When the end comes

[Boston5602]

ok So January 31 2042 my DVC ownership will end, does this mean all trips with points have to be taken by then or we just dont get anymore after this point in time. I ask because I just bought a December use year and am already dreading the end , or will I have to use my Dec 2041 points up within the 62 days to Jan '42 . ( I guess that would mean I could borrow 5.5 points a year and wont run out till 2042 <G> ) Just curious


Thanks for your time

 

[boatboatboat]

I figure either global warming or the bird flu will kill us many years prior to that.

IMO, DVC will offer to sell us "extra" years as the end of our contacts approach.

No one knows what they will do. I doubt if DVC knows what they will do.......

 

[RobDoc]

As it stands at this time, there will be no DVC for those resorts after December 31, 2042. Any unsued points will be lost. We (on this board) have speculated for years about how DVC will handle the last few years. Some have suggested that extensions would be offered. Others feel that banking and borrowing will be suspended for the last few years. Certainly, no dues will be expected for 2042 and no one will get any points in 2042 (there are no January Use Years). How they handle points for those with a December Use Year remains to be seen.

I doubt the decision has even been made about this and won't be made for many years yet. It's likely the decision will be made by someone not even working for Disney at this time.

Personally, I don't expect any offer to extend the contracts for those six resorts and I do think that some concession will be made for those last few years regarding points received and annual fees. I do think banking and borrowing will have to be carefully controlled since there is no way that everyone would have the opportunity to use their points in 2041 if banking was allowed the prior year.

I'm not going to lose any sleep over it in the meantime.

Stay tuned.

 

[Dean]

I agree with Doc that it's unlikely an extension will be offered but we shall see. DVC has not said how they will handle the end of the resorts so anything we discuss is purely speculation, some more educated than most. One thing that is factual is that there are not enough units and time for every owner to use every point the last couple of years. IMO, the leading options are a pro-ration of points the last couple of years or a lottery with an owner paying for the points they use but not the ones they can't. The only other option I could see would be a free for all and let owners eat about half the points the last year. Some have stated they expect Disney to let the resorts run for the rest of 2042 to allow the points to be used up, I see this as a very naive and unlikely position. And the best part is we can have this same discussion periodically for a long time to come.

 

[Daitcher]

Maybe I'm a litle slow Dean but I don't get it. Why would there not be enough rooms for owners in the last year or so? I could see that being the case if many banked points. I am a constant borrower so I'll probably have no points left to use at the end. Any statistics out there about borrowers versus bankers? I would think more borow than bank? Webmaster Doc, any clue. Need some clarification with this. I doubt I'll own for the duration but just in case I'd like to know the potential problems.


Thanks,


DAVE

 

[Dean]

Maybe I'm a litle slow Dean but I don't get it. Why would there not be enough rooms for owners in the last year or so? I could see that being the case if many banked points. I am a constant borrower so I'll probably have no points left to use at the end. Any statistics out there about borrowers versus bankers? I would think more borow than bank? Webmaster Doc, any clue. Need some clarification with this. I doubt I'll own for the duration but just in case I'd like to know the potential problems.


Thanks,


DAVE

The resorts end on 31 Jan, 2042. While Feb use year owners would have a full 12 months to use their 2041 UY points, Dec owners would only have 2 months and so on. Do remember that all DVC resorts are sold out except for SSR and that as the end approaches, it's reasonable to expect none would be selling retail for some time. So if there are essentially only enough units to service all the points plus maint in a given year, there has to be some give and take. At the present time it'd some that use weekends and burn points as well as enough banking, borrowing and loss of points to even it out. It's also likely to see banking and possibly borrowing stopped the last couple of years of the contract, maybe more. It may be that enough people will simply have opted out that it won't be an issue but the end result will be the same.

The only other issue we've had thus far that even remotely resembles this is the end of the free park passes. DVC tried to say you couldn't borrow points and get the free passes but legally they didn't have that authority so had to back down. They have had a lottery one and ran a special season preference list for several years, both referenced in the POS.

 

[RobDoc]

As Dean noted, it will all depend on how DVC chooses to handle banking and borrowing those last few years. Due to the staggered Use Year system, some will have limited opportunity to use their 2041 points. It may also depend on members using points for all weekends, as well as at HH and VB during the less popular winter months in order to have the opportunity to utilize all of those points.

Another possibility would be to restrict point usage to home resorts during those last few years since there will still be at least one resort still open beyond the first expiration date. What options will be open to those whose ownership expires in 2054 will be even more interesting since there could be far fewer reservation options within DVC after 2042.

Regardless what opinions we all offer in 2006, no decision or announcement is likely to be forthcoming for another 33-35 years.

Stay tuned!

 

[paults]

in 2040 I'd be 92 and they better have a room for me ground floor I hope

 

[tomandrobin]

I just Social Security will still be around by then and cover my maintenance fees!

 

[djreed]

Anyone know why the Disney time-share has an expiration date? This seems to be somewhat unique to DVC. The only obvious answer I could come up with is that we have purchased a depreciating asset, like a car. Maybe to be less skeptical it is to give Disney freedom to modify the resort accommodations as the market demands…

 

[Rence]

The inability to use all of our points the last couple of years assumes that all points will still be owned and in active use come 2041.

Currently, there are members who don't use all their points and let them simply go to waste. Occasionlly on here, we hear of a user who let 5 points go to waste etc. There have also been posts where people encountered other users (non-disboard members) who regularly let points go to waste. They have 300 points, the trip this year only took 230, they let 70 go to waste, they don't "bother" with banking and borrowing etc. DVC has never stated how many points go to waste each year, my bet is that it is a bit larger than most of us think and in a sense it does help the rest of us get the reservations that we want.

The other thing that is happening at this time is folks who default on their membership. If you don't pay your maintanence fees, Disney can reposses your points. I am sure that this happenes today, it happens with all timeshares. It probably happens less at DVC because it is easy enough to sell a contract if you are unable to pay fees or no longer interested. But there will always be those who just stop paying. Today DVC is able to reclaim and resell the points. Again, they don't report how much of this is taking place.

But defaulted points should become a much bigger deal as we get close to the end. The points won't be worth as much on the resale market because of the very short amount of time left for DVC. Also a lot of points are going to be owned by very elderly individuals who will find themselves unable to pay the fees. In some cases other family members may step in and pay the fees but in many cases the points will just default and DVC will reclaim them. The last couple of years these defaulted points won't be worth selling, it will be better for DVC to rent the rooms for cash rather than sell the points. I believe that the percentage of points that will fall back to DVC the last couple of years will be sizable.

With a big chunk of points taken out of the system, the remaining owners will have an easier time booking with the inventory unused by DVC members then being rented for cash.

 

[Dean]

Anyone know why the Disney time-share has an expiration date? This seems to be somewhat unique to DVC. The only obvious answer I could come up with is that we have purchased a depreciating asset, like a car. Maybe to be less skeptical it is to give Disney freedom to modify the resort accommodations as the market demands…

It's not unique but is fairly uncommon in the US. I'd presume it's RTU so Disney con retain control and have the option of other use after the end. I'm assuming 50 years because that is a reasonable life expectancy of the type of resorts and buildings in question for central Florida.

 

[RobDoc]

...
With a big chunk of points taken out of the system, the remaining owners will have an easier time booking with the inventory unused by DVC members then being rented for cash.

The villas available to owners will be only those still in the member inventory.

Currently that figure is 96-98% at each of the sold out resorts, but would drop under the conditions you describe as more "ownership" is returned to Disney. In those last years, if owners still control 75% of the resort, they will have only 75% of the occupancy for reservations. The other 25% will be available only thru CRO for cash reservations and cannot be used for point reservations. If owners control only 50% of the resort, they will have access to only 50% of the rooms for point reservations. The availability for owners at that time will be the same as described earlier.

If Disney chose, out of the goodness of their heart, to allow point reservations for rooms not owned by members, it would be a sharp difference from the policy that has been in place for the past 15 years. Currently, only those rooms declared into the sales inventory is available to SSR owners. The other rooms are open for cash reservations thru CRO. Each resort was treated the same way while sales were ongoing.

 

[Daitcher]

Thanks to Dean and Doc, just wanted to be clear with this.


DAVE

 

[Dean]

The inability to use all of our points the last couple of years assumes that all points will still be owned and in active use come 2041.

Currently, there are members who don't use all their points and let them simply go to waste. Occasionlly on here, we hear of a user who let 5 points go to waste etc. There have also been posts where people encountered other users (non-disboard members) who regularly let points go to waste. They have 300 points, the trip this year only took 230, they let 70 go to waste, they don't "bother" with banking and borrowing etc. DVC has never stated how many points go to waste each year, my bet is that it is a bit larger than most of us think and in a sense it does help the rest of us get the reservations that we want.

The other thing that is happening at this time is folks who default on their membership. If you don't pay your maintanence fees, Disney can reposses your points. I am sure that this happenes today, it happens with all timeshares. It probably happens less at DVC because it is easy enough to sell a contract if you are unable to pay fees or no longer interested. But there will always be those who just stop paying. Today DVC is able to reclaim and resell the points. Again, they don't report how much of this is taking place.

But defaulted points should become a much bigger deal as we get close to the end. The points won't be worth as much on the resale market because of the very short amount of time left for DVC. Also a lot of points are going to be owned by very elderly individuals who will find themselves unable to pay the fees. In some cases other family members may step in and pay the fees but in many cases the points will just default and DVC will reclaim them. The last couple of years these defaulted points won't be worth selling, it will be better for DVC to rent the rooms for cash rather than sell the points. I believe that the percentage of points that will fall back to DVC the last couple of years will be sizable.

With a big chunk of points taken out of the system, the remaining owners will have an easier time booking with the inventory unused by DVC members then being rented for cash.

I would think the other way. Since it is my belief that SSR, and do a degree, OKW, VB & HH members are vying for the reservations at the 7 month window, those members will be looking inward and competing with the other owners there where they had not done so previously or to the degree they were at the time.

I'm sure a certain percentage of owners lose points now but I'm having trouble envisioning a full 50% as that is the number it'd take the last year or two to avoid other restrictions coming in to play.

 

[byoung]

I think they will offer some kind of extension.

 

[NJOYURLIFE]

I am just curious what the sales department says about December use years and that final year. If they are still selling December use years, this would be a legitamate question.

I find it difficult to believe that the end has not already been mapped out. I would think it should have been spelled out in the beginning. The same people who decided to make it 50 years vs 20 or 25 had to have had some kind of vision of a plan.

I know I would be pretty ticked off if I wanted to borrow points the year before the final one and then was told that I could not do it. Is banking and borrowing a privaledge like the free passes and the annual pass discount that can be taken away like that?

I am guilty of course of not reading all of the paperwork. Actually since I purchased resale I am not even sure that I got all of the paperwork.

What happened the first year of DVC? I don't even know what date DVC actually started. Was it in February of that year?

Hopefully at age 76 I'll still be racing around Disney.

 

[RobDoc]

OKW opened on October 1, 1991. Those who purchased at that time actually got more than 50 years and are the only ones to have that distinction. (Even the first owner at SSR will get less than 50 years since the resort didn't open until May, 2004.)

There is nothing in our documents describing how the points will be handled in 2041 (or 2053), but it is clear that banking and borrowing may be suspended at any time and that owners could be restricted to reservations at their home resort. It might be wise to assume that those features could come into play.

As noted by Dean earlier, there are also provisions in the POS for "Special Seasons Priority" lists and a past history of using a lottery for securing reservations for the millenium, so those features could also be resurrected at any time to meet the needs of the membership in the final years.

Because of the volatility of the reservation system, the constant foreclosure of contracts for non-payment and the unknowns regarding future use of the DVC resorts, I'd think it wise to wait until the last moment to announce how those last couple of years will be handled for members.

 

[Simba's Mom]

in 2040 I'd be 92 and they better have a room for me ground floor I hope

My sentiments too! I'll be 90. When our financial advisor tried to approach the issue of life expectancy, I volunteered January 2042. Maybe I'll even borrow points-after all, I probably won't be around to need them!

 

[iankh]

I don't know about the rest of you, but I've already made my plans for 2042. I'm going to buy into a fabulous resort that the DVC properties can't hold a candle to.

I is going to be everything than anyone could ever want in leisure real estate.

And roomy? You bet! A whole 6'x6'x6' all to myself.

The only delemma is should I buy in New Jersey where all of the family is, or Chicago where all of my friends are?

But then, the question is does one go against conventional wisdom, you know what they say, "Live in Chicago, play in Florida, buried in New Jersey."