2019 Restrictions Not Worth Considering When Buying Resale

[DougEMG]

The effect of restricting trading hurts everyone, direct and resale alike.

For each point that can't be trade out, that is going to have to stop a point from being traded in, that shrinks the availability pool for everyone.

Resale owners are going to want to book before their 7 month window opens to make sure they have a chance of getting a room at the time they need at their home resort. This will then force direct buyers to book early as well if they want to stay at their home resort. Anyone who can't plan far in advance will risk not getting the room they want.

You thinking walking is bad now, just wait for 5-8 years from now when everyone starts walking at their home resorts just to make sure they have a room.

Right now you might be complaining that the only thing left is SSR and you are stuck booking that, with these trading restrictions it is going to turn into "there is nothing left, wish I could have gotten a room at SSR".

 

[LAX]

Protecting their consumer is probably item number 99 on a list of their top 100 concerns.

If you are talking about physical safety, I would agree. If you are talking about finances, I would say it won't even make the top 100.

LAX

 

[DaveNan]

I think the only issue here is that the premise is based upon a single report that supposedly originated from a CM chat. I still haven't seen anything official from Disney that states Riviera resale will only be able to book at Riviera. Still worth going through the what if exercise though.

• Effective January 19, 2019, Disney Vacation Club Members who do not acquire their real estate interest directly from the developer will not be able to make Vacation Point reservations at some or all non-Home Resorts.
• Once sales of Disney’s Riviera Resort begin, Members who purchase a resale contract at that Resort will only be able to stay at their Home Resort. Resale contracts purchased at the 14 other Disney Vacation Club Resorts opened prior to Disney’s Riviera Resort will only be able to exchange into those 14 Resorts but not into Disney’s Riviera Resort.
• Members who purchase directly from Disney Vacation Club have the opportunity to use their Vacation Points to stay at all current and potential future Disney Vacation Club Resorts and access additional benefits such as Membership Extras

https://disneyvacationclub.disney.go.com/dvc-direct-vs-resale/


From DVC directly.

 

[Dean]

If the rumored change happens that Riviera resale owners will be restricted to only booking at Riviera, then within 10 years, only Riviera owners will ever be able to book there. (DVC did not officially announce that although there are reports of CM saying that.)

If that restriction comes to pass, all current owners will all defacto have the current restrictions apply to our contracts; Riviera direct owners will not. That being the case, the new restrictions are not worth your consideration when buying resale.

Let me explain:

Let’s imagine 6 million points are sold at 100 points per contract: 60,000 Riviera owners at sellout. If the average owner holds for 10 years before selling, then it’s not unreasonable to estimate that there will be 30,000 Riviera resale buyers (half of all owners) by year 10, or roughly in 2030.

30,000 resale buyers must book before the 7 month window or they’ll have no guarantee of the ability to book at all. 7 months is no longer a “window”, it’s a deadline.

If it’s a defacto deadline for resale buyers, it will also become a deadline for all Riviera owners wanting to book at their home - or risk not having access to any decent dates/lengths of stay. Anything leftover at 7 months is just a minor cleanup operation with resale buyers scrambling to pick up whatever pieces are left.

The practical effect is that none of us will have a realistic shot at using outside points at Riviera. But 30,000 owners at Riviera will have the right to book our resorts at 7 months.

If you think the pressure to book before the 7 month window is a problem now, you ain’t seen nothing yet.

But that works both ways, right? If someone from Riviera can book out, then we can book in? Not in an overwhelmingly unbalanced system. Say 40% of Riviera owners book outside their resort in a given year; that’s not 40% of the total, that’s 20% of the total (40% of the remaining direct owners).

So Riviera is 80% booked at the 7 month window with 12,000 owners looking elsewhere to book, with a choice of 14 resorts. And 14 resorts having a choice of the leftovers that creates.

There are about 3 million current DVC owners, if my memory serves.

Let’s say Riviera has 300 rooms and at the 7 month window, 80% of them are booked: 60 rooms available - (and if the same 40% of other resort owners are looking at 7 months elsewhere as we credited to Riviera) that would means 1,200,000 potential DVC owners looking to book those 60 rooms. Even if we assume that half of all currently grandfathered owners will be resale owners in 10 years as well - that’s still 600,000 owners seeking those 60 rooms: Odds of booking a Riviera room? 0.0001or 1/100th of 1 percent chance of success.

Practically non-existent and that’s without considering that even those dates that were available would be heavily skewed to non-popular DVC weeks. And this will just get worse as time goes on.

Conversely, 12,000 Riviera owners will have their pick across 15 resorts at 7 months.

As each new resort comes online, the problem repeats: practically non-existent to book into the resort with a not small number of their owners picking over the entire 15, 16, 17 etc resort inventory.

If this is the policy as implemented, then DVC has already gamed out that all current owners will be essentially iced out of booking into Riviera anyway. Since that will be the practical effect of the new policy at Riviera, why not make it a selling point now and make that an express restriction for resale buyers?

I’m not sure these restriction will mean much. Sure, new resale buyers can’t book into Riviera, but they’ll be in good company; none of us will either.

What’s it worth to have a 1/100th of 1 percent chance of booking a Riviera room in 10 years? That’s what you have to ask yourself when considering if the 2019 restrictions matter to you.

I think booking before 7 months is the new norm so I don't see this having a major impact. Making the assumptions as presented about restrictions they'll book and wait list and with planning, the resort won't likely be open to others very often. And even when available we don't know it'll be at the same time as the owners there or the new DVC II component.

You’re assuming DVC doesn’t ROFR the Riviera contracts because few will want them & they’ll be dirt cheap.

I think the idea of a fire sale is unrealistic. If so, DVD will just pick them up ROFR but such threats of major impact on resale price with other changes haven't come to pass.

All the more reason not to worry about buying resale.

If DVC allows members to “qualify” resale points later, that makes buying resale today (after the 1/19/19 restrictions) an even better deal.

I won't be surprised if there's a way to make them qualified, I will be surprised if it's much cheaper.

 

[Phatscott25]

https://disneyvacationclub.disney.go.com/dvc-direct-vs-resale/


From DVC directly.

Did anyone also notice when clicking that link that resale owners are also now not going to have access to TOTWL?

 

[Ben E N]

Did anyone also notice when clicking that link that resale owners are also now not going to have access to TOTWL?

From another thread, people were saying it looked like a typo that meant the Epcot Lounge, not TOTW

 

[Littlelulu01]

I’m not so sure Disney would not allow fire sales on resale prices. I’ve yet to see a rofr on Aulani. I could purchase Aulani directly today and if I had to sell tomorrow the points are worth less than half the purchase price. They don’t even bother rofr on subsidized contracts at $69 let alone $94. Aulani just got devalued even further with the new restrictions. Who knows for sure but it’s likely years away from being sold out. Aulani points if ever sold out will also be hunting for a wdw stay at 7 months and anything resale forward will be locked out of Rivera forward. 7 months will be a mess. 11 months home resort studio good luck and iffy.

Couple that with dvc apparent ability to take whatever inventory on studios they desire- see akv value availability for December this year if any doubt, and there’s going to be a lot of owners unable to get anything even at 11 months.

I see a few groups who will be ok- anyone who purchased larger contracts and wants larger units at 11 months, riviera direct owners forward will get Rivera and subsequent resorts pretty regularly once resale restricted points fill the system and new resorts come onboard (assuming riviera resale will get to book new subsequent dvc), and current gt week purchasers. Aulani VB and HHI owners will likely be ok sticking with their home resorts as long as they book 11 -7 months and don’t change dates.

Overall it’s not a good thing for anyone except dvc and their direct purchasers for a short time. I feel bad for the Ccv purchasers who are already blocked out many days at 11 months for studios. If the average joe can figure out how hard poly and Ccv studios would be with the point heavy bungalows, cabins and 3 bedrooms, I have to believe dvc knew full well what they were selling vs what folks would be able to book. It’s a shame dvc allowed all the small contract sales, then bumped up the point requirement for anything those small contracts could have booked with, raised my akv mf’s 10% this year and who knows what subsequent years, and then placed restrictions on resale that will negatively affect everyone including direct purchasers.

I also found it disturbing they decreased the point requirement at akv value but now somehow all the values are not available for bookings December forward. Is the point reduction for them to take for cash bookings at a lower cost? I just stayed in one and it looked newly refurbished and had a great savanna view. I don’t think values were ever going empty when the point requirement was higher yet for our benefit they reduced the point requirement and miraculously they disappeared December forward.

 

[KAT4DISNEY]

I’m not so sure Disney would not allow fire sales on resale prices. I’ve yet to see a rofr on Aulani. I could purchase Aulani directly today and if I had to sell tomorrow the points are worth less than half the purchase price. They don’t even bother rofr on subsidized contracts at $69 let alone $94. Aulani just got devalued even further with the new restrictions. Who knows for sure but it’s likely years away from being sold out. Aulani points if ever sold out will also be hunting for a wdw stay at 7 months and anything resale forward will be locked out of Rivera forward. 7 months will be a mess. 11 months home resort studio good luck and iffy.

Couple that with dvc apparent ability to take whatever inventory on studios they desire- see akv value availability for December this year if any doubt, and there’s going to be a lot of owners unable to get anything even at 11 months.

I see a few groups who will be ok- anyone who purchased larger contracts and wants larger units at 11 months, riviera direct owners forward will get Rivera and subsequent resorts pretty regularly once resale restricted points fill the system and new resorts come onboard (assuming riviera resale will get to book new subsequent dvc), and current gt week purchasers. Aulani VB and HHI owners will likely be ok sticking with their home resorts as long as they book 11 -7 months and don’t change dates.

Overall it’s not a good thing for anyone except dvc and their direct purchasers for a short time. I feel bad for the Ccv purchasers who are already blocked out many days at 11 months for studios. If the average joe can figure out how hard poly and Ccv studios would be with the point heavy bungalows, cabins and 3 bedrooms, I have to believe dvc knew full well what they were selling vs what folks would be able to book. It’s a shame dvc allowed all the small contract sales, then bumped up the point requirement for anything those small contracts could have booked with, raised my akv mf’s 10% this year and who knows what subsequent years, and then placed restrictions on resale that will negatively affect everyone including direct purchasers.

I also found it disturbing they decreased the point requirement at akv value but now somehow all the values are not available for bookings December forward. Is the point reduction for them to take for cash bookings at a lower cost? I just stayed in one and it looked newly refurbished and had a great savanna view. I don’t think values were ever going empty when the point requirement was higher yet for our benefit they reduced the point requirement and miraculously they disappeared December forward.

Why would anyone do a fire sale? You can rent to easily cover MF's if necessary for short term. And the core value of DVC is the same as it's always been - a less expensive way to lock in Disney vacations onsite. Until Disney does a fire sale on their hotel rooms DVC has the same value it always did.

For Aulani that's an interesting point (and VB and HHI too) although if Riviera is not going to be a part of the same system as the existing 14 there has simply got to be a control on the exchange aspect between the 14 and Riviera.

 

[Littlelulu01]

Was referring to another comment on fire sales and pointing out that aulani is already a fire sale situation. It’s one of only two actively marketed dvc properties. The resale value after walking off the showroom floor is less than half the purchase price. Anyone can easily pick up Aulani in the low 80’s. Direct prices are $188/point. Dvc doesn’t exercise rofr. They let aulani go for whatever someone is willing to pay. I got aulani subsidized for an even $80 loaded. I saw recently a $69 subsidized pass rofr.

I think Aulani being so much larger than VB and HHI is a bit of an issue if they ever sell out.

I don’t think anyone who purchases Aulani, or any other resort, ever intends to sell however folks circumstances change and most owners do eventually sell after a few years. The massive aulani points will eventually hit resale market and not be able to book riviera forward. Coupled with all direct points from any new dvc that also has access to the 14, and 7 months at the 14 looks pretty impossible to me.

At that point it’s likely going to be book at 11 months home resort and be all excited if you won out and procured a studio with your ssr points at ssr.

I can definitely see the benefits of renting out grandfathered points vs trying to sell a contract but not all owners can or will do that.

Will be very interesting to see what actually happens. I definitely see a potential severe devaluation for aulani, hhi and vb. Hate to say it because I own aulani. I hope I defy odds and end up using my points till they expire/never needing to sell.

 

[Aussie RJ]

I’ve heard that in the opinion of many at the Aulani the resort will never sell out. I’ve purchased some direct points for CCV while staying at Aulani, in doing so the guides invited me for an after work drink. We got talking about why as an Australian I didn’t buy Aulani points. Main reason was I wanted an 11 month booking window at WDW as Aulani is an easy get at 7 months. The other is of course is the resale value of points.
I can see a very slow year in sales for Aulani during 2019 with the refurbishments scheduled. I’m sure DVD will have to do something...
As for the booking issues ahead, isn’t the main sales target at Aulani the Asian market? I’m not sure many Aulani international buyers plan too many trips to WDW. There are only a few few of us crazies around right?

 

[Lorilais_mommie]

I’ve heard that in the opinion of many at the Aulani the resort will never sell out. I’ve purchased some direct points for CCV while staying at Aulani, in doing so the guides invited me for an after work drink. We got talking about why as an Australian I didn’t buy Aulani points. Main reason was I wanted an 11 month booking window at WDW as Aulani is an easy get at 7 months. The other is of course is the resale value of points.
I can see a very slow year in sales for Aulani during 2019 with the refurbishments scheduled. I’m sure DVD will have to do something...
As for the booking issues ahead, isn’t the main sales target at Aulani the Asian market? I’m not sure many Aulani international buyers plan too many trips to WDW. There are only a few few of us crazies around right?

Why do they think it will never be sold out??

 

[Matty B13]

Why do they think it will never be sold out??

Been on sale since 2011, and I'm not sure if it has even sold 50%.

 

[Littlelulu01]

I’ve heard that in the opinion of many at the Aulani the resort will never sell out. I’ve purchased some direct points for CCV while staying at Aulani, in doing so the guides invited me for an after work drink. We got talking about why as an Australian I didn’t buy Aulani points. Main reason was I wanted an 11 month booking window at WDW as Aulani is an easy get at 7 months. The other is of course is the resale value of points.
I can see a very slow year in sales for Aulani during 2019 with the refurbishments scheduled. I’m sure DVD will have to do something...
As for the booking issues ahead, isn’t the main sales target at Aulani the Asian market? I’m not sure many Aulani international buyers plan too many trips to WDW. There are only a few few of us crazies around right?

Smart choice imo. If not planning a Japanese holiday, USA summer or Christmas vacation to aulani, the 7 month window at aulani continues to be pretty wide open for most categories. 3 bedroom standard and hotel rooms are the only categories that 11 months is consistently necessary.

I couldn’t resist the bargain on a December pre holiday Aulani trip. 16 point Hotel room with $5.91 subsidized mf and a $50/night resort credit for construction brings it down to a $44/night hotel room in Hawaii!

 

[Bruin_mouse]

Been on sale since 2011, and I'm not sure if it has even sold 50%.

I’m beginning to wonder if they even want to sell it out? They keep raising the price per point on it and are currently not offering any incentives, and I don’t think they have for a while. I’m not sure how it all works exactly, but maybe the income from DVC owners trading in and breakage income make the numbers work? I just can’t imagine them taking a loss year after year and not pricing it more aggressively to sell it out.

 

[cbyrne1174]

I personally hope Riviera can't change out. I want resale prices to plummet. I don't own DVC yet. I only own Wyndham resale and haven't been able to justify buying into DVC because I know the value can easily tank by changing the rules. I don't want to finance and I don't want to spend a lot of money on contracts. I would rather buy resale at rock bottom prices, use the points I want to use and rent the rest out. I already own 2x as many Wyndham points as I actually use and use the rest to generate extra income.

If they make it where resale contracts save you even more, I will buy at every resort I can afford and just rent out what I don't use. Restricting resale just makes the resale buyer able to make a larger profit if they're smart about it lol.

 

[Dean]

I personally hope Riviera can't change out. I want resale prices to plummet. I don't own DVC yet. I only own Wyndham resale and haven't been able to justify buying into DVC because I know the value can easily tank by changing the rules. I don't want to finance and I don't want to spend a lot of money on contracts. I would rather buy resale at rock bottom prices, use the points I want to use and rent the rest out. I already own 2x as many Wyndham points as I actually use and use the rest to generate extra income.

If they make it where resale contracts save you even more, I will buy at every resort I can afford and just rent out what I don't use. Restricting resale just makes the resale buyer able to make a larger profit if they're smart about it lol.

I wouldn't hold your breath. The idea that any DVC resale will be dirt cheap is unlikely in the absence of other economic pressures that would make all travel cheaper.

 

[DougEMG]

I wouldn't hold your breath. The idea that any DVC resale will be dirt cheap is unlikely in the absence of other economic pressures that would make all travel cheaper.

Agree. Lots of demand from people that want to stay on-site will keep prices from getting dirt cheap. If prices ever really tank, especially compared to cash rates, buyers who want to rent will step in to buy.

2010-2012 had really low prices. I doubt we will ever see that again just because the base for direct is so much higher now. Assume direct is $200, getting 60% off on resale still makes it $80.

 

[Dean]

Agree. Lots of demand from people that want to stay on-site will keep prices from getting dirt cheap. If prices ever really tank, especially compared to cash rates, buyers who want to rent will step in to buy.

2010-2012 had really low prices. I doubt we will ever see that again just because the base for direct is so much higher now. Assume direct is $200, getting 60% off on resale still makes it $80.

Or if we do we won't care because there will be so many other issues we all have to deal with. But it's possible that comparatively speaking one might be a better deal than another.

 

[cbyrne1174]

I just want $75 per thousand back for SSR and I'm happy. I was born too late to have had the opportunity to buy back then. I was 20-22 and still in college ;_;

I got pregnant at 25 and couldn't afford to buy 4 years ago either when SSR was decent. Now that I'm almost 30, it's something that I can finance and rent out while I pay it off over a year or two, but the buy in is too much of a risk for my age because I don't know if my finances will get tied into another kid. I also did the math looking at rental prices on Redweek. At $95 per thousand, you can rent out for 9 years and the income will pay for the membership. I also included interest using an amortization calculator over 2 years in my calculations as well as annual dues. Still, that's a long time to break even without getting to use the membership.

If SSR drops to what it was in 2015, I'd buy without hesitation.

This restriction is stupid though. It just makes it so you need MORE resale points. You just buy an extra 100 points resale for every new resort that comes out and bank and borrow up to 300 or rent out what you don't use.

A VIP program makes so much more sense. For example, owners who own 500 points bought directly from Disney get to book 8 months out at ALL resorts for only a buy in cost of $100,000!
People would do it too.....
Wyndham and Marriott BOTH have that already implemented.

 

[Frederic Civish]

There is also an assumption here that resale Riviera purchasers will not be offered the “chance” to upgrade to “real member” status for a fee...

Would such an upgrade even be legal? I know BVTC and DVCM can restrict 'resale' people from having access to Riviera, but that might only be legal if they also require Riviera resale owners to not have access 'outside.' Can they just sell 'Access?' And, if they sell access into outside resorts to Riviera resale owners, for a 'fee,' couldn't/wouldn't they also sell access to Riviera, for an upgraded fee, to L 14 resale owners?