ROFR- what is the big deal?

[kamgen]

Okay....I see a lot of talk about making it through ROFR. What I dont understand is what is the big deal? I mean, who cares who decides to buy the resale as long as it sells, right?? Can someone explain why people get so worked up about it making it through ROFR? Thanks!

 

[Metsoskil]

Okay....I see a lot of talk about making it through ROFR. What I dont understand is what is the big deal? I mean, who cares who decides to buy the resale as long as it sells, right?? Can someone explain why people get so worked up about it making it through ROFR? Thanks!

If you are the seller, your logic is correct. If you are the buyer, not so much. If Disney exercises ROFR, you are back to square one. You have now wasted a month in the process of trying to get your points, which can affect future vacation plans, etc.

 

[keys2kingdom]

Okay....I see a lot of talk about making it through ROFR. What I dont understand is what is the big deal? I mean, who cares who decides to buy the resale as long as it sells, right?? Can someone explain why people get so worked up about it making it through ROFR? Thanks!

I think you're looking at it only from the sellers perspective. It's the buyers who are sweating it out and worrying. The seller is getting a sale regardless.

 

[Laxmom]

As a buyer who was previously ROFR'd I can tell you it is a big disapointment. Some people feel that buyers shy away from vacation properties (nonDVC) with ROFR. I don't feel that applies to Disney but the disapointment when you fail ROFR is huge!

 

[Dean]

Even as a seller I felt a sense of loss when one of the 3 contracts I've sold was ROFRed, but as a member or seller I realize there are potential benefits even though DVD's reason for ROFR is for their protection and not mine. As a member and potential seller there are good and bad components of the ROFR though somewhat less so on the bad side for Marriott or DVC as for say Westgate.

 

[kamgen]

Thanks. I didnt realize the difference in perspective. Appreciate the info!

 

[Terri2007]

As a buyer who was previously ROFR'd I can tell you it is a big disapointment. Some people feel that buyers shy away from vacation properties (nonDVC) with ROFR. I don't feel that applies to Disney but the disapointment when you fail ROFR is huge!

I certainly can understand a buyers disappointment from a failed contract: we had one fail the day of closing when the seller could not afford to pay-off their loan. However, a buyer that stays away from a timeshare because of the possibility of ROFR being exercised by the developer is not doing their homework. The fact that Disney exercises this rite routinely is one of the more important reasons I considered DVC to be a reasonable place to park some of our money - it protects the price of the property and as an owner, this is paramount, IMHO. I was recently looking at higher end timeshares such as Starwood and Marriott - and could not believe the horrors that owners have on the resale market - I saw many going for 50-80% of the original price ....Scary.

Of course, regardless of the "good investment" vibe I have for our family, I get to go to WDW every year....priceless.

 

[Dean]

I was recently looking at higher end timeshares such as Starwood and Marriott - and could not believe the horrors that owners have on the resale market - I saw many going for 50-80% of the original price ....Scary.

Given that for most timeshares marketing is roughly 50%, this is about right. For the properties where Marriott has ROFR they generally will exercise that right at around 60% of the CURRENT sales price. 50% is not a horror story, many are 3-5% and some you couldn't give away if you tried.

 

[Terri2007]

Yes right you are Dean. Sorry, I meant 50-80% off the sales price. OT- I have seen you write with a lot of knowledge regarding the timeshare market. Would you give your opinion as to whether you consider DVC to be the timeshare that holds the greatest amount of value? Your thoughts.... TIA

 

[Dean]

Yes right you are Dean. Sorry, I meant 50-80% off the sales price. OT- I have seen you write with a lot of knowledge regarding the timeshare market. Would you give your opinion as to whether you consider DVC to be the timeshare that holds the greatest amount of value? Your thoughts.... TIA

IMO, DVC will hold about as good a value as you can expect from anything compared to developer purchase early in the course of RTU, likely better than most. But there will come a time when the value will start to decline, likely once the particular resort goes under 30 years or so remaining. But I think the days of buying retail and making money are gone or nearly so. And I think that a number of other timeshare options are actually a better long term value even if the criteria is resale price compared to what you paid, assuming you get a good price resale on the front end.