Which is better, buy only the points we "need" or get the better $ per point deal and potentially rent some every year?

[Plireed]

We are considering our first DVC resale purchase, and are torn between getting 150 points per year (what we think we "need") or getting a better $ per point deal, and getting 230 points per year - and potentially renting the difference (80 pts per year) to cover the additional dues. I truly think I would buy a million points if our budget would allow for that many trips - LOL. Just wanting to make the first purchase, with the fewest regrets. Has anyone every had trouble renting out their points, if they did so far enough in advance? We are looking at OKW properties, and the 2042 expiration. We will be in our mid-70's by then.
Thanks in advance!

 

[grepes]

I would go with what you need. You'd be close to the end of the contract (+more work, rental demand variations, etc) before you'd be making your money back... making ~6 per point on the 80 rent points. This is relative to average resales. soooo if theres a 230 steal that could change things. Id rather my money now and try to make it back elsewhere. It could also make sense to put the money towards a 2057 contract as you could sell in your mid 70s to return some of your upfront cost (if you are willing to gamble the same way you would renting pts every year).

$10 pp less for 230 would save ~3500 at the end of the contract these savings would likely only be there at years 13+. (using 150 renting 80 yearly).

 

[BamaGuy44]

I wouldn't buy 200 if you think you need 75, but if there's an 80 point difference I don't see a big downside having the extra. It's not hard at all to rent out your points, we do it every year. I'm quite certain way more people end up wishing they'd bought a few more points, than wish they'd bought fewer.

This is by far the lowest price you'll ever get on those 80 points, so there's that. If you come back later and want 80 or 100 points, you'll likely be paying full price since there usually aren't incentives for small purchases. Plus the price will increase by then.

Just be careful, it's way more fun to use points than to rent them out. Many of us find ourselves sneaking in an extra trip, making those extra points pretty expensive

 

[JOLT]

I bought extra to rent out to pay dues.... I use all the points and run into borrow territory. If you go with the more points make sure you are okay with paying all the dues.

 

[Plireed]

I would go with what you need. You'd be close to the end of the contract (+more work, rental demand variations, etc) before you'd be making your money back... making ~6 per point on the 80 rent points. This is relative to average resales. soooo if theres a 230 steal that could change things. Id rather my money now and try to make it back elsewhere. It could also make sense to put the money towards a 2057 contract as you could sell in your mid 70s to return some of your upfront cost (if you are willing to gamble the same way you would renting pts every year).

$10 pp less for 230 would save ~3500 at the end of the contract these savings would likely only be there at years 13+. (using 150 renting 80 yearly).

Thank you for the insights. On the 2057 extensions, I am a little concerned that the rules may change and we wouldn't be able to sell it. Yet this is a great point.

 

[Plireed]

I wouldn't buy 200 if you think you need 75, but if there's an 80 point difference I don't see a big downside having the extra. It's not hard at all to rent out your points, we do it every year. I'm quite certain way more people end up wishing they'd bought a few more points, than wish they'd bought fewer.

This is by far the lowest price you'll ever get on those 80 points, so there's that. If you come back later and want 80 or 100 points, you'll likely be paying full price since there usually aren't incentives for small purchases. Plus the price will increase by then.

Just be careful, it's way more fun to use points than to rent them out. Many of us find ourselves sneaking in an extra trip, making those extra points pretty expensive

Oh, I am sure I would have no problem using them, provided that the rest of my budget allowed for it! Thank you so much for your insights!

 

[Leight19]

My take on this is new owners often underestimate the points they need by assuming they can always get exactly what they want when they want it. From that perspective I’d lean towards buying the extra points if you could afford it. That way if you do have extra you can rent them but you’re covered as well if you had underestimated points you would need.

However, I also would say I wouldn’t buy points I couldn’t afford with the idea I could pay for it if I rent them to cover the cost. There’s a lot of risk in that move as rental markets aren’t always guaranteed to be profitable and it’s very easy to creep up your point usage as well.

 

[BuzzLightyr]

I'd go with more points. 230 is also more popular at okw as it was the original minimum when they set their point charts.

You can always rent extra points you don't need. You can bring along friends/family.

The older resorts have better point charts. If you want to stay anywhere else, compare some of the higher season 1 bedroom costs and see how many points those use up. The value options go quickly and you might need to go larger or pay for a better view to stay when/where you want. One more expensive stay elsewhere every third year can use up excess points you had planned to rent out.

 

[Chili327]

I bought extra to rent out to pay dues.... I use all the points and run into borrow territory. If you go with the more points make sure you are okay with paying all the dues.

Yep, i bet you find a way to just use the extra points every year, so just make sure you can afford the extra dues, & you'll be fine.

 

[GrumpyInPhilly]

I would buy close to what you need. I use renting as a fallback if something happens and I can't use all our points.

 

[BlueGreen5]

I would never buy more points than you reasonably plan to use consistently. Keep the extra cash if you have it, invest it wisely, use the investment earnings to buy more points whenever you need them (you can always find someone willing to sell you points). Using more DVC to offset the cost of DVC is - sorry to say it - financially quite foolish.

From the financial standpoint, DVC contracts are a below average asset for investment. You couple not a great return with considerable risk. Not only are you locked into a recurring cost model that you have no control over, but you are subject to the risk that the rules change, that the Disney market goes sour, or that some crazy macro event happens (like, I don't know, a scorched earth cultural war with the DeSantis administration that results in a Budweiser effect or the laws being changed unfavorably), all with the best case scenario of recognizing revenue that is only double your recurring costs. You would be investing $22,000+ to maybe make $1,300 per year with the possibility of getting that $22,000 back in 20+ years -- you could do better with an S&P 500 mutual fund.

Don't get me wrong, I'm a DVC member, but I don't look at it as a financial investment. Happy to have the ability to sell my points, if needed, but I didn't buy them for that.

EDITED TO ACTUALLY APPLY YOUR FACTS: My $22k/$1,300 example above was a hypothetical where you were buying 150pts at $150/point and able to hold the contract for a long period of time. That probably doesn't work for OKW for a number of reasons. In your case, your investment would be about $11,600 and you'd be looking at maybe making $640 per year off the points. At some point OKW (along with the other 2042 expirations) contracts are going to devalue on the resale market, steeply and quickly -- not imminently, but it's going to happen in the next 10-15 years. Your contract is not going to retain equity long enough for you to even break even off the annual rental income. Adding these extra 80 points is going to be virtually guaranteed to be a loss. Again, if your plan is to use them most years, then a financial "loss" is perfectly fine. But, if you're just adding them to get some upfront savings, you're going to lose more than you'll save. Again, just put the $11,600 in a low-cost S&P 500 mutual fund and use the earnings to offset the cost of those occasional add-on years.

 

[lilsonicfan]

I'm of two minds, while I don't think that DVC is any sort of real investment for me, I do generally feel better knowing I have enough points in almost all scenarios. It's not super hard to rent points either through a broker or on your own ... but I say this knowing that I'm totally fine to pay the dues on my points (and of course the initial buy-in) even if I don't rent out at all in any given year. If paying the dues on 230 points vs 150 would make a big difference then I would not necessarily go for the 230. That being said, if you were content to rent out some excess points to just cover your dues for those excess points - that's very doable.

 

[fflmaster]

I would say buy the additional points.

In my first contract, we bought the exact amount I expected to use each year for the time of year we wanted to travel.

After a few years, we found out that we also liked to travel at different times of the year, needing more points, and as our family grew (nieces and such), we started using more points. We also started going more often than once per year.

I have never had an issue with renting out points if we didn't need to use.

 

[Chili327]

I would say buy the additional points.

In my first contract, we bought the exact amount I expected to use each year for the time of year we wanted to travel.

After a few years, we found out that we also liked to travel at different times of the year, needing more points, and as our family grew (nieces and such), we started using more points. We also started going more often than once per year.

I have never had an issue with renting out points if we didn't need to use.

I usually plan for the highest season to see what amount of points i would need in the worst case scenario.
Usually Halloween week/end fits that bill for most places.

 

[JOLT]

I'm of two minds, while I don't think that DVC is any sort of real investment for me, I do generally feel better knowing I have enough points in almost all scenarios. It's not super hard to rent points either through a broker or on your own ... but I say this knowing that I'm totally fine to pay the dues on my points (and of course the initial buy-in) even if I don't rent out at all in any given year. If paying the dues on 230 points vs 150 would make a big difference then I would not necessarily go for the 230. That being said, if you were content to rent out some excess points to just cover your dues for those excess points - that's very doable.

Do it! every bodies doing it!

 

[Sandisw]

I would not buy extra DVC until we see if there are going to be any rule changes or enforcement against rentals that will impact owners who want do rent regularly, even if it’s to offset some dues.

 

[sarahlord]

I definitely underestimated what I would need for points, now I’m on the hunt for more….

I wish I had bought a little more than I did.

 

[🍀TwinsMom]

I would buy more if you can afford the dues now and don't anticipate it being a burden for the next 17 years. Do you think you may want a GV or 2B for extended family at OKW? If you anticipate long weekends in a studio, those extra points may be too much. If you think you can snowbird a bit in a few years, you may be glad to have the points to get R&R and totally slow down and enjoy the parks and resort amenities leisurely. We just had our Riviera five-year resort anniversary, and I am amazed how quickly that flew by. Assuming good health for you guys, 17 years is a nice span to enjoy yourselves and then be done with the contract when dues may be exorbitant.

 

[crisi]

I think you'll use the extra 80. You'll discover one or two bedrooms, take friends or family. But only if it isn't a burden in terms of purchase cost or dues. I wouldn't count on renting them in your calculations - not because you can't but because I suspect you won't.

 

[Genie+]

My first few thoughts -

A) How much $pp is jumping from 150 to 230pts actually saving? You’ve chosen OKW which has about $2pp higher dues than a few others, which can impact profit potential. Plus some other resorts get a premium for home priority as well.

B) More importantly though, is having excess points is too easy to use them yourself lol. If the plan was to stay within a 150pt budget each year to keep the math comfortable, the extra points might be hard to resist when you see a week or resort open that you always wanted to try.

C) DVC rules and the recent meeting where they discussed looking at changes to combat walking and commercial rentals. None of us owners know the outcome here. There may or may not be risk to your strategy. We are all left to interpret our own contracts. They do consistently say DVC is for personal use, and renting is allowed under FL timeshare law when excess points can’t be used. Some people read them separately. I read them together. You can rent out but typically need to be using contracts for personal use. Purchasing more points than you ever plan to use is different than renting out some points because plans change or you needed to skip a year. If the sole purpose of buying excess points is for profit, that could run afoul of how DVC updates clarification on commercial use. I don’t know but not a bad idea to keep an exit strategy in mind.