Wading Through the Information and Have Questions

[PurpleKomodo]

Hello.

The last couple of times we have traveled to a Disney Park, we have come home questioning if we should buy into DVC. We LOVE Disney vacations. We go about every other year. Up until now, we have been exclusively going to WDW, but just returned from DLR and fell in love. We also want to explore other things that Disney has to offer like Cruises, Aulani, and ABD.

Like I said, we typically travel every other year. We almost always travel in the summer. I am a school employee so off-season trips are difficult. If we had DVC points, we might consider a couple of long weekedn type trips to attend special events. We live in Missouri so travel to either resort is long and expensive.

We are currently a family of 4. My husband, myself, a nearly 5 year old, and a nearly 1 year old. There is a chance we would have more children down the road. We like Suit style rooms, but rarely travel to Disney just our family. We typically go with extended family and share a large Grand Villa. The last WDW trip we took, we stayed at Saratoga Springs in the Treehouse Villas. There were 9 people total on that trip (8 ticketed). The trip we just returned from, we stayed at a good neighbor hotel that had 2 bedrooms and there were 7 people (6 ticketed) on that trip.

Overall, is DVC something that is worthwhile for us? How may points and how many contracts should we get? How do the maintenance fees work? My husband was reading up on DVC and was concerned about the annual fees being too steep. I am not sure we have a strong preference for a home resort. What do you find most effective? Any tips are appreciated.

 

[disneynutz]

You need to keep reading, decide on how and when you will travel, the size of room and which resort. Then do the numbers and compare the costs to how you vacation today. Also consider renting reservations from existing owners and seeing how those numbers work. DVC is designed to maybe save you some money BUT my guess is that most owners end up spending more money because they vacation more often.

Bill

 

[jscottnc]

If you are going to a DVC resort (WDW, DLR, Aulani) at least every other year AND you can plan at least 7 months in advance, then YES, DVC is for you. My cost for a DVC villa is typically half what the rack rate is for the same accommodation. The big question is whether you want to/can afford to pre-pay for future vacations albeit at a very reduced rate. You can still save big (though not as big) by renting DVC points for your Disney stays.

 

[mustinjourney]

Lots to dive into. These are my personal thoughts, so they certainly are not definitive by any stretch. And I know some will disagree -- particularly when it comes to the financial comments.

1. Summer trips -- if you go in the summer, DVC availability is actually pretty good. The hard time of year to book are the cheaper point times, which are Fall and January. Race weekends are also difficult to book. As such, if you are going to be going in the summer, your home resort is not as important (at least right now -- dynamics change as more and more people join the club with the new resorts). With that said, as of right now, SSR or BLT tend to be the best values taking into account the initial purchase price and their lower annual dues.

2. Don't plan on making weekend trips during the year anytime a member event is announced. By the time the member event is announced, the rooms are usually already all booked, so trying to book it yourself is highly unlikely. The member events sound great, but in reality, they don't have as much value as you'd expect because they are more like bonuses if they happen to coincide with a trip you've already planned.

3. You'll be able to stay in studios for now...but as the kids get older, you'll find yourselves wanting 1 BRs or even 2 BRs. Grand villas are very expensive point options (boardwalk GV is minimum 561 points per week. You could get two 2 BR units (sleep 16 instead of 12) for 538 points for the same week). Study the charts to see how many points you'll need.

http://www.wdwinfo.com/disney-vacation-club/DVCpoints.shtml

4. If you go every other year, then DVC makes a lot of sense -- particularly if you would have stayed in a deluxe hotel. DVC rooms are easily 40% cheaper than similar hotel rooms at the same resort. However, if you would have booked All star/Pop -- then you're going to be spending a lot more money than before.

5. (this is somewhat controversial) -- if you can't pay cash for the buy-in, then you probably shouldn't be buying DVC. Financing DVC is a recipe for disaster. The interest rates through Disney are over 10% -- which is a very high. Any savings from the DVC would be eaten up by the finance charges.

6. If the MFs will be a yearly financial burden, then DVC is probably not right for you. This is a luxury purchase, so someone should not be putting their financial health at risk to buy into it. It'd be like buying a $60,000 sports car and then complaining that the $400 tires are breaking the bank. If you cannot afford the tires, then you probably cannot afford the car in the first place. Put another way, if you want to be able to stay in a grand villa every other year, you'll need at least 300 points (likely 350-400), which even at SSR will cost you around $28,000 (assume $85 per point + closing costs+MF reimbursement) initial payment and then another $1680+ in MFs (expect these to go up at least 3% every year). To me, if you can afford to drop almost $30,000 in cash, then $1700 every year is not likely to feel like a lot of money. However, if you're having to finance that initial payment, then the MFs are likely going to feel like a lot of money.

https://*******.com/financial/dvc-annual-dues/

I look at it this way. Take a look at how much you normally spend for lodging for your vacations. If that is around $4000 a year, then DVC would save you about $2300 in this example (4000-1700 for the MF). If those points cost you $30,000, then it would take about 13 years to break even (30000/2300) -- and this is not taking into account the time value of money.

Renting points might also be another option for you.

 

[disneynutz]

I wouldn't use the published rack rate numbers for comparison, IMO they are inflated numbers that hardly no one pays.



Bill

 

[MrInfinity]

If you fell in love with it, then go for it. That's what luxury items are for. We did, it's great -- lots of fun options. But it doesn't look from your signature that you're into the Deluxe resorts... Your history is value and off-site. Expect your cost per vacation to go up about 3x-4x when all is done. You could buy in 160 points at BLT resale to keep costs down. That puts you next to the Magic Kingdom in accommodations that blow away the Value resorts. So you're paying a boatload more but getting a whole different vacation. The points might run you $110-$120pp, so maybe ~$17k. With that you could get a 2-Bedroom every 2 years for 6 nights. Or every 3 years for 9 nights. That worth it to you? I don't know what you're used to spending, but if it's ~$1200 per vacation for an offsite or value resort, this won't be in that price range. The fees alone will be $5.60*160 = $900/year, ($1800/2 years) so you'd be spending more on fees than you used to spend on hotel before even considering the up-front costs. Nothing wrong with that and we love it. If it's in the budget then buy in and have fun! The DVC resorts are perfect for when you have larger parties, like you do. They provide tons of space, great proximity to the parks, and tend to associate with Deluxe hotels which have all the perks.

 

[PurpleKomodo]

If you fell in love with it, then go for it. That's what luxury items are for. We did, it's great -- lots of fun options. But it doesn't look from your signature that you're into the Deluxe resorts... Your history is value and off-site. Expect your cost per vacation to go up about 3x-4x when all is done. You could buy in 160 points at BLT resale to keep costs down. That puts you next to the Magic Kingdom in accommodations that blow away the Value resorts. So you're paying a boatload more but getting a whole different vacation. The points might run you $110-$120pp, so maybe ~$17k. With that you could get a 2-Bedroom every 2 years for 6 nights. Or every 3 years for 9 nights. That worth it to you? I don't know what you're used to spending, but if it's ~$1200 per vacation for an offsite or value resort, this won't be in that price range. The fees alone will be $5.60*160 = $900/year, ($1800/2 years) so you'd be spending more on fees than you used to spend on hotel before even considering the up-front costs. Nothing wrong with that and we love it. If it's in the budget then buy in and have fun! The DVC resorts are perfect for when you have larger parties, like you do. They provide tons of space, great proximity to the parks, and tend to associate with Deluxe hotels which have all the perks.

Your right, looking at my history, I have not stayed in tons of deluxe resorts; however, most of those trips were before establishing my own family so I was at the mercy of what accommodations others could afford. Like I said in my original post, we have almost always traveled with extended family. I am reaching a point that I don't know that we will always do that. Plus, if using points helps my entire group have better accommodations when we all travel together, I am good with that too. We stayed at SSR in a Tree House Villa on our last WDW trip. We would have likely stayed at the Disneyland Hotel if the size suit we wanted had been available for our trip. Our choice of good neighbor resort was based entirely on room layout.

So, am I right to assume that the value comes from many years of owning DVC. Like, you break even 7-10ish years down the road. How do you figure that math? By adding up what you would have spent off the rack?

 

[miTnosnhoJ]

Your right, looking at my history, I have not stayed in tons of deluxe resorts; however, most of those trips were before establishing my own family so I was at the mercy of what accommodations others could afford. Like I said in my original post, we have almost always traveled with extended family. I am reaching a point that I don't know that we will always do that. Plus, if using points helps my entire group have better accommodations when we all travel together, I am good with that too. We stayed at SSR in a Tree House Villa on our last WDW trip. We would have likely stayed at the Disneyland Hotel if the size suit we wanted had been available for our trip. Our choice of good neighbor resort was based entirely on room layout.

So, am I right to assume that the value comes from many years of owning DVC. Like, you break even 7-10ish years down the road. How do you figure that math? By adding up what you would have spent off the rack?

I think DVC is probably a good fit for you. You can make banking and borrowing work for you. The danger is you are banking and borrowing is that you risk leaving points on the table if you must cancel your vacation one year and cannot use the points before they expire. The way around that is to have a use year that gives you plenty of time to bank or reschedule after a cancellation.

An issue to consider if you are taking extended family to a Grand Villa: This is a great option in DVC. However, it can also be awkward. If you have the means to pay for everybody, then it is easy. However, if you own a timeshare, sometimes your family will expect you to let them stay there for free. That is what I do with my grown kids, and I am happy to do it. But if you need help from the family, the question becomes what to charge. Charging them rack rate (pro-rated) is too much, but just charging them maintenance fees is too little. If you are paying cash to Disney, you can just split up the bill. But as a timeshare, your family may view it as "free" and therefore not want to contribute to the cost. You may want to address this with them before you buy.

For your question of how to calculate value, you can create a spreadsheet that compares your lodging costs using DVC vs. staying in a similar deluxe resort while paying Cash, either to Disney or through points rental. On the DVC side, you will have a lump sum up front, and maintenance fees that go up roughly with inflation. On the cash side, the room rate will be increasing with inflation. Then you apply a discount rate (like an interest rate) because there is a time value of money. A dollar in your pocket today is worth more than a dollar in your pocket in 40 years. Then you see how many years it takes for the large initial payment to generate savings.

 

[jscottnc]

I wouldn't use the published rack rate numbers for comparison, IMO they are inflated numbers that hardly no one pays.



Bill

True but I have not seen a discount greater than 30% off rack rate. My cost difference is more typically 70% off rack rate. My argument would be easier to make if we picked a specific week and a specific villa and resort. I suspect I would still come out ahead comparing Deluxe Studio with a standard hotel room at the same resort. I do know that I "spend" less per night for a 2 bdrm villa at VGF than I did for a garden view room at Poly (Disney thinks a lot of those rooms).

 

[bwvBound]

We live in Missouri so travel to either resort is long and expensive.

So, attempting to peel an onion layer here, which part did you love: that you were on Disney property (location) or the large unit with "at home" features (kitchen, laundry, bedrooms, etc)?

Reason I ask: It seems timesharing would be a great tool for your vacation style, traveling with extended family. That said, there are many timeshare options out there ... including at least one that is flexible (points based) with drive-to locations near your home (Branson; Lake of the Ozarks; Grand Lake, OK) and locations near to WDW/DLR. Would you be interested? ;-)

 

[disneynutz]

True but I have not seen a discount greater than 30% off rack rate. My cost difference is more typically 70% off rack rate. My argument would be easier to make if we picked a specific week and a specific villa and resort. I suspect I would still come out ahead comparing Deluxe Studio with a standard hotel room at the same resort. I do know that I "spend" less per night for a 2 bdrm villa at VGF than I did for a garden view room at Poly (Disney thinks a lot of those rooms).

So the real discount is 40% off of the rack rate?

Bill

 

[_auroraborealis_]

I will also call out that for those who do not own at VGC, staying DVC at Disneyland is not necessarily easy at 7 months, even in a 2BR. There is only one, small DVC at Disneyland.

 

[MrInfinity]

So, am I right to assume that the value comes from many years of owning DVC. Like, you break even 7-10ish years down the road. How do you figure that math? By adding up what you would have spent off the rack?

No, I never use rack rate. Disney puts some absurd price on the DVC rooms like $700/night to make it look like a good deal to buy instead. It helps their sales people who can say, look this room is worth $700/night otherwise! I always compared to what I would actually spend when staying at the Contemporary / Poly, which was more in the $300-$350/night range. At these levels, it's really hard to come up with a scenario in which buying DVC is actually profitable, so we didn't. But once you start needing bigger rooms like the 2B's, then DVC becomes a better value. Suites on Disney property are not plentiful and so command a hefty price of $1000-$1300/night, and on up. Looking at a room that might cost you $8,000 for a week stay, and then considering that would be 1/2 the purchase price of a $17k contract, buying becomes more advantageous. You should do up like Tnosho suggests, make your own amortization chart where you factor in what you would earn on your money vs buying in. I have several sheets I used where I could tweak all my constants to figure out the breakeven points in various scenarios.

 

[BillPA]

Your a bit out of touch with Disney prices.

See the rates:
https://www.mousesavers.com/2018-polynesian-village-room-rates-season-dates/

 

[MrInfinity]

You're a bit out of touch with Disney prices.
See the rates:
https://www.mousesavers.com/2018-polynesian-village-room-rates-season-dates/

Heh... You found something on a website, it must be what I paid...
Seriously tho that's what I mean about not comparing to rack rate. If you compare to those, DVC is a steal. But I would never pay that. I went online just now and found Poly rooms for $425, and with a little work I could get them much lower.

 

[Dean]

Hello.

The last couple of times we have traveled to a Disney Park, we have come home questioning if we should buy into DVC. We LOVE Disney vacations. We go about every other year. Up until now, we have been exclusively going to WDW, but just returned from DLR and fell in love. We also want to explore other things that Disney has to offer like Cruises, Aulani, and ABD.

Like I said, we typically travel every other year. We almost always travel in the summer. I am a school employee so off-season trips are difficult. If we had DVC points, we might consider a couple of long weekedn type trips to attend special events. We live in Missouri so travel to either resort is long and expensive.

We are currently a family of 4. My husband, myself, a nearly 5 year old, and a nearly 1 year old. There is a chance we would have more children down the road. We like Suit style rooms, but rarely travel to Disney just our family. We typically go with extended family and share a large Grand Villa. The last WDW trip we took, we stayed at Saratoga Springs in the Treehouse Villas. There were 9 people total on that trip (8 ticketed). The trip we just returned from, we stayed at a good neighbor hotel that had 2 bedrooms and there were 7 people (6 ticketed) on that trip.

Overall, is DVC something that is worthwhile for us? How may points and how many contracts should we get? How do the maintenance fees work? My husband was reading up on DVC and was concerned about the annual fees being too steep. I am not sure we have a strong preference for a home resort. What do you find most effective? Any tips are appreciated.

There has been no time in the history of DVC where it made sense to buy retail to use for cash type exchanges like cruises. If you can pay cash, plan 7-11 months out, will go around every 2 years or more and are OK with the compromises of the timeshare; it's reasonable to buy.

Heh... You found something on a website, it must be what I paid...
Seriously tho that's what I mean about not comparing to rack rate. If you compare to those, DVC is a steal. But I would never pay that. I went online just now and found Poly rooms for $425, and with a little work I could get them much lower.

If one wants to compare to rack rates for fun, that's OK, but to use it as an evaluation tool would be foolish. The 2 best metrics are renting DVC points privately and what you would likely pay not owning taking into account reasonable discounts.

 

[jscottnc]

So the real discount is 40% off of the rack rate?

Bill

More like 40% off the best price you are likely to get for a comparable room. Let me give an example. I will be traveling to WDW in early January. I will be staying at Kidani Village in a 2bd savanna view villa, Sunday through Thursday. My cost on points is ~$370/night (I bought VGF making my cost per point a bit less than $10/point/year including dues). A savanna view hotel room during this period runs $508+tax/night. My saving is ~27%. It is a bit unfair to compare a 2 bedroom villa with full kitchen, washer/dryer and living room but you get the idea. A savanna view Deluxe Studio would run me about $140/night, saving 72%. (Now we're talking!) Suppose you got one of those 30% discounts. This would make the savanna view hotel room ~$355/night. My savings drop to 60%. (Looks like I low-balled the savings.)

Let's turn to my home resort of Grand Floridian also in January (we like the lower rates, lower crowds, and cooler weather). Lowest price (rack rate) is $646/night Sunday through Thursday. A standard view Deluxe Studio would cost me ~$170/night. My saving is 73% (62% on about the best discounted rate). If you rented points (What is it now? $18/point?) you would save at least 50% off rack rate (at least 30% off the best discounted rate).

You do give up flexibility using DVC. You really need to be able to plan more than 7 months in advance; less if you don't care where you stay and you are flexible on the dates. You REALLY give up flexibility and control when you rent points but it can be done (there are brokers that make this easier) and you do save real money on deluxe accommodations.

 

[PurpleKomodo]

So, attempting to peel an onion layer here, which part did you love: that you were on Disney property (location) or the large unit with "at home" features (kitchen, laundry, bedrooms, etc)?

Reason I ask: It seems timesharing would be a great tool for your vacation style, traveling with extended family. That said, there are many timeshare options out there ... including at least one that is flexible (points based) with drive-to locations near your home (Branson; Lake of the Ozarks; Grand Lake, OK) and locations near to WDW/DLR. Would you be interested? ;-)

We are only looking at Timeshare options related to Disney right now. We don't need Timeshares in Branson or Lake of the Ozarks. We own a house on the Lake in Branson.

Now that we have children, we have found that home-away-from-home type accommodations for Disney vacations are how we prefer to travel. Having the kitchen, laundry, and separate sleeping areas is best for us. I would not consider an off-site Timeshare because we travel to WDW most often and the on-site benefits are too great (dining and FP+ reservations) to make me want to stay off-site.