Would you pay a premium when buying direct for ability to sell as unrestricted?

[Bearval]

yep, so like I said Disney's wins

And I bet you'll find lots of trades happening

But what are they going to trade? A booked reservation they no longer want or can use? They will have to hope someone wants that room on those dates.

 

[Robbie Cottam]

confirmed reservations......
maybe not point for point,
may required a cash payment one way or another...
but it would be no different than confirmed reservation are sold or traded now.....

And Or we will start seeing a lot more confirmed reservation for rent at a bargain rate....

 

[Bearval]

confirmed reservations......
maybe not point for point,
may required a cash payment one way or another...
but it would be no different than confirmed reservation are sold or traded now.....

And Or we will start seeing a lot more confirmed reservation for rent at a bargain rate....

I agree with that. I don’t care for the “new” restrictions but I have my legacy contracts for AKL to use the concierge and value rooms and my BLT. Love both and have used those point to stay at BWV and CC. I cannot imagine being stuck to just one choice.

 

[Her Dotness]

I think an informed buyer can make either choice; depending on the facts of their situation, their travel desires, and their available cash, both can make sense.

This was us last year upon realizing we were stuck with a VGF studio every other year or that vexatious bank-borrow cycle plus OTU points.

And, we weren't that fond of the deluxe studio, didn't want a resort studio at all, and very much wanted to upgrade to a VGF 1br annually.

We had 125 VGF direct points, added 150 VGF resale for those reasons.

But 99% of uninformed buyers aren’t aware of the resale market and will buy direct.

What we were upon buying in 6 years ago. That percentage may be a wee bit high but not by much, I suspect.

Would we have bought only resale had we known then how much less expensive it was? Maybe some but would eventually have gotten the direct minimum. We wanted event perks like MM primarily but have enjoyed the miniscule ones like the discount on my Basin White addiction.

There can be benefits either way, depending.

 

[Sandisw]

So if, for argument’s sake, RIV was selling for $70 resale, you’d still buy for $220 direct knowing you lose (on paper) 70% of your equity 10 days after you sign? Is there any resale price that would make you rethink direct?

No thanks for me… I know it will be worth $0 in 48 years, but I don’t want it to depreciate 70% in 10 days…

The thing is that I just don’t think we will see resale for RIV I. the 70s while its an actively selling resort.

If it gets that low, they will be on to selling new resorts and just like today, where one doesn’t buy sold out resorts direct, RIV and the rest will be the same.

Like today, BLT is $250 yet resale is going around $130. No one choose that resort direct..but they may be buying RIV or VGF closer to $160 to $170 and have access there as well.

 

[Sandisw]

The people who buy resale with the intention of staying at studios or two bedrooms is going to hate it if they have to make changes to their reservation after the 7 month mark. The availability of the rooms they want will be slim to none and they won’t have the option of switching resorts.

Which is why people will need to think carefully on whether or not they want to have a one resort only set of points for a huge savings but higher chance of losing points for last minute changes.

If DVD wanted to do anything, I’d think it’d be offering resale buyers a chance to pay to get more trading rights.

 

[DanCali]

The thing is that I just don’t think we will see resale for RIV I. the 70s while its an actively selling resort.

If it gets that low, they will be on to selling new resorts and just like today, where one doesn’t buy sold out resorts direct, RIV and the rest will be the same.

Like today, BLT is $250 yet resale is going around $130. No one choose that resort direct..but they may be buying RIV or VGF closer to $160 to $170 and have access there as well.

My point is that if RIV gets to be that low (before or after it sells out) those who are informed about resale markets and resale prices will perhaps consider twice before buying at other restricted resorts (like Poly2?) because it's maybe likely to follow the same path.

The "sold out" resorts are not usually really sold out due to ROFR. Even if everything was "sold out", once can still buy unrestricted VGF, AKV, BLT or Poly over a restricted resort. They just need to know they can ask for that.

 

[Sandisw]

My point is that if RIV gets to be that low (before or after it sells out) those who are informed about resale markets and resale prices will perhaps consider twice before buying at other restricted resorts (like Poly2?) because it's maybe likely to follow the same path.

The "sold out" resorts are not usually really sold out due to ROFR. Even if everything was "sold out", once can still buy unrestricted VGF, AKV, BLT or Poly over a restricted resort. They just need to know they can ask for that.

Yes. I understand that but the bulk of buyers don’t buy based on resale value…heck, most don’t know it even exists.

If this continues and the resale market becomes sub 100…which Iif it happens for RIV it will be that way for the other near park resorts as well….it will be seem as par for the course.

Plenty of timeshares sell direct and are worth nothing right out the gate…so the fact that DVC may not be the resale deal it once was, I don’t think that will change those buying direct.

In order for RIV, VDH, or any future restricted resorts to fall that low, you have to have sellers who sell that low, and there are plenty of people who would swoop in and buy before it even happens.

Like I said, many of us predicted it would ever get above $100 and yet, it’s sold plenty of contracts in the $130s to the $150s. And, no ROFR to help prop that up either.

I just think that the future DVC owner won’t be expecting the product of the past and thus, will buy direct because it offers you a lot more than resale does.

 

[DanCali]

If this continues and the resale market becomes sub 100…which Iif it happens for RIV it will be that way for the other near park resorts as well….it will be seem as par for the course.

I don’t think RIV and unrestricted resorts are in the same category on the resale market. Reduced resale demand at RIV may in fact result in increased demand for unrestricted resorts near the parks. There will probably always be greater demand for the more flexible products. Well at least till the mid-2060 when they all expire…

 

[Sandisw]

I don’t think RIV and unrestricted resorts are in the same category on the resale market. Reduced resale demand at RIV may in fact result in increased demand for unrestricted resorts near the parks. There will probably always be greater demand for the more flexible products. Well at least till the mid-2060 when they all expire…

I am just not so sure. When you all of a sudden have more restricted resorts out there and fewer resorts near parks to trade into as a resale buyer….thinking in 18 years….what’s left may not be seen as any big plus….

Right now, we have BLT, CCV, PVB and RIV all selling in the same general vicinity , give or take $10/point.

Not saying RIV won’t potentially settle in lower some day, but so far, it’s holding its own for a one resort product.

But I do agree that restrictions, when they are the norm, May have a large impact on the resale market and the days of buying with confidence you will get your money back are gone

 

[MyDogTink]

Which is why people will need to think carefully on whether or not they want to have a one resort only set of points for a huge savings but higher chance of losing points for last minute changes.

If DVD wanted to do anything, I’d think it’d be offering resale buyers a chance to pay to get more trading rights.

I wonder if you see DVD offering a one time chance for resale owners to buy into getting rid of their restrictions. Would be a good cash move for them.

 

[DanCali]

I am just not so sure. When you all of a sudden have more restricted resorts out there and fewer resorts near parks to trade into as a resale buyer….thinking in 18 years….what’s left may not be seen as any big plus….

Right now, we have BLT, CCV, PVB and RIV all selling in the same general vicinity , give or take $10/point.

Not saying RIV won’t potentially settle in lower some day, but so far, it’s holding its own for a one resort product.

But I do agree that restrictions, when they are the norm, May have a large impact on the resale market and the days of buying with confidence you will get your money back are gone

It’s hard to argue with free markets. But I think even in 18 years, having a product that can trade into ~7 resorts (including Hawaii) for another 15-20 years is still pretty valuable compared to a one resort product. DVC is playing the long game, but it will be a 40+ year transition to their new vision of the product. I’ll probably not care by then …

 

[MyDogTink]

I think you have that backwards, Informed buyers WILL buy RIV and The new Disney Land hotel direct because they don't want to be restricted.

I have two "blue card" memberships I don't need another one but I most likely WILL NOT buy resale point because, I like to keep my options open.

I have 6 separate contract in total,

I have know about resale since shortly after buying my first.
I have never even consider buying resale.

I would not consider myself uninformed or an uninformed buyer.

Direct and resale are really two different products, now.

Good point m direct and resale are now different products.

 

[Sandisw]

I wonder if you see DVD offering a one time chance for resale owners to buy into getting rid of their restrictions. Would be a good cash move for them.

I don’t see it because the cost would need to be high so that it would cost someone more to buy resale and upgrade than just direct to start.

But, you never know what they might do since I doubt anyone predicted restrictions would be a DVC thing.

 

[Sandisw]

It’s hard to argue with free markets. But I think even in 18 years, having a product that can trade into ~7 resorts (including Hawaii) for another 15-20 years is still pretty valuable compared to a one resort product. DVC is playing the long game, but it will be a 40+ year transition to their new vision of the product. I’ll probably not care by then …

It definitely depends on the resort and I think RIV has shown that people will buy at a higher piece if that one resort is a good one.

They are selling VDH without issue right now and I think they will have no trouble selling Poly tower with them if they go that route.

Then again, I don’t believe the restricted resorts are going to go as low as some believe they will.

 

[Robbie Cottam]

Which is why people will need to think carefully on whether or not they want to have a one resort only set of points for a huge savings but higher chance of losing points for last minute changes.

If DVD wanted to do anything, I’d think it’d be offering resale buyers a chance to pay to get more trading rights.

no that is an interesting point....
I can see Disney charging 75 dollars per point to convert resale to "standard" points

 

[Robbie Cottam]

It definitely depends on the resort and I think RIV has shown that people will buy at a higher piece if that one resort is a good one.

They are selling VDH without issue right now and I think they will have no trouble selling Poly tower with them if they go that route.

Then again, I don’t believe the restricted resorts are going to go as low as some believe they will.

I agree once sold out, I don't think Disney will allow the restricted resort to sell for pennies on the dollar....
If anything Disney will just take really low ROFR contracts and resale them, you will never see a 70 dollar contract because Disney will just see it as profit ...

 

[Sandisw]

I agree once sold out, I don't think Disney will allow the restricted resort to sell for pennies on the dollar....
If anything Disney will just take really low ROFR contracts and resale them, you will never see a 70 dollar contract because Disney will just see it as profit ...

Good point..especially if they decide to have a lull in building new resorts before they have decide about the 2042 locations and what to do!

 

[Cfabar1]

I think you have that backwards, Informed buyers WILL buy RIV and The new Disney Land hotel direct because they don't want to be restricted.

I have two "blue card" memberships I don't need another one but I most likely WILL NOT buy resale point because, I like to keep my options open.

I have 6 separate contract in total,

I have know about resale since shortly after buying my first.
I have never even consider buying resale.

I would not consider myself uninformed or an uninformed buyer.

Direct and resale are really two different products, now.

My view is I find most of resale to be overpriced already... I know that is a controversial view, but it is my view. Direct is in some ways actually the more cost effective way to go, especially right now. My feeling is, take the price of the existing owner point per year at the cheapest selling resort. So right now, that's the $161 pp at VGF, with arguably say 40 years left on the contract places the cost at $4.03ish per point per year. I would then argue, because of the resale restrictions, you are losing about 20-25% of the value in terms of exchange options that are going to continue becoming more and more limited each year. So, generously, I would value the resale cost around $3.22 or so per year where I would want to be.

Beach Club comes out to, in comparison $7.74ish per point, per year. By the way, the dues are higher as well. This is based on last month's DVC Resale Market average sales price.

Even OKW comes out to around 5.15 for the 2042 expirations. OKW 2057 comes out much closer to ideal at 3.68 pp. Animal Kingdom is also a very attractive valuation, but that excludes dues costs. Vero Beach doesn't look too terrible in this valuation, but when you factor in the dues, well, that tells another story.

Polynesian and Copper Creek both would look attractive in this situation, assuming they are below the $161pp given that they expire later.

I know others have their own beliefs, but this is one calculation I made when determining our next steps.

 

[Robbie Cottam]

My view is I find most of resale to be overpriced already... I know that is a controversial view, but it is my view. Direct is in some ways actually the more cost effective way to go, especially right now. My feeling is, take the price of the existing owner point per year at the cheapest selling resort. So right now, that's the $161 pp at VGF, with arguably say 40 years left on the contract places the cost at $4.03ish per point per year. I would then argue, because of the resale restrictions, you are losing about 20-25% of the value in terms of exchange options that are going to continue becoming more and more limited each year. So, generously, I would value the resale cost around $3.22 or so per year where I would want to be.

Beach Club comes out to, in comparison $7.74ish per point, per year. By the way, the dues are higher as well. This is based on last month's DVC Resale Market average sales price.

Even OKW comes out to around 5.15 for the 2042 expirations. OKW 2057 comes out much closer to ideal at 3.68 pp. Animal Kingdom is also a very attractive valuation, but that excludes dues costs. Vero Beach doesn't look too terrible in this valuation, but when you factor in the dues, well, that tells another story.

Polynesian and Copper Creek both would look attractive in this situation, assuming they are below the $161pp given that they expire later.

I know others have their own beliefs, but this is one calculation I made when determining our next steps.

I have said for a long time that Direct, is easier and has way more value than resale.

The simple fact that one could buy Direct and rent it for 8 years to completely payoff a direct contract is also pretty cool.

Now direct at sold out resorts like BLT or Poly, CCV at 250 a point..... well I will pass for now