip, and sell model would work in a growing market, but if resale prices are dropping you could take a bath. I really don't think there is a huge cabal of commercial renters ruining everything. I think there are just more and more people getting rid of unused points.

 

[Jwaire]

I think there are just more and more people getting rid of unused points.

That too. I can't tell you how many Disney people I know that are cruising (and not on DCL) instead of going to WDW because of the nickel and diming, Genie+ and having to make park reservations.

 

[Sandisw]

If Disney concludes that renting is costing them direct bookings they will do it in a heartbeat. If DVC concludes that renting is making it harder for their direct purchasers to book rooms thus devaluing the product, they will similarly do it in a heartbeat. The latter is the reason that Wyndham did it. I think that Disney does not care as much about the resale market value as people on here think they do. Direct will continue to sell just fine regardless of what the resale market does, especially as more and more restricted resorts come online and more and more unrestricted resorts approach their expiration dates.

Wyndham resale has effectively gone down to zero, yet their direct sales are doing just fine.

From what some have posted, the big difference between DVC and Wyndham is that the 8000 point limit DVD put in place severely limits people from being the same level of mega renter that Wyndham had.

While I think there are certainly companies that have decided to get into the rental business of contracts they own through LLCs, etc, I have never seen anyone post how they determined it is actually happening large scale.

Since rentals are private contracts, how would one even know how many the company made?? Is there a way to show which contracts for sale belong to brokers? Or that it’s been bought, stripped or sold?

 

[RoseGold]

While I think there are certainly companies that have decided to get into the rental business of contracts they own through LLCs, etc, I have never seen anyone post how they determined it is actually happening large scale.

You can see it in the transactions on the Comptroller. Plenty of the resale transactions are going to LLCs. Maybe that's a person who went through the trouble to set all that up for their estate, more likely it's a business.

I rented twice from LLCs with professional management before I bought into DVC.

 

[Sandisw]

You can see it in the transactions on the Comptroller. Plenty of the resale transactions are going to LLCs. Maybe that's a person who went through the trouble to set all that up for their estate, more likely it's a business.

I rented twice from LLCs with professional management before I bought into DVC.

Haven’t you recommended that people consider buying and putting into an LLC?

So, renting from an LLC could also be an estate renting out extra points? It’s not necessarily a broker or business is it?

I don’t doubt there are owners who are renting a lot but to be fair, the only ones who actually know how many reservations were made on any one membership is the owner of that membership and DVC.

Maybe things appear to be out of control because there are lots more rentals now with the internet?

Maybe its simply more and more owners renting yearly?

Even your own experience simply supports only that there are at least one or two LLCs that exist who have rented reservations.

 

[KAT4DISNEY]

Haven’t you recommended that people consider buying and putting into an LLC?

So, renting from an LLC could also be an estate renting out extra points? It’s not necessarily a broker or business is it?

I don’t doubt there are owners who are renting a lot but to be fair, the only ones who actually know how many reservations were made on any one membership is the owner of that membership and DVC.

Maybe things appear to be out of control because there are lots more rentals now with the internet?

Maybe its simply more and more owners renting yearly?

Even your own experience simply supports only that there are at least one or two LLCs that exist who have rented reservations.

It could also be more owners renting directly vs using a broker such as David's. There's just a lot more options available now than in the past.

 

[john7994]

Interesting topic and conversation - so on the DIS points rental boards themselves - where does this fall? https://www.disboards.com/threads/p...500-wl-br-19-75pp-160-aulani-19-75pp.3931635/