RTU Expiration -- Good or Bad Thing?

[freewill]

Hi All,
Wondering what people's opinions are generally about the RTU expiration factor for DVC -- as compared with non-expiring timeshare options? I mean, do DVC owners view the time-limited nature of their ownership as a good thing or a bad thing, or something in between?

We're comparing DVC with HGVC but don't either (or any other timeshare for that matter), and HGVC ownership doesn't expire whereas DVC does. It's such a fundamental difference that I'm trying to get my head around it as I do my diligence. For instance, I'm wondering what's likely to happen to DVC resale values as we closer to their expiration dates.

I've seen some scattered opinions in a few threads during my early research but thought I'd try to poll folks in a new thread separately.

Anyway, thanks!

 

[OKW Lover]

I'm not familiar with the term "RTU".

As far as the expiring nature of our DVC investment goes, in our case it was a simple matter of recognizing that was one of the limitations of what we were buying. It wasn't a good thing or a bad thing. It just was.

 

[chalee94]

Hi All,
Wondering what people's opinions are generally about the RTU expiration factor for DVC -- as compared with non-expiring timeshare options? I mean, do DVC owners view the time-limited nature of their ownership as a good thing or a bad thing, or something in between?

i don't think most DVC owners consider other timeshares. they trust disney but tend to be suspicious of the whole "timeshare" thing otherwise.

and if you go with disney, to a certain extent: "it's the mouse's world and you are just lucky to live in it." disney would never let you own the property outright so a long-term lease is going to be your only option.

We're comparing DVC with HGVC but don't either (or any other timeshare for that matter), and HGVC ownership doesn't expire whereas DVC does. It's such a fundamental difference that I'm trying to get my head around it as I do my diligence. For instance, I'm wondering what's likely to happen to DVC resale values as we closer to their expiration dates.

i own DVC and also a non-branded timeshare. DVC expires and the other does not. DVC will eventually be worth nothing and i bought the other timeshare for a dollar on ebay, so it basically already is worth nothing.

when the DVC resorts are 50 years old or so, disney takes back the rights and gets to figure out what to do with the property. they might keep renting out the old buildings if they are still in pretty good shape or they could tear them down and start over. not my problem. when the contract expires, i don't owe disney anything and i don't own anything...based on my age and projections, that works out fine for me.

some people expect a sharp drop in resale values at about 20 years from expiration...no one knows for sure. all i can guarantee is that on Feb 1, 2042, my contract will be worth zero.

what happens when the HGVC resorts are really old? how expensive will they be to maintain? if maintenance costs go up signficantly and owners run for the hills, how much more expensive would it become for the remaining owners? and how competitive will they be against the shiny new resorts that will be built in the next couple of decades?

a lot of timeshares go for $1 because their annual dues/maintenance costs more than the typical rental value for the same period. there can be a lot of uncertainty and it can be challenging to organize enough owners to accomplish much of anything as a group. marriotts and hiltons have held their value decently in the "perpetuity timeshare" category but that's not a guarantee of anything going forward. i enjoy using my non-DVC timeshare but i know if i needed to get rid of it, things will be more complicated than selling DVC.

there are trade-offs, but i do like the certainty of the DVC end point. sometimes it's better to lease than to buy...

 

[supersnoop]

In my opinion, the 50 year RTU coincides perfectly with major maintenance and renovation. With a normal timeshare, you'd be on the hook for replacing stucco and major structural components of the buildings, which would be charged as a special assessment. I think the RTU contract limits the overall risk of major excess expenses.

 

[disneynutz]

Most buy DVC because they want a discounted room at Disney, not because they want to buy a timeshare. We don't expect to keep our contracts full term or close to it, so for us it really isn't a comparison.

Bill

 

[Minniesgal]

I don't view the expiration a dates as a good thing or a bad thing I view it as a none thing. We bought newer resorts to vacations with our kids and during our retirement. Ill be 90 when my first contract expires I'm not sure I'll care.

 

[Dean]

Hi All,
Wondering what people's opinions are generally about the RTU expiration factor for DVC -- as compared with non-expiring timeshare options? I mean, do DVC owners view the time-limited nature of their ownership as a good thing or a bad thing, or something in between?

We're comparing DVC with HGVC but don't either (or any other timeshare for that matter), and HGVC ownership doesn't expire whereas DVC does. It's such a fundamental difference that I'm trying to get my head around it as I do my diligence. For instance, I'm wondering what's likely to happen to DVC resale values as we closer to their expiration dates.

I've seen some scattered opinions in a few threads during my early research but thought I'd try to poll folks in a new thread separately.

Anyway, thanks!

My opinion on RTU is it's a mixed bag. For a desirable option like DVC it's likely bad overall but not as much so as some hardcore regular timeshare people will tell you. The problem is it erodes inherent value and given the assumption that Disney and DVC will continue to be desirable, it ultimately costs us money and future options for our heirs. Once you get under 30 the negatives start to escalate and we're there with the 2042 locations already.

 

[freewill]

Thanks everyone for your thoughts. I think the challenge for us is that we happened to attend an HGVC presentation before learning much about DVC -- and so the baseline understanding/expectation I had (thanks to Hilton's timeshare salesman) when beginning our DVC education was that timeshare interests didn't expire. (Of course, I understand that he highlighted that fact as a way to try to elevate HGVC in our mind over DVC.)

So now we're trying to assess and understand everything, slowly. And it does begin to make sense that the 50-or-so year term of a DVC interest could be a positive in sparing DVC owners from maintenance costs associated with updating older buildings/infrastructure -- when compared with HGVC or other permanent timeshare interests.

Really appreciate your thoughts and this board. Thanks.

 

[DenLo]

After a while for regular timeshares no one wants to by a timeshare that is looking at expensive remodeling or the place is in sorry shape. And many owners are wondering if it is really worth continuing to pay the dues. You can see these type of timeshares for sell for anywhere from $1 to $300.

I think the 50 year expiration works for us. I don't know if the next generation will be able to afford the dues after we are ready to quit paying so it might turn out that our estate just sells the points. And since we were in our late 50's when we purchased BLT, I really doubt we will be around for the expiration date.

 

[nkosiek]

I can give you two POVs. From an owner standpoint, my wife and I did consider it when we bought. Sure, we bought a few years after BLT opened, but still having it for 45+ years means we'll have it until we are in our early 80s. We thought that'd be good enough. If we still want to go after that point we'll figure something out.

As a survivor of owners of two different non-DVC timeshares who have since passed away, I'm quite glad to have one less "hassle" to leave to any survivors. Trying to sell timeshares I knew nothing about was proving to be impossible, and time-consuming. Thankfully, my uncle informed me that he had the rights for one of them once my dad passed away. That solved one problem, but the other still remained. I was paying the maintenance fees and my dad still had a mortgage on the other I was dealing. After a year I made the decision to just turned it back over to the company instead of having the heirs/estate keep paying on it. None of us wanted it and trying to sell it was proving to be difficult as it was a not-so-much in-demand resort with limited value. We definitely lost money on it (from what my parents bought it for) turning it over but it saved money on listing it on ebay as well as the maintenance fees. Granted, this has nothing whatsoever to do with RTU but instead about demand. DVC's @ WDW seem to have kept up their demand and that is a good thing. As people have said, no one knows what it will be like 20+, 30+, 40+ years from now but I'm hopeful that it will still be "worth the hassle" if something happens to my wife or I earlier than hoped for.

I'm hopeful Dean will chime in on this topic as his knowledge on timeshares has proven to be invaluable to a number of people on these boards.

 

[Chuck S]

I like the RTU factor. That way, my heir isn't stuck trying to sell a timeshare he may not want, and he's not on the hook for fees forever. And it will be his option if they want to extend OKW after 2042, if he can afford it. I'm in the process of adding his name to the deed now, but it is taking a while because my Mom was on the deed and she passed a couple of years ago.

 

[peabody58]

The RTU clause was one of the reasons we went with DVC. The 2062 BLT RTU works well for our long-range plans.

We retire in 2 years (age 58) and we will then have close to 8 years worth of expected use with our AP's and NE+ tickets. At that point (age 64) we will reevaluate our 'need' to still get a Disney fix via DVC, or decide to sell our BLT contact (still lots of years left) and use the proceeds/MF savings for another 10+ years of vacations.

 

[supersnoop]

The RTU clause was one of the reasons we went with DVC. The 2062 BLT RTU works well for our long-range plans.

Just to clarify, the BLT RTU is 2060.

 

[crisi]

When we bought, we figured we'd either sell when the kids got to be college age. Or we'd hang onto it for our own retirement. We are nearing the first point....and our thinking has changed a little. But back then, the thinking was that we'd get ROI in the first ten years of ownership (done) and any resale value at that point was gravy. If we kept it for retirement, it would expire about the time we wouldn't be up for traveling, and if we wanted to travel past that point, we could get a cash room.


I really don't want to leave a timeshare to my heirs. Especially an older one.

 

[DougEMG]

I bought DVC because I wanted to save money on staying onsite at WDW, so RTU only comes into it so far as saying that the eventual value of any DVC is $0. For me, even with the value of the DVC unit going to $0 I end up saving money, so I purchased.

As others have already said, owning a timeshare outright is not an advantage if I can rent the same room for less than the maintenance fees.

 

[jillmc40]

I have 3 timeshares. One I bought when I was super young (22) and super stupid. I did no research, it sounded great that i could go anywhere anytime and I did it. It is a studio in the poconos. Flash forward to being married with 2 kids and that doesn't work for us at all. However, the maintenance is low and we have actually had some great trips from it (to other places) by being very patient and very flexible. It was only a 20 year contract. I am happy to see that one go. Only a few more trips left!

We also have a 2 bedroom Marriott. That is for-ever.....I hope my kids aren't cursing me when I am gone.

Dvc will last me until I am 86. I hope on my 86th birthday I am sitting in the lounge of the gf having a drink listening to the band play. If my kids want a Dvc they can buy one with a longer life, I think I will have gotten my money's worth at that point

 

[freewill]

Thanks again everyone. It's really helpful to hear different viewpoints.