Two 1,000 points contracts sold for VGF

[zavandor]

https://dvcnews.com/dvc-program/fin...-up-overall-direct-sales-down-in-january-2023

If you purchased one of them, I just want to say I'm jealous, but also... good luck selling it if you change your mind.

 

[Sandisw]

Crazy! Looks like the pricing strategy for lowering VGF is working!

 

[Nursemanit]

I will keep consistent in my opinion - Discounts work. This is the first month totals where we have a level playing field ( no RR double points). I predict if the discounts are made equal we would see RR and VGF flip rough equal as resort location MK vs Epcot would divide when $ is equal.

 

[Spivey378]

I split it up into two 1000 point contracts to make it easier to sell.

 

[AnnaKristoff2013]

I will keep consistent in my opinion - Discounts work. This is the first month totals where we have a level playing field ( no RR double points). I predict if the discounts are made equal we would see RR and VGF flip rough equal as resort location MK vs Epcot would divide when $ is equal.

Riviera doing poorly versus VGF is really helpful for those that hope Disney pulls back from the resale restrictions “experiment”

 

[Nursemanit]

Riviera doing poorly versus VGF is really helpful for those that hope Disney pulls back from the resale restrictions “experiment”

RR is not doing poorly - the market is. People are looking to get direct points at the best price possible. I can’t be the only one who shopped direct last summer at what was about 182 point vs PVB resale at 162 and said ok I can stomach the 20 a point spread for better flexibility down the road. I will not buy at 217 a point when I can get PVB at 155 now. The market has changed.

 

[RoseGold]

I will keep consistent in my opinion - Discounts work.

Uh, 110,000 points/month is working?

RIV (2019) was like 7M points, VGF2 (2021) 2.5M points. That's 9.5M points for 4 years, 2019-2023, assuming Poly2 will go online 2024. DVC needs to sell 200,000 points a month just to keep up with what they are putting into the system -- and assuming DLT will just sell through and not be in this discussion.

Add in millions of Aulani points still sitting, some foreclosures and a little ROFR also in that 110,000, and the bags are growing. You can see why ROFR is not appealing right now.

Historically, DVC has been able to sell out, but not now. Still holding bags on three properties and not keeping pace with construction. This is a dangerous place to be in a recession with a shiny new building rising in the swamp, and another one in California.

 

[DonMacGregor]

If they’d just throw in a terry cloth robe and a 12-pack of Cottonelle, they’d sell out in days if not weeks.

 

[CarolMN]

https://dvcnews.com/dvc-program/fin...-up-overall-direct-sales-down-in-january-2023

If you purchased one of them, I just want to say I'm jealous, but also... good luck selling it if you change your mind.

I'm jealous, too. That's enough for a week in a Grand Villa every year for most times of the year. Those VGF Grand Villas are really nice!

 

[tjkraz]

Historically, DVC has been able to sell out, but not now. Still holding bags on three properties and not keeping pace with construction. This is a dangerous place to be in a recession with a shiny new building rising in the swamp, and another one in California.

I'm guessing you weren't around during this period of expansion:

AKV Kidani (May 2009)
Treehouse Villas (May 2009)
BLT (August 2009)
VGC (September 2009)
Aulani (August 2011)

Unsold rooms can be sold to cash guests. It's a pretty low risk for Disney.

DVC isn't blind to the effect of price increases. If the primary goal was to sell out VGF and RIV as quickly as possible, they wouldn't have raised prices and lowered incentives. The $217 price point is setting the table for VDH and they can always increase incentives later. Meanwhile, there's logic in selling fewer units at a higher profit margin.

 

[RoseGold]

Unsold rooms can be sold to cash guests. It's a pretty low risk for Disney.

DVC isn't blind to the effect of price increases. If the primary goal was to sell out VGF and RIV as quickly as possible, they wouldn't have raised prices and lowered incentives. The $217 price point is setting the table for VDH and they can always increase incentives later. Meanwhile, there's logic in selling fewer units at a higher profit margin.

Until it's not low risk because and Aulani is half sold and closed. Of course owning millions of points is risk, and wasn't the point of making timeshare units to sell.

Right now, DVC is sitting on millions of unsold points and adding two giant new properties in the system. Combine this with resale restrictions and a large resale market that is directly competing with new DVC, and it's a position DVC hasn't been in before. DVC is intentionally competing with itself with a different product than legacy DVC.

If I were Disney, I would probably do the resale restrictions and keep prices high as well. But we will see how that strategy goes when millions more points are in the system shortly, maybe more than RIV? Could be a rough transition.

 

[tidefan]

Until it's not low risk because and Aulani is half sold and closed. Of course owning millions of points is risk, and wasn't the point of making timeshare units to sell.

Right now, DVC is sitting on millions of unsold points and adding two giant new properties in the system. Combine this with resale restrictions and a large resale market that is directly competing with new DVC, and it's a position DVC hasn't been in before. DVC is intentionally competing with itself with a different product than legacy DVC.

If I were Disney, I would probably do the resale restrictions and keep prices high as well. But we will see how that strategy goes when millions more points are in the system shortly, maybe more than RIV? Could be a rough transition.

Aulani is a different animal, only because they are able to rent the unused inventory pretty easily out there, so I don't know that they are that concerned with the sales timeline out there.

HOWEVER, I bet they are concerned about sales at WDW properties. I would imagine they thought that VGF2 would sell much quicker than it has. I also think they are running into a big issue with the spread on Direct vs. Resale. Resale prices have been dropping to the point where it really just doesn't make sense to buy direct (in most cases). Also, I believe that not having AP availability is really hurting with add-on sales to existing members. It is a lot harder to justify going multiple times a year without an AP.

 

[tjkraz]

Right now, DVC is sitting on millions of unsold points and adding two giant new properties in the system. Combine this with resale restrictions and a large resale market that is directly competing with new DVC, and it's a position DVC hasn't been in before.

In many ways, this is a repeat of 2008-2010. Resale prices were way down due to the recession + housing crisis. Aulani was plagued by the dues fubar and DVC's head was fired. Still they announced and started building the original VGF in 2011 while still actively selling SSR, AKV, BLT and Aulani.

Having two WDW resorts in active sales is somewhat unusual for today's DVC but holding millions of unsold points is not.

As of April 2019, DVC had over 7 million unsold points between CCV and Riviera. Today they have 4.4 million between VGF and RIV. Poly 2 is still almost 2 years away from opening and it's not terribly large. Even if DVC continues selling a modest 110k points per month in VGF + RIV, they'll be down to about 2-2.5M points in those two properties combined when Poly enters the fray. Better incentives and an improved economy could easily reduce that number further.

The resale market has the potential to alter direct sales going forward. This has always been true to a degree. Direct sales thrives on uninformed consumers and desire for new properties which are unavailable via resale.

DVC could increase sales at any time by improving incentives. The fact that they aren't suggests they're largely content with current results. I suspect we'll see moderately better incentives in March but they're not going to dramatically roll back prices in the interest of selling a higher volume.

 

[DVC Doctor]

The largest deeds sold in January were two 1,000-point deeds for Grand Floridian purchased by different buyers. A third new buyer bought 1,000 Riviera points, splitting the purchase into five 200-point deeds.

 

[Stank]

Uh, 110,000 points/month is working?

RIV (2019) was like 7M points, VGF2 (2021) 2.5M points. That's 9.5M points for 4 years, 2019-2023, assuming Poly2 will go online 2024. DVC needs to sell 200,000 points a month just to keep up with what they are putting into the system -- and assuming DLT will just sell through and not be in this discussion.

Add in millions of Aulani points still sitting, some foreclosures and a little ROFR also in that 110,000, and the bags are growing. You can see why ROFR is not appealing right now.

Historically, DVC has been able to sell out, but not now. Still holding bags on three properties and not keeping pace with construction. This is a dangerous place to be in a recession with a shiny new building rising in the swamp, and another one in California.

Your entirely rational and well-reasoned points will be dismissed as doomsayerness as people look around and observe no evidence of a DVC market crash as prevailing BLT prices are now sub-$140s after being $190-200 last year, and we have a stubbornly high 2,700 active resale listings inventory.

I’m sure it was believed ROFR and demand surge would’ve scooped up and stopped BLT at $160, no—$150—no, $140….

 

[AnnaKristoff2013]

Your entirely rational and well-reasoned points will be dismissed as doomsayerness as people look around and observe no evidence of a DVC market crash as prevailing BLT prices are now sub-$140s after being $190-200 last year, and we have a stubbornly high 2,700 active resale listings inventory.

I’m sure it was believed ROFR and demand surge would’ve scooped up and stopped BLT at $160, no—$150—no, $140….

The DVC market has absolutely crashed. That doesn’t mean BLT is going to crash to sub $100…. A big part of the current crash is that the resale market was incredibly inflated. Resale prices in the $160+ range were insanity, they have now correctly crashed back to earth. For that matter, DVC is pricing it’s direct points too high as well and is getting burned. The 2042 resorts may likely be in a downward death spiral just based on the fact that they are expiring soon, but the other resorts are going to stabilize eventually, perhaps sooner than many here realize.

 

[Stank]

The DVC market has absolutely crashed. That doesn’t mean BLT is going to crash to sub $100…. A big part of the current crash is that the resale market was incredibly inflated. Resale prices in the $160+ range were insanity, they have now correctly crashed back to earth. For that matter, DVC is pricing it’s direct points too high as well and is getting burned. The 2042 resorts may likely be in a downward death spiral just based on the fact that they are expiring soon, but the other resorts are going to stabilize eventually, perhaps sooner than many here realize.

See you at BLT $100.

 

[AnnaKristoff2013]

See you at BLT $100.

Bookmarked.

 

[macman123]

https://dvcnews.com/dvc-program/fin...-up-overall-direct-sales-down-in-january-2023

If you purchased one of them, I just want to say I'm jealous, but also... good luck selling it if you change your mind.

I would always split into max 100 point contract. Sure its $250 per contract, but I also never take insurance from Disney

 

[RamblinWreck]

Your entirely rational and well-reasoned points will be dismissed as doomsayerness as people look around and observe no evidence of a DVC market crash as prevailing BLT prices are now sub-$140s after being $190-200 last year, and we have a stubbornly high 2,700 active resale listings inventory.

I’m sure it was believed ROFR and demand surge would’ve scooped up and stopped BLT at $160, no—$150—no, $140….

We have definitely seen periods before where prices have tumbled and Disney has been tightening the purse strings, and therefore not actively ROFR'ing contracts. I'm sure we will see more of them.