The tipping point

[TDC Nala]

When I decide not to go to Florida anymore, I'll sell the points, or sign them over to my brother (he has a family that would probably like to use them.)

 

[DrTomorrow]

One of the biggest financial risks of DVC ownership is the increasing disparity between the purchase price (whether through DVC or resale) and the underlying rental rate. Since I began evaluating DVC many years ago, the rental rates have remained relatively flat while the purchase price has consistently climbed. In the end analysis, since this program is essentially a right to use DVC properties, eventually, the rental rate becomes the most significant element of each potential purchaser's consideration (at least an informed purchaser). [...] .

I consider myself an "informed purchaser", and I'm quite capable of doing some basic analysis (let me blow the dust off of my MBA ), yet I don't agree with your statement (it goes a little bit beyond opinion, at least to me). If I never intend on renting (which is the case, save a few onesies and twosies here and there), then what possible effect can the rental rate have on my long-term enjoyment of my DVC ownership?

Be well!

 

[Maistre Gracey]

One of the biggest financial risks of DVC ownership is the increasing disparity between the purchase price (whether through DVC or resale) and the underlying rental rate. Since I began evaluating DVC many years ago, the rental rates have remained relatively flat while the purchase price has consistently climbed. In the end analysis, since this program is essentially a right to use DVC properties, eventually, the rental rate becomes the most significant element of each potential purchaser's consideration (at least an informed purchaser). It is my contention that even Disney's ROFR, which effectively mitigates the impact of free market pricing, will eventually be insufficient to support the elevated pricing without a related increase in rental rates. With all due respect to those who fundamentally object to the rental alternative, this is a pretty nonsensical approach. After all, comparing home ownership versus renting an apartment is not the question here--in the world of DVC, the apartment “tenant” gets identical accommodations as the DVC "owner".

We remain generally positive about our purchase made 2 years ago. That said, our concern about relative value continues to grow, due in large part, to the "rent versus buy" equation.

I can't say that I agree with you here, but I was wondering what you are using for "underlying rental rates"?
Are you using a cash rack rate, $10/pt, or some other amount?

MG

 

[Johnnie Fedora]

We have just completed our 4th DVC trip this year, and the pace of our trips will slow a little. One of the options we liked about DVC was the ability to rent and use the proceeds for other vacations options. We figured it would be relatively easy to rent, as destination Disney would always be a lure. So far, we have done a WDW offsite and DCL as our "rental proceeds" option, but we will plan trips to other destinations as the kids get older. We also like HH and Vero as stand alone vacations.

We do worry about stagnating rental rates, the rate of dues increases, and park burn-out.

Like Colleen, we enjoy and look forward to a warm FL get-away, the quality of the DVC resorts, even w/o the WDW parks. We also appreciate the new AP discount, and think it adds to the program.

No interest in selling at this time.

 

[dallastxcpa]

I agree!

Going to Dallas and staying at a fancy Hotel for the weekend just isnt the same.
We purchased DVC instead of a Vacation Home or RV for many of the reasons Beca stated. No maintenance work, the resorts are Destinations, etc. If we grow tired of the parks, we will still have top notch accomodations.

What would prompt me to sell is if the resorts are not maintained properly, not the parks. I would just stop spending money on the parks if they decline, but I could still see us visiting BCV and SSR as destinations.

What do you mean Dallas is not a destination. If you want DRAMA you attend a Dallas city council meeting or maybe a Willmer Hutchins school board meeting. For action there's the regular taping of COPS and shootings on 75 from the sunroof of a white Jaguars.

For adult entertainment there's always the filming of Cheaters and of course Harry Hines Blvd.

Just a little humour. Honestly I love all that Dallas has to offer but, sometimes it makes you want to move to a small town.

 

[Pootle]

Cyndy said: I also agree with many points made, especially the DVC as a destination resort. We're empty nesters who have used DVC both for the parks and simply to vacation without doing parks. What a fantastic option. I recall a few years ago Vegas did that "family" destination campaign, now really!! Maybe we can't gamble at WDW (fine with me) we can take our GK and be sure that they will be delighted. We can also book HHI and Vero for a beach fix, so when we were comparing DVC to other resorts, none could offer the inside WDW which is what tipped the scale for our buying. So far I have yet to see any TS that can guarantee WDW reservations for any time I choose

Despite a 4000 mile cross-Atlantic journey to get there, this is my view exactly - well no GK yet .

I just missed the free park tickets when I bought, but have always thought I get great value from my membership and have even done a small add-on recently - so no selling here even though I could make a small profit on the deal.

 

[magicmouse2]

We bought into DVC because:

• We wanted to have a guaranteed vacation every year, even if money was tight
• We love the room of villa accomodations but wanted to be onsite
• Staying on cash reservations for 14 nights per year in a 2 bed dvc over 50 years would cost around $392,000 ! thats quite a bit more than what I paid for my points and what I will pay in annual dues

I would still like to purchase a vacation home in Florida so that I also have somewhere I can go any time I want, though I wont be able to afford that for 5 or 10 years yet.

 

[DisneyMim]

As a long time owner (1991) I thought I would reply to the OP. No we are not tired of our membership and I don't think we will ever be, BUT I can understand how some people might. I thought our kids would start to get tired of Disney as they became older, but just the opposite happened to us. Our vacations are different than when they were young, but believe it or not, we enjoy them more. They have become wonderful older children (21 and 16) and we all really enjoy going out to dinner at all of favorite restaurants and spending time just talking to each other. I am at the point of "daydreaming" (although I know my kids and it is still lightyears away!!) of taking the grandkids with us. Now, on to the other side. Some of our friends have sold their memberships. It just doesn't suit them anymore. Also I believe that Disney has made a huge push in the past ten years or so and a lot of parents felt that they "had" to take their children to Disney. Some of these people realized that they don't actually like Disney. Not everyone can be like me, a Disney fan since birth almost!! Also the economy has not helped. People bought into DVC and then realized that they could not do much else. DVC is not for everyone. I have said this before, but if I could not go to other places during the year I would have to reconsider our membership. We are very lucky (and our children know this too) to be able to spend 2 plus weeks at WDW every year and about 2 weeks on other type of vacations, cruises, beaches, mountains, etc. DVC is expensive and some people figure out that they can stay in a moderate or value at Disney, still have a good time, and have some money left for other things. And there are many other things. College tuition is through the roof, home prices, at least in our area (northeast) are crazy, etc. etc. etc. I think there are many reasons people sell their memberships and I see this continuing.

 

[dianeschlicht]

We are in our 9th year of ownership. Our "kids" are grown and were when we purchased. We purchased DVC to specifically vacation at WDW on a regular basis. IT truely does feel like our vacation home. What a gret place to have a vacation home too! We have had a great deal of fun treating others to a trip with us to WDW! When we can't bring anyone with us, we enjoy just enjoying the resorts and parks by ourselves. I don't see this changing anytime in the near future, unless our health fails. When that happens, we will turn the points over to the kids and hope they still take us along in our wheelchairs and walkers!

 

[lisareniff]

I live in the Midwest and Orlando offers me spring break in a beautiful community. Dreaming of the flowers and sunshine literally keeps me going in January and February. I used to struggle with seasonal depression after Christmas was over. Now I spend those 8 weeks planning our spring break and it has been the best medicine...

Ditto! Just substitute overcast snowy Rochester for Midwest. The lack of sunlight really affects me. Between the shorter days and the ever present lake effect clouds(and snow) sometimes it is days between bits of sun. Having a warm sunny trip in the middle of Feb. and all the planning in Jan. really helps.

 

[disneyberry]

[SIZE=+0]We would sell if
1) DBF and I stopped enjoying our trips to WDW or
2) We stopped going to WDW as often as we do... probably the threshold is that we must go at least once every other year, otherwise the dues aren't worth it.
3) We start preferring more to stay at Disney's regular resorts either because a. They start having heavy discounts again or b. We no longer care about being in the Epcot Resorts location due to deterioration in the quality of Epcot park or MGM Studios park... 'cause our love for those 2 parks is what drove us to stay at BWV in the first place.
4) Maybe if we had 3 consecutive DVC stays where we had horrible experiences either being treated badly by CMs/the resort, or if the resort room itself is so badly maintained or seems like pest control is not seriously trying their best (we have no desire to ever repeat our ants experience). Now this is 3 consecutive stays, 'cause we're willing to give DVC the benefit of the doubt, and if we're only traveling once every 1 to 2 years, then that's 3 to 6 years for them to get things right again. I think it'd be pretty bad to have 3 to 6 years of unpleasant DVC stays.

Hm, actually writing these out makes me think about DVC in a different way. I was realizing that when we have a bad experience at a resort, it's hard to go back right away. For example, we couldn't bring ourselves to go back to BWV, especially given the incredible POFQ discount we got last year. So we stayed at POFQ instead... and it was an excellent experience.

Those are just the ones off the top of my head. There's probably more. Also, I did sell already, because we didn't buy where we wanted to stay (BWV), and felt like we really needed to own the resort we wanted to stay at. So, we sold one resort, and bought BWV to replace our original contract.[/SIZE]

 

[joycmc]

Can't imagine selling-trying to get dh to buy more points.He thinks 400 PTS and house in VT. IS ENOUGH VAC. I say more!!
Joy