Sales slow at DL DVC? Al Lutz update

[bethy]

Al Lutz posted the following info about DVC at MiceAge.com: http://miceage.micechat.com/allutz/al061708a.htm

And speaking of using up the last of your home equity, it seems an increasing number of Southern Californians have done just that, right as the Disney Vacation Club tries to get them to shell out big bucks for a timeshare deal. DVC has seen record and undreamed of growth over the last 10 years at their properties in Florida and South Carolina, with many new DVC members back East using their home equity credit lines to fork over the tens of thousands of dollars in dues and fees needed when you sign the lifetime contract. While construction continues on the first small batch of DVC units on the West Coast located in the new Grand Californian expansion wing, the number of new accounts being signed up by DVC representatives is falling short of internal goals.

There has also been a softening in the market out in Florida, but the numbers here in California just can't get off the launching pad. They've recently begun trying to offer big discounts to Anaheim Cast Members, but with what Disneyland pays there are only a small handful of salaried folks in TDA who could even begin to afford the big down payment and recurring annual fees. Needless to say, the recent attempt by DVC to drum up sales amongst Disneyland Cast Members wasn't a big success.

The DVC units planned for the Grand are still on track, and there is enough demand from DVC owners back East to likely fill the small collection of units when they open in 2010. But the soft sales figures are making TDA take a second look at their long term plans for hotel and lodging construction in Anaheim.

I'm not sure how reliable he is but I am extremey interested in purchasing VGC and so slow sales would possibly up my chances of being able to buy in. What are everyone else's thoughts?

 

[Greg K.]

...I suspect a lot of people are keeping the wallets closed, waiting for things to improve.

A friend who works at the YC/BC told me just last week that things have slowed down there noticeably, and there is concern the economy is catching up with Disney.

 

[bbangel]

I would imagine many people in California want to wait and buy into a property in California. Buy where you want to stay as they say.

 

[Disney_Villain]

I'm not sure how reliable he is but I am extremey interested in purchasing VGC and so slow sales would possibly up my chances of being able to buy in.

Me too! (Crossing fingers that my October 2008 trip to Disneyland is timely as I can't phone in the purchase living where I do.)

 

[DisFlan]

If it's true, it's not surprising. If the economy IS catching up with Disney, the CMs are probably looking at job retention - and not likely to be shelling out for DVC.

I know a lot of you guys like to argue the point - especially where DVC is concerned, but I still think we're in for a big economic thump in the near future. It'll impact Disney and DVC, too. WDW bookings are already down for after the first of the year. More people are going to be less willing to pull out the checkbook where DVC is concerned. This board isn't representational - we're all pretty much confirmed DVC nuts and we're more likely to see it as a "buying opportunity". Not so the rest of the world. By this time next year, DVC's sales could be very weak.

I HOPE everything turns out rosey and fine for everyone (my kid works for Disney) - that the parks and resorts stay full and DVC sales fly out the doors......but I think there's a good chance it won't be.


DisFlan

 

[KAT4DISNEY]

How can there be slow sales when it hasn't even gone on sale yet? I didn't know that cast members got first shot at buying in?

 

[bethy]

I think by slow sales he is referring to DVC sales in general coming in through the California sales center. Mainly AKV and SSR sales (and probably a few others - maybe.) He also claims his source says that Florida sales are slowing also.

I agree that DVC right now at DLR would be a haaaard sell since there is no property there yet. That's why they implemented the Founding members program for VGC of course. But there are a lot of people like me who are hoping to call their bluff and try and buy VGC outright.

 

[Disneypirate85]

The economy is worsening I do not know anyone other then Congress and the President who would disagree with that
My DW and I have cut back here and there just small stuff but all in all have no plans as of right now to alter our Disney vacations. We work hard 50 weeks out of the year and like most ppl REALLY need to get away, And as long as Southwest's flights remain resonable we'll continue to fly! and if not then....

 

[bethy]

Disney Villian, I meant to ask you where you heard about sales possibly starting in October? I've seen that mentioned one other time and just wondered just how solid such a rumor might be. I really hope it's true b/c the timing would work well for me. I wonder if the Oct timing might also refer to when sales start for founding members.

This is the silver lining of the economy for me - that the price and demand for VGC might be a lower than anticipated. I will still luckily be in a position to buy and I will not be re-selling - probably ever!

 

[DisFlan]

Kevin Yee's article on miceage.com, "Sorry, We're Closed", is interesting, too. And scary. Low attendance leading to rotating park closures. Peak oil and WDW losing money if oil goes over $160. There's a DVC mention, too.

http://miceage.micechat.com/kevinyee/ky061008a.htm

DisFlan

 

[KAT4DISNEY]

I went to the actual micechat site and still get the impression that they are trying to say that DL is having a hard time getting CA people to buy at GCV since they are completely referring to taking a hard look at doing any more units there. And also the reference that east coast people at least will buy up the units. Does Disney know that they haven't actually started selling? At least that's why they've had a hard time selling to me!

 

[tjkraz]

Lutz does undeniably have sources. At times he comes across as a guy with an axe to grind, but I think it would be wrong to characterize that as being a consistently-displayed trait.

It's worth noting that the California sales office has been without any model rooms to show for about 6 months now. From the time the sales facility opened, they had full-size mock-ups of Saratoga Springs villas. Those units closed off several months ago as DVC began to convert them to models for the Villas at the Grand Californian.

According to people I've spoken with, sales were noticeably impacted when the models were lost. Understandably it's much harder to get people to take the plunge when they can't even view the finished product.

 

[ACDSNY]

I agree, without the models I'm sure DL is having a tough time selling. In addition, I think many are holding out for the VGC to go on sell.

Are the model still on schedule to open in Aug? We're heading down to DL Sept 7th and I'm hoping to view the models.

 

[bethy]

As a current non-owner I'm excited that the models are for VGC. I figure that if they're willing to spend the time and money building these (and taking the hit of lost opportunities by having the models closed in the meantime) then they must not be THAT confident that VGC will sell out to Founding Members within the first two weeks.

I believe what Al Lutz wrote about DvC because we went to a presentation in CA in April and could not for the life of us imagine buying into a Florida property when the only place we (mainly) want to repeatedly visit is DLR. My guide kept repeating to me that "points were points" in a slightly exasperated manner.

Though I will say if the point requirements for DLR rooms weren't so darn high (and presumably escalating over the coming years) then we probably would have pulled the trigger. I'm not at all married to having a villa with a full kitchen in DLR - I'm married to the prepaid luxury accomodations right in the heart of DLR.

 

[Longhairbear]

Kevin Yee's article on miceage.com, ... There's a DVC mention, too.

http://miceage.micechat.com/kevinyee/ky061008a.htm

DisFlan

Both Kevin and Al need to research DVC if they want to report on it. They make assumptions about how it works, and how it is sold. I had a good giggle over Kevin asking if members could sue because AK might close one day a week.

 

[stopher1]

Both Kevin and Al need to research DVC if they want to report on it. They make assumptions about how it works, and how it is sold. I had a good giggle over Kevin asking if members could sue because AK might close one day a week.

I read both of those stories as well, as well as the site for years, and you really do have to take some of what both Al and Kevin say with a grain of salt. They like to believe they are hard-core journalists, when really they are not. Sometimes they put forth good information, and other times, there's just too much conjecture in their opinions. When I read Al's piece, I felt he was trying to say, in a convoluted way, that Californians in general, don't want to have to buy their home resort in FL first, in order to get "first chance" to then buy VGC. In that mindset - I see his point, and agree that sales could be "down" - from a CA perspective. Especially when you factor in a lack of models to view... but to generalize it and claim that DVC as a whole is down, I think is misleading. Lutz does have his sources, but he certainly didn't back up this claim very substantially. The economy will most likely impact DVC purchases at some point, but I'm not sure we're at that point yet.

 

[tjkraz]

As a current non-owner I'm excited that the models are for VGC. I figure that if they're willing to spend the time and money building these (and taking the hit of lost opportunities by having the models closed in the meantime) then they must not be THAT confident that VGC will sell out to Founding Members within the first two weeks.

Much as I'd love to agree with you on that point, I wouldn't make too much of the model rooms foreshadowing poor sales. Disney has a habit of creating full-size mock ups for all of its resort rooms before construction details are finalized. In this case, it just so happens that the mock ups will be in a public location rather than sitting somewhere on an empty lot.

 

[gkrykewy]

Several months ago, I used this space to muse about "peak oil," a phenomenon of the world starting to run out of petroleum and the effect on prices in general and Disney World in particular. Disney had commissioned a study, and if oil stays above $160/barrel, Disney was advised to sell off the WDW parks and just collect a licensing fee. The parks would still eke out a profit, but not as much of a profit margin as Disney wants and the parks would be a drag on the company's bottom line.

Eek!

 

[bethy]

Much as I'd love to agree with you on that point, I wouldn't make too much of the model rooms foreshadowing poor sales. Disney has a habit of creating full-size mock ups for all of its resort rooms before construction details are finalized. In this case, it just so happens that the mock ups will be in a public location rather than sitting somewhere on an empty lot.

Thank you - this is a very good point. I hadn't thought of it that way and it does make sense. I've only been watching and considering DVC for about a year and so I very much appreciate the background you and so many other helpful people here have to contribute.

 

[emlutz23]

We were just in DL for 4 nights. We stayed on points in a one-bedroom villa at the DLH, which was great by the way! In the 4 days we spent in both parks, I only saw someone talking with a DVC rep at a kiosk once. Most of the time no one was even working at the kiosks. The parks were bery busy between kids out of school, Father's Day, and the opening of Toy Story Mania (what a great ride!). So there was no shortage of people to market to. But like other's have said, east coast DVCer's will keep those villas filled!