Where is bottom?

[Brian Noble]

Even with inflation though, would the decrease of years left somewhat counteract that?

Maybe for the '42 resorts, maybe not for some/most of the others.

 

[brazzledazzler]

If someone had Vero Beach points, they could always stay at Old Key West or Saratoga until 2042. Those resorts are almost always available. On a 100 point contract dues are approx $350 more a year than Old Key West and $500 more than Saratoga. So an extra $30-41 a month (weekly coffee addiction err... I mean budget for some ) a month isn't that bad, especially if you really like going to Vero. I've never been, but I'm going in April and really looking forward to it. I booked three weeks into the seven month window and could not get a two bedroom. I got a one bedroom, but had to wait list for a studio and inn room. I ended up having to stalk the booking site to pick off one day at a time over a few weeks to get the extra room. I had called the front desk and asked if I could book cash rooms a backup and was told that the mandatory cash rooms that Florida law dictates go very quickly.

The difficulties with booking at 7 months during the times we want to go to Vero are why we bought a 50-point subsidized contract. We plan on running it out into '42! If we could find another similar contract, we'd buy it in a heartbeat—such a great resort.

 

[tom1944]

Even with inflation though, would the decrease of years left somewhat counteract that?

I figure there should be a 2% drop in price every year. That automatic drop is countered by other factors forcing the price up. I would think direct price moves resale prices higher, a good economy and FOMO.

 

[KAT4DISNEY]

I figure there should be a 2% drop in price every year. That automatic drop is countered by other factors forcing the price up. I would think direct price moves resale prices higher, a good economy and FOMO.

It's never worked that way with DVC. One reason is the cost comparison is onsite cash rooms.

 

[sleepymouse]

But you loose a whole year of usage, which would essentially offset the price drop.

I agree and think this is important to factor into the equation. I just closed on my first contract with full points for last year and this year. So, I essentially bought a year ago at today's prices and without having to pay dues on 2022 points. Also, I am planning a December trip to WDW and already have tickets because of covid cutting our trip short last August. I do not have time to wait to purchase if I want to use points this year. (side note: Disney's customer service was top notch in helping us out while my son quarantined in the hotel and in setting us up with future tickets due to unused days)

 

[tom1944]

It's never worked that way with DVC. One reason is the cost comparison is onsite cash rooms.

Yes, the cash cost of rooms absolutely has to be a factor in which way resale prices go.

 

[Nabas]

“Deeper” than when?

Deeper than recently.

For example, the direct sale discounts at RIV and VGF were just increased. Disney does not do that if sales are meeting expectations.

 

[AstroBlasters]

Deeper than recently.

For example, the direct sale discounts at RIV and VGF were just increased. Disney does not do that if sales are meeting expectations.

I know the AUL Incentives are significantly less generous than before 3/1. But only pay attention to member add-on and not new member.

 

[Epcot Forever Forever]

Even with inflation though, would the decrease of years left somewhat counteract that?

No.

I figure there should be a 2% drop in price every year. That automatic drop is countered by other factors forcing the price up. I would think direct price moves resale prices higher, a good economy and FOMO.

2% is far too much. With any resort, the year you’re losing by waiting a year, mathematically, is the last year of the contract. And the last year is worth the least of all of the years, because of all of the inflation and all of the cost of capital between now and then.

So for example, take Saratoga Springs, if you assume 5% net of inflation and savings rate (cost of capital), which is conservative, with 31 years left now vs 30 years left a year from now, the inherent value in constant dollars will drop about 1.2%. A more aggressive savings rate would drop that well below 1%.

Now offset that because inflation was 6.5% over the past year. So you’d expect the dollar price of SSR to be about 5.3% higher than it was a year ago.

 

[AstroBlasters]

I figure there should be a 2% drop in price every year. That automatic drop is countered by other factors forcing the price up. I would think direct price moves resale prices higher, a good economy and FOMO.

That is reasonable from a GAAP perspective, but it actually has much more to do with cash rates less broadly available discounts.

 

[Disney_David]

But you loose a whole year of usage, which would essentially offset the price drop.

That’s how I view it. Could wait another six months or a year and save a couple of grand, maybe more - but I’d lose using it this year. Especially with a loaded contract.

If I made the decision, I want the fun of using it ASAP. But not so much I’d pay double the price for direct points.

Then again, I’m local and picking off one night here or there, not planning a future vacation.

 

[Chili327]

That’s how I view it. Could wait another six months or a year and save a couple of grand, maybe more - but I’d lose using it this year. Especially with a loaded contract.

Could also find that in 6 months the price has gone back up, & you missed the dip.

 

[Royal Consort]

Could also find that in 6 months the price has gone back up, & you missed the dip.

In 2020 when covid shut everything down and prices dropped, a few disboarders were adamant that prices would continue to drop and would wait "until the end of the year" to pick up contracts in a bloodbath....

 

[JPKanks]

Yes, the cash cost of rooms absolutely has to be a factor in which way resale prices go.

Renting dvc points needs to be a factor too. A lot of people dont pay the sticker cash price. Cash price is used as an argument and a way for people to rationalize their purchase.

 

[Disney_David]

Could also find that in 6 months the price has gone back up, & you missed the dip.

Right! I thought I’d dip my toe in now, and see if I can pick up a moderate amount of points, and will pick up more if it drops significantly further

 

[Epcot Forever Forever]

Could also find that in 6 months the price has gone back up, & you missed the dip.

It’s pretty straightforward to tell when prices are going to turn around, just watch the number of contracts listed. When it starts to drop meaningfully, buy.

 

[Genie+]

There’s over 2,500 listings today. 200+ popped up this last week.

 

[Nabas]

In 2020 when covid shut everything down and prices dropped, a few disboarders were adamant that prices would continue to drop and would wait "until the end of the year" to pick up contracts in a bloodbath....

Prices dropped in 2020?

I was watching closely, waiting for something good. Nothing looked like a good value.

The Fed pumped trillions into the economy in a short time. Consumers were not spending on vacations. They were flush with cash for DVC resale purchases.

If prices did drop, then they were still will above the run-up that occurred after 2016.

 

[Epcot Forever Forever]

Prices dropped in 2020?

I was watching closely, waiting for something good. Nothing looked like a good value.

The Fed pumped trillions into the economy in a short time. Consumers were not spending on vacations. They were flush with cash for DVC resale purchases.

If prices did drop, then they were still will above the run-up that occurred after 2016.

They did! They dropped continuously from ~May to ~September, some resorts by as much as a third in terms of the lowest prices, and then ROFR restarted and the government sent checks and most white collar people got more comfortable that they weren’t getting laid off and people decided to schedule their revenge travel the market turned around FAST. Check the ROFR thread! There were some amazing deals!

 

[Chili327]

Right! I thought I’d dip my toe in now, and see if I can pick up a moderate amount of points, and will pick up more if it drops significantly further

That's it... Dollar Cost Averaging, can't "time the market"