Riviera vs. 2042

[Akck]

We currently aren’t DVC owners, but are planning on taking a tour on our upcoming trip. As part of the analysis, we have to consider as many scenarios as we can think of and plan accordingly. One scenario is selling after 10-15 years. With about 10 years remaining, will the 2042 resorts have a reasonable resale value compared to Riviera with resale restrictions?

 

[Great3]

I think you are pretty much asking the same question that was asked in this thread: https://www.disboards.com/threads/better-future-resale-value.3755889/

There, I said, In 5 years, I lean towards Beach Club (2042). 10 years, I would probably still lean towards Beach club. But in 15 years time, I will probably lean more towards Riviera. But that's just my guess, I am sure the future will surprise us somehow.​

 

[Paul 55555]

I think the key is will Disney offer an extension to the 2042’s? If they do then it’s definitely the 2042’s.but no one knows if they will.

 

[Marionnette]

We currently aren’t DVC owners, but are planning on taking a tour on our upcoming trip. As part of the analysis, we have to consider as many scenarios as we can think of and plan accordingly. One scenario is selling after 10-15 years. With about 10 years remaining, will the 2042 resorts have a reasonable resale value compared to Riviera with resale restrictions?

No one knows what to expect resale prices to be for any resort 10 years from now. Heck, we have no idea what the could be next month! They could all tank in price if DVC succeeds in destroying the resale market.

 

[_auroraborealis_]

I think the key is will Disney offer an extension to the 2042’s? If they do then it’s definitely the 2042’s.but no one knows if they will.

Odds are no, however. Several of the issues with the OKW extension are baked in to how the points were declared, and there is no difference for BWV or BCV in that regard.

 

[katandmouse]

IMO we will see the 2042 resorts drop to follow more closely projected savings vs cash stays (so, cash stays for the years remaining minus MFs minus some extra savings).

RIV resale, who knows? It depends a lot on what DVC does with the restrictions - do they ever roll them back? Do they double down and change the booking window for resale? Resale prices could stay strong, or they could tank to pennies on the dollar, and it wouldn't surprise me either way.

Personally I think, no matter which resort, plan that it is truly a sunk cost and you may not get anything back.

 

[Sandisw]

Personally. I would not buy in to DVC with the expectation that it will have a good resale value, especially if you are expecting to only own around 10 years.

IMO, resale value shouldn’t be part of the equation. With RIV, and the resale rest4ctiiona, the pool of buyers will be less,

But, the fl,or could drop out of all DVC since there are more restrictions and who knows what restrictions could be in play in 10 years for those 2042 resorts that could severely limit its value.

 

[Akck]

I think you are pretty much asking the same question that was asked in this thread: https://www.disboards.com/threads/better-future-resale-value.3755889/

There, I said, In 5 years, I lean towards Beach Club (2042). 10 years, I would probably still lean towards Beach club. But in 15 years time, I will probably lean more towards Riviera. But that's just my guess, I am sure the future will surprise us somehow.

Thanks for the link. It’s sometimes hard to come up with the right search terms to find a good link. At this point, we’re uncertain about what we want to do. Direct vs. resale, new resorts vs. 2042 or later years, location vs. location, and so forth. Heck, we may go on this trip and be totally turned off by WDW (not likely, but the wrong guide won’t help matters). We just want to cover anything we can think of and I like to analyze every what-if scenario I can think of.

 

[Akck]

Personally. I would not buy in to DVC with the expectation that it will have a good resale value, especially if you are expecting to only own around 10 years.

IMO, resale value shouldn’t be part of the equation. With RIV, and the resale rest4ctiiona, the pool of buyers will be less,

But, the fl,or could drop out of all DVC since there are more restrictions and who knows what restrictions could be in play in 10 years for those 2042 resorts that could severely limit its value.

I’ll disagree about resale value shouldn’t be part of the equation, simply because resale is a fact of ownership. I’ll also agree with you in that scenarios should include $0 resale value. Likewise, while none of knows what will happen in the future, it’s better to have an idea what the numbers look like should plans be cut short.

 

[jarestel]

With all of the data hoops people jump through to justify DVC purchases, it would be extremely difficult to image tons of people lining up to pay premium prices for BCV/BWV/BRV in 10 years. The decision is essentially, 10 years at the 2042s or 20 - 40 years at Riviera or the newer resorts. Once demand begins to fall due to the perceived "lack of remaining value" at the 2042s resale prices will as well. Folks who are looking to invest their hard-earned money in timeshare futures would be better served looking at the non-2042 resorts in order to serve that purpose.

 

[CanadaDisney05]

Personally I think, no matter which resort, plan that it is truly a sunk cost and you may not get anything back.

The way I personally like to do my analysis is do three separate analysis side by side. Worst Case, Best Case, and Most Likely. Worst case would include getting zero back on resale. Best case may mean break even or even a small profit, most likely would mean selling back the proportionate usage if that makes sense.

Proportionate Usage: I buy for points for $100 resale at SSR. 35 years left on the contract. Sell in 10 years. In 10 years the value would be 25/35 x 100 = $71/pt

If you plan on selling in 10 years and assume it will be worth zero at that time, your analysis will likely lead you to the wrong result, and therefore a poor decision. However, you should have an understanding of what that scenario will look like, and can you afford it?

 

[Ruttangel]

Personally I would go for something inbetween the new and 2042 properties, (e.g. PVB or AKV) but you seem to be considering only Epcot resorts?
If that's the case this becomes pure speculation as what happens with Beach/Board/RIV are uncertain.

I can't see a scenario where contracts are worthless as that would mean that the dues are higher than equivalent rental costs

 

[_auroraborealis_]

I can't see a scenario where contracts are worthless as that would mean that the dues are higher than equivalent rental costs

Nearly worthless for sale, potentially. Once you include the capital expense the ROI is going to start getting messy.

 

[CLE2WDW]

Nearly worthless for sale, potentially. Once you include the capital expense the ROI is going to start getting messy.

Agreed with the word “messy.” The combination of points expiring in 2042 and everyone trying to use every last point been 2038 and 2041 is going to create a very interesting market dynamic. The 2042s will basically have a minimal resale value (if any) and some people will be stuck paying dues on points they will not be able to use. Messy indeed.[/QUOTE]

 

[ziravan]

If you buy BCV today, and have a newborn baby today, that child will graduate college about the time BCV expires.

In the meantime, that child will have lifelong memories of staying at BCV.

Buy where you want to stay.

If you find that you want more years, add on at a different resort. I’ll be 73 when my BCV contract expires. IF I still want to go to WDW after that, my Poly contract doesn’t expire until I’m 98.

 

[Sandisw]

I’ll disagree about resale value shouldn’t be part of the equation, simply because resale is a fact of ownership. I’ll also agree with you in that scenarios should include $0 resale value. Likewise, while none of knows what will happen in the future, it’s better to have an idea what the numbers look like should plans be cut short.

i

I think your explanation of running it at $0 was more what I meant. If one could not handle the loss of a sale at a low resale value., then I’d be hesitant to advise buying

When we bought in 2009 at BLT, I looked at what would happen if we were forced to sell within 5 years at 50% value. We would break even compared to cash vacations with a discount . So that made us realize that if we had to sell for less than that the loss would equate to paying rack rate. Since we paid cash, we knew we’d take the risk and if worst case happened, we could sustain the loss.

 

[Akck]

Personally I would go for something inbetween the new and 2042 properties, (e.g. PVB or AKV) but you seem to be considering only Epcot resorts?
If that's the case this becomes pure speculation as what happens with Beach/Board/RIV are uncertain.

I can't see a scenario where contracts are worthless as that would mean that the dues are higher than equivalent rental costs

We’re thinking good Epcot access is a plus for our ages, but won’t be an overriding factor in any decision. DW thinks AKV is too isolated. PVB and CC are possibilities depending on the cost. Direct is a plus for the AP benefit, but becomes moot if we decide limiting trips to every other year.

 

[rg35]

Personally I think, no matter which resort, plan that it is truly a sunk cost and you may not get anything back.

I agree with this 100%. The money I spent on DVC is gone. If we decide to sell one day, good for us if it's worth something. If not, then we had a bunch of great vacations as a result of the purchase.

 

[Akck]

i

I think your explanation of running it at $0 was more what I meant. If one could not handle the loss of a sale at a low resale value., then I’d be hesitant to advise buying

When we bought in 2009 at BLT, I looked at what would happen if we were forced to sell within 5 years at 50% value. We would break even compared to cash vacations with a discount . So that made us realize that if we had to sell for less than that the loss would equate to paying rack rate. Since we paid cash, we knew we’d take the risk and if worst case happened, we could sustain the loss.

Currently, my number running utilizes rough numbers and a 0% IRR falls somewhere in the 5-10 year range assuming $0 resale. The 10-15 year range is a positive return. I’ll have to run the $0 resale scenario against the rack rate to find my lowest holding period as you did. Of course, I’ll refine my numbers should we decide to go forward with a purchase.

 

[CarolynFH]

I agree with this 100%. The money I spent on DVC is gone. If we decide to sell one day, good for us if it's worth something. If not, then we had a bunch of great vacations as a result of the purchase.

If I could double or triple Like this, I would.

We bought DVC to stay in larger, more comfortable accommodations on our WDW trips. We thought of it as prepaying for our accommodations as part of our monthly budget. Whether we could later sell for a profit was the furthest thing from our minds.