Renting Points - An Opinion

[rccomputers]

IMHO. I just posted 290 points for rent on the rent/trade board. Happily, wonderful families rented them all in just four days. I charged $10.00 per point and the folks were happy and excited to rent them from me.

Now I know people can charge what they want for the points but why is anyone considering and posting rental for less then $10.00? I see many people wanting to rent the DVC units, that if we wanted to be greedy we could probably even get more.

With the volume of people wanting to rent, if everyone standardized the price at 10.00 I think the rentals would go even smoother because it would jut be a matter of contacting the person with the number of points that you want and renting them. This way everyone wouldn’t be scrambling around trying to save 25 cents a point.

Thoughts?

 

[sandieb]

Hello - I have not rented out any of my points yet, but I believe it is a free market, and folks can determine at what price they choose to rent their points. A short time until points expire might reduce their market appeal. Someone on the fence about renting them might choose $12 or more dollars to rent them. "Price fixing" isn't realistic, and possibly it is unethical. Sandie

 

[CarolMN]

I think there are several members who routinely rent their points for more than $10.

FWIW, I think points should rent for whatever the market will bear - i.e., it all supply and demand. IMHO, points used to book at the 11 month window are "worth" quite a bit more than points about to expire.

Periodically, suggestions to increase, fix or decrease the price of points show up on this board. The threads usually generate some interesting discussion (including some that probably is more suited to the Debate Board), but never any noticable change in Rent/Trade transactions - those just continue to be negotiable between buyer and seller.

 

[Dean]

Collaborating to "fix" the price would be illegal.

 

[Jollymon]

Collaboration is a very grey area. Do the airlines collaborate when they all hike prices at the same time or are they simply following the leader? It is common knowledge that prices in the airline business go up and down pretty much across the board as all carriers pretty much follow each other. If one does not, then a price war ensues in the non-conforming carrier's most lucrative market to get them back in line. Are they breaking the law? No, as they have not colluded to set prices; they are free to set prices at what ever they wish.

This same self policing can be applied here, but who among us is willing to sell their precious few points at a considerable low price to get the non-conformists to raise their price? There are just way to many sellers entering the market at different times with varying amounts of points to be able to control it.

The going rate of $10 has been established based on the economic forces of supply and demand. The only way to raise this price is to make the points more scarce; there needs to be a competition, a scramble for the points when they become available. When an allotment of 290 points are gone in 1/2 hour, trust me, the price will go up on their own. If the same allotment takes 4 weeks to sell, the price will come down.

So, if we want more money for our points, we need to bring more traffic to the marketplace. Let people know that they can pick up a room that goes for $300 a night for $120 by renting points.

Andrew

 

[JohnnyII]

Dean,

I think your statement is a little too "black and white". As we all know "fixing" the cost per rental point would be impractical. There are way too many people owning points and all too many forums to rent them. Second, even if the was a way for "owners" to charge the same amount, it would be highly unlikely that it would be considered illegal. Since each owner is a private citizen, renting their points would unlikely be considered a business activity. I doubt you could even find any entity interested in even investigating the posibility of illegal activity.

Anyway, we never have to even think about this since in this case it is virtually impossible to fix point rentals. I am a new member and may never rent my points, but if I do, I will rent them for what I feel is a fair and reasonable amount.

John

 

[Dean]

Regardless of what happens with air lines and the unlikely chance of anyone really caring, separate entities getting together and agreeing to fix the price is illegal. It doesn't matter if it's only 2 people, the fact you can't corner the market has no effect on the technicallity. As for whether anyone would be willing to pursue it, I can't say but would not be so sure that they would not be. Johnny, legally it is a black and white issue. I'm not a lawyer but work in an area where it is an issue that affects us every day. You can look at what the other guy is going and do the same thing, that's ok. Saying lets set the price at X is 100% not OK. OK, back to channel DVC.

 

[PamOKW]

The Rent/Trade board is provided here as a very nice gesture by Peter Werner. He has no obligation to continue to offer this forum that allows members an easy way to rent their points using his resources at no cost. To try to use this forum to "set" prices borders on taking advantage of Pete's hospitality. In the past, he has asked that we not use this forum to organize in any formal fashion to appoach DVC on subjects. Trying to set prices would seem to fall under this same type of activity.

It's fine to raise the issue of what is the "fair" price. That seems to come up from time to time. It's really up to the individual how much time they want to put into getting a higher price versus just wanting to get something for points that will go to waste.

 

[Desperado]

IMHO....... Thoughts?

Great way to start and broach the discussion. Looks like from some of the posts above from people much more knowledgable than me, it's probably not a good idea. But thanks for the discussion topic, I learned something.

 

[rccomputers]

First, I didn’t want to suggest that we should fix prices. Even though proving that any group got together to fix prices would probably cost the person trying to prove it more then it was worth. It would be a case of the lawyers making all the money on the class action law suit and the actual complainants getting a discount coupon on their next purchase.

I meant it to be more of a discussion of why people offer lower prices then 10.00. Have they ever checked the rack or even the discounted rate on a 1 bedroom or 2 bedroom. 10.00 is an excellent rate. I don’t know about you, but after staying at a DVC resort in luxury compared to a standard room, I know I won’t be staying anywhere else.

I want to disagree with the point that the sooner the points expire, the less they are worth unless you are under a 30 day deadline. I have seen plenty of rental requests for only a month and even a few days away. It is the renters that are smart when they say “Would you take 8.00” I had a few people try it and I just said “No, I am firm at 10.00” Some moved on and some didn’t.

I was trying to say that IMHO it seems that some people are afraid that they will not be able to move the points and will be stuck with them when this is just not the case. The only reason I rented my points this year was because I could not use them.

Also Kudos to Pete Warner. I am using some of the money to buy a sponsorship.

 

[d-r]

I continue to maintain that the "competition" for rentint points is not whether other dvc-ers are renting their points for 10 or 9 or 11 per point, but what cro is charing for hotel rooms. If people are paying $109 or $119 a night for the wilderness lodge or animal kingdom lodge, I'm not sure why they would pay more than 10 per point for dvc points. I can understand it a little for 2 or 3 bedrooms, and maybe for week day stays. But face it, as great as renting points can be for both the member and the renter, it is not as easy and as "safe" feeling as just booking the room through CRO and should come with a discount over the cost of getting a room through cro. Also, they've released codes for the spring break/Easter season. Though not as deep as the codes for the off-season, that is pretty unheard of and suggests to me that booking is relatively soft even during spring break.

Anyway, my point is simply that it is more complex than just comparing to what other dvc'ers are charging to rent the points. For a moment there, you are stepping into the world of renting resort accomodations, and frankly that has been a pretty soft world around Orlando, FL recently. The "competition" is CRO and all those el-cheapos off-property.

DR

 

[PamOKW]

I agree with your thoughts DR. As long as WDW is offering deals, that will continue to be competition for renters and will effect what people will pay. For the most part, they want a real deal if they are going to go the DVC rental route.

RcComputers encouragement to wait for a higher price is something to consider. It's all personal comfort level but it is good to have an idea of what the market is currently accepting.

 

[rccomputers]

I have never done the comparison until right here, and I don’t know what discounts are currently being offered so I need some help in that area, but I just did two rentals. Without giving dates away just seasons, here is the comparison to rack rate.

OKW 1 Bedroom = $ 385 per night + 11% Tax
5 night Stay = 1925.00 + 211.75 = 2136.75

Rental of 100 Points no tax = 1000.00

Renter Saved = 1136.75 OR 53.20 %

Boardwalk 1 Bedroom Preferred View = $ 435 per night + 11% Tax
5 night Stay = 2175.00 + 239.25 = 2414.25

Rental of 180 Points no tax = 1800.00

Renter Saved = 614.25 OR 25.45 %
*Note No rate on the DVC website for a preferred view yet we pay more points!

Average amount saved = 39.325%

That IMHO is a h*** of a discount!

If someone wants to post some of the discounted rates, I will add them to the comparison.

It would be nice to see just how our rentals actually compare to the CRO.

 

[PKS44]

I had an unfortunate situation where I had family cancel at the last minute...I had a studio reservation that I wanted to rent since the points would go into a holding account if I did not..(that means I had less than 30 days) For the first few days I had no offers of significance..some offered to buy the points at $3 a point!!!...I eventually rented the reservation...but look at it as the general public does--- there is no saftey, no cancellation allowed in this circumstance, no maid service ....and you can cheaply rent an on-site room (which for the general public is what they are comparing your reservation to)--and they get maid service and all the safety, etc....I was happy to get rid of the reservation quickly and get $8 a point rather than nothing or have to try to use them in a holding account...shortly after I closed the deal I was offered $9 a point, but I could not have known that was going to happen and by waiting I may have had nothing....It all depends on the individual circumstances and the market...I have heard on ebay of $15 a point...

Paul

 

[WDWguru]

RC, I tend to agree with you that points are more valuable than most of us realize (and the potential renters at times, judging from the $3 offer - I hope you laughed!). However, the comparison to rack rates at DVC I don't think are the most accurate way to figure it.

Most people who look into renting, from my experience lurking on the resort board over the last three years, kind of stumble into it. They start by looking at deluxe or sometimes moderate resorts, or may just have a party large enough they need multiple rooms. Many don't even realize the DVC resorts exist or that they CAN rent them from CRO direct.

The cost comparisons are skewed when you start comparing one or two deluxe rooms to a 2-bedroom unit, for example. IMHO you throw in more intangibles. You may have a lower rate for one room than a DVC unit, or it may be more for two rooms. There may be discounts to factor in, which aren't always available. BUT I think the main point to stress to renters is the vast difference in accomodations. The addition of a kitchen and washer/dryer makes the DVC MUCH more attractive to most folks than even the deluxe rooms. Not to mention the extra living space, even when considering two rooms versus a 2-bedroom.

Bottom line I guess is I agree points are worth more, but even a direct price comparison can't show the whole value. It's comparing apples to oranges, and the advantages of the orange are what we really need to show potential renters.

 

[Jen D]

It is a discount, although it is worth noting the discounts are most significant for Sunday-Friday stays, and adding the weekend levels the playing field a bit.

I'm just speaking as a renter here. It is great you were able to move your points, but I have to figure it must be harder with a close expiration date. I think $10, what I consider the going rate, is fair for plenty of lead time. I wonder about the people whose points are expiring in 45 days and are still trying to fetch $10 a point (there is a message on there now like that.) I also wonder about the fellow whose points are expiring in 45 days who is only asking $5. Everyone will jump at the lowest rate on the board no matter what, so if you want your points claimed first, why not just go a little below the lowest rate (I think the next highest rate is $8, why doesn't he ask $7?)

I want to disagree with the point that the sooner the points expire, the less they are worth unless you are under a 30 day deadline. I have seen plenty of rental requests for only a month and even a few days away. It is the renters that are smart when they say “Would you take 8.00”

They are worth less only because savvy renters know that owners are in a use or lose situation. If someone is willing to pay $10, fine, but people who have been around the boards know if they want to pay less for points, the discounters are likely those with a soon expiration date.

Just my point of view. If I was looking to rent points for Christmas 2003, and to book now, I would pay the market rate (which seems to be $10.) But if I am looking for a quick jaunt late Febuary, I'm going to FIRST scour the board for fire sales, people with points expiring 2/03. Because often, they are out there. Are the points literally "worth" less? Well, take a beautiful, handblown Christmas ornament. $30 at the store up until 12/24. On 12/26, it is still the same beautiful, lovingly crafted ornament, but I won't pay $30 because as a savvy buyer I know the store has to rid itself of the inventory, and I wait for a sale. (Then again, I may pay full price on the day after Thanksgiving because I'm afraid it will be sold out after Christmas. The problem with those fire sales is I wonder if you can get the reservations you want or need on such short notice.)

I'm not sure what is going through the head of a guy who charges $5, except that he just wants to move them now. But those sellers come along so rarely, I doubt they really harm people who are trying to get a "fairer" rate. Does it increase renters to expect a deal? Well, perhaps, but as you said, rc, some people offered you $8 and you held firm, and in any case you rented the points anyway.

To me as a renter, the scariest thing about the "deep discounters" is often the poster is an unknown with only one post on the board. Paying $10 feels okay when it is going to a well-known Dis'er with a history on the boards.

 

[WDWguru]

Originally posted by Jen D
They are worth less only because savvy renters know that owners are in a use or lose situation.

This is not always the case, however. Plenty of people just decide not to go one year or want the extra income for something else. The folks renting points aren't necessarily going to lose them if they don't rent them. Depending on timing, they can be banked forward or they can simply decide to use them. Yes, there are folks who have banked or borrowed and are in a "stuck" situation, but I would guess those are not the majority.

For certain times of the year (holidays) you have to book at the 11 month window, so for people wanting to rent those times, those points can still be cancelled and banked or used elsewhere for several months. Most renters aren't planning as far ahead as owners and aren't aware of booking windows, so if they want a sought-after time, they're dealing with someone who likely has current points that are completely flexible. Obviously this isn't the majority either and most will fall somewhere in between. But to assume that everyone renting is in a "use or lose" sitation is far from the case.

 

[Jen D]

bviously this isn't the majority either and
most will fall somewhere in between. But to assume that everyone renting is in a "use or lose" sitation is far from the case.

I agree, you're right; I should have made myself clearer. I was responding specifically to rc's statement that points that are expiring soon are assumed to be worth less and he didn't see why that was the case. When a person seeking to rent points says "points must be used by X date", and the date is three months away, I make the assumption it is use or lose. I wasn't talking about just anyone trying to rent out their points.

 

[rccomputers]

I must say that I did not consider someone having banked or borrowed points and having them expire. In my case I knew I was not going to use my 2003 year points. Saved enough to bank to 2004 and rented the rest. I could have banked them all but this helped pay for our other plans.

My main issue is not with the people that have to “fire sale” their points. I might do the same thing if I needed to cash out fast or loose them in 30 days. If you spent time looking on the board, I am sure you could scour the board and fine someone looking in the window you have your points available.

Problem is I see posts with points in the same option as mine. Not banked or borrowed current use year. It seemed the logic was that they had to undercut the “other guy” or all the business would go to the other guy. When all they had to do was wait, the other guy would sell out, since points are a limited asset to each owner, and then their points would rent too.

 

[jazyjewel]

Hi, I am very new to reading about the DVC. I am curious about something, and I am sorry in advance if I offend anyone because I know nothing about this. I have looked an can stay At the Carribean beach resort for $119 per night (cash)the days I want to go down. But when I go check the DVC points it is 25 for 2 nights and 45 the other two nights.... that equals 140 points or $1400 in points if rented at $10 per point. Is that how that works? If so, why would anyone want to do that when they can pay $476 cash? Please help me, I don't know if I am missing something here. Thanks!!
Julie