What happens when a DVC Property becomes “worthless”?

[AnnaKristoff2013]

I doubt that. They might go up about 5% per year, so perhaps 90% more by 2042, so about $15.20 per point if yours are $8 per point now.

Vero beach is already at $12.85 pp. They went up 7.6 percent YOY. Your math is way off though. Even if they only went up 5 percent a year from here forward, they would end up at $32.47. Even if they were $8 pp now and only went up 5 percnet a year, they would end at $20.22. You're not taking into account the compounding nature of percentage increases.

 

[Brian Noble]

This is the dues chart if VB grows by the same amount as it did last year, every year.

This is probably a pessimistic case. This last year almost* all of the resorts had substantial jumps in dues thanks to the ripple effect of the tightening labor market. There is likely still a bit more of that to come, but I suspect it won't play out that way every year for the next 19.

It wasn't the highest. That "honor" belongs to Beach Club at 8.35%. But it was a bit above median (6.24%, OKW).

Looking at the history of the resort, the cumulative annual rate of growth is a shade under 4.8%. I'd say 5% is probably a more realistic long-term guess than this past year's 7.6%, modulo whatever you think inflation is likely to do in the next five-ish years.

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The stark outlier? RIV at 1.12%. The initial dues at that resort were arguably set quite a bit too high, and they still haven't quite worked through that over-estimate.

 

[kilik64]

The stark outlier? RIV at 1.12%. The initial dues at that resort were arguably set quite a bit too high, and they still haven't quite worked through that over-estimate.

Byproduct of over estimating skyliner cost share and not wanting to pull an Aulani?

 

[Brian Noble]

Maybe the latter, probably not the former. Those systems are broadly used and well known and should have been easy to model.

Edited to add: it might be interesting to go back over the budgets to see if something jumps out.

 

[Epcot Forever Forever]

Byproduct of over estimating skyliner cost share and not wanting to pull an Aulani?

Maybe the latter, probably not the former. Those systems are broadly used and well known and should have been easy to model.

Edited to add: it might be interesting to go back over the budgets to see if something jumps out.

They’ve overshot in dues significantly with every resort since after Aulani. @i<3riviera did a whole analysis of it at one point (but has since deleted it)

 

[sethschroeder]

There are no rumors that the Polynesian or Contemporary are going to be torn down soon because they are almost 52 years old.

I’m not sure why you think the Beach Cub or Boardwalk Villas would be any different.

DVC members, not Disney, pay for maintenance and repairs of those buildings. In 2042, Disney is going to retake control of buildings that will be well maintained exactly because that maintenance was paid for by someone else.

Except Disney can tear it down in 10/20/30/40 years from now. Additionally both resorts mentioned were not built as timeshares they were built specifically to last "forever".

When DVC flips the resort again they have to sign on for having that building exist for another 50 years.

Another aspect is Poly and Cont are landmarks. None of the DVC building are that so they could tear them down and build a resort that hold 2x-3x the number of resorts netting them a ton more money.

 

[Brian Noble]

Well, heads did roll due to Aulani, so that makes sense.