Stripped Contract...Updated 5/8 It's sold!

[robinb]

The pretense of your post is contradicted by recent history. Just three years ago, I purchased VWL resale, 300 point contract, at $55- loaded- and that was full asking price. This wasn't any incredible bargain; it was merely a "decent" price for the market at that time.

While $65-70 is indeed below recent asking prices, it is appreciably more than one could expect on this property a couple years ago.

I will readily grant that VWL "could" be more expensive than it is now during 2015. However, it seems at least equally likely that prices will in fact be less then than now. My point is simply that it is wrong to hold onto a contract assuming that it will be worth more in the future. No such guarantee, or even likelihood, exists.

And 9 years ago I sold my 300 point (exp 2042) OKW contract for $73 per point . I guess there could be another recession and DVC could take another hit, but the economy is on the rebound and prices have been steadily rising since you bought at the bottom. So while I agree there is no guarantee, I do think there is a likelihood that prices will either remain the same or go up. If she holds the contract until it's "current" in 2015 she can charge the going rate instead of a "stripped" contract she has to give away.

 

[TeresaNJ]

You're scenario makes sense, Robin, but at $65/point, we're still making out pretty good, considering we've owned at VWL for 13 years, and used it frequently. We talked about it back and forth, and even though we don't have to sell, we really could use the extra cash for farm equipment, etc, as we have settlement in two weeks.

Since we have the 90 points (well really, 92, as I purchased 2 extra points in order to book a standard one bedroom at AKL Jambo House for September for four nights) that have to be used by September 30th, I added four nights on to our September vacation, of which we rented points. If the contract doesn't sell with the next month or so, we will take it off the market, go on our vacation in September, and then relist after October 1st.

Maybe we're just not suppose to sell this contract, lol.

 

[TeresaNJ]

And 9 years ago I sold my 300 point (exp 2042) OKW contract for $73 per point . I guess there could be another recession and DVC could take another hit, but the economy is on the rebound and prices have been steadily rising since you bought at the bottom. So while I agree there is no guarantee, I do think there is a likelihood that prices will either remain the same or go up. If she holds the contract until it's "current" in 2015 she can charge the going rate instead of a "stripped" contract she has to give away.

So if I hold the contract until January 2015, it's no longer considered stripped since the 2015 points will all be available? It still won't be that attractive though, considering some contracts have a large amount of banked points, correct? So I'd still have to list at a lower than going price?

 

[Msmithmd]

So if I hold the contract until January 2015, it's no longer considered stripped since the 2015 points will all be available? It still won't be that attractive though, considering some contracts have a large amount of banked points, correct? So I'd still have to list at a lower than going price?

You can list it for whatever you want, whenever you want. If selling isn't urgent to you, I agree with robin that there isn't a big motivation for you to list it low.

That said, it would be considered a stripped contract until it had full current UY points. In this case, on Oct 1, 2015 it would be a non-stripped contract, as long as you don't use any of those points.

Then, if you didn't sell in that year and banked those points forward, it would become a "loaded" contract on Oct 1, 2016. I wouldn't suggest you do this, as for whatever reason the DVC resale market seems to over-value stripped contracts, and under-value loaded ones, respective to the objective rental value of those points.

 

[KAT4DISNEY]

So if I hold the contract until January 2015, it's no longer considered stripped since the 2015 points will all be available? It still won't be that attractive though, considering some contracts have a large amount of banked points, correct? So I'd still have to list at a lower than going price?

Since it's an Oct UY it really wouldn't be considered to not be stripped until Oct 1, 2015 when it will have all the current UY points. If you got to Oct 2014 then the buyer would at least have access to borrow a full contract worth of points. I don't know if it will get you any more money but it would probably make it more attractive to buyers.

 

[robinb]

Since it's an Oct UY it really wouldn't be considered to not be stripped until Oct 1, 2015 when it will have all the current UY points. If you got to Oct 2014 then the buyer would at least have access to borrow a full contract worth of points. I don't know if it will get you any more money but it would probably make it more attractive to buyers.

I think the majority of buyers would consider the contract 'current' some time in 2015. Maybe not in January, but probably before October.

 

[KAT4DISNEY]

I think the majority of buyers would consider the contract 'current' some time in 2015. Maybe not in January, but probably before October.

I can't say what the majority would think but 2 of us posting at approx the same time did not nor would it be for direct DVC sales because of how UY works. If a buyer wanted to make an immediate reservation for equal to the 300 points they were buying and purchased the contract in January they would have to borrow. Otherwise they are essentially waiting until after Oct 1 2015 to reserve with a full amount of current points. The other way to consider is how Disney sells a contract and if someone purchased directly from them prior to Oct 1, 2015 they would receive 300 2014 points and the next allocation would start Oct 1, 2015.

 

[robinb]

I can't say what the majority would think but 2 of us posting at approx the same time did not nor would it be for direct DVC sales because of how UY works. If a buyer wanted to make an immediate reservation for equal to the 300 points they were buying and purchased the contract in January they would have to borrow. Otherwise they are essentially waiting until after Oct 1 2015 to reserve with a full amount of current points. The other way to consider is how Disney sells a contract and if someone purchased directly from them prior to Oct 1, 2015 they would receive 300 2014 points and the next allocation would start Oct 1, 2015.

All I'm saying is that most buyers are not as well educated as those on the DIS .

 

[TOTMGMWDW]

What is a stripped contract over a fully loaded one? Just that the points are not available for a few years?

 

[KAT4DISNEY]

What is a stripped contract over a fully loaded one? Just that the points are not available for a few years?

A stripped contract is one that does not have most or all of it's current years points available. And a loaded contract would be one that has all of the previous years points banked into the current UY plus all points available going forward.

 

[TeresaNJ]

Thank you all for all your thoughts. We'll keep the contract up until around the end of July, at $65/point. If it doesn't sell by then, we'll take it down, use the 92 points that have to be used, then put it back up after October 1st. I appreciate everyone's input.

 

[robinb]

Thank you all for all your thoughts. We'll keep the contract up until around the end of July, at $65/point. If it doesn't sell by then, we'll take it down, use the 92 points that have to be used, then put it back up after October 1st. I appreciate everyone's input.

Good luck!

 

[TeresaNJ]

Yippee!!! Looks like we have a buyer! Of course, I'll probably be crying when it's all said & done. I love my VWL, but sometimes real life has to come first. I hope the new owner enjoys it as much as we did.

 

[KAT4DISNEY]

Yippee!!! Looks like we have a buyer! Of course, I'll probably be crying when it's all said & done. I love my VWL, but sometimes real life has to come first. I hope the new owner enjoys it as much as we did.

Congrats!!

And Hugs!!

 

[TeresaNJ]

Congrats!!

And Hugs!!

Aww, thanks!