Where do you think DVC resale prices are headed?

[wreing]

I am wondering how much of that was fueled by the perception in June that things were getting better in a COVID sense.

I also think this is a pretty standard pattern as the market incorporates all this info. We started looking to buy our first house in 2008 and the market was similarly weird. Buyers pulled back anticipating declines, sellers came off the sidelines to see if they could get out while prices were still high. Since a lot of the sellers had flexibility, the completed sales were based on people buying who were LESS price sensitive than before.

Now if there is going to be a big correction, sellers who have to sell will start to take lower prices and things will start dropping, like they did for houses in 2008-2009. But maybe there is enough demand and sales keep up and prices stay about where they have been.

 

[JETSDAD]

Actually they get paid commission on that one and the replacement contract both.

Replacement contract?

 

[Dean]

Replacement contract?

If a buyer loses a contract to ROFR they're usually moving on to a second and even a third contract in most cases.

 

[JETSDAD]

If a buyer loses a contract to ROFR they're usually moving on to a second and even a third contract in most cases.

They are the buyer though for the instant offer deals.

 

[Deeleebaker]

is that average closed sales prices or listing prices? It's hard to imagine that AKV closed contracts average $118 when other brokers have listings for under $110. I think the average of closed contracts is more likely in the $105 range, IMHO, if I had to guess.

As someone who just bought a 100 point AKV for $122, it was because I have a $15,000 budget, love AKV and hope to stay there in 2021. I was going to wait until later in the year, wanted to spend closer to $100 and originally was content to get a stripped contract to go in 2022, but coronavirus had me needing a vacation sooner. Of course, now it’s highly likely I won’t be able to go in 2021, but as my calculus teacher used to say, hindsight is 20/20.

 

[ldo]

As someone who just bought a 100 point AKV for $122,

sorry, I should have said 150+ AKV points contracts. Smaller contracts always go for a premium. Enjoy your AKV!

 

[Deeleebaker]

sorry, I should have said 150+ AKV points contracts. Smaller contracts always go for a premium. Enjoy your AKV!

I will, eventually. It would be interesting to see if DVC Resale is selling mostly 150- contracts and that’s driving the average. I could probably have afforded 150 or more, but only if I financed some, and that seemed imprudent during a pandemic. This was a purchase I planned for at least a year.

 

[sethschroeder]

I will, eventually. It would be interesting to see if DVC Resale is selling mostly 150- contracts and that’s driving the average. I could probably have afforded 150 or more, but only if I financed some, and that seemed imprudent during a pandemic. This was a purchase I planned for at least a year.

DVC Resale has a large number of small contracts.

Which skews the pricing because they go "per contract" and no "per point" average (which makes sense when trying to show a higher price than what a "normal" contract would go for.

You can see here and sort by contract size:
https://www.dvcresalemarket.com/listings/
We have went over it on page like 50 or 60 of this thread that prices are partly "elevated" because of all the add-ons that people are shedding for premium right now.

 

[sethschroeder]

Just pulled all the listed contracts that have offer accepted or pending from DVC Resale.

312 Contract:
62 were 25-75 points
45 were 76-100 points
61 were 101-150 points
83 were 151-200 points
57 were 201-350 points
Rest were a 435, 471, 655, 700 point contract

35% of contracts were 100 points or less and with 20% being 75 points or less that is going to dramatically impact pricing in a more expensive manner.

No clue how quickly or when they remove contracts from their site? Maybe 30 days after closing?

 

[Brianstl]

I think the thing that is going to flood the market more than even dues becoming due is people not being able to rent their points out. There are dedicated rentals sitting out there as low as $9 a point and nobody is biting at $9 a point. A lot of people justify their purchase of DVC with the belief that they can rent out their points when not using them and make a little money off it. It is far more likely than not that isn't going to be the case for an extended period of time. People aren't even going to be able to cover their dues with what they are going to be able to make off rentals.

 

[Dean]

They are the buyer though for the instant offer deals.

Talking about ROFR situation. If a broker buys it they're expecting to turn a profit. In both cases the seller left money on the table.

 

[KAT4DISNEY]

I think the thing that is going to flood the market more than even dues becoming due is people not being able to rent their points out. There are dedicated rentals sitting out there as low as $9 a point and nobody is biting at $9 a point. A lot of people justify their purchase of DVC with the belief that they can rent out their points when not using them and make a little money off it. It is far more likely than not that isn't going to be the case for an extended period of time. People aren't even going to be able to cover their dues with what they are going to be able to make off rentals.

They are part of the unique situation with unexpected expiring points though. An opposing thought is that with the normal booking windows in operation and with WDW keeping resorts closed the rentals may starting coming at a premium. I've seen more than one comment that for 11 month bookings people are still getting the rates they were prior to the pandemic.

 

[JETSDAD]

Talking about ROFR situation. If a broker buys it they're expecting to turn a profit. In both cases the seller left money on the table.

Yes but the question was regarding ROFR on an instant purchase which is being bought by the broker....it doesn't matter to them if it gets bought back because they still are paid commission but there is no replacement contract. Yes the seller is leaving money on the table but that is a given in that scenario (it's even in the disclosure on the site).

 

[Dean]

Yes but the question was regarding ROFR on an instant purchase which is being bought by the broker....it doesn't matter to them if it gets bought back because they still are paid commission but there is no replacement contract. Yes the seller is leaving money on the table but that is a given in that scenario (it's even in the disclosure on the site).

They get their commission if it's bought back and they get the low point purchase to resell if it's not. And if it's bought ROFR by DVD then they'll see others they might not have sold or as quickly, esp right now.

 

[CastAStone]

They are part of the unique situation with unexpected expiring points though. An opposing thought is that with the normal booking windows in operation and with WDW keeping resorts closed the rentals may starting coming at a premium. I've seen more than one comment that for 11 month bookings people are still getting the rates they were prior to the pandemic.

There still just a ton more points in peoples accounts than usual though. There has to be. The broker model is outstanding at obfuscating supply, because the broker does not care if some people don’t ever find renters their points. So while at some point, supply will exceed demand, what will have to happen to bring prices down is people meaningfully undercutting the existing brokers elsewhere.

 

[limace]

I’ve been actively looking for a small AKL contract for the last month. I haven’t seen anything less than $120 for a 100 point contract. And even those don’t last more than 24 hours. The 50 pt contracts get listed for $135 and are gone in an hour. If someone finds a 100 point contract listed for less than $115 please share with me.

on the ROFR page, several folks have recently had offers accepted at between 95 and 105 pp for 100-150 at AKV.

 

[KAT4DISNEY]

There still just a ton more points in peoples accounts than usual though. There has to be. The broker model is outstanding at obfuscating supply, because the broker does not care if some people don’t ever find renters their points. So while at some point, supply will exceed demand, what will have to happen to bring prices down is people meaningfully undercutting the existing brokers elsewhere.

However the biggest "competitor" is not participating in the market like they usually do - Disney resorts. Of course demand is down but I was just was saying that it's not a given that rental prices are going to absolutely plummet because while the demand has decreased so has the supply (Disney). Right now there's a glut of rapidly expiring points but there's possibilities of other scenarios playing out going forward.

 

[Brianstl]

There still just a ton more points in peoples accounts than usual though. There has to be. The broker model is outstanding at obfuscating supply, because the broker does not care if some people don’t ever find renters their points. So while at some point, supply will exceed demand, what will have to happen to bring prices down is people meaningfully undercutting the existing brokers elsewhere.

I think we already are seeing brokers undercut their own listed owners when it comes to points the brokers are stuck with either through chargebacks or other points they control. I am sure the rentals we are seeing at the deep discounted prices our controlled by the broker. So when you see a $9 or $10 listing just assume those are the brokers points and the demand the broker is seeing has led the broker to determine that is the most that they can get.

 

[davidl81]

I think we already are seeing brokers undercut their own listed owners when it comes to points the brokers are stuck with either through chargebacks or other points they control. I am sure the rentals we are seeing at the deep discounted prices our controlled by the broker. So when you see a $9 or $10 listing just assume those are the brokers points and the demand the broker is seeing has led the broker to determine that is the most that they can get.

But those $9-10 point type of rentals are ones that are like two weeks out etc and if they cancel them i would assume they would go into holding or expire. It's not like I can get a November reservation right now at $9-10, those are still going for $18-$19

 

[lovethesun12]

Same reason some people hit their head against the wall?

Also that broker is most like Disney from when I have talked with them (saying information that is false but outline they are not sure lol). I also think it has to do that lower contracts they will buy themselves and likely not report.

https://www.dvcresalemarket.com/selling/instant-sale/
As an example they will buy a 75 point contract with 2020 and 2021 points for $105/point themselves right now. Those instant bought contracts then go in to rental markets or get resold again for a higher price without the commission requirement.

This is why I mentioned before I don’t even bother with some sites. I guess everyone has their favourite sites, but I find Fidelity is consistently the site that actually will sometimes list prices at or below the instant sale price. Some great negotiators have managed to get good deals In various places, but the $100pp 250pt BLT, $130 50pt poly etc...Those were the listed price, no negotiating required.