Their best customers are not DVC owners. Their best customers are DVC buyers.
That’s absolutely right. I’m sure there would be a good debate on this site regarding if people should be allowed to buy a 400 point contract and rent every single point out, every single year. To me, doing that violates the spirit of DVC. And people who were doing that just experienced the definition of “risk” in 2020.
You're forgetting about the opportunity costs on that 40k. You could make similar money to renting DVC by just throwing 40k in an index fund... so a $0 return year is a pretty big hit.
I don't think you understand my point. Timeshares aren't meant to be bought into with the intention of renting all the points out (i.e. to make money every year off them). That's what I mean by "the spirit of DVC". Renting now and again when the owner can't utilize the points is one thing, and precisely why Disney allows rentals. To think someone is going to use 50 years worth of points (for Riviera, for example) isn't practical, so renting is in place as an option. But for an owner to buy DVC knowing that they will rent the majority of those points to make money is, like I said, against the spirit of DVC (or any timeshare).
Exactly right. Anyone buying DVC as an investment got really bad investment advice.
So, this was us when we bought into DVC. We bought VGC at about $18,000 for 200 points. We were still paying about $2,500 per trip at value resorts at that time. The 200 points have allowed us to get up to two vacations a year on points alone of a similar length. So about $5,000 per year meant our break even was done very quickly, even factoring in dues and we got the previous use years points when we joined, so that made it even faster.
Except you can exchange through RCI for places outside of Disney, so not entirely captive.
I know a few years after we bought in, Disney had introduced a rule that at least one of the members on the contract had to be staying on a reservation every 3 years or something like that and if you continuously failed to do so they had the right to buy back your contract from what you paid. I haven't ever heard of that rule being eliminated, maybe I have missed something and it has been, I am not sure.
Yeah, you don’t need to be staying at a deluxe resort to see the value add up. I have enough points so that next summer we can do about two weeks at Aulani in a two bedroom. With four kids, I need at least two hotel rooms or a vacation rental to fit everyone. In Hawaii, that adds up fast even if you want to stay somewhere semi-nice.
And a good portion of potential direct buyers would turn resale with a gap like that.
I agree. We bought resale before restrictions and my math says after 6 trips we were ahead of the game.
Whoa...take a deep breath. I never said it was a legal term. It absolutely is my opinion. Replace "spirit" with "purpose" if that makes you feel better. The general purpose of a timeshare is that it is a way to save money on vacations. When you are talking to a DVC guide to buy a contract, do they every tell you that the points could/should be rented out every year to make money? Do they every tell you that "this is a great investment opportunity...you can rent out your points every year and make money on your contract"? No, they don't. Because that isn't the purpose of DVC or any timeshare (i.e. it goes against the "spirit" of what the timeshare is meant to be). Like you said, the owner has the right to use it as he/she sees fit as an owner. But when things happen that negatively impact renting points (like covid in 2020), those that bought DVC strictly to rent the points can't be complaining because that's not the purpose of DVC. Or if DVC incorporated a rule stating that owners can't rent points two years in a row (for example), those same owners who bought DVC with the sole intention of making money off the rentals have no room to complain. And if they did complain I would roll my eyes. Because that isn't the purpose, or "spirit", of why to buy into DVC.
That's true. And, if you do, someone else will exchange back in and make use of that time---and that someone is likely to be a less-frequent visitor, and spend even more money while they are there. After all, they don't yet have three sets of mouse ears each, they haven't eaten in a character location recently, etc. etc.
Would it have some impact? Sure. How large is very much an open question though. There are plenty of timeshares that are worth at most a dime on the dollar once the ink on the sales agreement dries, yet those developers are still able to sell at a strong clip. The rest of the industry has demonstrated that you can have a robust sales operation without having a strong resale market.
In the timeshare industry, the cost of construction is usually about 20-30% the total cost of sales. (By comparison, marketing costs are 40-50% or higher). At $120pp it is probably much cheaper for Disney to build a shiny new resort rather than to re-acquire existing points. That's especially true because they already own the land on which that new resort will sit.
I never said that because I said it "made it so". I have never said that my opinion is fact. It is merely my opinion. Just like other opinions do not "make it so". That's what the majority of the comments on these boards are...opinions. I like when people on these boards have different opinions. It gives insight into different perspectives. No reason to get heated and say that someone's opinion is "total crap", as you said about mine.
