When will points cost start dropping?

[TheBeast]

Ok, so as a follow up to my "prices are outrageous" thread -

With a fixed life on our DVC contracts, you'd think at some point, prices will have to drop instead of increase. Any guesses when that will happen? Why do you think that?

 

[Plutofan]

Prices will definitly drop at some point in time. My personal opinion is that the prices will drop when Disney lowers the price on non-SSR resorts. Currently the price is $92 per point. At some point that will be to high. I believe the re-sale market for WDW DVC resort will follow Disney's lead. Vero beach for most part sells on its own. Also for the most part HH sells on its own but I think the value is a little inflated since it appears that some of the HH purchases are people looking for cheap points to use at WDW that have a pretty reasonable maintenance fee. At some point in the next few years Disney will need to come up with a two tier pricing for sold out resorts. Once for resorts that expire in 2054 and one that expires in 2042. At some point in the future the extra 12 years is worth more than the value of getting into a smaller DVC resort.

 

[Plutofan]

For those who say never I would love to sell you a one week in a BCV studio in 2041 for $12,328. ($92 per point x 134 points). If studios are going for that much in 2041 we are all in trouble.

 

[Doctor P]

Well, at 6% inflation in room prices per year, that would mean room rates in 2041 would be 8 times what they are now. That would mean roughly $1600 per week in today's dollars for a studio at BCV. Not a bad deal in that case. With room price inflation of 4% per year, the room rates in 2041 would be 4 times what they are today. Therefore, using your figures, the cost of a room would be approximately $3100 in today's dollars. That is a little over $250 per night. Not a "cheap deal", but certainly a competitive price. I think prices will likely start to drop eventually, but the example indicates that they wouldn't necessarily have to according to the logic being used.

 

[Daitcher]

Good poll and good thoughts so far. The price will drop, make no mistake about that. My guess would be around 2012 - 2016 mark. This is why I strongly suggest buying SSR points over any other resort right now. Only the people who are forced to travel peak times should consider any other. SSR will hold value for another 15+ years if the trends continue. OKW and others wil be selling for half of what they are now in the not so distant future. Disney will stop exercising ROFR on those old contracts and then the prices will plummet. People holding DVC for the duration might not care about resale values but they should. You never know when and if you might be forced to or want to sell out. I know for sure I'l sell my SSR points down the road. No ned to hold them until the end. By that point you could sell SSR at a high price and buy into the newest offering with the full 50 years if you wanted to stay in the program. Owners of the older DVC resorts won't have this option, they will have to sell at a lost if they decide to get out. Just my opinion here, not the facts, I know no more than you guys do.


DAVE

 

[CarolMN]

Good poll and good thoughts so far. The price will drop, make no mistake about that. My guess would be around 2012 - 2016 mark. This is why I strongly suggest buying SSR points over any other resort right now. Only the people who are forced to travel peak times should consider any other. SSR will hold value for another 15+ years if the trends continue. OKW and others wil be selling for half of what they are now in the not so distant future. Disney will stop exercising ROFR on those old contracts and then the prices will plummet. People holding DVC for the duration might not care about resale values but they should. You never know when and if you might be forced to or want to sell out. I know for sure I'l sell my SSR points down the road. No ned to hold them until the end. By that point you could sell SSR at a high price and buy into the newest offering with the full 50 years if you wanted to stay in the program. Owners of the older DVC resorts won't have this option, they will have to sell at a lost if they decide to get out. Just my opinion here, not the facts, I know no more than you guys do.


DAVE

Down the road, my BWV contract may sell for less per point than your SSR contract, but it won't be "at a loss". We're close to even now (comparing to our usual stays at a moderate) - in just a few years, I can honestly say that even if we gave away the contract we'll still have saved $$ over what we were usually spending on our WDW vacations.

Best wishes -

 

[Beca]

Good poll and good thoughts so far. The price will drop, make no mistake about that. My guess would be around 2012 - 2016 mark. This is why I strongly suggest buying SSR points over any other resort right now. Only the people who are forced to travel peak times should consider any other. SSR will hold value for another 15+ years if the trends continue. OKW and others wil be selling for half of what they are now in the not so distant future. Disney will stop exercising ROFR on those old contracts and then the prices will plummet. People holding DVC for the duration might not care about resale values but they should. You never know when and if you might be forced to or want to sell out. I know for sure I'l sell my SSR points down the road. No ned to hold them until the end. By that point you could sell SSR at a high price and buy into the newest offering with the full 50 years if you wanted to stay in the program. Owners of the older DVC resorts won't have this option, they will have to sell at a lost if they decide to get out. Just my opinion here, not the facts, I know no more than you guys do.


DAVE

You have some good thoughts, but I just don't know if I agree with all of them. I still think there is going to be a "fallout" of sorts regarding SSR. I think within 2-3 years (once the resort is completely sold out), members will begin to find on a fairly regular basis that SSR and OKW are their only options. I think at that point, a number of owners (many who do not know about these boards) may think that their DVC ownership is not "what it was cracked up to be" and sell their ownership. I also think that, due to the high number of points available at SSR, the resale market for SSR will always be one of the lowest of WDW DVC resorts....just a matter of supply and demand. I think those two points will keep the other, smaller resorts "artificially inflated" for a long time to come.

Will there be a point at which they are even...sure!! And, will there be a point where SSR is worth more than the older properties...yes....if DVC does nothing to remedy this (which I am not sure they will). Disney is a master of marketing, and I cannot IMAGINE they will let their "captive audience" free. I suspect that between now and the time our contracts expire, DVC will come up with all sorts of "Extend your ownership contracts" specials. They may even make it easier for us "add children to your deed. WDW vacations are a WONDERFUL legacy to leave your children." Call it a hunch...we, as a group are TOO much of a "cash cow" for Disney to just let us "walk away."

Granted...this is if:
1) Hurricanes don't wipe WDW off the map in the next 36 years, and
2) Global warming doesn't cause sea level to rise too quickly (Okay, kind of kidding on this one, but I did just read an article saying that if something doesn't change, in less than 300 years, Dallas, TX will be "beachfront property".



Beca

 

[jade1]

For those who say never I would love to sell you a one week in a BCV studio in 2041 for $12,328. ($92 per point x 134 points). If studios are going for that much in 2041 we are all in trouble.

Not for me, as soon as BCV doubles ($120) I am selling and will have had the most wonderfull stressfree reserved trips possible which will also return the initial investment and all the annual dues (I think about 7 years from now) meaning all those trips were FREE and will purchase at the "new-new 50 year resort" built connected to and by monorail to the new Disney Villans theme park.

 

[Dean]

Most RTU timeshare start to drop around just under 30 years but it depends on where DVC is in terms of sales and ROFR actions.

 

[Daitcher]

Down the road, my BWV contract may sell for less per point than your SSR contract, but it won't be "at a loss". We're close to even now (comparing to our usual stays at a moderate) - in just a few years, I can honestly say that even if we gave away the contract we'll still have saved $$ over what we were usually spending on our WDW vacations.

Best wishes -

Very true, I'm not counting any value of the stays people have had along the way. When I say at a loss I mean that the owner would sell the points at less than what they paid resulting in a loss of there intial buy in. Right now many owners could sell and make a profit. I'm of the group that thinks DVC owners should try to time the market and sell at a profit. Now that would be a winfall, making money on the sale not even counting al the money saved on trips.

DAVE

 

[Daitcher]

You have some good thoughts, but I just don't know if I agree with all of them. I still think there is going to be a "fallout" of sorts regarding SSR. I think within 2-3 years (once the resort is completely sold out), members will begin to find on a fairly regular basis that SSR and OKW are their only options. I think at that point, a number of owners (many who do not know about these boards) may think that their DVC ownership is not "what it was cracked up to be" and sell their ownership. I also think that, due to the high number of points available at SSR, the resale market for SSR will always be one of the lowest of WDW DVC resorts....just a matter of supply and demand. I think those two points will keep the other, smaller resorts "artificially inflated" for a long time to come.

Will there be a point at which they are even...sure!! And, will there be a point where SSR is worth more than the older properties...yes....if DVC does nothing to remedy this (which I am not sure they will). Disney is a master of marketing, and I cannot IMAGINE they will let their "captive audience" free. I suspect that between now and the time our contracts expire, DVC will come up with all sorts of "Extend your ownership contracts" specials. They may even make it easier for us "add children to your deed. WDW vacations are a WONDERFUL legacy to leave your children." Call it a hunch...we, as a group are TOO much of a "cash cow" for Disney to just let us "walk away."

Granted...this is if:
1) Hurricanes don't wipe WDW off the map in the next 36 years, and
2) Global warming doesn't cause sea level to rise too quickly (Okay, kind of kidding on this one, but I did just read an article saying that if something doesn't change, in less than 300 years, Dallas, TX will be "beachfront property".



Beca

Great thoughts Beca and I certainly can't disagree with any of this. It very well may play out as you suggest. We should save these predictions for later on so we can reference them. Thanks again.

DAVE

 

[Boston5602]

Will there be a point at which they are even...sure!! And, will there be a point where SSR is worth more than the older properties...yes....if DVC does nothing to remedy this (which I am not sure they will). Disney is a master of marketing, and I cannot IMAGINE they will let their "captive audience" free. I suspect that between now and the time our contracts expire, DVC will come up with all sorts of "Extend your ownership contracts" specials. They may even make it easier for us "add children to your deed. WDW vacations are a WONDERFUL legacy to leave your children." Call it a hunch...we, as a group are TOO much of a "cash cow" for Disney to just let us "walk away."

Granted...this is if:
1) Hurricanes don't wipe WDW off the map in the next 36 years, and
2) Global warming doesn't cause sea level to rise too quickly (Okay, kind of kidding on this one, but I did just read an article saying that if something doesn't change, in less than 300 years, Dallas, TX will be "beachfront property".



Beca

I've already decided I'm buying DVC this year , just how many points and how
( Disney or TSS cost to point best value thing ) to do it . I also thought I'm buying BWV and i'm fine with paying more for less cause I want to stay there . But I never thought about what you stated above , why would disney want 100,000 people who come to disney at least once every 3 years ( or so ) go and spend their money somewhere else. Good Point.

 

[LisaS]

I share CarolMN's point of view on this. DH and I bought into DVC to allow us to stay at an Epcot resort for much less than the AP rates we had been paying to stay at YC. I haven't got my spreadsheet handy but we break even somewhere in the next 7-8 years. From that point on, whatever we could get for it (if we ever decided to sell) will be gravy.

I think there will continue to be a good market out there for BCV, VWL and BWV resales for many years to come, provided that BC/YC and WL continue to be popular resorts with expensive rooms. DVC provides a way to stay at those resorts without paying hotel room prices, so as long as that continues to be the case, I think people will still be interested in purchasing resales there and that will keep prices up. This will be particularly true if the "buy where you want to stay" crowd proves to be right about it becoming increasingly difficult to book the smaller resorts at 7 months and it becomes necessary to own points there if you ever want to stay there.

Assuming the break even point for DVC ownership continues to be about 7 years, then I think values will hold up pretty well until we're down to 20 years left on the contracts. But that's 16 years away so who knows what Disney might dream up in the way of extension plans by then, or how many other DVC resorts will have been built, or what the dues will be by that time, or what other changes will have occurred at WDW that could change the whole picture.

I also agree with Beca's comments that there are going to be a lot of SSR points out there on the resale market keeping SSR's resale prices down. SSR is a beautiful resort, but there are just going to be so many owners there that there will be too many contracts for sale at any given time, putting pressure on resale prices. But then again, maybe someday Disney will do something so spectacular with DTD that everyone ends up clamoring for points at SSR. Who knows...

 

[rwcmath]

We who own at VWL, BCV and BWV have something, even if it's just a booking advantage, that MANY if not MOST of the people who bought SSR wish they had.

Prices will drop when a large minority of the owners of VWL, BCV and BWV begin selling.

I think the 2042 resort prices are going up, so it's not quite yet.

rwc

 

[DrTomorrow]

You have some good thoughts, but I just don't know if I agree with all of them. I still think there is going to be a "fallout" of sorts regarding SSR. I think within 2-3 years (once the resort is completely sold out), members will begin to find on a fairly regular basis that SSR and OKW are their only options. I think at that point, a number of owners (many who do not know about these boards) may think that their DVC ownership is not "what it was cracked up to be" and sell their ownership. I also think that, due to the high number of points available at SSR, the resale market for SSR will always be one of the lowest of WDW DVC resorts....just a matter of supply and demand. I think those two points will keep the other, smaller resorts "artificially inflated" for a long time to come.[...]

I disagree with this. You would probably be correct IF every DVC owner at every resort was able to (or intelligent enough to) make DVC plans more than 7 months in advance. However, this is NOT the case - as I keep saying, DIS DVCers are NOT representative of DVC owners in general (Heaven forbid for a DIS DVCer to let points lapse); this means that there will still be options for others at the 7 month window.

Also - and I know this is heresy to some - I believe that resort preferences will change over the decades. For example, the ability to walk to EPCOT for dinner will be seen as less of a value than being able to walk to DTD for dinner; parking close to your room - and being very close to offsite access - will be seen as more important.

It will, however, be interesting to see how it all plays out - and there couldn't be a nicer group of people that the DIS DVCers to sit with in the bleachers....

Be well!

PS. Daitcher - advocating Market Timing now? tsk tsk tsk

 

[Beca]

I've already decided I'm buying DVC this year , just how many points and how
( Disney or TSS cost to point best value thing ) to do it . I also thought I'm buying BWV and i'm fine with paying more for less cause I want to stay there . But I never thought about what you stated above , why would disney want 100,000 people who come to disney at least once every 3 years ( or so ) go and spend their money somewhere else. Good Point.

Thanks!! And just remember, if you don't want to worry about ROFR, you CAN buy BWV direct from DVC....just ask your guide.



Beca

 

[TheBeast]

Wow, lots of great thoughts. Thanks for your opinions. I especially like the comment about taking inflation into effect. Imagine paying $10000 for a week at a BCV studio in 2042 and thinking it's a deal!

I think Beca has a valid point on the ability to get rooms at BCV or VWL - yes there will be people that don't plan ahead but with enough DVCers at the 7 month mark, rooms could fill pretty quick.

p.s. Not to start a political or environmental debate, but Beca or anyone else worried about global warming should read Crichton's State of Fear.

 

[Rozzie]

What amazes me is there is still this perception that the SSR owners are lining up to take over the Epcot Resorts. I've done BCV, thanks, and we missed our SSR/OKW the whole time.

Will the prices decrease as contracts get older? Of course they will. When? I think sooner rather than later. My imagination has it peaking at this next increase, or very soon after. (1-2 years) But that's JMHO.

Will DVC offer extensions on contracts? In my mind it is a no-brainer, YES. The length of contract is not what sold us into SSR, it was actually the RESORT ITSELF.

Now, if we can get this global warming thing worked out, we'll be in good shape.

 

[doubletrouble_vb]

I think prices will start falling as soon as the ROFR price point decreases. Current prices aren't where they are because individual buyers were bidding up the price. They are where they are because Disney is the 800 pound gorilla in the buying pool. When Disney lays off on ROFR the price point starts to fall until the new ROFR point is found. At least that's the pattern I've noticed over the last few years.

When will it fall below what I paid? ($72). That I'm not sure about. I think inflation will do an excellent job of keeping the price above $72 for 10 or 15 years.

 

[Dean]

What amazes me is there is still this perception that the SSR owners are lining up to take over the Epcot Resorts. I've done BCV, thanks, and we missed our SSR/OKW the whole time.

Will the prices decrease as contracts get older? Of course they will. When? I think sooner rather than later. My imagination has it peaking at this next increase, or very soon after. (1-2 years) But that's JMHO.

Will DVC offer extensions on contracts? In my mind it is a no-brainer, YES. The length of contract is not what sold us into SSR, it was actually the RESORT ITSELF.

Now, if we can get this global warming thing worked out, we'll be in good shape.

I think, my opinion but based on real information, that SSR and OKW owners (esp newer ones) are more likely to try to exchange into BCV, BWV and VWL than the reverse. Given the size of the resorts, even a 1-2 % difference will be very important. And we've seen, it appears to me, a far larger number of owners and potential owners on this board who bought SSR with the stated intent of staying elsewhere, than we did with say BCV and VWL. The same for OKW resale owners the last 5 years or so. That's not to say that there wont' be SSR owners that plan to stay there and no where else or even BCV, BWV or VWL owners that end up only wanting to stay at SSR. It's simply the balance that is the issue. And that's not taking away from either resort.

As for extensions, I'd love it but don't see it happening. I just don't see a logistical way for DVC to financially be able to swing it, but we shall see.