Rental prices dropping will drive resale prices lower

[CastAStone]

Theres a lot of people renting at 14$ so we are getting close.

A full price DVC rental through David’s was $16 all of 19 months ago.

 

[sethschroeder]

it is also important to remember that they will likely be looking for specific UYs and ones that can reasonably be broken down into the point quantities that are needed

DVC can reassign the UY of points taken via ROFR so it doesn't matter as much anymore. At least that's what I have read various times on this forum.

 

[i<3riviera]

͏

 

[macman123]

DVC can reassign the UY of points taken via ROFR so it doesn't matter as much anymore. At least that's what I have read various times on this forum.

Yes I brought BLT direct this week to add on to resale., they assigned the same UY

 

[CastAStone]

do you mean split contracts? that's at the request of the purchasers so the purchasers doesn't have one large contract if they want to gift to multiple children (or whomever) and they have the flexibility to sell some of their points later without selling all of them

sometimes split contracts also include different units (contract A may be unit XX and contract B may be unit YY) but that's just because that's the current points they are pulling from (or have gotten back from foreclosures, right-of-first-refusal, or something else)

or do you mean this part of the deed ...
View attachment 504799
has multiple interests and units listed? I'd be super interested if you have one that you've seen!

The latter - I’ll try to dig one up!

 

[crisi]

I think resale price will drop, but I don't think - and don't believe you'd ever be able to create a causation - between resale prices and rental prices. People don't buy to rent out. People who rent sometimes do buy - and may think twice about doing either right now. But the biggest issue is going to be twofold - the recession - which really hasn't hit middle class people yet - but will. And people not wanting to commit themselves to Disney due to uncertainty about the parks being available. Disney during and after a pandemic is like Disney right after 9/11. Disney is a problematic place for events like this. Its a lot of crowds. For terrorists its an attractive target. For the virus, it loves (as much as a virus can care) somewhere you are going to be standing in line next to a stranger for longer than fifteen minutes. But DVC prices rebounded after 9/11 - this will take longer but they will rebound again - memories are short term and few people in the last ten years have not bought DVC because of fear of terrorists.

 

[Brian Noble]

People don't buy to rent out.

I'm not sure that's true. Most people certainly don't, but there are a few who saw it as an attractive investment. Add to that the set of folks who buy 2x the points they use so that they "don't pay dues," and it starts to add up. I suspect that the flurry of stripped contracts entering the for-sale market with very consistent pricing based on UY came from one or more "landlords" who decided to liquidate.

But I agree 100% with your broader points.

Edited to add: here are two other folks thinking about the same thing, even in the face of the current headwinds:

https://www.disboards.com/threads/buying-cheaper-deals-to-rent-them.3805998/https://www.disboards.com/threads/point-strategy.3805933/

 

[heynowirv]

It has always been a peeve of mine that people buy DVC for the purpose of renting. I believe that DVC was /is meant for families to enjoy vacations.We have owned since our kids were tweeners and have had many wonderful vacations and memories that has lasted a lifetime. Now we have a grand daughter that we hope to pass on our /my love of Disney.
Those who buy with the intention of renting go flip housesit's quicker and more profitable.

 

[bookwormde]

DVC can reassign the UY of points taken via ROFR so it doesn't matter as much anymore. At least that's what I have read various times on this forum.

I have not heard of this, though given DVD history it would not surprise me even if it is questionable under TS law

 

[crisi]

I'm not sure that's true. Most people certainly don't, but there are a few who saw it as an attractive investment. Add to that the set of folks who buy 2x the points they use so that they "don't pay dues," and it starts to add up. I suspect that the flurry of stripped contracts entering the for-sale market with very consistent pricing based on UY came from one or more "landlords" who decided to liquidate.

But I agree 100% with your broader points.

Edited to add: here are two other folks thinking about the same thing, even in the face of the current headwinds:

https://www.disboards.com/threads/buying-cheaper-deals-to-rent-them.3805998/https://www.disboards.com/threads/point-strategy.3805933/

Some people do....not enough to impact resale prices significantly.

 

[sethschroeder]

I have not heard of this, though given DVD history it would not surprise me even if it is questionable under TS law

I think part of it might be they are not actually changing point A instead they are selling you point B which has been held since the creation of the resort.

 

[bookwormde]

I think part of it might be they are not actually changing point A instead they are selling you point B which has been held since the creation of the resort.

possible but there are only so many of them, but that would clearly be withing the original licence grant

 

[sethschroeder]

possible but there are only so many of them, but that would clearly be withing the original licence grant

They can focus on specific UY for ROFR as well to replenish it. Most times they only need 100-200 points at a time to sell anyways.

 

[bookwormde]

They can focus on specific UY for ROFR as well to replenish it. Most times they only need 100-200 points at a time to sell anyways.

yes it does give them a buffer that I have not considered

 

[CarolynFH]

I have not heard of this, though given DVD history it would not surprise me even if it is questionable under TS law

Here’s a good article from DVC News - surprisingly, it only happened last year! How time flies!
https://www.dvcnews.com/dvc-program...ey-greater-flexibility-in-assigning-use-years

 

[bookwormde]

Here’s a good article from DVC News - surprisingly, it only happened last year! How time flies!
https://www.dvcnews.com/dvc-program...ey-greater-flexibility-in-assigning-use-years

From my reading this only applies to "new" points not ones previously sold. While I have not done deep research, I think they would have to do a modified licencing to modify previously sold units, and I would be skeptical that the state would allow it.

 

[CarolynFH]

From my reading this only applies to "new" points not ones previously sold. While I have not done deep research, I think they would have to do a modified licencing to modify previously sold units, and I would be skeptical that the state would allow it.

I believe this applies to any points Disney is able to sell, whether a new resort or a “sold out” one. The Membership Agreements for all the resorts were amended to allow it. Disney has staff attorneys and undoubtedly access to outside attorneys as well, so I’d be quite surprised if it were not allowed under Florida TS law.

I’m curious though - why do you think changing the UY of a group of points might be illegal? Given how the percentage of points in each UY varies so much among the different resorts - seeming to be random - I don’t know what difference it would make. Disney only changes the UY when they sell the points, they can’t change the UY once they belong to someone else.

 

[tweetykl]

I would have loved to find VGC for that price. The prices I’m seeing are $210+. we finally bit the bullet and went for it.

There are so many confirmed reservations out there. One well known site had 1300 reservations last time I checked.

I bought a VGC resale last January, at first I was kicking myself thinking I should have waited (who would have known). I'm surprised from the listings I've seen, it hasn't dropped. I paid $180 with 1 point for this year (sellers pay dues), I saw a stripped this week for $214! I know VGC is extremely limited so perhaps not a good example.

 

[bookwormde]

I believe this applies to any points Disney is able to sell, whether a new resort or a “sold out” one. The Membership Agreements for all the resorts were amended to allow it. Disney has staff attorneys and undoubtedly access to outside attorneys as well, so I’d be quite surprised if it were not allowed under Florida TS law.

I’m curious though - why do you think changing the UY of a group of points might be illegal? Given how the percentage of points in each UY varies so much among the different resorts - seeming to be random - I don’t know what difference it would make. Disney only changes the UY when they sell the points, they can’t change the UY once they belong to someone else.

It is only changing UY of existing points that may be a problem, missing UY on a single physical unit does mot appear to be an issue. There are certain things that are "fixed" when a resort is approved as a timeshare, which can only be changed by a licencing modification

 

[CarolynFH]

It is only changing UY of existing points that may be a problem, missing UY on a single physical unit does mot appear to be an issue. There are certain things that are "fixed" when a resort is approved as a timeshare, which can only be changed by a licencing modification

So I guess Disney changing UY is not one of those things that are not allowed at all; DVD did amend all the Membership Agreements for all the DVC resorts. Several owners who post here are very knowledgeable re Florida TS law, and I don’t recall any of them raising legal issues with this change at all.

It does seem to have shortened waiting time for people wanting to buy direct but wanting a specific UY for a sold out resort, making many people happy!