Renting Points to Fund Resale Purchase Price

Ssplashhmtn

Earning My Ears
Joined
Sep 18, 2020
Hi - Fairly new here to the economics of resale purchases. I know that it’s common to buy a loaded resale contract, and rent out unneeded points. I’d use a broker. Are there any renters out there that could speak to the typical timeline and rental likelihood in the next 6 months? .... even if it’s just your best guess. Home resort in my case will be PVB or VGF, but I’d be interested in hearing generally how people assess ability to liquidate points via the rental market these days.
 

db24

Mouseketeer
DVC Gold
Joined
Mar 21, 2019
Hi - Fairly new here to the economics of resale purchases. I know that it’s common to buy a loaded resale contract, and rent out unneeded points. I’d use a broker. Are there any renters out there that could speak to the typical timeline and rental likelihood in the next 6 months? .... even if it’s just your best guess. Home resort in my case will be PVB or VGF, but I’d be interested in hearing generally how people assess ability to liquidate points via the rental market these days.
I would not decide to buy a contract with the expectation that your points will rent. You should look at it as just some bonus money if they do rent. Renting out points these days is far from guaranteed but if you put them up for a good price they have a decent chance to be rented.

I tried a rental broker a couple months ago and never heard anything from them. I eventually just rented my points on the rent/trade board here and my points rented in about 3 days. If you decide to put your points to rent on the rent/trade board here just make sure to read all the rules before you make a listing. They have a lot of rules you must follow to rent your points there.
 

CarolMN

DVC Co-Moderator
Moderator
Joined
Aug 18, 1999
Most of the rental brokers have a lot of confirmed reservations (offered at a discount) that they are trying to re-rent because of the pandemic. You'd be competing with all of those right now. You may or may not be able to rent your excess points without offering a discount over historical prices.

I wouldn't buy with that in mind, but YMMV.
 
  • Ssplashhmtn

    Earning My Ears
    Joined
    Sep 18, 2020
    I would not decide to buy a contract with the expectation that your points will rent. You should look at it as just some bonus money if they do rent. Renting out points these days is far from guaranteed but if you put them up for a good price they have a decent chance to be rented.
    Thanks - I may conclude the same. And if so, I’m not buying right now (I’m within my 10 day retract period). The economics don’t work well enough for me if the points don’t have value in the rental market. That talks me out of the market to be honest, and it’s what I was worried about.
     

    Sandisw

    DVC Forums
    Moderator
    Joined
    Nov 15, 2008
    Also be aware that with the pandemic, many owners and brokers are including language that covers another resort closure,

    One broker now requires an owner to return the money if that should happen.

    So, if you must get the rental income to make it work, I would not buy,
     

    crisi

    DIS Veteran
    Joined
    Feb 25, 2002
    And even without Covid - watch expiration dates. Even in good times points that expire in four or five months might not be worth much.
     

    Eldon32

    Welcome Home
    Joined
    Jul 1, 2019
    Thanks - I may conclude the same. And if so, I’m not buying right now (I’m within my 10 day retract period). The economics don’t work well enough for me if the points don’t have value in the rental market. That talks me out of the market to be honest, and it’s what I was worried about.
    Just out of curiosity; how many points were you planning to buy, use, and rent? I'd like to know the math behind the logic.

    Thanks!
     

    Cyberc1978

    DIS Veteran
    Joined
    Jul 19, 2016
    Depending the expiration of the points you need to rent, you might have difficulties renting them.

    I recently purchased a VGF contract with points I couldn't use before they expired end of May 2021. I have rented most at $18 pp and the remaining I asked that MS reallocated to other reservations that I also had to rent due to being unable to travel. Those freed up points I have now banked for next UY and I really hope that I will be able to travel in summer/fall of 2021.

    IF we are able to travel in 2021 then the family and I will have some nice vacations due the excessive amount of points we have banked into our 2021 UY. If not i'm forced to rent those too.

    It can be done to rent your points, and depending on your price that will be the kicker if it will be easy or not.
     

    Ssplashhmtn

    Earning My Ears
    Joined
    Sep 18, 2020
    Just out of curiosity; how many points were you planning to buy, use, and rent? I'd like to know the math behind the logic.

    Thanks!
    We have a 165 pt contract in the works that has all 2019 points banked into 2020, and also all 2020 points that just came online- September UY. We aren’t planning a stay before Sept 2021, and will use the 2021 points for that.

    The purchase price per point is higher than I want to pay, but if the points are rentable in the near term, I can get comfortable with it. There is a fair amount of time to rent them out I guess, but I’m trying to assess the ability to rent them out in the next 6 months or so. Seems like the market may have a lot more points than vacationers right now.
     

    Ssplashhmtn

    Earning My Ears
    Joined
    Sep 18, 2020
    Depending the expiration of the points you need to rent, you might have difficulties renting them.

    I recently purchased a VGF contract with points I couldn't use before they expired end of May 2021. I have rented most at $18 pp and the remaining I asked that MS reallocated to other reservations that I also had to rent due to being unable to travel. Those freed up points I have now banked for next UY and I really hope that I will be able to travel in summer/fall of 2021.

    IF we are able to travel in 2021 then the family and I will have some nice vacations due the excessive amount of points we have banked into our 2021 UY. If not i'm forced to rent those too.

    It can be done to rent your points, and depending on your price that will be the kicker if it will be easy or not.
    Thank you, thats great...I’d be really happy getting $18 pp on most of them. How long did it take, and did you use a broker or the rental board here? Sure hope you can travel by Fall 2021!
     

    RoseGold

    DIS Veteran
    Joined
    Jan 21, 2020
    I don't think now is a great strategy for this, because resale is so picked over. I do think this might work when the resale market softens, I would guess at least 2021.

    I think this is a reasonable strategy to plan on for a year or two, but I would not buy points to rent them long term.
     

    Sandisw

    DVC Forums
    Moderator
    Joined
    Nov 15, 2008
    Thank you, thats great...I’d be really happy getting $18 pp on most of them. How long did it take, and did you use a broker or the rental board here? Sure hope you can travel by Fall 2021!
    I am going to add that by the time this contract will close, you will be in the 7 month booking window for majority of the time those points are valid. That means the home resort won’t really matter and people may not be willing to pay for it if they could just as easy get someone else who is offering points from
    other resorts for less.

    Just keep that in mind!
     

    Cyberc1978

    DIS Veteran
    Joined
    Jul 19, 2016
    Thank you, thats great...I’d be really happy getting $18 pp on most of them. How long did it take, and did you use a broker or the rental board here? Sure hope you can travel by Fall 2021!
    It took less than a month and I did not use a broker. Maybe I could have done it faster but I could “afford“ to be picky about price as I could always shuffle points around if I couldn’t find a renter.

    If you take this route I’d recommend that you book one or more reservations that is desirable/hard to get. As @Sandisw mentioned when you are within 7 month window home resort window do not matter.

    Thanks I really hope that too.

    best of luck.
     

    Ruttangel

    Mouseketeer
    Joined
    Jun 21, 2013
    I kind of ended up in the same position as you last year, new contract and points I couldn’t use.
    The main difference was that I could rent at 11 month window and I have renters that are there are right now.

    I rented within 48 hours BUT things have changed dramatically since then.
    I opted to change the renters as the first family no longer wanted to travel.

    I also got really lucky that the rental wasn’t in the closed period, been a lot of sad stories this year.

    All that being said I actually think you will have no trouble renting, it’s 50th anniversary next year and although capacity may be somewhat reduced and there’s a lot of unused points in the system, I think there is pent up demand for happier, nostalgic times and so WDW could be in high demand

    Just my opinion, none of this will come without risk.
     

    Ssplashhmtn

    Earning My Ears
    Joined
    Sep 18, 2020
    I am going to add that by the time this contract will close, you will be in the 7 month booking window for majority of the time those points are valid. That means the home resort won’t really matter and people may not be willing to pay for it if they could just as easy get someone else who is offering points from
    other resorts for less.

    Just keep that in mind!
    Wow that’s a great point. The 2019 points (banked) expire August 31 2021. I was assuming we’d close and fund the account by year end, and have 8 months. But I guess it is cutting it pretty close?

    The good news is the 2020 points don’t expire until Aug 2022 if we bank those.
     

    Ssplashhmtn

    Earning My Ears
    Joined
    Sep 18, 2020
    It took less than a month and I did not use a broker. Maybe I could have done it faster but I could “afford“ to be picky about price as I could always shuffle points around if I couldn’t find a renter.

    If you take this route I’d recommend that you book one or more reservations that is desirable/hard to get. As @Sandisw mentioned when you are within 7 month window home resort window do not matter.

    Thanks I really hope that too.

    best of luck.
    Ok really sorry if this has been covered elsewhere, but I am not familiar with this approach to point rental. I’d make a reservation for a week during Spring Break or Thanksgiving for example in my name. Then post the trip, and once someone is interested, I can change the guest names on the reservation? Is it basically that simple?

    Learning a lot here. Really appreciate the input!
     

    Minniemoo15

    DIS Veteran
    Joined
    Jan 27, 2016
    This was pre covid (all bets are off these days...)

    Offer made early May 2019
    Points loaded in account end of June 2019

    We had 370 points to rent out.
    Immediately rented out 120 points that were expiring 1/31/20. I didn’t have much trouble renting them out - I discounted them quite a bit. I did this on my own via a FB group. I also browsed the site for open coveted reservations (ie: CCV at Christmas). I snagged those and they rented very easily.

    I then had 250 points that I banked right away. There was less pressure to move those quickly and I didn’t discount at all. I ended up renting these to a family friend.

    All in all, this was a great strategy for us as we got nearly 7000$ back. I wouldnt buy a contract in today’s climate with this in mind, but its a nice bonus.
     

    Sandisw

    DVC Forums
    Moderator
    Joined
    Nov 15, 2008
    Wow that’s a great point. The 2019 points (banked) expire August 31 2021. I was assuming we’d close and fund the account by year end, and have 8 months. But I guess it is cutting it pretty close?

    The good news is the 2020 points don’t expire until Aug 2022 if we bank those.
    I would figure mid December by the earliest to have the points for booking, so really, mid July through August trips would still be in the home resort time period....which tend to be less Busy for DVC.

    Any other trips would be within that 7 month booking window so while you have 8 months of dates, people don’t usually pay a premium for points 7 months or less because they don’t need to...

    In terms of spec renting...booking something hard to get and renting it as a confirmed reservation will probably not be that beneficial to you because there really won’t be any special events that fall within the dates for your 2019 banked points...and those were the ones I was referring to in my comments,

    IMO, I’d plan on $13 to $15/point max for those 2019 points if you decide to proceed.
     

    Cyberc1978

    DIS Veteran
    Joined
    Jul 19, 2016
    Ok really sorry if this has been covered elsewhere, but I am not familiar with this approach to point rental. I’d make a reservation for a week during Spring Break or Thanksgiving for example in my name. Then post the trip, and once someone is interested, I can change the guest names on the reservation? Is it basically that simple?

    Learning a lot here. Really appreciate the input!
    Yes that’s the way to go. It’s actually pretty simple. :-)
     

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