i think about it a little differently. i don't have any of the real numbers handy, so bear with me if this example is a bit off from reality.
if one objective is to figure out the financial "return" on your investment, then you need to figure out the numerator (i.e. the "value" of a point ), and the denominator (i.e. the annual cost of a point). the denominator is relatively easy; annual cost has two components, the maintenance charge (call it $4 to use a round number) and the financing charge of the purchase. while the latter number can vary, in practice the range ain't all that great. you can use your cost of debt, which for most people nowadays is 10% or less. so, if you paid $50-$70 per point, your finance charge is something like $5-7 each year. this implies that for most people on this board the annual cost of a point is going to be something between $9-11 per point (let's say $10). note that this applies even if you didn't borrow to buy your points, since you would presumably have otherwise invested the money in something that would have generated a return. if that's not the case, give me a call. i'd love to hang onto your money for you; i have a lovely shoebox under my bed.
now the numerator is a little trickier. i personally value my
dvc points by figuring out how much i would have otherwise had to pay (including taxes) to occupy a room at my home resort, and divide that total by the number of points the dvc schedule requires. in most cases that works out to an implied value of about $12-15 per point (let's say $14). this number varies more widely among dvc'ers, depending on the season and day of the week you choose to go; in theory the dvc point schedules equalize for this, but in reality they do so imperfectly.
let's make one more assumption; that all points are used in one way or another, or sold for at least their annual carrying cost.
this is enough to estimate the "return" on your dvc points. but to clarify the value of the return, let's back out the cost of capital and pretend you wrote a check out of your bank account. the question would be, what level of return are you getting on this investment. since each point gives you something worth $14 each year, and it costs you only $4 (setting aside the finance charge), you're receiving about $10 of value for each point annually to set against your investment. if you paid $60 for your point, your annual return is 10/60, or 16.7%. that's not a bad return, especially in today's market. it's actually even better though, since that return is untaxed; the government doesn't know or care that you've received what in effect is a discounted vacation. if your marginal tax rate is 25%, this means the real pre-tax return on your dvc point is more like 22%+.
now i know that that's a needless complicated and analytical overview of something that most people (me included) did for reasons that were in large part emotional, and i also know that it embeds a variety of questionable assumptions (how many of us would stay at a dvc 2 bedroom if we really had to cough up $600/night plus tax?). also the numbers are vastly different and less favorable when you use points outside the dvc resorts. and i know that there were endless other details that i deliberately ignored (e.g. the tax deduction associated with the real estate tax portion of maintenance, the impact of inflation on point value and annual cost, etc.), but i don't believe any of them are material.
i guess the bottom line is that even though it didn't drive my decision, it's still nice to know that dvc is a good deal for those that use it.
