Thoughts on Aul dues, will they increase like VB/HHI

[AstroBlasters]

No. That’s pretty involved since there is so many factors at play and will vary person to person. Some don’t pay taxes on gains some do, some lose money in investments some don’t. Some make 5% some make can make more. I’m looking at it as an apples to apples money sitting in a checking account standpoint which I know is not the most financially responsible way to look at it. it’s just a quick way of showing how dues makes a large impact on overall cost of a contract.

Over the life of the contact at 100 points subsided at $120pp is the same as paying $28pp non subsidized. Of course big financial up front cost vs very low up front financial cost. But the numbers are still shocking none the less. I hope Aulani never sees $28pp in the near future if so all of DVC would likely be in trouble at that point imo.

When I ran my own spreadsheet I didn’t come anywhere close to those numbers. But I also believe you have to take into account a conservative return on the amount of upfront cash savings.

 

[VGCgroupie]

When I ran my own spreadsheet I didn’t come anywhere close to those numbers. But I also believe you have to take into account a conservative return on the amount of upfront cash savings.

Yep they are accurate as far as total cost pp and total contact cost over the life. I did math, husband did the math and then it was also entered into a spreadsheet.

 

[AstroBlasters]

Yep they are accurate as far as total cost pp and total contact cost over the life. I did math, husband did the math and then it was also entered into a spreadsheet.

But to clarify, without taking into account any of the lost potential of the additional buy in price?

 

[VGCgroupie]

But to clarify, without taking into account any of the lost potential of the additional buy in price?

Correct.

 

[AstroBlasters]

Correct.

So if you used the same methodology for a $225pp VGC contract, what would it value VDH when taking into account the higher dues and TOT?

 

[Chili327]

I’m looking for the best bang for my buck in the DVC world for SAP not due to my love for Aulani.

I wouldn’t buy Aulani just for subsidized dues. If you’re not planning on staying there, just get CCV/BLT for best value. Aulani-S dues are not much less than BLT/CCV (or even VGF)

 

[VGCgroupie]

So if you used the same methodology for a $225pp VGC contract, what would it value VDH when taking into account the higher dues and TOT?

VGC 150pts @225pp
Total Cost $78,637.50
Total Cost Per Year $2,246.79
Cost PP $14.98

VDH 150pts @176.33pp
Total Cost $96,495.00 ($117,589.50 w/ TOT)
Total Cost Per Year $1,969.29 ($2399 w/ TOT)
Cost PP $13.13 ($16.00 w/ TOT)

This assumes TOT @2.87pp and doesn’t take into account any dues increases or TOT increases. I do have a sheet that gives numbers based on dues increases of 5% each year and currently working on one that will apply a dues increase specific to each resort based of historical dues data. For VDH that one would be hard since there’s not much data.

 

[AstroBlasters]

VGC 150pts @225pp
Total Cost $78,637.50
Total Cost Per Year $2,246.79
Cost PP $14.98

VDH 150pts @176.33pp
Total Cost $96,495.00 ($117,589.50 w/ TOT)
Total Cost Per Year $1,969.29 ($2399 w/ TOT)
Cost PP $13.13 ($16.00 w/ TOT)

This assumes TOT @2.87pp and doesn’t take into account any dues increases or TOT increases. I do have a sheet that gives numbers based on dues increases of 5% each year and currently working on one that will apply a dues increase specific to each resort based of historical dues data. For VDH that one would be hard since there’s not much data.

Right, but you stated that AUL is worth $92pp less than AUL-S based on based on a $2.42 dues delta.

So, how much less is VDH worth than VGC if the dues and TOT are $3.70 more?

 

[VGCgroupie]

Right, but you stated that AUL is worth $92pp less than AUL-S based on based on a $2.42 dues delta.

So, how much less is VDH worth than VGC if the dues and TOT are $3.70 more?

oh I see what you are saying. VDH vs VGC can’t really be compared in the same way as AUL vs AUL/S since the contract lengths are so different.

 

[VGCgroupie]

Right, but you stated that AUL is worth $92pp less than AUL-S based on based on a $2.42 dues delta.

So, how much less is VDH worth than VGC if the dues and TOT are $3.70 more?

oh I see what you are saying. VDH vs VGC can’t really be compared in the same way as AUL vs AUL/S since the contract lengths are so different.

So this was fun to calculate. In order to get a comparison I took the life of VDH down to the same amount of years left as VGC.

VDH would be the same as $225 VGC at $190.60 w/o TOT.
With TOT $90.25

 

[AstroBlasters]

So this was fun to calculate. In order to get a comparison I took the life of VDH down to the same amount of years left as VGC.

VDH would be the same as $225 VGC at $190.60 w/o TOT.
With TOT $90.25

Now, how much are the extra years worth? Because in theory there is some residual value for VDH at the expiration of VGC.

Perhaps depreciate the VDH contract at 2% per year for the remaining years?

 

[VGCgroupie]

Now, how much are the extra years worth? Because in theory there is some residual value for VDH at the expiration of VGC.

Perhaps depreciate the VDH contract at 2% per year for the remaining years?

Great idea. I’ll do that one tomorrow. I’d actually really like to know since I’m still considering my direct purchase to be VDH even though it pains me to do it because I love VGC so much more.

 

[AstroBlasters]

Great idea. I’ll do that one tomorrow. I’d actually really like to know since I’m still considering my direct purchase to be VDH even though it pains me to do it because I love VGC so much more.

Excellent!

And for modeling purposes, perhaps consider putting any upfront cost difference between two resorts into a 30-year US Treasury. The current yield is 4.44%. You could also look at a 30-year TIP at 2.16% on top of whatever CPI you are using for inflation. Those rates require no skill to achieve and carry no principal risk if held to maturity.

 

[Chili327]

Now, how much are the extra years worth? Because in theory there is some residual value for VDH at the expiration of VGC.

Perhaps depreciate the VDH contract at 2% per year for the remaining years?

Great idea. I’ll do that one tomorrow. I’d actually really like to know since I’m still considering my direct purchase to be VDH even though it pains me to do it because I love VGC so much more.

Excellent!

And for modeling purposes, perhaps consider putting any upfront cost difference between two resorts into a 30-year US Treasury. The current yield is 4.44%. You could also look at a 30-year TIP at 2.16% on top of whatever CPI you are using for inflation. Those rates require no skill to achieve and carry no principal risk if held to maturity.

The answer is going to be what the reasonable/value of resale price for VDH should be.

 

[ehh]

So I know I said I might have been convinced to avoid AUL entirely just yesterday, but I started doing a deeper look at 'most economical points' last night, and, um, I might be back on the AUL-train (but only subsidized).

It's not ready to post fully, but I borrowed from @CastAStone's 'Discount' methodology for upfront cost weighting over time (though I might have used slightly different math) and my own dues forecasting methodolgy, then plotted it out over the course of the contract length.

I mostly want to look at the first 5 or 10 years of a contract, rather than just the 1st year. I realized that with variable dues growth, some resorts might have a lower year 5 cost than year 10. And if dues growth was low enough compared to contract length (BCV, BWV, and VGF), maybe even out past year 10.

I will eventually make a fuller post about this with more effort, but here's just a '5% discount', zoomed in through 2035, and with random chart colors not conducive for readability:


The Aulani Subsidized numbers sure are something...I used $129/pt for AUL-S and $97 for AUL.

Also, with a 5% annual value decay (rather than 'discount') and $82 for OKW42 and $116 for OKW57, the last 15 years work out to $32.29 in additional value, which is almost exactly what the market organically priced them at ($34).

 

[AstroBlasters]

So I know I said I might have been convinced to avoid AUL entirely just yesterday, but I started doing a deeper look at 'most economical points' last night, and, um, I might be back on the AUL-train (but only subsidized).

It's not ready to post fully, but I borrowed from @CastAStone's 'Discount' methodology for upfront cost weighting over time (though I might have used slightly different math) and my own dues forecasting methodolgy, then plotted it out over the course of the contract length.

I mostly want to look at the first 5 or 10 years of a contract, rather than just the 1st year. I realized that with variable dues growth, some resorts might have a lower year 5 cost than year 10. And if dues growth was low enough compared to contract length (BCV, BWV, and VGF), maybe even out past year 10.

I will eventually make a fuller post about this with more effort, but here's just a '5% discount', zoomed in through 2035, and with random chart colors not conducive for readability:
View attachment 876705

The Aulani Subsidized numbers sure are something...I used $129/pt for AUL-S and $97 for AUL.

Also, with a 5% annual value decay (rather than 'discount') and $82 for OKW42 and $116 for OKW57, the last 15 years work out to $32.29 in additional value, which is almost exactly what the market organically priced them at ($34).

I would be curious to see what AUL @$90pp BLT @ $125pp would look like…..

 

[VGCgroupie]

So I know I said I might have been convinced to avoid AUL entirely just yesterday, but I started doing a deeper look at 'most economical points' last night, and, um, I might be back on the AUL-train (but only subsidized).

It's not ready to post fully, but I borrowed from @CastAStone's 'Discount' methodology for upfront cost weighting over time (though I might have used slightly different math) and my own dues forecasting methodolgy, then plotted it out over the course of the contract length.

I mostly want to look at the first 5 or 10 years of a contract, rather than just the 1st year. I realized that with variable dues growth, some resorts might have a lower year 5 cost than year 10. And if dues growth was low enough compared to contract length (BCV, BWV, and VGF), maybe even out past year 10.

I will eventually make a fuller post about this with more effort, but here's just a '5% discount', zoomed in through 2035, and with random chart colors not conducive for readability:
View attachment 876705

The Aulani Subsidized numbers sure are something...I used $129/pt for AUL-S and $97 for AUL.

Also, with a 5% annual value decay (rather than 'discount') and $82 for OKW42 and $116 for OKW57, the last 15 years work out to $32.29 in additional value, which is almost exactly what the market organically priced them at ($34).

I’m loving this. I actually came to this conclusion yesterday (without such an amazing graph) but kept it to myself until I secured the contract for the AUL-S I had originally declined the sellers counter on. So I’m rolling the dice with AUL-S and hoping for the best longish term outcome.

 

[Chili327]

So I know I said I might have been convinced to avoid AUL entirely just yesterday, but I started doing a deeper look at 'most economical points' last night, and, um, I might be back on the AUL-train (but only subsidized).

It's not ready to post fully, but I borrowed from @CastAStone's 'Discount' methodology for upfront cost weighting over time (though I might have used slightly different math) and my own dues forecasting methodolgy, then plotted it out over the course of the contract length.

I mostly want to look at the first 5 or 10 years of a contract, rather than just the 1st year. I realized that with variable dues growth, some resorts might have a lower year 5 cost than year 10. And if dues growth was low enough compared to contract length (BCV, BWV, and VGF), maybe even out past year 10.

I will eventually make a fuller post about this with more effort, but here's just a '5% discount', zoomed in through 2035, and with random chart colors not conducive for readability:
View attachment 876705

The Aulani Subsidized numbers sure are something...I used $129/pt for AUL-S and $97 for AUL.

Also, with a 5% annual value decay (rather than 'discount') and $82 for OKW42 and $116 for OKW57, the last 15 years work out to $32.29 in additional value, which is almost exactly what the market organically priced them at ($34).

How does this look if you go out longer than 10 years? (I guess technically half are gone in 15. lol)

I would be curious to see what AUL @$90pp BLT @ $125pp would look like…..

Agree!!

 

[DonMacGregor]

Hurricane Iniki repair costs for the Grand Hyatt Kauai were $30M in 1993. That’s $66M in todays dollars, but the way construction costs have gone over the last 30 years it would probably cost $200M today.

And it was closed for a year. That’s my thoughts on dues. Lots of risk.

https://www.latimes.com/archives/la-xpm-1993-04-18-tr-24281-story.html

That's also the last hurricane to hit Hawaii and was a meteorological aberration (and it was in 1992). You just don't see many hurricanes in that part of the central/eastern Pacific very often and the mechanism for creating them there isn't being altered by global warming to the extent that the pattern is going to change radically any time soon. Stronger El Nino's can definitely mean bigger storms, but Hawaii just doesn't get hurricanes on any kind of regular basis. Plus, Aulani is on the leeward side of the island.

HHI and VBR are hit by multiple strong tropical depressions every single year, and the potential to fall inside a hurricane's track happens multiples times every year. That, and the relative differences in construction means and methods and age between Aulani and the other two resorts also means a far lower potential for damage, Oahu versus Vero Beach or Hilton Head.

 

[ehh]

How does this look if you go out longer than 10 years? (I guess technically half are gone in 15. lol)



Agree!!

Zoomed out to 2070 is a lot harder to read with all the resorts on there at once:

I would be curious to see what AUL @$90pp BLT @ $125pp would look like…..

Zoomed to first ~10 years:


Full contract lengths: