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

[VGCgroupie]

Hahah your tag, too! Poor @veginaz, working hard to keep DIS minds out of the gutter. As a pin lover, I think your pic is great

hahah yes trying hard. I was wondering how anyone took me seriously with a username like that.

I love your new avatar! Especially the ear post!

And I guess I really am old (meaning naive), because I didn’t see anything but a strange username until someone pointed out that it might be a sneaky one.

thanks! Me too even when pointed out I still didnt get it... when I did..

There’s a really unfortunate username that was probably fine back in the day but now I read it and have to remind myself, that person is just telling us they are a perfectionist…

Wish I could change it. I have a really good (clean) one in mind.

 

[VGCgroupie]

BrianLo---$140-$14671-100-CCV@WL-Dec-200/23, 100/24, 100/25-seller pays MF '24- sent 6/3


Hello my name is Brian and I am ready to start recovering from addonitis.

Please do not let me back in this thread again: (unless I get a small RIV normalized for 100, Poly normalized for 120 or VGC normalized for 170’s).

Talk to me about normalized price. I thought I got a bangin deal on my VGC but when it was added to the rofr site I was at #10 and my normalized seem high. I really thought I would be higher up in ranking. I was 232 for 153 pts seller pays MF for 24. 153/24 and on. My CCV Im in the #4 spot. Is normalized about extra points and not about seller paying any fees?

 

[Tatebeck]

Talk to me about normalized price. I thought I got a bangin deal on my VGC but when it was added to the rofr site I was at #10 and my normalized seem high. I really thought I would be higher up in ranking. I was 232 for 153 pts seller pays MF for 24. 153/24 and on. My CCV Im in the #4 spot. Is normalized about extra points and not about seller paying any fees?

I think it does take it into account. Mine was #2 on the list and I got free 2023 points and regular 2024 points at a slightly lower price, with the same use year where you got 0 2023 points and free 2024 points. Also a slightly smaller contract but they don't take that into account on the website. So the difference was basically 1 year of points/dues and 7 dollars per point. I think it's just very competitive in the top 10. Especially since most people are more likely to report when they get a good deal. From what I've seen VGC going for I think you definitely got a great deal for what it's worth!

 

[CastAStone]

Talk to me about normalized price. I thought I got a bangin deal on my VGC but when it was added to the rofr site I was at #10 and my normalized seem high. I really thought I would be higher up in ranking. I was 232 for 153 pts seller pays MF for 24. 153/24 and on. My CCV Im in the #4 spot. Is normalized about extra points and not about seller paying any fees?

DVCROFR is one person’s opinion on how to value each aspect of a contract. It may not match yours or mine exactly.

 

[VGCgroupie]

DVCROFR is one person’s opinion on how to value each aspect of a contract. It may not match yours or mine exactly.

Me and my husband could not agree on how to value the per point paid. We agreed to disagree but still buy it.

I think it does take it into account. Mine was #2 on the list and I got free 2023 points and regular 2024 points at a slightly lower price, with the same use year where you got 0 2023 points and free 2024 points. Also a slightly smaller contract but they don't take that into account on the website. So the difference was basically 1 year of points/dues and 7 dollars per point. I think it's just very competitive in the top 10. Especially since most people are more likely to report when they get a good deal. From what I've seen VGC going for I think you definitely got a great deal for what it's worth!

Thanks! it’s likely due to it having no 23 points then.

 

[AstroBlasters]

Thank you! Now I actually have a 2 bedroom portfolio to be that strange poster gyrating between Duo Studios and 2 bedroom units on alternating trips.

I go onto these boards as silly stress relief. Please know that I never mean to offend even if I have a difference of opinion.

 

[Tatebeck]

Me and my husband could not agree on how to value the per point paid. We agreed to disagree but still buy it.

Thanks! it’s likely due to it having no 23 points then.

Actually it was even closer as I misspoke. We got free 2024 points like you, not 2023, so the difference was just 7ish dollars per point I think

 

[CarolynFH]

Wish I could change it. I have a really good (clean) one in mind.

Check the Technical Support forum or post a question there. It is possible to change your user name. I know of at least one poster who has done it.

 

[BrianLo]

Talk to me about normalized price. I thought I got a bangin deal on my VGC but when it was added to the rofr site I was at #10 and my normalized seem high. I really thought I would be higher up in ranking. I was 232 for 153 pts seller pays MF for 24. 153/24 and on. My CCV Im in the #4 spot. Is normalized about extra points and not about seller paying any fees?

Sorry I was indirectly borrowing a word from that website, but not the actual values of it. It seems a bit wonky and I don't understand what they are calculating. Case in point I have two CCV's at 140, but this second one has an extra year of points and no 24 maintenance fees. So I'm not sure why it's normalized a dollar worse than my other contract (maybe the other one being 50p makes up that behind the scenes math).

Mostly what I meant is that I'm stripping three years worth of free points and making my own Magical Beginnings x3. In the same way some calculate their direct prices on a pp basis with magical beginnings baked in.

It also helps me a little for capital gains if I ever sell.

PS - your CCV was great and literally what inspired me ha ha.

 

[Massachusetts]

Talk to me about normalized price. I thought I got a bangin deal on my VGC but when it was added to the rofr site I was at #10 and my normalized seem high. I really thought I would be higher up in ranking. I was 232 for 153 pts seller pays MF for 24. 153/24 and on. My CCV Im in the #4 spot. Is normalized about extra points and not about seller paying any fees?

A top 10 deal is a very good buy! The info is all self reported to disboards. So if you take a step back and figure disboards only reports maybe 10-20% of all resale your deal maybe closer to top 5% or better of all VGC resale.

 

[VGCgroupie]

Sorry I was indirectly borrowing a word from that website, but not the actual values of it. It seems a bit wonky and I don't understand what they are calculating. Case in point I have two CCV's at 140, but this second one has an extra year of points and no 24 maintenance fees. So I'm not sure why it's normalized a dollar worse than my other contract (maybe the other one being 50p makes up that behind the scenes math).

Mostly what I meant is that I'm stripping three years worth of free points and making my own Magical Beginnings x3. In the same way some calculate their direct prices on a pp basis with magical beginnings baked in.

It also helps me a little for capital gains if I ever sell.

PS - your CCV was great and literally what inspired me ha ha.

Super smart. Double thanks!

 

[HyperspaceMountainPilot]

Mostly what I meant is that I'm stripping three years worth of free points and making my own Magical Beginnings x3. In the same way some calculate their direct prices on a pp basis with magical beginnings baked in.

It also helps me a little for capital gains if I ever sell.

PS - your CCV was great and literally what inspired me ha ha.

I’m not entirely sure why (probably the Chardonnay) but the expression “making my own Magical Beginnings” really made me smile. I’ve always thought it was quite the euphemism for “sacrificing a year’s worth of points to cut down upfront costs” but I 100% support your decision to create your own MB— it’s a fantastic deal and had me perusing resale aggregators when I saw it, I bet you could direct transfer points here for even more $/pt than Disney gives you with the latest round of MB.

 

[BrianLo]

I’m not entirely sure why (probably the Chardonnay) but the expression “making my own Magical Beginnings” really made me smile. I’ve always thought it was quite the euphemism for “sacrificing a year’s worth of points to cut down upfront costs” but I 100% support your decision to create your own MB— it’s a fantastic deal and had me perusing resale aggregators when I saw it, I bet you could direct transfer points here for even more $/pt than Disney gives you with the latest round of MB.

I don't need no stinking developer, I can make my own magic!

I do get the concern about Disney's forced sacrificing the value upfront. I legitimately cannot use the points anyways. But, I could use a cruise to the Philippines and another Caribbean, which is exactly what this will be used for! Then it's on the docket for actual use.

Let's call it forward-looking addonitis?

 

[walt34]

The discount rate is impacting it that much to me now. I wouldn’t pay more than ~$85 for a fully stripped BCV contract (which I realize means I’m not getting one, but, ya know what, good!)

Would you mind explaining your reasoning? And if you value current and next use year points so highly, does this not strangely assign a very low value to the remaining 14-15 years?

 

[HyperspaceMountainPilot]

I don't need no stinking developer, I can make my own magic!

Enthusiastic agreement with this. It used to be common wisdom even 8 months ago that loaded contracts were undervalued because most resale contracts were purchased by people who only considered per point price, but (at least where I’m looking) great loaded deals like this are few and far between, especially on a very in demand resort with long expiration and favorable point chart.

I do get the concern about Disney's forced sacrificing the value upfront. I legitimately cannot use the points anyways.

I don’t think Magical Beginnings is forced sacrificing so much as a wild misnomer. Miserly Beginnings just doesn’t have the same ring to it. Marshmallow Test Beginnings? Whatever it’s called, I think it’s a good option for those of us who already have trips planned (whether offered by DVD or as a DIY), although it’s probably helped Disney get away with more price increases for their direct points.

 

[CastAStone]

Would you mind explaining your reasoning? And if you value current and next use year points so highly, does this not strangely assign a very low value to the remaining 14-15 years?

I don’t think so. How many years are left on a BCV contract? Let’s say it’s an April UY. If it’s fully stripped the next points are coming in 2026, so there’s 16 years of points left.

If I use a discount rate of 5% to account for how much more money I could have if I used the money I’d spend on the contract instead to make more money, the first of those years, 2026, has to be discounted twice before I even get them, so it’s worth 0.9025% as much as points I have in hand. 2027 points are worth .8574% as much, and so on. Year 16 winds up being worth .42% as much as points in hand would be.

Combined the 16 years are worth 10.1 years at a 5% discount rate.

So points in hand to me are therefore worth about 1/10th what the remaining future points are worth to me.

I could hear an argument in today’s economic conditions for using a discount rate anywhere from 3.5% to 6.5%, and that will of course impact how you’d value things. I think perhaps the plurality of people on these boards don’t use a discount rate at all when valuing contracts because it makes the math look better, but as someone who sat through too many corporate finance classes, I just can’t do that.

 

[walt34]

I don’t think so. How many years are left on a BCV contract? Let’s say it’s an April UY. If it’s fully stripped the next points are coming in 2026, so there’s 16 years of points left.

If I use a discount rate of 5% to account for how much more money I could have if I used the money I’d spend on the contract instead to make more money, the first of those years, 2026, has to be discounted twice before I even get them, so it’s worth 0.9025% as much as points I have in hand. 2027 points are worth .8574% as much, and so on. Year 16 winds up being worth .42% as much as points in hand would be.

Combined the 16 years are worth 10.1 years at a 5% discount rate.

So points in hand to me are therefore worth about 1/10th what the remaining future points are worth to me.

I could hear an argument in today’s economic conditions for using a discount rate anywhere from 3.5% to 6.5%, and that will of course impact how you’d value things. I think perhaps the plurality of people on these boards don’t use a discount rate at all when valuing contracts because it makes the math look better, but as someone who sat through too many corporate finance classes, I just can’t do that.

Interesting. So you are discounting the points as if they were money. I've always modeled with a depreciation model, with a linear depreciation where cost of capital is taken into account for the not yet depreciated capital. The difference between (dues + depreciation + cost of capital) to rental points is what I apply TVM to.

Does your model take inflation into account in the right way? If the points would equal the same monetary value over time, you'd certainly be right. But the value points deliver is not quite a fixed value, is it?
This is how I did it so for: The value the points deliver is the difference between dues and point rental costs (this assumes availability of points, which is not always given for BCV, but let's ignore this for the moment). If point rental costs rise with inflation (not sure about this - they tend to stay stable for several years and then jump) and dues rise according to recent history, I see the nominal value points provide rise over time (which can than be discounted).

Another interesting aspect seems to be taxes. If I invest money on the capital market, I pay capital gains taxes (probably more than you do because of the country I live in but for you it is probably also not zero). I don't pay taxes on DVC holidays. So I'd probably go a bit lower than the 5% you assumed for the discount rate with your model.

Feel free to shoot holes into this argument - I'm always learning.

 

[CastAStone]

Interesting. So you are discounting the points as if they were money. I've always modeled with a depreciation model, with a linear depreciation where cost of capital is taken into account for the not yet depreciated capital. The difference between (dues + depreciation + cost of capital) to rental points is what I apply TVM to.

Does your model take inflation into account in the right way? If the points would equal the same monetary value over time, you'd certainly be right. But the value points deliver is not quite a fixed value, is it?
This is how I did it so for: The value the points deliver is the difference between dues and point rental costs (this assumes availability of points, which is not always given for BCV, but let's ignore this for the moment). If point rental costs rise with inflation (not sure about this - they tend to stay stable for several years and then jump) and dues rise according to recent history, I see the nominal value points provide rise over time (which can than be discounted).

Another interesting aspect seems to be taxes. If I invest money on the capital market, I pay capital gains taxes (probably more than you do because of the country I live in but for you it is probably also not zero). I don't pay taxes on DVC holidays. So I'd probably go a bit lower than the 5% you assumed for the discount rate with your model.

Feel free to shoot holes into this argument - I'm always learning.

I have simplified my approach after starting with a very complicated approach initially that modeled estimated dues inflation and hotel price increases and broader inflation and a bunch of other stuff. The spreadsheet was so complicated that when I stopped using it for a year and came back to it I couldn’t make sense of what I’d done (I of course didn’t bother to label anything).

So I now just use long term S&P 500 CAGR (9%) minus my best guess of future Disney hotel net price inflation, which should track to rental rates % increases over the long haul. It is a close enough approximation of what I had come up with the first time. I compare to the lowest priced way to reliably get a 1 bedroom, which is not always renting, both on reliability and price.

It’s not perfect and if there’s a fundamental flaw please point it out, but it’s something I can quickly gut check things against.

 

[CastAStone]

Oh, and yes, I’m not worried about capital gains. Most of my savings are in tax protected accounts and if I get to the point where that’s not true, I probably won’t be concerned about saving a measly few thousand dollars.

 

[Jshep105]

Jshep105---$130-$10316-75-CCV@WL-Apr-0/23, 150/24, 75/25-seller pays MF ‘24- sent 6/1, passed 6/19

Jshep105---$127-$14204-100-CCV@WL-Apr-0/23, 100/24, 100/25- sent 6/1, passed 6/20