Third party commercial renters

[Sandisw]

I feel like the more people write to them, there is a chance they consider changes or looking into it. Your response seems very " 'shrug' we have no power" - but lacking the power to legally force a change does not mean there is zero chance of anyone listening to member feedback. To me that is important.

What I mean by no power is that ultimately it’s up to DVC to set them. Member feedback is important and those that have ideas should share them….I always do.

What is important to me is that rules for using my membership always favor me as an owner to book what I want for me and family, and to use it for rentals, if and when I need them….and that DVC enforce the rules consistently.

What I don’t want is to be hindered in my use of my membership because other owners could be causing an issue. Penalize them, not me.

Currently, I think the rules, as I know them, are fair. I don’t believe changes are needed, but I also would be content to see some changes since the volume of rentals has increased, not in violation of the contract, but for the rental market in general.

If 17 years ago, having up to 20 potential rentals was okay, because DVC saw only about 100 owners a year appearing to rent and now you have 5000 owners renting, that 20 reservation limit may no longer be appropriate.

 

[mistysue]

What I mean by no power is that ultimately it’s up to DVC to set them. Member feedback is important and those that have ideas should share them….I always do.

What is important to me is that rules for using my membership always favor me as an owner to book what I want for me and family, and to use it for rentals, if and when I need them….and that DVC enforce the rules consistently.

What I don’t want is to be hindered in my use of my membership because other owners could be causing an issue. Penalize them, not me.

Currently, I think the rules, as I know them, are fair. I don’t believe changes are needed, but I also would be content to see some changes since the volume of rentals has increased, not in violation of the contract, but for the rental market in general.

If 17 years ago, having up to 20 potential rentals was okay, because DVC saw only about 100 owners a year appearing to rent and now you have 5000 owners renting, that 20 reservation limit may no longer be appropriate.

We're more in agreement than not.

At the moment I'm bitter because we wanted to throw in a September trip - and when I looked back in April (dates 5+ months out) I couldn't get in anywhere I would want to stay without moving multiple times within a week. OKW was hell for us (little reasons specific to my group) and I feel slighted by this being my only option, and believe it's related to the number of rentals on the market. I had no trouble scheduling until the past few years, and I see the number of rooms "confirmed and available for rent" for the dates I want. That's not really how this should be working. Right now we're having trouble scheduling far enough out and it's pushing me into that territory of "maybe we have to rent out our points to pay for a hotel room" - which is SO backwards.

 

[kilik64]

Wait so we mad about inside 7 months availability?

 

[sndral]

Let me check to see what I can find in the current documents. I thought it was still the same. If this is no longer in the POS, then I will request an updated version...I did just get hard copies of the most recent CFW and multi-site POS, and will check out the language in both.

UPDATED: I reviewed my RIV and VGF POS statements....the language you mention above is in my VGF POS, but is not in RIV (I will post below)

Both do say that DVC or the Board of the association, get to determine the definition of "commercial purpose"...however the VGF POS uses the word reasonable discretion and the RIV POS does not... both use the words "pattern of rental activity....what is missing from both documents is the enforcement language that existed in the 2007 language....so, the published POS for, at least these two resorts, and the MS POS do not define that...that to me is a big piece of info.

The MS POS is where you find the language about the total number of points one can own (8000) that say "to encourage personal use.

So, it does appear that the Commercial Use language from 2007 is no longer being written into the contracts, and the RIV and Resort Use Plan for CFW do have a bit more specifics than VGF, the enforcement of it is not included. So, I emailed DVC because I want the legal document that currently exists that spells it out...and did include that I don't want a random CM to say "we do this..." Is it still the 20 reservation threshold, or is it different? As owners, that is something that should be included when and if it is ever updated....

What is interesting, and it is part of the Resort Use plan for CFW, is that the RIV POS does add some more specific examples of what DVC may (not shall) use in finding an owner in violation (see below), it is incomplete without knowing what they are using today and how they are enforcing it. This is what RIV POS says for RIV owners, but is not the language for VGF owners.

Thank you @Sandisw. I was going by my VGF doc.s circa 2013 & although I knew they were more recent than the 2007 20/12 version, I suspected they might not be the most up to date. It’s remarkably difficult to find the current version & I appreciate you reaching out to DVC for clarity.

 

[mistysue]

Wait so we mad about inside 7 months availability?

That part is only because it's gotten a lot worse and chunked into individual nights vs even a few years ago you could get 4-5 nights at a time without much pressure. When booking for themselves, people tend to book longer stretches than 2 nights, and those shorter stays tend to be weekends for that quick trip. Getting to a point where you can't get a 5 night stretch 6 months out really does seem to be a symptom of how much the "book a confirmed stay to rent" has taken over.

It's frustrating to be blocked out of specific views at 7 or 11 months, but something is wrong when you can't get ANY room at 5-6 months. (meanwhile, I can rent the rooms/views I want in a bunch of chunks well past the dates I can no longer book them)

 

[lowlight]

The problem with the rules, as they stand, is that they don’t effectively prohibit commercial renting. At all, not even a little bit. You can disagree that the rules need to be changed, but you can’t argue that the rules aren’t working. Whether it’s because they aren’t enforced or because they aren’t strong enough is of no matter, the end result is the same.

Say I want to buy DVC for my retirement. I calculate the break even on my 500 point contract as 7 years of point rentals. For the first seven years, I rent 5 separate 1 week studio stays. At the end of 7 years, I’ve made my initial investment back, paid my yearly dues for 7 years, and pocketed a little money on the side. Now I have 500 points free and clear that I can sell for 75k or keep as my retirement vacation plan. Technically I am not breaking any rules, except the commercial renting rule which DVC doesn’t enforce. MANY members here are doing this. This wouldn’t matter in most timeshares, because they have no inherent value after 7 years, but people are treating DVC like a business instead of a vacation. The LLCs are doing this same thing x10000. If you think it’s coincidental that most of these brokerages are owned by former DVC employees, I don’t know what to tell you. Imagine working for Disney and making a pittance and then realizing all the loopholes that exist to make millions off the back of regular owners. The current distinction between commercial and personal use is so pointless it might as well not exist.

 

[Sandisw]

The problem with the rules, as they stand, is that they don’t effectively prohibit commercial renting. At all, not even a little bit. You can disagree that the rules need to be changed, but you can’t argue that the rules aren’t working. Whether it’s because they aren’t enforced or because they aren’t strong enough is of no matter, the end result is the same.

Say I want to buy DVC for my retirement. I calculate the break even on my 500 point contract as 7 years of point rentals. For the first seven years, I rent 5 separate 1 week studio stays. At the end of 7 years, I’ve made my initial investment back, paid my yearly dues for 7 years, and pocketed a little money on the side. Now I have 500 points free and clear that I can sell for 75k or keep as my retirement vacation plan. Technically I am not breaking any rules, except the commercial renting rule which DVC doesn’t enforce. MANY members here are doing this. This wouldn’t matter in most timeshares, because they have no inherent value after 7 years, but people are treating DVC like a business instead of a vacation. The LLCs are doing this same thing x10000. If you think it’s coincidental that most of these brokerages are owned by former DVC employees, I don’t know what to tell you. Imagine working for Disney and making a pittance and then realizing all the loopholes that exist to make millions off the back of regular owners. The current distinction between commercial and personal use is so pointless it might as well not exist.

I know I sound like a broken record, but ever rental is not a commercial rental by definition when it comes to DVC but it seems that some are using it in that way.

While I agree that some commercial renting may be going on, we do not know how many memberships are in violation..could be a handful…those associated with brokers, and it could be a ton, owned by everyday owners.

So, let’s shift the conversation in the other direction…instead of what rules should surround commercial, what clarifications would you like to see DVC add for defining rentals under the personal use clause?

 

[BeachClub2014]

Let’s say there were 1000 rentals out there and those are owned by just 100 owners. Nothing for DVC to do because none of those owners are violating their contracts.

I'm not sure you can infer that. If 10 of those owners are commercial rental sites and do their rentals in one—or two-day increments (which is clearly happening), then they could very well be violating the POS related to rentals. We have no way of knowing. That's DVC's job to police.

I don't think I want the number lowered at all, and certainly wouldn't set it below 15, as even the few (6) one/two night rentals I did last year (rented points, not pre-existing reservations) would have bumped a 15 reservation limit during a rolling year, counting my own reservations.I can see where someone less than 1,000 points could easily hit the 20 reservation mark, if they rented out 250 or so points for short last minute stays.

I would like to lower the number that triggers a review to something more reasonable. Ten seems like a good number. I don't think anyone is suggesting limiting the reservations that an owner can have just when DVC steps in and reviews them.

We will disagree on that point then- I would say if abuse is this common, They do need to lower that number. Because people who are not running a commercial business with their DVC account would be able to display that and make whatever reservations they needed.

Yes. Agree.

So, how many total reservations do you feel is a good mix of personal and rentals for an owner to have at one time within that 12 months span?

I like the number ten. Anything larger than that gets reviewed.

I mean, why not have DVC simply manually investigate each and every reservation from each and every member before a final approval of the reservation is given. While you're waiting, you can't enter it into MDE, and if you're an AP holder you can't get your park days reserved until you receive final approval.

That seems a tad extreme.

o, it does appear that the Commercial Use language from 2007 is no longer being written into the contracts, and the RIV and Resort Use Plan for CFW do have a bit more specifics than VGF, the enforcement of it is not included. So, I emailed DVC because I want the legal document that currently exists that spells it out...and did include that I don't want a random CM to say "we do this..." Is it still the 20 reservation threshold, or is it different? As owners, that is something that should be included when and if it is ever updated....

Great catch! I'll be interested to see what else you can dig up!

So, again, if you want it adhered to in it's entirety, then you do want DVC to take the time and money to review each and every reservation and approve each one?

Nope. But I do want DVC to do their job with the money we are already paying them to manage the program and ensure compliance with the rules. That's their job.

 

[Sandisw]

I'm not sure you can infer that. If 10 of those owners are commercial rental sites and do their rentals in one—or two-day increments (which is clearly happening), then they could very well be violating the POS related to rentals. We have no way of knowing. That's DVC's job to police.


I would like to lower the number that triggers a review to something more reasonable. Ten seems like a good number. I don't think anyone is suggesting limiting the reservations that an owner can have just when DVC steps in and reviews them.


Yes. Agree.


I like the number ten. Anything larger than that gets reviewed.



That seems a tad extreme.


Great catch! I'll be interested to see what else you can dig up!


Nope. But I do want DVC to do their job with the money we are already paying them to manage the program and ensure compliance with the rules. That's their job.

My point in the example is that we can indeed infer that. If DVC sees 1000 rentals and investigates and finds they are owned by 100 owners, each with 10 rentals, and the threshold for an acceptable number of rentals is 20, then there is no further action that DVC would be taking because none of those memberships is breaking the rules.

However, people have stated that the mere existence of 1000 rentals on a brokers website means that all of those violate the contract, and without knowing who owns them, that conclusion can’t be drawn…as you say, that is up to DVC to figure out.

The problem right now seems to me that some want DVC to enforce rules that don’t exist. So, we really don’t know if DVC is failing to enforce the rules since the last document that was published with clear rules and enforcement was in 2007…

So, it will be interesting to see what I get, I still think people need to be careful what they wish for…if they want to maintain any level of ability to rent.

 

[BeachClub2014]

So, let’s shift the conversation in the other direction…instead of what rules should surround commercial, what clarifications would you like to see DVC add for defining rentals under the personal use clause?

Great question!

I think a simple step forward is for them to define their terms clearly. Fundamentally, what is a rental and how many are reasonable for the average owner to do?

If Owner A has 50 extra points, makes a reservation, and then charges a stranger money to use the reservation, is that a rental?

If Owner B has 50 extra points, makes a reservation, and allows a friend to use the reservation as a kind gesture, is that a rental?

If Owner C has 50 extra points, makes a reservation, and allows their employee to use the reservation as a performance incentive, is that a rental?

If Owner D has 50 extra points, makes a reservation, and then charges a family member just enough to cover the dues to use the reservation, is that a rental?

I'm sure that we can go on and on......

 

[BeachClub2014]

My point in the example is that we can indeed infer that. If DVC sees 1000 rentals and investigates and finds they are owned by 100 owners, each with 10 rentals, and the threshold for an acceptable number of rentals is 20, then there is no further action that DVC would be taking because none of those memberships is breaking the rules.

However, people have stated that the mere existence of 1000 rentals on a brokers website means that all of those violate the contract, and without knowing who owns them, that conclusion can’t be drawn…as you say, that is up to DVC to figure out.

Yes, neither your specific example or those who say that the mere existence of 1,000 rentals violates the rules can be verified by any of us.

I totally agree with you that that responsibility resides with DVC. I happen to believe that they are asleep at the wheel.

 

[mistysue]

Has anyone actually said that the fact that 1,000 rentals appear on a site means that ALL of them is a violation?
I can't help but feel like some of these statements are getting generalized in a way that polarizes this conversation and stops it from being meaningful.
Again, Disney did not say that it's okay to use the account commercially as long as you don't rent more than 20 reservations. They said that they won't review until someone has 20. That doesn't mean that up to 20 is allowed to be commercial rentals. It just means they don't look until you have 20 reservations. Not even Disney knows how many accounts are breaking the rules because they simply aren't reviewing to see if anyone is breaking them. That doesn't mean that those people aren't breaking a rule. It just means they aren't getting caught.

 

[Memorymakerfor4]

Rental brokers have been around since I have been an owner..15 years.. and they did make adjusts years go to prevent the number of associates owners can have as some of those brokers were being added so they could make reservations.

I think if DVc had the power to stop them, they would have.

Having said that, there are a lot more now and a lot more rentals by the average owner so the market is much different today.

Here are some things that I think might help with little impact to owners.

Change the rules that a review will be triggered when threshold is met over across all memberships an owner is part of.

Limit the number of points a trust or LLC can own..below the 8000 an owner can have.

Require owners to submit rental contracts..not for approval but notice.

Prevent owners of rental brokers from renting their own points in sites they own. For example, those that own or are related to owners of a rental agency would no longer be allowed to list on their site but could as a client elsewhere.

Personally, I want options to use others to help me rent, when and if I do, but I do understand that some would like to see safeguards to prevent any broker from being the middle man for themselves.

I agree that there are lots of different topics that get mixed in to one topic.

I'm learning so much from this thread. I've never rented but don't have a problem with an owner listing their points, even on a rental site (I like the idea of a go between and a level of added security). I do wish confirmed reservations could be stopped, but also wonder how.

Do the rules allow for a situation where certain seasons and/or room types can not be occupied by anyone other than the owner of the points? Or at least without triggering a review by Member Services? No CCV studios the last two weeks of December, for example. The person who books three studios for themselves and family would still be safe as the owner is still part of the larger party.

Also, I was watching the DVC Fan YouTube video about rules the other day and it was mentioned DVC could use a minimum night requirement. Would that make a difference? I can feel the blowback from that one especially, lol, but not so much if they said the owner has to be on the reservation in order to book fewer than say 3 nights, for example. So the night I book before a cruise would be safe because it's for me, but I couldn't book and sell a single night in a Value Studio. Sure, you could sell 3 nights in the Value, but it sure seems like those single nights are listed a lot.

Neither of these are particularly convenient and I'm sure would be unpopular. I don't know, it's hard.

 

[lowlight]

Has anyone actually said that the fact that 1,000 rentals appear on a site means that ALL of them is a violation?

As the OP, it is my opinion all of them are a violation. I can’t prove it, but at over 30 bucks a listing and many of them being one nighters, I can’t see the company shelling out 20k for individual owners listings.

 

[Sandisw]

Has anyone actually said that the fact that 1,000 rentals appear on a site means that ALL of them is a violation?
I can't help but feel like some of these statements are getting generalized in a way that polarizes this conversation and stops it from being meaningful.
Again, Disney did not say that it's okay to use the account commercially as long as you don't rent more than 20 reservations. They said that they won't review until someone has 20. That doesn't mean that up to 20 is allowed to be commercial rentals. It just means they don't look until you have 20 reservations. Not even Disney knows how many accounts are breaking the rules because they simply aren't reviewing to see if anyone is breaking them. That doesn't mean that those people aren't breaking a rule. It just means they aren't getting caught.

Yes, some have suggested that the sheer number of reservations on brokers sites snd elsewhere is proof that violations are occurring.

You keep saying that it doesn’t mean under 20 isn’t commercial, just that DVC won’t check…and if they checked sooner, they’d find violations. But, how can you say that without explaining what the violation is they would find?

That is where I keep getting confused.

Help me to understand what you are using to determine that…

Not sure I understand what you mean by DVC doesn’t even know how many are breaking the rules? Doesn’t that imply that the threshold has been defined lower?

Is it not possible that if DVC doesn’t check before 20 it is because in their mind, less than 20 doesn’t rise to the level of commercial use of a membership? Because, so far, I can’t find anything that DVC has posted to indicate what they are using, if not that.

That’s why we need to get DVC to update the terms for us….

ETA: to be fair, I do not know if they check below 20, that very well could be happening…and that 20 reservations threshold no longer holds true..hence my email to them to explain the rules and how they enforce them.

 

[mistysue]

As the OP, it is my opinion all of them are a violation. I can’t prove it, but at over 30 bucks a listing and many of them being one nighters, I can’t see the company shelling out 20k for individual owners listings.

I'm not understanding why the paid listing makes much of a difference is anyone listing that many items is likely working at a discount.
That said, it sort of boggles my mind that it would even remotely be possible to have this many one-day listings without hitting more than 20 reservations on an account. The amount of setup required to have this many points across so many separate memberships to avoid that rule would be overwhelming.

 

[DonMacGregor]

As someone who's utilized a broker a handful of times to get rid of banked points in resale contracts I've purchased and can't use, I'd still be more than happy to pay more in dues to ensure that DVC is actively enforcing whatever their current threshold for "commercial" activity vis-a-vis renting might be. Heck, I'd pay an extra $1 PP for the assurance that entities aren't warehousing or flipping contracts just to use the points for rentals. I'd especially like to see spec renting curtailed. For the amount of money I spend every year on Disney-related travel, that extra $1 is a drop in the bucket. Plus, the entertainment value of watching the meltdowns on social media would be worth its weight in gold.

 

[mistysue]

Yes, some have suggested that the sheer number of reservations on brokers sites snd elsewhere is proof that violations are occurring.

You keep saying that it doesn’t mean under 20 isn’t commercial, just that DVC won’t check…and thst it’s not they are breaking the rule, but not getting caught. Then

That is where I keep getting confused. How can you say they are breaking the commercial breaking rule if you are not defining what that means?

Help me to understand what you mean by that because continuing to say that people are breaking a rule without defining what that rule is is not making sense to me…

Words have meaning outside of only our specific contract with DVC. The DVC website has a FAQ asking about this, where they state "the use of your Vacation Points for commercial purposes is expressly prohibited. " And goes on to state commercial is a pattern the board could reasonably conclude is commercial. Commercial is a real word meaning engaged in commerce or intending to make a profit. DVD can set a standard for when they're going to enforce something or when they are going to investigate, but they have not actually created a new word.

DVD has said that they will not look at a membership with under 20 reservations, that does not mean that they are restricting the term commercial to mean more than 20. They did not redefine the term commercial as more than 20. They aren't looking until 20. Some quantity under 20 could still be commercial.

 

[Chuck S]

As someone who's utilized a broker a handful of times to get rid of banked points in resale contracts I've purchased and can't use, I'd still be more than happy to pay more in dues to ensure that DVC is actively enforcing whatever their current threshold for "commercial" activity vis-a-vis renting might be. Heck, I'd pay an extra $1 PP for the assurance that entities aren't warehousing or flipping contracts just to use the points for rentals. I'd especially like to see spec renting curtailed. For the amount of money I spend every year on Disney-related travel, that extra $1 is a drop in the bucket. Plus, the entertainment value of watching the meltdowns on social media would be worth its weight in gold.

Except...we really can't. DVC Management is limited to 12% of dues. Special assements are limited in what they can be used for, and "dues" outside the 12% to Disney managment is limited to actual care serviices,(Transporation, lawn care, normal maintenance), utilities, parking/road upkeep, and common area maintenance of your home resort only. If it is a limited number of hard to get studios is a major problem, dues from Resort A can not be used to correct a problem at Resort B. Thaat is why the different resorts have different dues. The reserve fund is specifically limited to scheduled refurbishments. Now, going to the trust system, like FWC, may allow costs to be spread between resorts that are in the trust, but not the legacy resort system.

 

[Sandisw]

Words have meaning outside of only our specific contract with DVC. The DVC website has a FAQ asking about this, where they state "the use of your Vacation Points for commercial purposes is expressly prohibited. " And goes on to state commercial is a pattern the board could reasonably conclude is commercial. Commercial is a real word meaning engaged in commerce or intending to make a profit. DVD can set a standard for when they're going to enforce something or when they are going to investigate, but they have not actually created a new word.

DVD has said that they will not look at a membership with under 20 reservations, that does not mean that they are restricting the term commercial to mean more than 20. They did not redefine the term commercial as more than 20. They aren't looking until 20. Some quantity under 20 could still be commercial.

Thanks for clarifying and I completely agree that something below 20 could indeed be considered commercial, but it only becomes that when DVC decides to add that to its “definition”…if they do, then that is what we all have to accept.

That really has been my point…while some feel commercial purposes needs to be more strictly defined, and want DVC to define it more strictly, it’s not a violation until that change in language occurs.

We do know that they can look for a “pattern of rental activity” which is very broad and why these discussions can become deep because it’s pretty easy for DVC to get around enforcement if it’s not defined.

That’s why I think the 2007 rule helped because DVC made it clear what they would and would not allow you to do with your membership, and when your reservations reached the commercial purpose stage.