Trying to help a friend decide on first resort for DVC purchase

[RoseGold]

With RIV and VGF at roughly the same price, I think you have to take a hard look at RIV's resale restrictions and decide what they mean to you in the long term. Three years later, RIV is only half sold and there's no real RIV resale in play.

Over time, more and more resales are going to be trapped in RIV, and Disney might be selling RIV for a long time, like Aulani. I would much rather be selling or renting out VGF in 10 years.

But if you plan to have DVC pried out of your dead hands, or you really want RIV, maybe the resale restrictions don't matter so much. I plan to sell in less than 10 years, so to me, RIV's resale restrictions are a complete non-starter. I'd pick VGF even at a much higher price than it currently is.

If you need points right now, rent them. Heck, rent any resort you want while you can still get priority in December. I wouldn't lock into a decades commitment because you want direct points right this minute.

 

[smmora]

If money isnt a big issue
I would do a Feb Use year GFV for 200 pts
that gives him 300 for this Dec trip and the 100 new points are loaded in Feb
Also only pay fees for June -> Dec for 2022

 

[CarolynFH]

I would do a Feb Use year

If visits will be mostly November through February, a February UY would be about the worst UY, at least for the November through January visits, because of the very short time that would be left to reschedule before the end of the UY.

Study the Understanding Use Year thread.

 

[smmora]

Oh, i missed the travel dates ... i just saw was Dec this year

Works even better with an Oct Use Year,
with a 200pt purchase you can book Dec borrowing 100 upon purchase
and you only pay fees for Oct -> Dec

 

[defrogger]

I voted Grand Floridian if going direct. I do think 2 bedrooms point charts are really high there though. But currently $207/p is probably the best direct pricing you can get and low dues. Rivera the dues are over a $1/p more which makes a big difference. Its sounds strange to say but Grand probably has the best SAP for going direct.
So i would get Grand and use it for places like OKW and Saratoga for 2 bedrooms.
It does stink that theres no 2021 points and you would only have 150 points for this Dec, but remember this is a long term purchase so try not to base the purchase on getting enough points for your first trip.

Im still new, but December seems to be a tough time to get a room without 11 month window except for Saratoga and OKW.

 

[sethschroeder]

Over time, more and more resales are going to be trapped in RIV

Roughly 1% per year turns over to resale long term. Meaning in 20 years you can expect 20% of the resort to be resale based contracts with the restrictions (if they keep them).

I would suspect a vast majority of BCV resale buyers only buy to stay there. Yes they might stay somewhere else but you already have this playing out at other resorts that command a premium in the resale market.

It could be different for Riviera but no way to know except to assume its going to be roughly the same turn over as other resorts.

If you plan on selling though I would skip Riviera. If you buy Riviera you should both love the resort and plan on keeping long term IMO. Doesn't mean you can't sell but just don't have it as your plan going in.

 

[DeeBee3]

Buy where you want to stay. As for this December, that is one of the busiest times of year. It may be difficult depending on resort. Nov/December are incredibly busy, but if he might travel post holiday Jan/Feb, that would be less busy (not counting holiday weekends). He needs to do the numbers and see what works out for him with point charts, etc.

 

[DVCsloth]

I voted for Riviera; you can use your points anywhere if bought from Disney. You can take advantage of OKW point charts and still have 11 months booking at Riviera. I would avoid VGF because of the new Studio Only addition.

 

[koncra]

BLT had some pretty great incentives not too long ago, not sure if they’re still offering them?

It’s my vote regardless. He may think he likes OKW now but that could change so it would be nice to have a real 11 month advantage somewhere else where it’s more useful. Plus, the room sizes of BLT are great in the bigger units and the location is so good.

 

[RoseGold]

Roughly 1% per year turns over to resale long term. Meaning in 20 years you can expect 20% of the resort to be resale based contracts with the restrictions (if they keep them).

I don't see how that number can be accurate. Maybe it's like the everyone sells in 8 years number that no one can document.

I thought even the foreclosure rate was higher than that, and most of those are finance companies, which means it goes to resale or gets bought by Disney at auction.

 

[hglenn]

Well he want to buy direct because he doesn't want to wait for resale ROFR and the $$ difference doesn't matter to him. Plus he also wants to be able to use his points at Riv if he wants to. He plans on going every other year for a week so 150 points would achieve that goal. As far as selling it, he's planning on holding onto it and passing it down to the kids, but you never know what could happen. He certainly knows the value of a $$, but his time is even more valuable than that. So basically, I was just trying to help him determine the best value for his home resort for a direct point purchase. Resale is not an option for him in his eyes. He doesn't care how much more it is, he just doesn't want to wait for it. I can't help but think as far as term vs $$ per point and the ability to get double points right out of the gate, that Riv is probably the best "deal". Hard to pay OKW prices even if he plans on staying there most of the time when you can get Riv points cheaper per point and have a longer term on the deed. Also would be more valuable to rent out if that need arised.

The timeline is exactly why we are going direct, too. At least for our first contract. This has been a great thread for me, too, bc we were also planning to buy RIV. We like the resort, too, so it makes sense for us but love all the comments!

 

[sethschroeder]

I don't see how that number can be accurate. Maybe it's like the everyone sells in 8 years number that no one can document.

I thought even the foreclosure rate was higher than that, and most of those are finance companies, which means it goes to resale or gets bought by Disney at auction.

This is accurate from information that both maps to what a historical poster found regarding OKW and what active resales data has shown for DVC from pulling contracts from the county. So its not applicable to other locations other than WDW which could vary more.

Foreclosure and buy back ends up being back as a direct sale. So it doesn't add to the number of restricted resale buyers that Riviera would see.

Also the 8 years comment is fairly flawed because its all an average of when people do sell not when people who don't sell will sell. Its hard to have a higher average number of years than what most points had existed when that saying first came around.

 

[Sandisw]

Roughly 1% per year turns over to resale long term. Meaning in 20 years you can expect 20% of the resort to be resale based contracts with the restrictions (if they keep them).

I would suspect a vast majority of BCV resale buyers only buy to stay there. Yes they might stay somewhere else but you already have this playing out at other resorts that command a premium in the resale market.

It could be different for Riviera but no way to know except to assume its going to be roughly the same turn over as other resorts.

If you plan on selling though I would skip Riviera. If you buy Riviera you should both love the resort and plan on keeping long term IMO. Doesn't mean you can't sell but just don't have it as your plan going in.

To add, once a direct contract turns over to resale, it never turns again, no matter how often it is sold.

So, if in 20 years, you have 20%, it’s probably not going to be much higher as a total of the resort.

 

[Sandisw]

I don't see how that number can be accurate. Maybe it's like the everyone sells in 8 years number that no one can document.

I thought even the foreclosure rate was higher than that, and most of those are finance companies, which means it goes to resale or gets bought by Disney at auction.

But, remember, a resale contract only becomes resale once and that is when the direct owner sells it or is forecloses on.

If the person bought it resale and sells it again, it doesn’t impact the % of the resort that is resale…it just changes who the owner is.

I bought a 125 point contract resale and if I sell it, those 125 points are still only counted once in the resale vs direct number because they are already restricted points.

So while the other number may be high, when talking about number of points that are resale, that only changes when the original owner changes…not every time a resale contract gets sold again.

 

[RoseGold]

This is accurate and information that both maps to what a historical poster found regarding OKW and what active sales data has shown for DVC from pulling contracts from the county. So its not applicable to other locations other than WDW which could vary more.

Foreclosure and buy back ends up being back as a direct sale. So it doesn't add to the number of restricted resale buyers that Riviera would see.

Disney can foreclose for dues. But foreclosure is often financing, not dues, which isn't Disney. They can sell them in the normal resale market or auction them, which I haven't seen much about in a while.

I saw the BLT foreclosure stats, and it was that high. And that was in a historic time of appreciation, when it would have been pretty hard to be underwater. Now, plenty of RIV/CCV/VGF2 direct buyers will be underwater, especially if they financed. In that situation, it might make more sense to let it foreclose instead of bringing money to the table to get the sale done.

 

[sethschroeder]

Disney can foreclose for dues. But foreclosure is often financing, not dues, which isn't Disney. They can sell them in the normal resale market or auction them, which I haven't seen much about in a while.

I saw the BLT foreclosure stats, and it was that high. And that was in a historic time of appreciation, when it would have been pretty hard to be underwater. Now, plenty of RIV/CCV direct buyers will be underwater, especially if they financed. In that situation, it might make more sense to let it foreclose instead of bringing money to the table to get the sale done.

From my understanding the foreclosures often go to auction at which point Disney buys back a large portion of them because they have all the data on the contracts. There was a post a while back regarding buying through the auction site and it seemed to point to it not really being worth your time.

If the Finance company just decided to sell it then it would show up as a recorded resale deed and be in the data.

Now didn't do this for the past 20 years but when more recent data in the past couple years matched up to what someone else found who tracked down basically every OKW deed back a decade ago I didn't question it much since that was good enough for me to go off of.

 

[Lumpy1106]

BLT - buy resale. You can sleep 5 in a 1br there pretty comfortably. It has 2 bathrooms, a sleeper chair and a sleeper sofa. If your kids are like mine and don't like sharing the sleeper sofa you can "covert" the dining area into another bed.

 

[kilik64]

But, remember, a resale contract only becomes resale once and that is when the direct owner sells it or is forecloses on.

If the person bought it resale and sells it again, it doesn’t impact the % of the resort that is resale…it just changes who the owner is.

I bought a 125 point contract resale and if I sell it, those 125 points are still only counted once in the resale vs direct number because they are already restricted points.

So while the other number may be high, when talking about number of points that are resale, that only changes when the original owner changes…not every time a resale contract gets sold again.

But if Disney exercises ROFR on your 125, bingo bango it becomes direct points again when they sell them.

That alone should mean theres some kinda ceiling to how many points are resale was direct.

 

[kilik64]

From my understanding the foreclosures often go to auction at which point Disney buys back a large portion of them because they have all the data on the contracts. There was a post a while back regarding buying through the auction site and it seemed to point to it not really being worth your time.

If the Finance company just decided to sell it then it would show up as a recorded resale deed and be in the data.

Now didn't do this for the past 20 years but when more recent data in the past couple years matched up to what someone else found who tracked down basically every OKW deed back a decade ago I didn't question it much since that was good enough for me to go off of.

I think JETSDAD is who knows the most about this, but basically what you said is correct. Foreclosures go through an auction process and DVD knows all the specifics of a contract whereas its hard to figure that out yourself or for anyone else buying it.

People and certain board sponsors end up buying quite a few though through this process however. The major upside is there is no ROFR since the auction was basically the ROFR, Disney doesnt win the auction, that was their ROFR chance.

 

[Sandisw]

But if Disney exercises ROFR on your 125, bingo bango it becomes direct points again when they sell them.

That alone should mean theres some kinda ceiling to how many points are resale was direct.

Great point And your right, that further reduces the number of resale points.

So, if the average DVC resort currently sees around a 20% ceiling for resale points, I just don’t see RIV being worse.

If anything, it may be lower because if the value tanks, people could hold longer to just rent vs sell.