Which resort is best for sleep around points?

[3 DD love princesses]

Well done. That is a serious deal. May I ask which broker?

Fidelity

 

[LadybugsMum]

It's nice to see others from NC here.

 

[Zip-a-dee-dude-da]

I just bought 90 points at Hhi for 68 bucks a point ....mf or not doesnt get better than that for sap

 

[sethschroeder]

$120 poly is cheaper than 85 ssr pp. this is going by the cost pp for the life of the contract.

Cost/Value now is a bigger impact than in 34 years. Its hard to do a flat analysis because in 34 years when you need to buy a new contract you actually are then getting a better deal than POLY likely since you will lock in a new contract sooner. Just like contracts keep going up in price now.

 

[sethschroeder]

I just bought 90 points at Hhi for 68 bucks a point ....mf or not doesnt get better than that for sap

Depends as over time the MFs will erase the difference and you also don't have a WDW home if over time things get extra tight (possibly post 2042).

 

[CastAStone]

Cost/Value now is a bigger impact than in 34 years. Its hard to do a flat analysis because in 34 years when you need to buy a new contract you actually are then getting a better deal than POLY likely since you will lock in a new contract sooner. Just like contracts keep going up in price now.

Yes. Also, If you put the difference between 200 SSR points @ $95 and 200 Poly points @ $140 into an IRA earning 6.5% CAGR, after adjusting out inflation you’d have turned your $4,500 into $35,000 in savings by 2054 - that’s $35,000 in today’s dollars.

In other words, when you take the time value of money (TVM) into account, there is extremely little value in years 30+ no matter how old you are because to pay for whatever a currently-$5000 hotel stay costs in 2054 you only need to put $650 into an investment account today, whereas to pay for a $5000 cash stay in 2021 you need to put $4700 into an investment account - so year 2 is worth 7x what year 34 is worth.

Next time I pick up my computer I’ll throw out the math on this, it’s illuminating. SSR and OKW(e) are, not surprisingly, the best values when TVM is included. Poly is somewhere in the middle. Beach Club is far and away the worst - it’s just a hair over $20/point once you discount the future years appropriately and include MFs (e.g. you’re better off renting at the current going rate of $20/point than buying at current prices).

 

[Duckbug.Ducktales]

Next time I pick up my computer I’ll throw out the math on this, it’s illuminating. SSR and OKW(e) are, not surprisingly, the best values when TVM is included. Poly is somewhere in the middle. Beach Club is far and away the worst - it’s just a hair over $20/point once you discount the future years appropriately and include MFs (e.g. you’re better off renting at the current going rate of $20/point than buying at current prices).

It would be really interesting to see the spread of resorts with TVM included!

 

[iflyjetzzz]

Yes. Also, If you put the difference between 200 SSR points @ $95 and 200 Poly points @ $140 into an IRA earning 6.5% CAGR, after adjusting out inflation you’d have turned your $4,500 into $35,000 in savings by 2054 - that’s $35,000 in today’s dollars.

That's not right. Using the rule of 72, you'll have ~$35K in 2054 in 2054 dollars. Unless you assume that the inflation rate is zero, that's not today's dollars. It's more like $18K in today's dollars using ~3% annual inflation rate.

 

[CastAStone]

That's not right. Using the rule of 72, you'll have ~$35K in 2054 in 2054 dollars. Unless you assume that the inflation rate is zero, that's not today's dollars. It's more like $18K in today's dollars using ~3% annual inflation rate.

The 6.5% was inflation adjusted to start with. It assumes you actually make roughly 9% pre-inflation (I don’t have my laptop handy so I don’t have my exact assumptions). If you see that and you think I still have the math wrong please let me know, I work in marketing so it has been a long time since I didn’t have a finance person to do these calculations for me!

 

[sethschroeder]

long time since I didn’t have a finance person to do these calculations for me!

I slept at a holiday Inn last night does that count hahaha.

Man that joke probably goes over some people heads now.

 

[Prince John Robin Hood]

It'll be interesting to see if staying outside ones home resort is possible the next few years. There's lots of availability right now and resorts were closed for months. The amount of points that owners are holding will make booking at 7 months very difficult I believe.

 

[CastAStone]

It'll be interesting to see if staying outside ones home resort is possible the next few years. There's lots of availability right now and resorts were closed for months. The amount of points that owners are holding will make booking at 7 months very difficult I believe.

It will indeed be interesting to see what it does to availability.

The initial thought I had was “studios will become just plain impossible at 7 months for a while”.

But OTOH, if you have more points than you have days off or are willing to spend time in one place, an easy way to use them is to book up a room category - Lake View instead of standard, 1 Bedroom instead of Studio, etc. Plus the rental market, which eats a lot of studios, is at best ambiguous as to whether the demand will come back to what it was.

So while I think availability will be tighter on the whole (I would hazard a guess that SSR and OKW will be tough to book at 3-4 months out for a while), I think it’s really hard to assess the 7 month window impact.

 

[Prince John Robin Hood]

It will indeed be interesting to see what it does to availability.

The initial thought I had was “studios will become just plain impossible at 7 months for a while”.

But OTOH, if you have more points than you have days off or are willing to spend time in one place, an easy way to use them is to book up a room category - Lake View instead of standard, 1 Bedroom instead of Studio, etc. Plus the rental market, which eats a lot of studios, is at best ambiguous as to whether the demand will come back to what it was.

So while I think availability will be tighter on the whole (I would hazard a guess that SSR and OKW will be tough to book at 3-4 months out for a while), I think it’s really hard to assess the 7 month window impact.

I think those that rent out their points every year will be disappointed and it will be tough to rent/transfer out points.

Those that use their points should be okay if they're flexible, stay at home resort and book early. SSR and OKW will be interesting but I'm really thinking about AUL. I'm predicting that will be the DVC resort with the softest demand for some time and it holds a TON of points.

 

[iflyjetzzz]

The 6.5% was inflation adjusted to start with. It assumes you actually make roughly 9% pre-inflation (I don’t have my laptop handy so I don’t have my exact assumptions). If you see that and you think I still have the math wrong please let me know, I work in marketing so it has been a long time since I didn’t have a finance person to do these calculations for me!

OK, I understand now. 9%'s a bit aggressive number but I see how you did that.

 

[3 DD love princesses]

Yes. Also, If you put the difference between 200 SSR points @ $95 and 200 Poly points @ $140 into an IRA earning 6.5% CAGR, after adjusting out inflation you’d have turned your $4,500 into $35,000 in savings by 2054 - that’s $35,000 in today’s dollars.

In other words, when you take the time value of money (TVM) into account, there is extremely little value in years 30+ no matter how old you are because to pay for whatever a currently-$5000 hotel stay costs in 2054 you only need to put $650 into an investment account today, whereas to pay for a $5000 cash stay in 2021 you need to put $4700 into an investment account - so year 2 is worth 7x what year 34 is worth.

Next time I pick up my computer I’ll throw out the math on this, it’s illuminating. SSR and OKW(e) are, not surprisingly, the best values when TVM is included. Poly is somewhere in the middle. Beach Club is far and away the worst - it’s just a hair over $20/point once you discount the future years appropriately and include MFs (e.g. you’re better off renting at the current going rate of $20/point than buying at current prices).

I’d be interested in the numbers with poly at $120 vs Ssr at $85

 

[CastAStone]

I’d be interested in the numbers with poly at $120 vs Ssr at $85

If you bought 200 SSR at $85 instead of 200 Poly at $120 and socked the $3,500 you saved into an investment account that netted 6.5% per year after inflation (a decent proxy for the S&P 500, which looking over the last 33 years has had a CAGR of 7.8% after inflation), you’d wind up with the equivalent of $27,000 in todays dollars in year 33. Its hard to predict what a Poly contract with 12 usable years left would cost at that point, but presumably you could buy one for less than the $27K (plus inflation) that you saved.

 

[Lorana]

If you bought 200 SSR at $85 instead of 200 Poly at $120 and socked the $3,500 you saved into an investment account that netted 6.5% per year after inflation (a decent proxy for the S&P 500, which looking over the last 33 years has had a CAGR of 7.8% after inflation), you’d wind up with the equivalent of $27,000 in todays dollars in year 33. Its hard to predict what a Poly contract with 12 usable years left would cost at that point, but presumably you could buy one for less than the $27K (plus inflation) that you saved.

$27,000 would be $135/point for 200 points. While I would love to be very wrong, given inflation, I feel like Poly will still be going for at least that, if not more, because it'll still have 12 years left. If the rate of inflation remains the same from now till 2027 as it did from 1993 till now, $135/point is the same as $75/point today, which I can see Poly still being worth and possibly more.

 

[DVC Doctor]

If you bought 200 SSR at $85 instead of 200 Poly at $120 and socked the $3,500 you saved into an investment account that netted 6.5% per year after inflation (a decent proxy for the S&P 500, which looking over the last 33 years has had a CAGR of 7.8% after inflation), you’d wind up with the equivalent of $27,000 in todays dollars in year 33. Its hard to predict what a Poly contract with 12 usable years left would cost at that point, but presumably you could buy one for less than the $27K (plus inflation) that you saved.

I have been a DVC member for 20 years and these comparisons are silly as these scenarios never happen. I have never seen someone prove that they avoided buying something (car, timeshare, boat, vacation, starbucks coffee) and then invest that money for a long term 6% growth. Sure there are one off stories, but not a conscious decision to avoid buying something and then invest in the stock market as a way to offset that expense.

Truth is - if you liek DVC and have the cash to buy it without financing, then go for it. Try to avoid financing. If you buy SSR or Poly or BLT, then they all are good.

That are many wildcards in timeshares, such as at one point OKW had way lower dues than AKV and now that spread has been closed. Disney does manipulate the system, but I am not sure it is on purpose to devalue something.

Buy where you love and try to get a good deal. There will always be someone that will claim to buy a resort cheaper than you or got a better deal. As long as you buy a good deal resale, you will be better than direct from Disney in terms of saving money.

 

[Prince John Robin Hood]

I have been a DVC member for 20 years and these comparisons are silly as these scenarios never happen. I have never seen someone prove that they avoided buying something (car, timeshare, boat, vacation, starbucks coffee) and then invest that money for a long term 6% growth. Sure there are one off stories, but not a conscious decision to avoid buying something and then invest in the stock market as a way to offset that expense.

Truth is - if you liek DVC and have the cash to buy it without financing, then go for it. Try to avoid financing. If you buy SSR or Poly or BLT, then they all are good.

I can't speak for others but the funds I will use for DVC will directly come from one of my investment accounts.

I get your point though as many save specifically to buy DVC or finance at 10%.

 

[CastAStone]

$27,000 would be $135/point for 200 points. While I would love to be very wrong, given inflation, I feel like Poly will still be going for at least that, if not more, because it'll still have 12 years left. If the rate of inflation remains the same from now till 2027 as it did from 1993 till now, $135/point is the same as $75/point today, which I can see Poly still being worth and possibly more.

I factored that in, or rather, due to the uncertainty around future inflation, I factored inflation out entirely, identifies what the typical investment return rate looks like after inflation, and did all the math in constant 2020 dollars. So It’s the future equivalent of $27k in today’s dollars. If we have 2% inflation it’s $52,000 in 2054 dollars, if inflation averages 3% its $72,000 in 2054, etc.