The VGF 2 pricing thread

[BWV Dreamin]

I personally think the slow sales of Riviera are a point in favor of a lower price for VGF not a higher one.

Regardless of the environment, purchases like these follow the laws of supply and demand. Too much supply? Not enough demand? Look at the housing market. Homes are still selling like wildfire….

 

[nuhusky123]

Regardless of the environment, purchases like these follow the laws of supply and demand. Too much supply? Not enough demand? Look at the housing market. Homes are still selling like wildfire….

Right, so by the same logic of supply and demand injecting 2,000,000 new points increases supply thereby decreasing the price

homes are selling at record prices because the supply is limited

the supply has been limited at gfv hence the $255

just like housing, as supply increases and catches up with demand prices will come down

at gfv 2,000,000 new points increases supply, catching up with demand thereby dictating a price decrease

 

[davidl81]

I said it several pages back but I’ll say it again:

Timeshare margins are so massive that they maximize profits more by selling quickly and moving along to the next build than they do by charging the highest price.

They’ll make way more money over the next 5 years in they price VGF to sell out VGF in 9 months and have another conversation ready to go in 2023 than they will if they price VGF to sell out in 18 months and have another conversation ready in 2024.

ROI is directly correlated to the amount of time between initial capital outlay and return of capital. That seems to be lost on a lot of people posting here. Disney has 0 interest in “slow selling” VGF. Each project is judged on its ROI metrics. They won’t intentionally lower the ROI on VGF just because they have “nothing to sell next”. They 100% will have something to sell next, we just don’t know what that is, but DVD sure does.

 

[davidl81]

I personally think the slow sales of Riviera are a point in favor of a lower price for VGF not a higher one.

I could get the argument for pricing VGF higher if RIV was flying off of the shelves, but it is not.

 

[RamblinWreck]

Now that Boardwalk is $230 pp direct, I HIGHLY doubt that VGF will be offered for the ridiculous price people here have stated ($207 - $210). Imagine that pitch...... BWV is $230 with only 20 yrs left but you can have VGF for the low low bargain price of $207 (with incentives) and it goes till 2062...... YEA RIGHT

Are you saying that sounds like a bad pitch??

That sounds like a great pitch! Especially since they have no interest in selling BWV and they’ll have WAY more VGF points to sell.

If you keep calling prices from $207-$210 “ridiculous”, it might become true someday though. Don’t lose faith!

 

[BWV Dreamin]

Right, so by the same logic of supply and demand injecting 2,000,000 new points increases supply thereby decreasing the price

homes are selling at record prices because the supply is limited

the supply has been limited at gfv hence the $255

just like housing, as supply increases and catches up with demand prices will come down

at gfv 2,000,000 new points increases supply, catching up with demand thereby dictating a price decrease

So I’d love to hear your reason for the lack of sales at Riviera?

 

[BWV Dreamin]

I could get the argument for pricing VGF higher if RIV was flying off of the shelves, but it is not.

Maybe the demand is just not there…doesn’t necessarily mean it’s the price, but maybe the restrictions…..

 

[davidl81]

Maybe the demand is just not there…doesn’t necessarily mean it’s the price, but maybe the restrictions…..

It sold decently well with restrictions at a lower price pre covid…

 

[Nabas]

It sold decently well with restrictions at a lower price pre covid…

Yes it did.

Reposting what I posted earlier.



The weak DVC sales started with the March 2020 shutdown due to COVID. Sales plummeted to 0 and have not yet fully recovered.

DVC sales reflect what is happening to theme park attendance. Nearly all new DVC sales originate at the theme parks.

Sales won’t rebound until theme park attendance rebounds. That doesn’t happen until people feel safe traveling and the economy stabilizes.

 

[Sandisw]

So I’d love to hear your reason for the lack of sales at Riviera?

The pandemic hit DVC sales hard and it’s slow to rebound.

There is no precedent for that and the sales prior to the shut down were some of the best and restrictions existed.

Last month, 74k sold, about 66% of total sales. Not great..most were closer to 75 % but certainly not a failure given the current travel situation.

We will never know the true impact of the past 18 months until we have something to compare it to.

IIRC, many international owners can’t buy except onsite..I wonder how many buyers fell in that category? Travel just resumed not too long ago. I imagine that had to impact sales to some degree.

Now, if VGF comes online and sells substantially better than what RIV is currently doing..then we can attribute it more to resort.

But, what if it doesn’t? What if it has similar numbers to what RIV is at now? Will people say it’s the resort?

 

[Epcot Forever Forever]

Yes it did.

Reposting what I posted earlier.

View attachment 641735

The weak DVC sales started with the March 2020 shutdown due to COVID. Sales plummeted to 0 and have not yet fully recovered.

DVC sales reflect what is happening to theme park attendance. Nearly all new DVC sales originate at the theme parks.

Sales won’t rebound until theme park attendance rebounds. That doesn’t happen until people feel safe traveling and the economy stabilizes.

I wonder if the minimum increase drove some of it as well. $19000 sounds a lot more affordable than $31000

 

[VegasDisneyMom]

Just wondering if anyone had heard if member adding on would be minimum of 25 or 50 pts?

A CM told me 50 pts minimum for existing DVC members.

 

[nuhusky123]

So I’d love to hear your reason for the lack of sales at Riviera?

Riv is too expensive for the current economic environment. I said this up thread Too. Increasing to $207 is going to slow down sales at riv even more. Dvc should really pause the price increase

i think gfv will have an initial influx of sales from people like us who are waiting just for gfv. Thereafter sales will drop like a rock

$207 is way too expensive for the avg Americans right now

 

[HIRyeDVC]

Riv is too expensive for the current economic environment. I said this up thread Too. Increasing to $207 is going to slow down sales at riv even more. Dvc should really pause the price increase

i think gfv will have an initial influx of sales from people like us who are waiting just for gfv. Thereafter sales will drop like a rock

$207 is way too expensive for the avg Americans right now

I’d agree with you but given the recent trends of price increases on just about everything, I don’t think Disney is targeting the “average” Americans anymore?

 

[nuhusky123]

100% agree Disney seems to no longer care about the avg American. They do seem to be tracking wdw to be more upscale cost wise. I’m ok with that too if it means less people are in the park.

id still maintain a price increase right now is not prudent regardless of their target demo. Inflation and russia won’t make buyers feel the warm and fuzzies to part with their cash. Add a price increase on top of that, I’d wager riv sales will drop by half come feb and March. That’s without gfv hitting the market which will further exacerbate the situation for riv

 

[CaptainAmerica]

My curmudgeon take. Grand Floridian has lost some of its luster and they're having trouble filling the rooms. The shiny new Skyliner is pushing people to want to stay at Rivera/Art of Animation and enjoy quick access to TWO parks and their new IP attractions (hello Galaxy's Edge, Guardian's of the Galaxy, Ratatouille and Frozen). I don't think they care if they sell out Rivera anytime soon. What they're getting per night on the cash side is astonishing.

Disney also wants to cut costs because of housekeeping ($17 per hour starting pay) and rising maintenance expenses (GF was built in the 80's), so they're converting it to DVC.

They're going to have to move millions of points, and from what we've seen, this is going to be a fast turnaround (otherwise known as cheap flip). I think they'll price it very similar to Rivera and maybe even lower with bonuses, add-on and minimum incentives.

Edit: Nabas beat me to it!

Nobody is talking about the fact that resale restrictions nuke demand for Riviera among savvy buyers who understand that sort of thing. Set aside Skyliner versus Monorail and Resort Studio versus Tower Studio and Topolino's versus Citricos. It's clear even from cash pricing that Disney considers Riviera to be equivalent accomodations to the Grand. But as a deeded real estate product, those resale restrictions make it a fundamentally different contract.

If they hadn't implemented resale restrictions, I think they'd price the two resorts exactly the same. But pricing the same with restrictions in place will make it darn near impossible to sell Riv.

 

[dvc lover 1970]

We are not comparing apples to apples. RIV has the resale restrictions while VGF will have 10 less years on its context.

 

[Nabas]

We are not comparing apples to apples. RIV has the resale restrictions while VGF will have 10 less years on its context.

I’ve often wondered about this but concluded that most (not all) buyers just don’t care where they are going to be vacationing 40 years from now.

And that most (not all) direct buyers buy DVC without thinking about selling it, meaning they don’t care about the resale restrictions because they don’t see it affecting them.

Essentially, most buyers ask themselves, “how is my purchase going to affect my life for the next few years?” As a result, cost and a hotel’s amenities & location are important. Other factors, less so.

 

[Marionnette]

We are not comparing apples to apples. RIV has the resale restrictions while VGF will have 10 less years on its context.

It's actually 6 fewer years. VGF expires 2064. RIV expires 2070. For some people that 6-year difference is small when the trade off is fewer restrictions on resale points.

 

[CaptainAmerica]

As a result, cost and a hotel’s amenities are important. Other factors, less so.

That's why I raised the point about cash prices being comparable between the two. It's clear to me that Disney, at least, regards them as roughly "equal" in terms of amenities.

I don't particularly like either resort, so it's hard for me to weigh them. But as a thought experiment, if AKV Jambo was available with a 2070 expiration and resale restrictions, and AKV Kidani was available as a separate property with a 2064 expiration and no resale restrictions, I would pick AKV Kidani in a heartbeat. I think you're generally correct that most buyers don't care about the restrictions *or* the expiration date, but of the two, I consider the restrictions to be a much bigger deal. I might need or want to sell in 5-10 years, even though I'm not planning on it. A 2064 expiration wouldn't come into play until I'm 75 years old.