Scared to death by the restrictions on resale pts thread

[Dean]

I don't buy that. I doubt if more than a small percentage of people taking tours even know a resale marketplace exists. The handful of prudent consumers who tour and then go home and do some research will learn about resale, but I'm sure most people who buy direct have no clue resale exists.

In addition, a pretty high percentage of direct purchasers require financing. Even at the current very high financing rates, many buyers simply don't have any other choice.

The most recent statistics I saw were a couple of years ago, and Disney was financing about 75% of their sales. I suspect that percentage is a little higher today. Unfortunately for both Disney and the purchasers, Disney is now eating many of those loans and taking back the points.

The thing killing DVC direct sales is the economy, and that's not going to get much better any time soon.

Jim, the internet is killing them with all the availability of information. Plus, even if it takes away 5% of sales, that's likely more than the difference between success and failure. Of course the economy plays a large roll.

 

[Brian Noble]

the internet is killing them with all the availability of information.

Except that it's not killing other timeshare developers. Wyndham still sells full-freight deeds at a pretty good clip, despite the fact that it is essentially free on the resale market. There are only three possible reasons: (1) new purchasers are bamboozled by the (meaningless) VIP "benefits" that accrue only to developer purchases, (2) they don't look quickly enough to discover they've been had before the rescission period ends, (3) they don't want to know, because they feel good about being able to make their purchase.

We often discount group #3, because most of us here are pretty rational about the whole thing. But, when you talk to rank-and-file owners, the "pride of ownership" is a big reason why they buy---and the price to do so is an important factor in that.

 

[Dean]

Except that it's not killing other timeshare developers. Wyndham still sells full-freight deeds at a pretty good clip, despite the fact that it is essentially free on the resale market. There are only three possible reasons: (1) new purchasers are bamboozled by the (meaningless) VIP "benefits" that accrue only to developer purchases, (2) they don't look quickly enough to discover they've been had before the rescission period ends, (3) they don't want to know, because they feel good about being able to make their purchase.

We often discount group #3, because most of us here are pretty rational about the whole thing. But, when you talk to rank-and-file owners, the "pride of ownership" is a big reason why they buy---and the price to do so is an important factor in that.

Brian, I think there are real differences. No other timeshare gets the main stream coverage on the net that DVC does with the tie in to other Disney sites including DIS and similar. Plus those other timeshares are far more aggressive both in sales and in distinguishing their product between resale and retail. Even then, Marriott has had to come out with a new product and Bluegreen has had to ramp up their differentiation between qualified and non qualified points. Were Disney to take similar approaches, the rest would be less important.

 

[Brian Noble]

Possibly. But type "wyndham timeshare" into google, and you get at least two hits on the first page that make the economics of the situation clear. Anyone with at least a vague familiarity with the internet can do that much.

That said, Reason #1 (the differentiator matters) could be at play, as well.

 

[Dean]

Possibly. But type "wyndham timeshare" into google, and you get at least two hits on the first page that make the economics of the situation clear. Anyone with at least a vague familiarity with the internet can do that much.

That said, Reason #1 (the differentiator matters) could be at play, as well.

Often the VIP benefits are not meaningless though they are usually over priced. The VIP benefit with BG if you're at the top level is dramatic.

 

[coastiewifern]

For prospective buyers, I think there are several strategies that make sense right now.

1. For a prospective buyer who is committed to purchasing direct no matter what, the debate over the rumors is irrelevant.
2. For a prospective buyer who is considering resale vs. direct, if you believe existing owners will be grandfathered in (which I think is very reasonable...if anything at all happens), consider your options and make whatever decision you think benefits your family. Now is obviously the advantageous time to buy resale.
3. For a prospective buyer who is considering resale vs. direct and is fearful that the rumors will apply to existing resale owners (i.e. NO grandfathering), the best strategy is to do nothing until mid-January or so. There's no advantage to buying direct now, and there is an advantage to waiting until you know whether there is any shred of truth in the rumors.

Obviously, anyone who believes any of the rumors should carefully consider if, in fact, any of the rumored changes would have any actual practical effect on their DVC ownership. I haven't seen anything yet that would affect me, but I bought DVC to use at DVC resorts.

So we are looking at an add on resale and would be concerned it didn't have the same benefits of our original DVC direct contract. I was told by resale company today that if I put in an offer today it would not likely close until the end of Jan? That is where my concern lies. What if I put down my 10% and while waiting to close all the rules change? That would not be cool

 

[coastiewifern]

Just recieved an email from *********** with their news. They also have a thread about the resale restrictions. New news posted yesterday - #428 post - is that Disney is not going with the restrictions. Anyways, it is an interesting thread to read. We'll see if anyone here posts about this from their "credible source".

?? anyone else seen this confirmed news?

 

[Sammie]

?? anyone else seen this confirmed news?

Regardless of the source until it is announced or not by DVC it is still rumor.

 

[dizfan]

Regardless of the source until it is announced or not by DVC it is still rumor.

Completely agree.

 

[momhmmx2]

I would hope for the grandfathering if restrictions are placed on resale points...IF Disney wants me to consider adding on points DIRECT through them I would only consider doing that IF BOTH my (current) resale points would be considered equal to my added on points via DVC.

Just my 2 cents worth

 

[wdrl]

So we are looking at an add on resale and would be concerned it didn't have the same benefits of our original DVC direct contract. I was told by resale company today that if I put in an offer today it would not likely close until the end of Jan? That is where my concern lies. What if I put down my 10% and while waiting to close all the rules change? That would not be cool

When you make your offer, you could add a provision that you could back out of the deal prior to closing without penalty if certain key elements in the Master Declaration of Condominium are changed by Disney. I'm not sure how you would word that provision, but it might be as simple as saying "As of the date of closing, the resale points will have the exact same rights and privileges as points bought directly from DVD and can be added to my existing membership account. In the event both items cannot be satisfied, the buyer can withdraw the offer and receive a full refund of all deposits." Not all sellers would want to accept such a qualified offer, but everything is negotiable when it comes to the resale market.

 

[tjkraz]

?? anyone else seen this confirmed news?

There never was any news. All Disney entities--including DVC--consider dozens of projects and policy changes per day, most of which are abandoned.

Right now this entire discussion ranks right up there with a 5th theme park and extending the monorail throughout Walt Disney World. We have no idea of knowing how close any of those policies came to being adopted. Most aspects--like limiting buyers to their Home resorts and not grandfathering long-time members who purchased resale over a decade ago--seem ridiculous to even entertain.

Other timeshares have been doing tiered benefit programs for years and frankly it would be irresponsible of DVC management to simply ignore the possibility. But when or if anything is ever implemented, and what form it would ultimately take, remains to be seen.

Rumors are fun but these days you could build a house from all the dead wood coming out of Disney "insiders." Just because someone spots a memo on their boss' desk doesn't mean that Disney is about to start adding countries to Epcot, lands to Animal Kingdom or radical new guidelines upon DVC owners.

 

[dmoore22]

There never was any news. All Disney entities--including DVC--consider dozens of projects and policy changes per day, most of which are abandoned.

Right now this entire discussion ranks right up there with a 5th theme park and extending the monorail throughout Walt Disney World. We have no idea of knowing how close any of those policies came to being adopted. Most aspects--like limiting buyers to their Home resorts and not grandfathering long-time members who purchased resale over a decade ago--seem ridiculous to even entertain.

Other timeshares have been doing tiered benefit programs for years and frankly it would be irresponsible of DVC management to simply ignore the possibility. But when or if anything is ever implemented, and what form it would ultimately take, remains to be seen.

Rumors are fun but these days you could build a house from all the dead wood coming out of Disney "insiders." Just because someone spots a memo on their boss' desk doesn't mean that Disney is about to start adding countries to Epcot, lands to Animal Kingdom or radical new guidelines upon DVC owners.

Disney advertises DVC as the "Disney Vacation Club timeshare" and "Timeshare Ownership with a Difference." Since 1991 timeshares have been addressed in the Fair Housing Act under HUD and the various court cases dealing with timeshare sales, interstate commerce and the commerce clause. One restriction under FHA is "cannot set different terms, conditions, or privileges for sale or rental of a unit." Since Disney does have offices and sales agents in several states they will have to deal with individual state regulations in addition to federal regulations under FHA if they make any changes.

 

[tjkraz]

Disney advertises DVC as the "Disney Vacation Club timeshare" and "Timeshare Ownership with a Difference." Since 1991 timeshares have been addressed in the Fair Housing Act under HUD and the various court cases dealing with timeshare sales, interstate commerce and the commerce clause. One restriction under FHA is "cannot set different terms, conditions, or privileges for sale or rental of a unit." Since Disney does have offices and sales agents in several states they will have to deal with individual state regulations in addition to federal regulations under FHA if they make any changes.

I don't necessarily see where HUD would prohibit Disney from making some of the changes discussed. HUD anti-discrimination rules are specifically geared toward equality regardless of "race, color, national origin, religion, sex, familial status (including children under the age of 18 living with parents or legal custodians, pregnant women, and people securing custody of children under the age of 18), and handicap (disability)."

Other timeshares have VIP programs with exclusive benefits for direct buyers so certainly Disney could find a way to do the same. Some of the more controversial aspects like holding buyers to their Home resort would obviously come under greater scrutiny. I have my own doubts about the legality of that. But they could surely limit many perks/benefits to direct buyers, add extra fees to resale and so on.

 

[keishashadow]

I would hope for the grandfathering if restrictions are placed on resale points...IF Disney wants me to consider adding on points DIRECT through them I would only consider doing that IF BOTH my (current) resale points would be considered equal to my added on points via DVC.

Just my 2 cents worth

Many of us, thinking ourselves savvy buyersbefore the recent point restructuring made things challenging) initially bought small resale then added on @ multiple resorts over the years thru DVC directly in order to enjoy the 11 month window/banking strategy. Quite a few elected this option to save up & pay (gasp!) cash vs financing.

We've plodded along & managed to reach or surpasse the total number of points most traditional direct purchase members have in their accounts without going into debt. Yet, will the stigma of being an initial resale buyer bite me, despite being financially prudent??? maybe

My points are all under a master contract number with the same UY and the majority of my points (75%) were purchased thru DVC directly after my initial resale purchase. Im not sure how DVC would be able to reasonably differentiate me from a 100% direct purchase member.

Yes, I paid less overall using this strategy but those who purchased early on back in the day also paid less per point, where do you draw the line? Does DVC base the decision upon total $$$s expended, length of ownership, or whatever abritary classification suits them to churn a direct sale and risk alienating existing non-traditional owners?

 

[dmoore22]

Other timeshares have VIP programs with exclusive benefits for direct buyers so certainly Disney could find a way to do the same.

Actually Disney already does does this. It's not that different from how Marriott Timeshare Club promotes their direct purchase program. Disney varies these from time to time but they are similar, eg. financing terms, no need to pay points on the loan, and other carrots they dangle. Timeshare membership such as Hilton and Marriott are sold as either a deeded real estate contract or a right to use services contract. DVC is the first of its kind deeded timeshare with right to use offerings which others, ie. Hyatt, are imitating.

That being said, Disney did lose a source of revenue from its ability to finance buyers, ie. selling the loans . . .

http://articles.orlandosentinel.com...2_1_disney-vacation-club-share-disney-profits

Right now this entire discussion ranks right up there with a 5th theme park and extending the monorail throughout Walt Disney World.

It is indeed a tangled web that the financial and legal minds will have to determine if the return is worth the effort to navigate. My son participated in the CareerStart Program where they were told a 5th Theme Park is in the works. The Theme is based on Disney Villains (how Ironic) and is 10 years off.

 

[JandD Mom]

Thank you for this very interesting and informative thread. I agree with most of what's been said about the complicated legal hurdles DVC would have to navigate to make such changes possible. DVC has been far too shrewd to implement such changes that would devalue its product in the many ways (legal, public relations, economic) by implementing such a plan.

However, by floating the rumor (which has been widespread and has caused panic among the many people who follow these things on the internet) DVC has accomplished that which would have happened with the changes - driving up interest in direct sales v. resales.

I think this sounds like the rumor a few years ago where everyone believed that DVC was going to restrict reservations for anyone but the owner so as to restrict rentals. That didn't happen except maybe for a small number of people.

 

[Brian Noble]

I wouldn't give Disney's lawyers so little credit---or DISboards so much.

 

[bwvmary]

Disappointing to hear that you had that experience. I have both resale and direct points, and they work the same way.

 

[JandD Mom]

I wouldn't give Disney's lawyers so little credit---or DISboards so much.

Not giving anyone any credit, and Disboards is not the only place where people get their information. There are other boards, they just aren't discussed here because they get blocked out.

As to the lawyers, you misunderstand the intent of the post. It's all about PR and creating that which is magical. Being embroiled in a major lawsuit over changes in one of their brands is not something Disney would take lightly since it would not help future sales or value. I am sure their lawyers have it, more than the thread posters do, but it's Disney PR that would have to manage the fallout.