ROFR Thread April to June 2024 *PLEASE SEE FIRST POST FOR INSTRUCTIONS & FORMATTING TOOL*

[AstroBlasters]

Does that math even work? Are you clearing more (after dues and taxes) than you would in a treasury bond (even without calculating the fact that your underlying DVC ownership is declining towards zero eventually)?

I ask this without judgment and in hopes that somebody will help me convince myself that buying another 500 points actually is a smart investment. Of course, then I’d have to have the discipline not to blow them all on 3 days in a bungalow…

That would of course depend on a variety of factors including your buy in, the dues of the home resort, the price you can get for renting, and tax rate.

Let’s look at a SUPER simplified sample set of my AUL-S purchase this year:

PV = $120pp x 350 points
($18pp Rent -Dues at $7.34pp) 350= PMT
N = 38 because it had banked points
FV is obviously 0

Some people will get more or less for rent, but I think few will reasonably argue at $18pp being too high.

Assume rent keeps up with dues over time. I know it’s flaws… just keeping it simple.

I = 8.48%

UPDATE: Ran a NPV with a 2% delta in growth rates between dues and rent and it came out to roughly 4%.

 

[CastAStone]

Does that math even work? Are you clearing more (after dues and taxes) than you would in a treasury bond (even without calculating the fact that your underlying DVC ownership is declining towards zero eventually)?

I ask this without judgment and in hopes that somebody will help me convince myself that buying another 500 points actually is a smart investment. Of course, then I’d have to have the discipline not to blow them all on 3 days in a bungalow…

I’ve never been able to make it work. There is a cost basis for the point where it would work, but these a lot more risk (huge dues increases, rental point market flattening or declining, assessments, etc) than in other similar paying financial vehicles.

 

[Jimmy Geppetto]

I get that. I was just thinking about owing $15k+ in annual dues if my wages/income sources was in a different currency…. that is a whole different level of DVC risk.

To your point, this is on top of airfare prices, park tickets, cost of food…. all with currency risk…..

Welcome to my world!

But I quickly forget about it all while staying in my grand villa (especially at Aulani).

But come January… don’t even bring it up. I’m always on tilt when dues statements land.

 

[Jimmy Geppetto]

A price drop on a nicely overpriced 1000 point AUL contract with DVCRM today.

For those of you who want instant access to the 1000 point club.

 

[jcolvin5]

A price drop on a nicely overpriced 1000 point AUL contract with DVCRM today.

For those of you who want instant access to the 1000 point club.

And in my preferred Feb UY

 

[Nxsteven]

Now people understand why the 10% Costco discounted Disney gift cards was such a big deal for some of us last year!

While not 10% (nearly impossible to beat lol), my trick is to buy a Disney GC at Staples with a Chase Ink Cash card. It earns 5x rewards which gets a bonus when used towards travel (at least 25% bonus but you can easily get more). On my projected $3,600 in annual dues (still in ROFR on a BLT contract!), I expect to earn at least $225 back in travel.

This is without any discounts to the GCs and is available all year round!

 

[gskywalker]

A price drop on a nicely overpriced 1000 point AUL contract with DVCRM today.

For those of you who want instant access to the 1000 point club.

To buy that contract I would need to buy it at about $50 a point to make up for 2 years of points gone, the dues credit won't cover next year's dues(they will go up buy another 6% or so), money lost on investment of principle for 2 years, and discount for large point contract.

Edit: I can't help but wonder whether I offer $40 and see what happens, on the other hand there is no point because resale market would have an insta sale price above that.

 

[jstampfly]

Jstampfly

Jstampfly---$87-$26852-300-SSR-Sep-0/22, 0/23, 303/24, 300/25-seller pays MF '24- sent 5/29, passed 6/17

 

[Chili327]

That would of course depend on a variety of factors including your buy in, the dues of the home resort, the price you can get for renting, and tax rate.

Let’s look at a SUPER simplified sample set of my AUL-S purchase this year:

PV = $120pp x 350 points
($18pp Rent -Dues at $7.34pp) 350= PMT
N = 38 because it had banked points
FV is obviously 0

Some people will get more or less for rent, but I think few will reasonably argue at $18pp being too high.

Assume rent keeps up with dues over time. I know it’s flaws… just keeping it simple.

I = 8.48%

So is it worth it or not.? lol
I think my algebra skills (E=mc2) aren't cutting it here.

 

[Kailunkat]

update:
kailunkat---$164-$17874-100-PVB-Mar-0/23, 200/24, 100/25, 100/26- sent 5/18, passed 6/17

 

[HyperspaceMountainPilot]

So is it worth it or not.? lol
I think my algebra skills (E=mc2) aren't cutting it here.

I think translating it into non-math language, the takeaway is that it can do better then many low risk investment alternatives— but it is riskier with potentially catastrophic consequences (that are unlikely but still much more likely than the default on a treasury bond)— and the more DVC points you own the more concentrated the risk (generally considered a bad thing). This all assumes you have the self control not to blow all your “for profit” points… and then there’s the separate question of whether or not Disney ever starts enforcing its terms against commercial renting.

 

[stat]

So is it worth it or not.? lol
I think my algebra skills (E=mc2) aren't cutting it here.

In my mind I'd take that calculation and give it a nice big haircut for taxes, time, and effort, and factor in the future risks others have mentioned... so IMO the answer is no. I wouldn't buy points just to use them to cancel out my maintenance fees given the hassle, low return, and risks. There are better ways to use a pile of money. That said renting is a very nice, net positive backup plan / way to generate cash flow when needed even if it's not as great as current high yield savings accounts or the stock market.

 

[Chili327]

This all assumes you have the self control not to blow all your “for profit” points… and then there’s the separate question of whether or not Disney ever starts enforcing its terms against commercial renting.

Yes, that is the draw in the first place... the points are available "if needed".

 

[CWTC]

update:
kailunkat---$164-$17874-100-PVB-Mar-0/23, 200/24, 100/25, 100/26- sent 5/18, passed 6/17

Congrats…that was a long time to clear ROFR though!

 

[Kailunkat]

Congrats…that was a long time to clear ROFR though!

Thank you! I had 2 other PVB contracts taken back in May ROFR so I was pretty sure this made it when I didn't hear back. But it's nice to know for sure.

 

[jolynne28]

Congrats…that was a long time to clear ROFR though!

I was thinking the same thing. Guess they were taking a long hard look.

 

[AstroBlasters]

I was thinking the same thing. Guess they were taking a long hard look.

Ran out of money before the end of the quarter…..

 

[HyperspaceMountainPilot]

Ran out of money before the end of the quarter…..

Oooh, now I’m hoping we can convince @Galactic Reversal to calculate whether ROFR activity varies dramatically (one way or the other) in the last few weeks of the quarter.

Maybe they blew all their ROFR budget on OKW.

 

[VGCgroupie]

Oooh, now I’m hoping we can convince @Galactic Reversal to calculate whether ROFR activity varies dramatically (one way or the other) in the last few weeks of the quarter.

Maybe they blew all their ROFR budget on OKW.

I hope so... I got one sitting over there now. Day 18

 

[CWTC]

Oooh, now I’m hoping we can convince @Galactic Reversal to calculate whether ROFR activity varies dramatically (one way or the other) in the last few weeks of the quarter.

Maybe they blew all their ROFR budget on OKW.

I hope so - we are waiting on a BLT contract right now.