Thoughts on Lowball Offer

[Paul Stupin]

But ultimately yes, higher fuel prices will lead to less disposable income and less travel leading to slightly fewer opportunities to hook people on DVC and slightly more people interested in disposing of their contracts. That should put additional negative pressure on the market.

If the invasion is protracted, with lengthy sanctions as a result, the mix of higher fuel prices and increasing interest rates could lead to a recession, that will lead to white collar job losses, and of course at that point all bets are off; I still think in a serious, sustained recession, that doesn’t involve massive government bailouts, the bottom will fall out of DVC entirely. The number of people looking to sell will increase 20%, 30%, maybe even 50% or more, and the number of people looking to buy will decrease similarly, leading to absolute fire sales. That’s in play, certainly.

This strikes me as an unlikely, apocalyptic scenario.

 

[CaptainAmerica]

But ultimately yes, higher fuel prices will lead to less disposable income and less travel leading to slightly fewer opportunities to hook people on DVC and slightly more people interested in disposing of their contracts. That should put additional negative pressure on the market.

If the invasion is protracted, with lengthy sanctions as a result, the mix of higher fuel prices and increasing interest rates could lead to a recession, that will lead to white collar job losses, and of course at that point all bets are off; I still think in a serious, sustained recession, that doesn’t involve massive government bailouts, the bottom will fall out of DVC entirely. The number of people looking to sell will increase 20%, 30%, maybe even 50% or more, and the number of people looking to buy will decrease similarly, leading to absolute fire sales. That’s in play, certainly.

Disney barely let up on ROFR during a pandemic that shut down half the company. ROFR will protect against any "fire sales" in a normal cyclical recession.

 

[RoseGold]

DVC hasn’t been impacted by much. Even the 2008-09 recession and Covid dropped prices only briefly and then it caught up again.

DVC’s biggest threat is itself. If DVC does some nonsense like another Aulani, they can devalue the product. Or if the parks keep angering users, they can certainly drive off ownership.

 

[davidl81]

This strikes me as an unlikely, apocalyptic scenario.

This is the internet, it’s basically specializes in apocalyptic scenarios.

 

[Paul Stupin]

DVC hasn’t been impacted by much. Even the 2008-09 recession and Covid dropped prices only briefly and then it caught up again.

DVC’s biggest threat is itself. If DVC does some nonsense like another Aulani, they can devalue the product. Or if the parks keep angering users, they can certainly drive off ownership.

Nonsense like Aulani?? I’d LOVE another Aulani!! If they were to build a DVC resort at their cruise line’s upcoming Lighthouse Point in the Bahamas, sign me up! Or if they ever took that empty lot right next door to Aulani, where Atlantis was going to go, and decided to build some cool new addition…bring it on…I’ll buy even more points!

I’m not sure we’re qualified to gauge the success or failure of Aulani either. They seem just fine with booking cash rooms, and appear happy, or at least resigned to maintaining the DVC price and bolstering sales with occasional incentives that offer great savings. And I don’t trade in the conspiracy theories that they’re secretly going to sell it behind our backs to Best Western, or that Hawaiian timeshare laws will somehow destroy 100% of my points’ worth.

Have you ever been there? The resort is hard not to like once you spend a few days there.

 

[DonMacGregor]

Nonsense like Aulani?? I’d LOVE another Aulani!! If they were to build a DVC resort at their cruise line’s upcoming Lighthouse Point in the Bahamas, sign me up! Or if they ever took that empty lot right next door to Aulani, where Atlantis was going to go, and decided to build some cool new addition…bring it on…I’ll buy even more points!

I’m not sure we’re qualified to gauge the success or failure of Aulani either. They seem just fine with booking cash rooms, and appear happy, or at least resigned to maintaining the DVC price and bolstering sales with occasional incentives that offer great savings. And I don’t trade in the conspiracy theories that they’re secretly going to sell it behind our backs to Best Western, or that Hawaiian timeshare laws will somehow destroy 100% of my points worth.

Have you ever been there? The resort is hard not to like once you spend a few days there.

I just don't get the whole "Aulani Failure" idea either. Yes, it hasn't sold out, but I doubt Disney cares as they can rent every single available room for cash at ridiculous rates until the cows come home. Ironically, there are several posts in other threads giving Disney kudos for the new VGF2 format of simply flipping hotel rooms and selling them as DVC, with a big point being the suggestion that they are easier to book for cash if any aren't booked on points (because they're still just hotel rooms). Good for VGF, bad for Aulani.

 

[RoseGold]

Replace Aulani with Vero2. FL is their home turf anyway. The point is DVC can swing wildly from the core product and create a huge amount of points competing at WDW.

Flipping some failed resort would be the cheapest way to add points into the system. It had to be an option on the table when all the construction got shut down. They could be doing it right now and we wouldn’t even know.

 

[Epcot Forever Forever]

This strikes me as an unlikely, apocalyptic scenario.

I agree it’s less than 50% likely to happen, but a recession isn’t particularly unlikely. We will get one eventually.

 

[Epcot Forever Forever]

DVC hasn’t been impacted by much. Even the 2008-09 recession and Covid dropped prices only briefly and then it caught up again.

I don’t think this is a fair reflection of what happened at all. Contracts could be obtained (and regularly were by members of this board) at 30% below previous prices. This very thread has reports of people paying mid 80s for BRV and 70s for SSR.

And it only lasted a few months before the government sent everyone a pile of money and the supply of contracts evaporated. A protracted recession would go differently. And the long timers here talk of prices falling 50% in 09-10 and ROFR suspended for almost 2 years.

 

[Paul Stupin]

Replace Aulani with Vero2. FL is their home turf anyway. The point is DVC can swing wildly from the core product and create a huge amount of points competing at WDW.

Flipping some failed resort would be the cheapest way to add points into the system. It had to be an option on the table when all the construction got shut down. They could be doing it right now and we wouldn’t even know.

Have never been to Vero Beach because the resort, though charming and cozy looking, just isn’t on the same level as what we see at WDW (which for some is understandably an advantage). But if DVC decided to tear it down in 2042 and replace it with something on the scale of Reflections, which they‘ll never do, I’d probably buy some points there. In the meantime, after all these months, we’ll finally know the ppp of VGF2!

 

[DonMacGregor]

Have never been to Vero Beach because the resort, though charming and cozy looking, just isn’t on the same level as what we see at WDW (which for some is understandably an advantage). But if DVC decided to tear it down in 2042 and replace it with something on the scale of Reflections, which they‘ll never do, I’d probably buy some points there. In the meantime, after all these months, we’ll finally know the ppp of VGF2!

And, at the risk of offending many, Florida, and in particular, the Atlantic coast, isn't Oahu.

 

[Sandisw]

I don’t think this is a fair reflection of what happened at all. Contracts could be obtained (and regularly were by members of this board) at 30% below previous prices. This very thread has reports of people paying mid 80s for BRV and 70s for SSR.

And it only lasted a few months before the government sent everyone a pile of money and the supply of contracts evaporated. A protracted recession would go differently. And the long timers here talk of prices falling 50% in 09-10 and ROFR suspended for almost 2 years.

I bought BWV in 2012 in the 50s and SSR in 2017 in the 70s. So, there were some great deals to be had for quite a long time!

 

[gharter]

Things to consider with a "low-ball offer".
1. It could be accepted. But if the price is too low, Disney most likely will take it back. But maybe yours is one that slips through and you get a great deal.
2. It could be declined. The owner may counter and you negotiate or they could just refuse another offer from you.

 

[ProudMommyof2]

I think it depends what you consider "low ball".
I recently offered $155PP for a contract asking $180 at PVB.
Looking at the ROFR thread on this board- I knew many contracts were going for around $160PP- which is where we settled. The board sponsor states their average price for PVB last month was $173.

So, I certainly offered much less than the asking price- but not much less than the recent sale prices.
I would be concerned with being much below the recent selling prices or what has been taken with ROFR

 

[Epcot Forever Forever]

I think considering ROFR in making bids in this market is foolish. If they take it they take it, but there’s so many contracts on the market, just keep trying, they literally can’t take all of them.

 

[Paul Stupin]

I think considering ROFR in making bids in this market is foolish. If they take it they take it, but there’s so many contracts on the market, just keep trying, they literally can’t take all of them.

That is a valid strategy, but making lowball offer after lowball offer continuously will no doubt payoff eventually, but can add additional months to the process. So the additional savings do indeed have a cost: your time, and the ability to actually use the points.

 

[BeachClub2014]

That is a valid strategy, but making lowball offer after lowball offer continuously will no doubt payoff eventually, but can add additional months to the process. So the additional savings do indeed have a cost: your time, and the ability to actually use the points.

It can definitely slow the process down, that's for sure. But for many resale buyers, we have the luxury of time on our side. May not be true for everyone, but I am willing to roll the dice with ROFR to get a really attractive deal.

 

[cbyrne1174]

Have never been to Vero Beach because the resort, though charming and cozy looking, just isn’t on the same level as what we see at WDW (which for some is understandably an advantage). But if DVC decided to tear it down in 2042 and replace it with something on the scale of Reflections, which they‘ll never do, I’d probably buy some points there. In the meantime, after all these months, we’ll finally know the ppp of VGF2!

They probably will sell Vero beach and Hilton Head off to another vacation club company, not tear it down. Wyndham has more properties that it bought from other companies than what it actually built itself. My guess is that Marriott, Hilton or Wyndham will just buy those properties and rebrand them as their own just like the Nickelodeon hotel was rebranded to Holiday Inn.

 

[Dina]

Problem is....if its really low, even if seller accepts, Disney will probably buy back in ROFR. We offered seller asking price (which was a very fair asking price) because we wanted the contract.

 

[Paul Stupin]

It can definitely slow the process down, that's for sure. But for many resale buyers, we have the luxury of time on our side. May not be true for everyone, but I am willing to roll the dice with ROFR to get a really attractive deal.

But certainly a lot of resale buyers are eager to get their points posted and start booking vacations, in which case it wouldn’t pay to chase a really attractive deal, if they could get an attractive deal instead with a greater chance of passing ROFR.