Will point prices increase with recovering economy?

[yekcoh_99]

We're new to DVC and have addonitis already. We'd like to hold off a few more years and experience as many resorts as possible to help determine where we want to add on. However, I have to wonder if we're better off making a decision sooner than later in case prices per point increase as the economy recovers. We bought 150 BCV points resale for $84/point last July. I'm split between wanting to add on more points there in order to get the 11 month booking window for an entire stay, but am beginning to see the wisdom and fun of having split stays. Therefore, owning another resort becomes appealing as well. At any rate, I'm curious to see what your opinions are? Especially those who have been DVC owners for a long time and have possibly seen point fluctuations during other rough economic times. Do you see the price per point increasing for both resale and new from what they are now? Many thanks!!!

 

[disneynutz]

Prices will move up as the economy improves. As sales increase Disney will offer fewer incentives and specials.

Bill

 

[yekcoh_99]

Thanks Disneynutz. How much do you think they'll increase by? Alot or just a few points?

 

[disneynutz]

Two years ago BCV was selling for $15 more per point, resale and there were about half the number of listings available that there are today.

That means that there are more sellers than buyers. There are also record numbers of owners renting out their points. Many members can't afford to vacation and they use the rental income to help pay their dues hoping that things will improve next year.

Bill

 

[RobDoc]

Here is a history of DVC as compiled from past posts over the years. The prices noted are the published rates for direct purchase thru DVC. They do not include incentives and do not include resale prices. You can some feel for recent resale prices by looking at the ROFR thread. Please note that resale prices are subject to supply/demand as well as decreasing lifetime of the resorts - unless DVC decides to extend contracts. Even that is not a guarantee to raise or even support resale pricing since the difference in resale pricing at OKW does not reflect the additional cost of the extension. In some cases, the size of the resort may play a role and certainly location is also a factor.

Pre-Construction -- $48 (230 pt. minimum)
October, 7, 1991 -- Sales begin at OKW
December, 1991 -- OKW opens at $51
January, 1992 -- $51 (230 pt. minimum)
February, 1992 -- $51
July-August, 1992 -- $54.50
11/1/92 -- $56
May, 1993 -- $56 (190 pt. minimum)
July, 1993 -- $57.50
January, 1994 -- $57.50 March, 1994 -- Announce Newport, CA plans
April, 1994 -- $59 Increase announced for June
6/15/94 -- $60.50
November, 1994 -- $61.50
7/1/95 -- $62.75
March,1995 - 150 point minimum begins
October 1, 1995 -- Vero Opens
March 1, 1996 -- HHI Opens
May, 1996 -- $62.75
July, 1996 -- BWV Opens
May, 1997 -- $62.75 (150 pt. minimum)
May, 1998 -- $62.75
Fall, 1998 -- OKW Sells-out
Fall, 1998 -- Announce WLV
January, 1999 -- $65
October, 1999 -- $65 (notice of OKW selling out again after adding buildings 62, 63, 64)
Mid-May, 2000 -- $67
June, 2000 -- $67
November, 2000 -- VWL Opens, BWV Sells-out
December, 2000 -- VWL sales begin
January, 2001 -- $72
March, 2001 -- an increase to $75 announced for June
June, 2001 -- $75
February 3, 2002 -- Sales begin for BCV
March 6, 2002 –- Reservations begin for BCV
June, 2002 -- $80 per point
Dec 1, 2002 -- $84 per point (announced early Oct.)
Aug 4, 2003 -- $89 per point (SSR Sales begin with $10 discount = $79) with expiration in 2054.
May, 2004 -- SSR opens.
May, 2004 -- $95 per point @SSR, $89 at other DVC resorts.
June, 2005 -- $98 per point @SSR, $92 at other DVC resorts.
Jan (?), 2006 -- $101 per point @SSR, $95 at other DVC resorts (with some variances at OKW, VB and HH). Incentives are also available lowering the effective purchase price for 150 or more points.
Fall , 2006 --AKV announced.
February 1, 2007 -- AKV sales begin for existing members. $101 ($8 incentive discount also available)
March, 2007 -- $104 per point. (160 point minimum) ($8 incentive discount available)
July 2, 2007 -- AKV opens as part of main AKL resort - Jambo House. (Original opening - was moved up to July from September)
Summer, 2007 -- GCV Announced (opening in 2009)
Fall, 2007 -- Ko'Olina, Hawaii DVC resort announced (opening in 2011)
September, 2007 - DVC extends OKW land lease until January 31, 2057. Existing members have the option to purchase the extension at $15 per point thru February 29, 2008.
May, 2009 -- AKV - Kidani Village - opening.
September 16, 2008 -- BLT announced. Sales begin on 9/21 to existing members at $112 per point plus a $5 incentive. Sales for new members begins on October 5, 2008. To open on September 1, 2009.
September 16, 2008 -- THV announced as an addition to SSR. To open in Spring, 2009.
January 15, 2009 -- Price increase to $112 for AKV purchase.
Spring, 2009 -- GCV sales begin at $112 per point.
Fall, 2009 -- Price increase to $120 for BLT and GCV purchases. Other incentives available.

 

[pinnocchiosdad]

Prices will move up as the economy improves. As sales increase Disney will offer fewer incentives and specials.

Bill

DVC sales must be pretty good right now, because incentives are practicaly nill.

 

[DebbieB]

The thing with BCV resales (along with VWL, BWV and some OKW) is that they expire in 2042. As the years available go down, the prices may drop. SSR does not expire until 2058, along with OKW extended contracts, the other resorts after that.

 

[Crystal_27]

During my membership alone (in just under a year), BLT has gone from $112/point (with up to a $16/point incentive) to $120/point (with only a $5/point incentive). AND, this increase was in a very depressed economy. I think that you will probably continue to see an upward trend if you are buying new contracts (through Disney). As to the older resorts, I believe that as the economy recovers, that you will see the resales stay fairly fixed. Still, if I knew that I was adding on (especially through Disney) I'd do it now rather than chance a price increase.

 

[Sandisw]

The thing with BCV resales (along with VWL, BWV and some OKW) is that they expire in 2042. As the years available go down, the prices may drop. SSR does not expire until 2058, along with OKW extended contracts, the other resorts after that.

I think SSR expires in 2054, OKW extended and AKV are 2057, and BLT and VGC are 2060.

 

[sweetdana]

If it is a small add on like 50 points. And waiting say 3 years to do it. Even an increase of say 15$ is only 750$ difference. If by add on you mean say 150 points... 15$ then is 2250$.

Based on supply and demand and resale price.
The resort you will add on will make a big diff too. If you pick BLT, the resale with incentives, is nearly the same as direct. Which means price will increase because of demand. I truely believe they could tommorrow add 10$ per point with no difference in overall sales. New buyers can still have AK or SSR. And picky buyers who really want BLT, have no other options as there is little to no resale on it. The opposit is true for SSR, where the ROFR is like 70$ and the boards are flooded.

If you decide you want BLT, I would not wait. To be honest you could resale for nearly the same amount if you decided later you wanted something different, or nothing at all.
If you are leaning towards BC or any other sold out resort, since there is no incentive right now and Disney is ROFR some every month, I would wait and feel secure on that. As I believe with the price of resale they will have to lower there price and/or incentives on these. Also based on OKW, seems that Dis will offer extened BC eventually.
If it is SSR. I would buy resale if I could now, as the price to me seems too low, and I think the ROFR minimum will SOON be raised. As soon as the VAST amount of sellers will sell off, the price will raise.

AK.. I donno, it doesn't make sense why it is more than SSR (resale) and the MF are more too. I think this one should be closer to the price of SSR.

But no one knows...

 

[Coach81]

The economy is recovering????

 

[jlewisinsyr]

The economy is recovering????

Absolutely

Are there still risks, absolutely, but things are definately heading in the right direction for now (I'm still on fence about a few things on the horizon that could be problematic from a Financial Institution perspective).

 

[Lawshark]

Absolutely

Are there still risks, absolutely, but things are definately heading in the right direction for now (I'm still on fence about a few things on the horizon that could be problematic from a Financial Institution perspective).

Hmmm. I wouldn't bet the house on that.

Unless, by "absolutely" you mean that we are looking at unemployment above 9% for at least another 18 months...real estate price stagnation for the next 2 to 3 years...

 

[BigTigger]

DVC seems to feel that BLT and GCV are premium properties and that they need little incentive to sell them. I'm guessing that the remaining SSR and AKV are the fillers to have in reserve if the other two sell out and equally attractive new sites aren't online yet (BLT 2 and Hawaii).

When we bought in 1995, the incentives weren't that great unless you stayed at a Disney resort and took the tour while onsite. You could then receive an incentive credit for the stay (room cost only) up to I believe $3500 (we got ~$3200 off our 300 pt. OKW purchase). I'm suprised that this type incentive hasn't been used in quite awhile.

While the economy has some signs of life, I don't see a great recovery to drive up real estate type investments in Florida anytime soon. Of course, that doesn't stop DVC from raising prices based on what their crystal ball shows

 

[jlewisinsyr]

Hmmm. I wouldn't bet the house on that.

Unless, by "absolutely" you mean that we are looking at unemployment above 9% for at least another 18 months...real estate price stagnation for the next 2 to 3 years...

Unemployment rate nor real estate price stagnation are definitions of a recession. In regards to the latter, people forgot years ago that real estate is just like any other investment, the value can go up or down.

 

[Lawshark]

Unemployment rate nor real estate price stagnation are definitions of a recession. In regards to the latter, people forgot years ago that real estate is just like any other investment, the value can go up or down.

Well...the original posted comment asked if the economy is recovering...and an "absolutely!" response seems a bit overly optimistic. They also didn't ask for a definition of a recession...but that is a fluid and argued definition...with one school of thought pointing to unemployment as one indicator...not just tracking GDP. Totally agreed on the real estate piece...I'm a real estate attorney and saw (and I am seeing) it first hand.

There is still concern that this could be a double dip recession...a "w" instead of a "v"...and the so-called growth in GDP right now is sluggish at best.

We may seen a 4th quarter estimated GDP increase of 5.9%...but I and many others have our doubts about how significant any of these numbers actually are, since they are being artificially pumped up by massive government spending.

The worst is likely over...but that sure doesn't mean things are good.

 

[dmoore22]

We purchased a resale nearly 10 years ago. Watching the market for our home resort we have observed that the prices continue to rise but not as much as before this current "Great Recession." However it seems that DVC points have maintained their value much more than our portfolio has in this current economy. I would use this opportunity to shop for a resale. Even in so-called "good" economic times there are sellers that over-extended themselves and need to get out from under some of their debt. Now I would anticipate would be a time when some wheeling and dealing can be done.

 

[LaurenT]

AK.. I donno, it doesn't make sense why it is more than SSR (resale) and the MF are more too. I think this one should be closer to the price of SSR.

Not sure why the resale on AK is more...just a more popular resort I guess...I see lots of posts on how much people love it (myself included) and really never see anyone mention SSR. I can tell you why MF are higher...it's the cost to maintain the safari and animals. Even higher MF are the ones with a beach that needs to be maintained..bringing in sand, etc...

 

[LaurenT]

We purchased a resale nearly 10 years ago. Watching the market for our home resort we have observed that the prices continue to rise but not as much as before this current "Great Recession." However it seems that DVC points have maintained their value much more than our portfolio has in this current economy. I would use this opportunity to shop for a resale. Even in so-called "good" economic times there are sellers that over-extended themselves and need to get out from under some of their debt. Now I would anticipate would be a time when some wheeling and dealing can be done.

There is a ton of wheeling and dealing to be done in the timeshare business in general right now..I am sure you could close a 3 bedroom lock out - peak sasaon annual for $5,000 or less....but not in WDW. Disney is very careful with their ROFR (right of first refusal) and will not let any sale go through that is too low, so there is a limit to how much dealing can be done..and that is good for all of us!

 

[LaurenT]

Well...the original posted comment asked if the economy is recovering...and an "absolutely!" response seems a bit overly optimistic. They also didn't ask for a definition of a recession...but that is a fluid and argued definition...with one school of thought pointing to unemployment as one indicator...not just tracking GDP. Totally agreed on the real estate piece...I'm a real estate attorney and saw (and I am seeing) it first hand.

There is still concern that this could be a double dip recession...a "w" instead of a "v"...and the so-called growth in GDP right now is sluggish at best.

We may seen a 4th quarter estimated GDP increase of 5.9%...but I and many others have our doubts about how significant any of these numbers actually are, since they are being artificially pumped up by massive government spending.

The worst is likely over...but that sure doesn't mean things are good.

Thr Oracle of Omaha said yesterday that he is confident the real estate market will recover in 2011...he doesn't usually step out there like that...if I'm gonna believe anyone....