Two-Tier DVC coming??

[BeesKnees]

RE: any benefits to DVD for a two tier system, I think they could make more money overall. If an owner of SSR wants a week in a 2bd at BCV now during mid-season it's around 350 points. If SSR was in a different tier, they could charge say, 600 points and then have that many to rent out through CRO. Also, they could charge higher fees at the first tier resorts and give "benefits" as compensation. I could see giving first tier resort owners a better booking window, or priority for trading out to DCL or similar. I also wonder how many waitlists are for people trying to get into BCV and BLT. I'll bet it's a large percentage. It would unclog the system a bit.

The problem with the CRO theory is that based on that exchange rate you would then give BCV and BLT owners substantially more vacations at SSR which uses up rooms they may want to use for upgrades to free up cheaper resorts. The demand for cheap rooms will always be higher than the villas so even if there is more money to be made it may not be enough to be worth doing it.

I don't think DVD cares even a little about unclogging the waitlists.

A two-tiered system based on what we have now would alienate owners, flood the resale market, and potentially end in a class action lawsuit.

 

[Breyean]

While those of us that bought more points than we really needed because they were cheaper can easily afford the extra points to stay at the new resorts.

Of course even if OKW was a higher point value I would still want to stay there.

This is a good point. I'm still stuck in my cocoon of having bought OKW in 1993 and having just those points to use until just recently. We finally added on at Aulani, and now are waiting for an ROFR for a bigger resale at VGC.

So we could quickly catapult from having a little over 200 points to having over 600, with all except Aulani being cheap.

 

[js]

BLT may be on the sales peoples hot list, but SSR is getting the attention of the DVC bean counters.
SSR has been blessed with the tree house villas. Members debated how the tree houses could have gone into OKW instead of SSR.
Now DVC digs up a leisure pool and turns it into a themed pool. How often has that happened at the other DVC resorts?
I would not like to see a two tier system, but if I have to pick one resort, SSR is looking pretty good. If the rumored DTD major expansion comes to fruition, SSR is going to look even better to me.


Kevin

Ditto. I own at SSR and have two teens, one 17 and one 13.
I love that DTD is in walking distance for my teens (or a boat ride) and my dh and I always rent a car or drive, we don't need the bus system to get to any parks. This includes any resort we stay in, not just SSR.
I did have a THV booked at exactly the 11 month mark for our upcoming trip this month but called and was able to switch to a GV just last month Go me!

 

[Dean]

Whenever there is a discussion of this sort, there always seems to be one component that is not even mentioned. We talk about how a tiering system might work, whether that would be good or bad for owners, etc.

But nobody talks about the most important factor: What benefit would tiering provide for DVD? Forget the effects on the owners (they don't care about that anyway), what's in it for DVD?

I frankly don't see any benefit at all to DVD in creating a second tier of resorts. I think they can accomplish far more by keeping everything in the same "Club," and just raising their selling prices and points-cost per night. The ability to use DVC points at any DVC resort is a big sales feature of the system, and if they lose or modify that, I think that would hurt their sales.

The benefit is simply money. The ability to sell more retail points and/or to get current owners to ante up more money for none equity options (perks) or to do add ons they would not have done otherwise.

Can any RCI owner trade to Disney? If so, we cannot trade for all RCI resorts.

Until I can figure out what is to be gained financially by restricting access I am not going to worry about a tier system that could make it harder for people to plan vacations. Last time I checked they still want us down there spending money.

There are no restrictions on which resorts can trade to DVC, only the trade power associated and availability. So yes, there are many owners that can trade to DVC that DVC owners cannot trade to their resort. The question really is how many of those resorts DVC owners want to stay at and that number is far less. And it is legal when it's the destination resort that blocks the trades, it likely would not be for RCI to do this on their own.

DVC could easily set up a system where one would not have direct access and the owners of the new system would have an advantage. It'd have to be a new timeshare system, call it DVC II, and as such it would not be difficult to have limited access from the old system to the new system but more access the other way. Marriott does this and DVC does to a degree as well with the BVTC.

I never imagined DVD cared about fairness I am guessing at why current owners keep this tiered idea alive and it seems to be pointed at what the BLT costs and what a GF DVC might cost.

I see no financial benefit to it so unless it affects sales in some manner. Why stop one of the best perks that cost them practically nothing to offer? If DVC did build some presidential level rooms on new properties I imagine it would be some sort of exchange system.

I do think DVC cares about "fairness". However, their definition is going to be different than each members and we will all have different definitions ourselves. To me, it's simply following the rules in place. To many though, it's an emotional issue not based in fact but in belief's. For example, some would say that booking high demand times for rental 11 months out is unfair or inappropriate, others would not. Some would say that booking at 11 month then canceling and rebooking with 7 mo points is inappropriate, others would not. From DVC's perspective if they feel a given situation is being exploited by enough people, they will change the rules. Often this will be based on their definition of "fairness" or appropriateness, sometimes (less often) it's based on their profits.

I think this bothers me the most. What Disney is selling is a timeshare, but many people don't feel the need to do their homework just because it's Disney. Disney puts on a great show, but they are a business and are out to get as much of your money as they can. They deliver a quality product, but they do it at a premium cost.

I think more than saying DVD is smoke and mirrors is that the members often made assumptions that were simply not true because it was Disney. Now some are realizing DVC is simply a very nice timeshare where many assumed it was much more but the reality is that things haven't really changed, just some people's perception.

 

[normr]

I hope they don't start something like this, it would be a slap in the face of long term owners who been here any of the other resorts, when I bought in, they were still selling OKW, BW and VB points

 

[OrangeCountyCommuter]

I have one question...

Why would you expect SSR to have incentives? I don't think there is that much "inventory" left to sell there.

AKV.. I think the carrying cost for Disney is much higher on BLT for some reason. Maybe the construction cost was just higher? I think that's why they are pushing that one.

 

[RobOnDisney]

There's also the flip side to the new resorts requiring a bigger investment due to higher prices per point and higher points per night.

Isn't this in essence creating a two-tier system now?

To me the system (for the most part) will divide along Monorail vs none. Disney now knows they can charge more per point and more points per night if the resort is on the loop-- or even close by with Wilderness Lodge. So I think they will focus in those areas to get the most bang for their buck. That will continue to push the economics in such a manner that people who could afford to buy new a few years ago will not be able to anymore.

I know today there is no way I could afford BLT new-- I bought AKV new at $94/point (BLT was same price at time) and I make a good bit more money. Prices for direct buys make little sense to me.

By the way-- I learned my lesson and bought my second contract resale!

 

[RobOnDisney]

I have one question...

Why would you expect SSR to have incentives? I don't think there is that much "inventory" left to sell there.

AKV.. I think the carrying cost for Disney is much higher on BLT for some reason. Maybe the construction cost was just higher? I think that's why they are pushing that one.

SSR has over 500,000 points in inventory to sell from THV's. That doesn't include any foreclosures or ROFR's they've done recently. Over the past year they've averaged about 34,000 points per month in sales.

 

[tjkraz]

I know today there is no way I could afford BLT new-- I bought AKV new at $94/point (BLT was same price at time) and I make a good bit more money.

I don't want to turn this into a resale vs. direct debate because obviously the resale buyer will always pay less than direct.

But strictly in terms of buying direct, I suspect most people who could afford $94 per point could find a way to swing $125+ if they felt passionately enough about the purchase.

The lower dues alone at BLT helps cover a chunk of that. An owner of 200 points at AKV is paying $20 more per month in dues than an owner of 200 pts at BLT. If the purchase is financed through DVC for 10 years, that $20 per month would offset a $9-10 difference in up-front cost.

In other words, the AKV owner who paid $94 per point has the same monthly out of pocket cost as the BLT owner who paid $103. To get up to $125 per point is...what...another $40-50 per month.

And the mortgage goes away after 10 years leaving the BLT owner with another 39-40 years of lower dues than the typical AKV owner.

Everyone has their tipping point but people are still buying at current prices.

 

[Dean]

Isn't this in essence creating a two-tier system now?

There are a number of reasons and forms for something along this line to happen. Ultimately it comes down to money but it could mainly take the form of additional investments from existing members and/or directing people to buy retail for more and more points. There are an infinite number of variations.

I hope they don't start something like this, it would be a slap in the face of long term owners who been here any of the other resorts, when I bought in, they were still selling OKW, BW and VB points

Maybe, maybe not. I guess the real question is whether or not it matters. The answer is unless it affects sales negatively more than it brings in income/lowers costs, etc; it doesn't matter. I think the reality is they could create such a system that treated current and owners fairly even if there were treated differently. I know many can't get over the fact that one member would not be treated the same as another but it is reality in every facet of life from CC to schools, to cars, Physicians offices etc. IMO, that some assumed this would not happen with DVC is irrelevant.

 

[Mich Mouse]

I don't want to turn this into a resale vs. direct debate because obviously the resale buyer will always pay less than direct.

But strictly in terms of buying direct, I suspect most people who could afford $94 per point could find a way to swing $125+ if they felt passionately enough about the purchase.

The lower dues alone at BLT helps cover a chunk of that. An owner of 200 points at AKV is paying $20 more per month in dues than an owner of 200 pts at BLT. If the purchase is financed through DVC for 10 years, that $20 per month would offset a $9-10 difference in up-front cost.

In other words, the AKV owner who paid $94 per point has the same monthly out of pocket cost as the BLT owner who paid $103. To get up to $125 per point is...what...another $40-50 per month.

Very interesting! Since BWV has the highest dues (that is right isn't it?) I'm interested in how much I really paid per point comparatively.

Everyone has their tipping point but people are still buying at current prices.

Very interesting! Since BWV has the highest dues (that is right isn't it?) I'm interested in how much I really paid per point comparatively.

And why are BWV dues so high?

 

[Maistre Gracey]

Very interesting! Since BWV has the highest dues (that is right isn't it?) I'm interested in how much I really paid per point comparatively.

And why are BWV dues so high?

I'm not positive which WDW resort has the highest dues, but Vero is the clear winner for the highest overall.

MG

 

[majortom1981]

I'm not positive which WDW resort has the highest dues, but Vero is the clear winner for the highest overall.

MG

Wouldnt akv have the highest because of the animals?

 

[Mickey'sApprentice]

Very interesting! Since BWV has the highest dues (that is right isn't it?) I'm interested in how much I really paid per point comparatively.

And why are BWV dues so high?

Why are BWV dues so high?

1) BWV are not a lot higher than some of the other resorts like BCV.
2) BWV pays a higher percentage of the resort cost for boat and bus transportation because it is 1/2 of resort. BCV only pays a small portion of the transportation fees because it shares with the much larger Y&BC complex.
3) BWV has all interior hallways, which adds up in air conditioning bills.
4) BWV has less expensive standard points, which IMHO is a huge bargain. The resort was originally not going to have the standard points, but decided that they should after the fact. The standard points are in line with OKW. This was done because BWV was the 2nd DVC resort.
5) Shouldn't the very best DVC resort have higher fees?

 

[dbs1228]

Wouldnt akv have the highest because of the animals?

Nope right now it is BWV as far as WDW dues is concerned Vero Beach is the most expensive "dues" wise followed by by Hilton Head

 

[Sammie]

Nope right now it is BWV as far as WDW dues is concerned Vero Beach is the most expensive "dues" wise followed by by Hilton Head

Which is due to small resorts with high taxes and insurance at to VB and HHI

 

[RobOnDisney]

I don't want to turn this into a resale vs. direct debate because obviously the resale buyer will always pay less than direct.

But strictly in terms of buying direct, I suspect most people who could afford $94 per point could find a way to swing $125+ if they felt passionately enough about the purchase.

The lower dues alone at BLT helps cover a chunk of that. An owner of 200 points at AKV is paying $20 more per month in dues than an owner of 200 pts at BLT. If the purchase is financed through DVC for 10 years, that $20 per month would offset a $9-10 difference in up-front cost.

In other words, the AKV owner who paid $94 per point has the same monthly out of pocket cost as the BLT owner who paid $103. To get up to $125 per point is...what...another $40-50 per month.

And the mortgage goes away after 10 years leaving the BLT owner with another 39-40 years of lower dues than the typical AKV owner.

Everyone has their tipping point but people are still buying at current prices.

Not making an appropriate comparison on this one here. BLT has a substantially higher points per night cost over AKV...

1BDR right now in standard/Bay Lake view:

AKV- 228
BLT- 296

Run the Maintenance Fees for each contract:

AKV at $5.01= $1,142.38
BLT at $3.98= $1,151.44


Add in the additional per point cost to purchase, even before it went to $140 and dropped all incentives, and BLT is a good bit more expensive than AKV.

The biggest mistake the average person makes IMO with DVC is assuming when they buy their first contract that their contract gets them generally the same vacation across the resorts. If you generally stay at your home resort a 200 point contract will get you significantly less vacation time over a 200 point BLT.

 

[mjc2003]

The biggest mistake the average person makes IMO with DVC is assuming when they buy their first contract that their contract gets them generally the same vacation across the resorts. If you generally stay at your home resort a 200 point contract will get you significantly less vacation time over a 200 point BLT.

Do you mean significantly more vacation time? 200 points at most resorts will get you more vacation time than 200 points a BLT....unless I am reading it wrong?

To your overall point, very true. We were ignorant enough to buy our points based on staying at BCV for 1 week, but that's b/c we didn't know any of the other resorts. I guess we got lucky in a sense.

 

[tjkraz]

Not making an appropriate comparison on this one here. BLT has a substantially higher points per night cost over AKV...

Both owners have the same 7 month booking rights so I don't see where that is particularly relevant.

Sure, if an owner wishes to stay at BLT trip-after-trip, there is a cost to be paid. But there is no reason the BLT owner cannot stay at BWV, OKW, AKV or any other resort.

 

[csharpwv]

I can easily see the development of a tiered benefits program before the development of tiered resorts.

BLT are at an advantage in some way because on average, they own more points. The advantage is only present if they are allowed to trade out to another, low point per night resort.

We own at 4 resorts, and we know that if we ever want to rent our points at 11 months out - it will likely be AKV Savanna View that is booked, or BLT. It's pretty simple to think about.

Each resort has its own level of attraction - there is something at every resort for everyone. Saratoga is HUGE, it has a lot of options - and has three themed water areas now. More than any other resort on property! A lot of people knock Saratoga, but it can be a great relaxing getaway.

One constant in this world is change. Disney/DVD/DVC is an enterprise. In fact it is one of the most creative companies in the world when it comes to how they get folks to part with their money!

If you look back at Disney's stock performance over the last two decade you'll see that it's far from a company that is extremely lucrative. The entertainment and travel industry are two of the most volatile market sectors out there.

I for one look forward to a tiered benefits type of program - bring on the better AP Discounts! HAHAHA