Resale Purchase vs. Point Rental - Infrequent Visitors

[bwbuddy5]

I used to feel that for those of us who visit WDW every 5 years or so that renting points when needed (or even cash reservations through Disney) was more practical than buying a DVC resale. But, I may be changing my mind.

It appears to me from what I've read that most DVC owners have little problem renting their points when necessary. So, would it not make more sense to go ahead and buy resale, rent the points in the years we don't visit WDW to cover the cost of annual dues, but then have the advantage of our own DVC points when needed (rather than renting every trip)?

Make sense? Feel free to shoot holes.

 

[Deb & Bill]

If I only went every five years or so, I wouldn't even think about DVC. I'd just get Disney's best deal and live with it.

 

[zavandor]

I agree with Deb. Renting points it's not a big hassle, expecially if you go through a broker, but DIY it's not a bg deal either. It's convenient if you want to skip one year or two, or you have used slightly less for a while.
However, if you don't plan to use your points most of the time, I think there are better ways to invest your money that would you you a better return (and use that money to book your vacation with cash).

 

[crisi]

Renting has the advantage of flexibility - want BWV for F&W - its possible with rental points and almost impossible if you don't own BWV. How about VGF? Plenty difficult at seven months - not often an issue if you have the ownership window. (There are exceptions both ways). And cash offers even more flexibility - cancel your vacation, rebook a different resort - have LOTS of choice - easiest with cash.

 

[HereIGo]

I don't think I could be convinced for less use than every other year. Based on the spreadsheets I've done, it would take so long to recover your upfront cost that it would not seeM worth the hassle of having to rent out the points. I never viewed DVC as a financial investment, more as pre-paying for my vacations and encouraging me to take those family vacations regularly. I figured it would take about 7 trips to begin "saving" money by purchasing vs renting. If I'm only going every 5 years, that's 2050 before I break even. You hade better make sure you get a newer resort that doesn't expire before then!

 

[Dean]

I used to feel that for those of us who visit WDW every 5 years or so that renting points when needed (or even cash reservations through Disney) was more practical than buying a DVC resale. But, I may be changing my mind.

It appears to me from what I've read that most DVC owners have little problem renting their points when necessary. So, would it not make more sense to go ahead and buy resale, rent the points in the years we don't visit WDW to cover the cost of annual dues, but then have the advantage of our own DVC points when needed (rather than renting every trip)?

Make sense? Feel free to shoot holes.

I could see it being workable for a very specific person, situation but in general life's too short to fool with it for this situation. Even at a firm every 3 yrs, I think it's extremely questionalbe. It is unlikely to save anything and the added control for every 5 yrs is not enough to justify the purchase. If I were going to do this, I'd just buy something to rent out then use it occassionally, say 150-250 pts a year. What most people would do trying to go this route is buy a very small contract and just rent enough to not lose points. But what they don't realize is they'll almost always be working with a large % of banked/borrowed ponts which adds considerable risk. And they'll always be balancing the UY, banked/borrowed points etc. Best case scenario, one's savings long term is likely to be no more than a couple dollars a point. When prices were lower the risk was less and the upside more but it still didn't make much sense. Here's how I'd run the numbers in this situation. Let's assume a 2 BR at 300 points every 5 years and selling after 3 trips. Up front at SSR roughly $12500 with yearly dues around $800 a point. Sell for maybe half in 12-13 yrs, maybe more or less but there's no way to know what will happen, it was almost half a few years ago with a longer RTU. So over the course of 13 yrs you'd pay around $10500 indues plus inflation. You'd rent out maybe 1000 points at $13 a point so around $13000 but one would have lost out on the earnings of the up front investment which would be more. One of the issues with a 5 yr plan is you can actually invest most of those dollars in long term investments, I'd use an 8% return after taxes for about 80% of it.

The other question is what are you doing off years, would a different timeshare or similar option cover you and give you the possibilty of trading to DVC even if you're not OK with off property. For me personally at every 5 yrs I'd do a different timeshare, either Marriott, Wyndham, Bluegreen or Worldmark. For one, likely Marriott because it'd give me better other options even if it doesn't routinely exchange with RCI (does II). Another option might be a good RCI points option that's none Orlando. Then even if not successful in trading, you'd still have rental and cash options.

 

[mmackeymouse]

We have been considering buying DVC, even though we probably only won't visit but once every 1 1/2- 2 years.

Even at every 5 years, as long as you can break even, and you should be able to pretty easily, I would definitely do it.

In addition to the financial benefits when you DO go, there are DVC discounts you'll receive. Special tours and events and tickets you'll have access to. If you can swing the up-front part of it financially, I say go for it!