Selling DVC

[vicki_c]

I disagree that brokers are setting the price for resales. Just like I don't think that real estate agents are setting the price for houses, even though some of them also won't take your listing if they think you are listing too high. The market sets the price -- and brokers are responding to the market. The only floor really, at this point in time, is Disney's ROFR and even that is only a floor to the buyer, really, since the seller will still get their money from Disney.

You would never get all DVC sellers to agree to artificially keep prices higher by some agreement - aside from just being legally questionable (and I'm not a lawyer so I won't go there) it would never happen anyway.

 

[Brian Noble]

The only floor really, at this point in time, is Disney's ROFR

And this isn't really a floor, because we've all seen things pass ROFR this year that would never have passed last year. This number also responds to the market overall. Many have reported success by repeatedly offering lowball offers, and eventually getting one to pass.

Indeed, there is some economics literature that suggests that ROFR slightly depresses prices, because the rightsholder doesn't need to competitively bid on price for inventory. As I recall, the one place where ROFR doesn't exhibit this market pressure is in an inefficient (opaque) market, but the DVC resale market is anything but opaque.

This appeals to my intuition---nothing Disney does is for anyone's benefit but Disney's.

 

[BWV Dreamin]

I am not talking about a thousand or two, thats not unreasonable. At $70 per point several would still have to bring $3000+ to the table, and part of that would be to cover the commission.

I see your problem as two fold.....you are trying to sell a property that has abundant supply and little demand, and you have money left on the loan which will affect your asking price, according to you. The market (supply) is driving the resales prices of SSR, not so much the owners, and definitely not the brokers. If you truely want to sell, you can not ignore these indicators. You also need to try to SEPARATE your contract from the other SSR's. How can you do that? With price, points, and possibly UY. I still don't think UY bears as much weight as price and points. These are the only two factors that are going to lure buyers to your contract. You must determine how bad you want to sell and at what cost to you it is worth it due to the fact that you still owe money on the loan. If you had less supply and more demand with your particular resort, those factors stated could be adjusted to be more profitable to you. Its all about supply and demand.

 

[silmarg]

I can't really blame the brokers. They only make money when there is a sale. So listing a contract too high just makes for a frustrated seller and broke broker.

If you want to list for a high price. Go with Fidelity. They have 11 SSR contracts for sale for $100 or more and 17 under $70.

Their lowest contact for sale is $62.50 and the highest is $156.25 - these are not misprints.

 

[Jason@dvcstore]

Its all about supply and demand.

Jason

 

[pinnocchiosdad]

I am trying to get out of debt in four years. To do this I should sell my DVC.
I have a few questions and if anyone has the time to answer them I will be greatful.

1.Should I go through someone who specializes in DVC?
2.Does everyone charge 10% commision?
3. How long does it usually take to sell?

Thanks,
Gail

Wht not rent your points out over the next 4 years. That way your membership will generate an income, and at the end of the 4 years when you are hopefully debt free, you will still own your DVC membership.

 

[sdlong329]

Can you list your contract with multiple brokers?

A contract is only what you negotiate with the other party. Some states have different regulations regarding requirements within Real Estate Listing contracts ... though I believe timeshares may be slightly different. That being said, as an example, a broker can mandate 35% commission. That does not mean you have to accept that particular verbiage. Likewise, a seller has the ability to request an OPEN CONTRACT ... whereby, the broker is only paid if / when they procure a ready, willing and able buyer, who agrees to pay a price which you agree to accept (but the broker does not have to agree to an OPEN listing).

I do not sell timeshares, but am a REALTOR with 24 years experience. OPEN listings (for houses) is not unheard of ... but not very common in all markets. I would think the same is true for timeshares.

Should you find someone who will accept an OPEN listing, consider they might not spend too much $ on advertising, as there is no guarantee they will recoup their expenses (unless they charge you an advance fee). Then again, IMHO, most of the timeshare brokers utilize the internet to market multiple properties at the same time.

IMHO, if an OPEN listing contract is not prevalent in the marketplace, I would not engage in same. All of the above aside ... do what is best for your ultimate goal ... not necessaily what is the cheapest. The two aren't necessarily the same.

 

[MAGICX2]

Are you seriously accusing brokers of colluding to fix the price *low*? That makes no sense at all.

Not at all. Someone stated earlier that if I wasn't happy with what a broker was telling me at a particular company then go with someone else. I was just making a statement that they all suggest pricing it at this level.

 

[Brian Noble]

Well, for what it's worth, you can find someone who will tell you to list your contract at a (much) higher price. They will also tend to charge you an up-front fee, rather than a comission. Avoid them like the plague. Such companies don't make their money selling timeshares, they make their money *listing* timeshares---and they will tell you anything to get your business.

 

[MAGICX2]

I don't mean to come off sounding beligerant about this whole thing. I realize that it is all about supply and demand. Beach Club resales go for much more and sell way more quickly than SSR contracts because it is a much more desireable home resort. I just think it is a shame that things have gone this low in such a short amount of time. When we first looked into buying DVC you couldn't get a resale contract for much less than what Disney was selling them for directly. Add on to that the incentives that Disney provides, plus the almost too easy lending and it was a no brainer. No way I would buy direct from Disney today. I just feel that the cost of DVC membership has been driven way to low. I realize it has to do with the economy and when (if ever) that economy starts to rebound we will see a decreased supply of resale contracts. More people will be willing to keep their contracts instead of being forced to make a choice to sell.
I guess I just don't understand how the market took such a low dive if we are all aware of how much it costs initially? And it wasn't a slow decline either. It was fast and steep. It makes you wonder why ANYONE would by from Disney directly when they could have the same points for nearly half the cost?

 

[sdlong329]

I just feel that the cost of DVC membership has been driven way to low. I realize it has to do with the economy and when (if ever) that economy starts to rebound we will see a decreased supply of resale contracts. More people will be willing to keep their contracts instead of being forced to make a choice to sell.

It makes you wonder why ANYONE would by from Disney directly when they could have the same points for nearly half the cost?

Too low? I purchased for $51 per point in 1994. I added an extra 15 years to OKW a few years ago ... amending my expiration date from 2042 to 2057. I forget how much, but it was next to nothing (even in comparison to what I paid (per point)). EVERYTHING is cyclical, subject to ups and downs.

As for ROFR - Disney is in business to make a profit. If they can buy a contract, and resell it at a higher price - they will do it, and make a profit. If there is too much inventory to be purchased, they would (theoretically) be acting like a bank, holding a "foreclosed" contract, and have to pay the maintenance fees on their own. As a REALTOR, I appreciate the ROFR.

There are advantages of buying from Disney, as well as online. Whether it's finding a specific resort, specific # of points, or specific use year. Then again, if the consumer is unaware of, or afraid of the process, they're likely to purchase from Disney. I would not begrudge Disney for making a profit selling their own product.

I understand, but do not condone brokers who list at ANY price, just to make money on advance fees. Sometimes, certain sellers have to understand, the hard way.

 

[Brian Noble]

I just don't understand how the market took such a low dive if we are all aware of how much it costs initially?

The only thing that determines the resale market is how many are looking to sell, and how many are looking to buy---the original retail price is nearly immaterial. That's because...

It makes you wonder why ANYONE would by from Disney directly when they could have the same points for nearly half the cost?

...for the most part, timeshare purchases are impulse purchases, and the purchaser generally isn't well-informed about the overall market landscape. There are exceptions, people who research their purchases carefully, but they are the exception, not the rule.

And, DVC is no where near having the largest spread in the timeshare business. Right now, you can buy Wyndham points resale for a dime (or, sometimes, even a nickel) on the dollar, yet Wyndham still manages to sell retail points at a healthy clip, even with the economic downturn.

 

[ACDSNY]

I just think it is a shame that things have gone this low in such a short amount of time.

I guess I just don't understand how the market took such a low dive if we are all aware of how much it costs initially?

Yes it's was a fast decline in the price. We've been switching over from a Feb UY to Aug UY so last year we sold 2 of our smaller SSR contracts for the price we paid for them. Our cost was just the commission, not too bad since we enjoyed several vacations on those points. Now a year later we'd like to get rid of the last Feb UY contract but I'm in no hurry with the prices in the $60s.

 

[snowbunny]

How can you say this? It has ALOT of bearing on what to price a resale contract. I don't know anyone that would price a resale contract at $65 a point that still owes enough that it would require them to bring THOUSANDS of dollars to the table. That is crazy. It has a lot of bearing on what a seller will price their resale contract at.
It may not have any bearing on what the buyer is willing to pay, but you can't say it has no bearing on the sales price. Why would someone who owes $100,000 on a home sell for $75,000?

She's saying it because it is a fundamental truth of real estate.

10 years ago I had to bring over $15,000 to a closing because I had bought my first home during a boom (sound familiar?) and needed to sell because we were leaving the state, boom long over.

I tried pricing the house at what I needed to get out whole. It sat for many months. Once the agent convinced me to drop the price to what people were paying for comparable homes, it sold.

Nowadays of course no seller brings money to a closing. They just mail the keys to the bank and walk away. I suppose you could try filing a quit claim deed on your DVC, no idea what the legal ins and outs would be.

 

[Lawshark]

When we first looked into buying DVC you couldn't get a resale contract for much less than what Disney was selling them for directly. Add on to that the incentives that Disney provides, plus the almost too easy lending and it was a no brainer.

That says it all...doesn't it? Lending wasn't almost too easy...it was. Prior to March 2007 all you need was the ability to fog a mirror to secure a loan. I closed loans where banks lent 100% on a purchase of a 4 unit residential investment property...and the buyer had a 600 credit score! You've been less than diligent on making monthly payments to get your score there...hard to believe some of those loans didn't work out.

I wasn't trying to be a pain in stating that it was a bad financial decision...no offense meant...millions made that gamble. However, from a financial standpoint it is simply a bad decision to borrow a high percentage of a time share cost. Frankly...it's a bad idea to borrow any of the cost. But that's a different debate...let's all just agree that borrowing anything more than 50% of your cost is basically throwing dice.

I realize it has to do with the economy and when (if ever) that economy starts to rebound we will see a decreased supply of resale contracts. More people will be willing to keep their contracts instead of being forced to make a choice to sell.

Yes...supply and demand. There is frankly not much demand for 2nd homes right now. It may be another 20 years before large numbers of people suddenly believe that investing large sums of money in a 2nd home is a good idea. Long enough that people forget that it was a dumb idea in the early 00's.

I guess I just don't understand how the market took such a low dive if we are all aware of how much it costs initially? And it wasn't a slow decline either. It was fast and steep.

Your buy-in cost is totally irrelevant...people unfortunately bought in the midst of a huge credit bubble...and most were willing participants.

 

[Jason@dvcstore]

It makes you wonder why ANYONE would by from Disney directly when they could have the same points for nearly half the cost?

My thoughts are similar to Brian Noble. Majority of people buy same day they take the tour. They don't do any research and it becomes an impulse buy.

I am pretty confident that when DVC first started they gave buyers a 30 day cancelation policy which then changed to 15 days. Now they simply use the standard 10 day period that the state of Florida gives all timeshare buyers. They are trying to reduce the number of people who go home and find a company like us -shameless plug-The Timeshare Store, Inc.®

Jason

 

[Slakk]

I just sold my BLT contract through TSS today - got a decent price for it and am even happier not to own it. I have two small contracts left to sell but am planning on pulling the 2009 points off first because the selling price is the same and I may as well make 10 bucks a point on them and then sell the contract for the same amount.

I am not in financial trouble but dissatisfied with DVC. The final straw was making a reservation the day BLT opened for reservations and getting a parking lot view low level supposed "MK View" while the Non-DVC person in line next to me got *upgraded* to a 10th floor MK view AND free dining - they paid for a Lake View studio...

They were talking about taking the tour and buying - I am no conspiracy theorist but IMHO the focus is on new blood and they just tell the rest of us we are special and hope we shut up and suck it up.

I spoke with my guide and DVC Satisfaction - and no one seemed to care although they did express their remorse for the unfortunate room. Whatever. I add it to the long list of the worst locations we have received - this time though it really ticked me off.

We will continue to keep a small contract for perks and our short trips to WDW, and use point transfer for anything else and spend most of our vacation dollars outside of DVC. I know I will not be missed - there will be another family to take our place But at one point we had over 500 points and now will be down to a tenth...

 

[lugnut33]

I have no clue why anybody would buy through Disney?

I'm looking at adding on a small June 50 point SSR contract. That will bring our total points up to 170, all bought resale. Currently I have an offer in on contract that has all 2010 points coming (not going until 2011) for $78 per point. Yeah, I know a lot of contracts have been going for around 70, but this is small and it's the use year that I want. And yes, I want SSR so we can stay in the Tree House Villas.

Anyways, the contract will shake out around $87 per point with closing fees. I did check with Disney about an add-on and the best they can come in at is $102 per point. That's a $750 difference. If I wanted to add on at Animal Kingdom that would get the price down to $97 per point, but then I don't get the resort I want (really need that 11 month window for THV).

Buying DVC resale seems to be the best kept secret.

 

[ACDSNY]

I have no clue why anybody would buy through Disney?

Buying DVC resale seems to be the best kept secret.

Buying direct through Disney is best for the newer resorts. We just added on VGC points. I do agree the best kept secret is resale for the existing resorts, especially SSR.

 

[Sandisw]

Buying direct through Disney is best for the newer resorts. We just added on VGC points. I do agree the best kept secret is resale for the existing resorts, especially SSR.

Same reason for us. We want only BLT and right now, getting another small contract (25) with our UY is not possible via resale.

The plan is to add on next month, but with DD still deciding on college for next year, I may have to postpone for a bit.