Small contrqct to dip my toes in, and buy points for trips as needed?

[bk1273]

Has anyone bought a small contract say 50 points to dip their toes in? Then buy points from the buy/transfer forums to plan trips? It would reduce buy ins and maintenance fees.

 

[Brian Noble]

Then buy points from the buy/transfer forums to plan trips? It would reduce buy ins and maintenance fees.

The cost to rent points is pretty close to the amortized cost of buying them, and maybe a little more expensive.

If you were going to do this, it might make more sense just to rent as you go, as that's more or less what you are doing anyway.

 

[Tatebeck]

You also can usually get a better price per point the larger the contract is. So buying a slightly larger sized contract will be cheaper per point, probably cheaper than renting every year, and you get to hold the power of those points/reservations unlike renting.

 

[bk1273]

The cost to rent points is pretty close to the amortized cost of buying them, and maybe a little more expensive.

If you were going to do this, it might make more sense just to rent as you go, as that's more or less what you are doing anyway.

True but I could control my own reservation and save a little over renting and maintenance fees.

 

[MarkNC2Disney]

Keep in mind transaction expenses are a large % of the total purchase price for small contracts. I wish it were more proportional to the number of points but it generally isn’t.

 

[skier_pete]

Renting will cost you more than buying, certainly on way more than buying on the resale market. You do avoid the upfront costs, but your points will cost you $10-15 per point on the resale market, and $21+ per point renting. If you want to try out DVC I definitely recommend renting, but as far as buying a small contract just to say you own, there's not much advantage there. Are you considering direct or resale??

 

[bk1273]

Renting will cost you more than buying, certainly on way more than buying on the resale market. You do avoid the upfront costs, but your points will cost you $10-15 per point on the resale market, and $21+ per point renting. If you want to try out DVC I definitely recommend renting, but as far as buying a small contract just to say you own, there's not much advantage there. Are you considering direct or resale??

Considering resale but trying to convince the wife.

 

[MilesofSmiles]

I kind of did this, my first contract was a loaded 50 pointer. If you plan to do a studio every other year, I think it’s doable and saves over rentals.

But I warn you, contract buying is addictive. I’ve bought another loaded 75 pointer and a 25 point direct within 6 months . I have another 50 points in ROFR too. You’ve got to have restraint to not buy more. I clearly do not.

I planned to buy some Transfer points but ultimately just end up with new contracts. We decided to rent larger units and bring our parents, siblings and their kids with us and we’d like to continue to do that. When we have the expendable cash I just grab another contract. I think we’ll stop at about 250 points per year.

 

[skier_pete]

Considering resale but trying to convince the wife.

Convince your wife to buy at all, or convince your wife to go resale?

I personally think resale is still the way to go, even with the resale restrictions. At least for a first contract. As @MilesofSmiles said, you probably won't stop with one.

 

[DanCali]

Has anyone bought a small contract say 50 points to dip their toes in? Then buy points from the buy/transfer forums to plan trips? It would reduce buy ins and maintenance fees.

If you don't want to jump all-in with ownership and will still be mostly renting, then I would only do that if you wanted to stay at places where using points is relatively very cheap but renting is relatively very pricy on a per point basis (e.g. as an alternative to renting AKV Value or BWV resort view @ $25-$30/pt)

Of course, keep in mind that owning at those places doesn't guarantee that you will actually be able to book those rooms, due to their high desirability... but at least if you own there you have a some chance to book them.

 

[emchen]

Considering resale but trying to convince the wife.

Convince via renting.

[side whisper voice] ...and if you rent 1 BR, you may be able to convince her on a first contract that's more than 50-points.

 

[matt_in_nh]

I would not do that. Small contracts cost more per point and you have to pay the full closing costs regardless if you are buying 25 or 250 points. So the cost really gets driven up per point ...you will pay a lot more with small contracts. I don't really understand why they are so in demand, there is a thread here about that but it does not make sense financially....at least to me. The thread offers some rationale why but the logic does not work for me. I am waiting for ROFR on my first contract so I only have experience renting but from even that I know you cannot assume you will just get the lowest point nights on the points chart, people snatch those up. Save up and buy the amount of points you would use or just rent is my thought. Link to that thread below. You should also consider what use year you want and stick with one or two if you end up with multiple contracts. Managing random use years with small contracts sounds like a nightmare.


https://www.disboards.com/threads/why-are-small-point-contracts-in-demand.3825993/

 

[bk1273]

Convince via renting.

[side whisper voice] ...and if you rent 1 BR, you may be able to convince her on a first contract that's more than 50-points.

Have already rented. She says we will "only".maybe make 4 to 6 more trips which puts us in the break even area and above.

 

[disneylandtour]

The cost to rent points is pretty close to the amortized cost of buying them, and maybe a little more expensive.

If you were going to do this, it might make more sense just to rent as you go, as that's more or less what you are doing anyway.

If you buy wisely, the amortized cost per point (buy-in plus MF) should be substantially less than renting points. SSR is good for this. Maybe get an $85pp SSR contract (I've seen them for slightly less recently) which is about $2.9 per year per point. Add in the yearly member fees. It comes out to under $12 per point per use right now.

Bay Lake is a little more money up front. But if you can get it around $115 (which is doable) it comes down to about $11.2 per point per use right now.

Transfers are usually around $20 (same for OTU points), and if you get lucky maybe $17 or $18pp. And there are limits on how often you can transfer points.

 

[bk1273]

If you buy wisely, the amortized cost per point (buy-in plus MF) should be substantially less than renting points. SSR is good for this. Maybe get an $85pp SSR contract (I've seen them for slightly less recently) which is about $2.9 per year per point. Add in the yearly member fees. It comes out to under $12 per point per use right now.

Bay Lake is a little more money up front. But if you can get it around $115 (which is doable) it comes down to about $11.2 per point per use right now.

Transfers are usually around $20 (same for OTU points), and if you get lucky maybe $17 or $18pp. And there are limits on how often you can transfer points.

Thanks this is helpful. BLT is our preferred resort.

 

[emchen]

Have already rented. She says we will "only".maybe make 4 to 6 more trips which puts us in the break even area and above.

You've rented and the trip is pending or completed? Studio? Resort? The more details, the better the advice.

What is your kids situation? Parents / in-laws?

 

[bk1273]

You've rented and the trip is pending or completed? Studio? Resort? The more details, the better the advice.

What is your kids situation? Parents / in-laws?

Rented a couple years ago. Planning another this or next. We go about every 2 years and stay at BLT. 3 kids under 15 so usually prefer a 2 bedroom.

 

[Brian Noble]

I'm not sure you have a problem to solve here. Given everything you've said, I would probably just keep renting.

 

[permavac]

True but I could control my own reservation and save a little over renting and maintenance fees.

This is why we did what you're considering. We started with a 25 point contract sometime before 2010 and it was for: financial/commitment-phobia/control-issues/access-to-DVC-discounts reasons.

We did lots of transferring in of points but still also booked hotels through WDW because we liked staying at some of the Values/Moderates and we didn't want to miss out on the good discount vacation packages Disney used to put out on those. Then we slowly bought additional resale contracts and this year we did our first direct add-on (small contract).

It worked well for us and I wouldn't have changed anything. We're probably done buying points to own but we will still do a Value/Moderate stay and rent from other members to pad our points.

 

[DanCali]

I would not do that. Small contracts cost more per point and you have to pay the full closing costs regardless if you are buying 25 or 250 points. So the cost really gets driven up per point

That point is most valid if you hold the contract to expiration.

But, putting closing costs aside, is there any reason to believe that if you sell a 2060s small contract in 15-20 years you wouldn't get more per point than a similar but larger contract? Perhaps the both depreciate in value, but the smaller one will still be more affordable and more desirable, so it will have greater per-point resale value. In that case, if the percentage of depreciation for a small and large contract is similar, the upfront "small contract premium" matters a lot less.