Big News

[Madame]

Part of me agrees with this thinking as well. It's not hard to 'justify' DVC looking forward over the next couple of years as I am guessing discounts off rack rates will be hard to come by. Maybe even getting an onsite reservation at inflated rack rates might be hard to do. But if one is thinking about DVC as a long term proposition what happens after all the new stuff gets old and the economy scales back... DVC prices are at an all time high so if one locks in the price at that high point that has to be considered over the period of use. Look at the next few months in terms of Disney rack rate discounts... Free dining in July, 25-30% off room rates, price line deals worth 40-50% off some places... I don't think Disney will keep raising the MF's at the same rates they did this year but I also have a hard time believing they can continue to raise rack rates at the same rates they have been doing. Over the next few years, sure, but long term I don't believe the market can tolerate it... Who knows though... People obviously love the Disney product.

I agree, but as we've seen for 2020, it's not just MF increasing. The manipulation of the points chart is devaluing our "purchasing power" (so to speak) per point. How far will they go with the lockoff premium. No one seems to know and this, for me personally, makes DVC potenially a worse bet than potentially discounted rack rates.

 

[Jack_Sparrow_NJ]

I've never paid rack rates at wdw.

If the demand for rooms increases as expected with the opening of Galaxy's Edge I would expect those room discounts to diminish and more and more people will be paying rack rate

 

[we"reofftoneverland]

Part of me agrees with this thinking as well. It's not hard to 'justify' DVC looking forward over the next couple of years as I am guessing discounts off rack rates will be hard to come by. Maybe even getting an onsite reservation at inflated rack rates might be hard to do. But if one is thinking about DVC as a long term proposition what happens after all the new stuff gets old and the economy scales back... DVC prices are at an all time high so if one locks in the price at that high point that has to be considered over the period of use. Look at the next few months in terms of Disney rack rate discounts... Free dining in July, 25-30% off room rates, price line deals worth 40-50% off some places... I don't think Disney will keep raising the MF's at the same rates they did this year but I also have a hard time believing they can continue to raise rack rates at the same rates they have been doing. Over the next few years, sure, but long term I don't believe the market can tolerate it... Who knows though... People obviously love the Disney product.

I agree that no one knows what will happen. What concerns me is how Disney is flexing its muscles. According to the contract they can pretty much do anything. I was only saying I wouldn't buy again because I do not see dvc as a sure thing anymore (in terms of cost savings). Since we just bought resale last fall, we are still getting emails from resale companies for new listings. I clicked on them this morning and there are many more new listings than there have been recently. I am kind of surprised by that. But it seems like a lot of people are worried about what the new restrictions will do to the value of their contracts. The prices listed are also a bit lower.

 

[sky2823]

when you raise minimum wage, which is currently happening everywhere, not only labor costs go up but the cost to buy every raw material is going up.

Basically, everything is going to be more expensive.

This doesn’t even count interest rate increases which increase cost of debt for every industry

It won’t be just Disney in the coming years that will be more expensive.

It’s easy to visually see DVC increases but every item on our expense list in the coming years will be increasing

Winter is coming

 

[Lynzer4]

I had planned to buy a small Riviera contact but now I won't. I think it would be better if you still want to add points to do a resale contract at one of the legacy. And resale will be fine as you can still stay at any of the 14.

I didn't buy planning to sell but I did buy knowing I could if I had too and I wouldn't be out much if any money put in. That was the reason I went with Disney over any of the other timeshare programs. Time will tell but its going to be interested once the next resort start selling.

 

[skier_pete]

I agree that no one knows what will happen. What concerns me is how Disney is flexing its muscles. According to the contract they can pretty much do anything. I was only saying I wouldn't buy again because I do not see dvc as a sure thing anymore (in terms of cost savings). Since we just bought resale last fall, we are still getting emails from resale companies for new listings. I clicked on them this morning and there are many more new listings than there have been recently. I am kind of surprised by that. But it seems like a lot of people are worried about what the new restrictions will do to the value of their contracts. The prices listed are also a bit lower.

Prices have inflated horrendously in the last 5 years. We bought AKV for $74 a point in 2014, now looking at $105-110 per point for that same contract, an inflation of 35% in 5 years. And just two years ago (in 2017) prices inflated in that year about 20% alone. It's unsustainable - but it's more related to the US economy than anything else. I've always said I am not buying another contract in these type of economic conditions. A sustained recession will kick prices in the pants as more people sell and less people want to buy. This will only make that situation worse - as the people that can most afford it will may prefer the direct buy. While I am not feeling a strong urge to add on - if we get a drop back in the $80-85 range I may add on when the opportunity arises.

 

[Greg36]

I agree that no one knows what will happen. What concerns me is how Disney is flexing its muscles. According to the contract they can pretty much do anything. I was only saying I wouldn't buy again because I do not see dvc as a sure thing anymore (in terms of cost savings). Since we just bought resale last fall, we are still getting emails from resale companies for new listings. I clicked on them this morning and there are many more new listings than there have been recently. I am kind of surprised by that. But it seems like a lot of people are worried about what the new restrictions will do to the value of their contracts. The prices listed are also a bit lower.

I agree with this... I still get e-mails as well and as I think I mentioned on another thread yesterday some of the specific contracts I was watching have dropped in per point cost over the last 24 hours or so. I got another e-mail from a major broker yesterday offering a discount on lender fees for one week only. Again, I have no idea how many contracts are actually selling but these types of actions don't suggest to me long lines of buyers...

 

[JETSDAD]

I agree with this... I still get e-mails as well and as I think I mentioned on another thread yesterday some of the specific contracts I was watching have dropped in per point cost over the last 24 hours or so. I got another e-mail from a major broker yesterday offering a discount on lender fees for one week only. Again, I have no idea how many contracts are actually selling but these types of actions don't suggest to me long lines of buyers...

I've only been watching AKV and stuff has been selling fast and not at reduced prices. The crazy outlier types of listings aren't selling but the 'well' priced listings are ($105-110 range and higher on smaller contracts).

 

[Greg36]

I've only been watching AKV and stuff has been selling fast and not at reduced prices. The crazy outlier types of listings aren't selling but the 'well' priced listings are ($105-110 range and higher on smaller contracts).

That's interesting for sure. I was watching some for AKV April use year (very small sample)...

 

[TexasChick123]

There have been a large amount of price reductions in the last 48 hours. I’ve been watching.

 

[skier_pete]

There have been a large amount of price reductions in the last 48 hours. I’ve been watching.

Interesting - is the feeling that these contracts can't get to ROFR by 1/19? I would think after the change we would see a drop in the short term.

 

[Matty B13]

I keep an eye on VGF February UY contracts, and since December there were about 3x as many contracts that I usually see selling. It could be because of the February UY, but also the increased dues (which weren't as high as some other resorts), or the new restrictions. Hopefully we will have some hard data over the next few months.

 

[TexasChick123]

Interesting - is the feeling that these contracts can't get to ROFR by 1/19? I would think after the change we would see a drop in the short term.

I think the feeling is that there will be a big price drop with the new restrictions, so people on the fence want to sell now. Also, people who don’t want to be hampered by the restrictions are hurrying up and buying. There aren’t a lot in the latter category. Most of us are becoming disenchanted between the large ticket price/AP increase at DL, 2020 charts, MF increases, and all the new restrictions being announced. They have scared away a good chunk of the buyers’ pool, current owners. Regarding a whether there will be a drop remains to be seen. Personally, I think there should be even though it is against my interests to have one. The points are now worth less. You can no longer trade into new resorts. That is a new limitation that wasn’t there before. Whether the market will reflect this “devaluation” remains to be seen.

 

[we"reofftoneverland]

There have been a large amount of price reductions in the last 48 hours. I’ve been watching.

I agree that the listings are lower. We thought we got a great deal when one of our "low ball" offers was accepted and then passed rofr last fall. Now contracts are listing at our low ball. I am surprised. I did not actually think this news would impact price that much- at least not for years. But then I think about us and maybe it makes sense. As new owner, we bought a total of 350 points last fall, but DH said right away he wanted 1000 total. I thought that was a bit much and frankly thought we might end up around six. Well, wow how things change. I do not want any more at this point. And if dues are up again significantly next year, I will be encouraging dh to get out if we can do so without losing anything. Hoping the economy holds so that this is an option. So I also agree with your other post that current owners are a good chunk of the resale buyers. Would have been us.

 

[TexasChick123]

Once they announce the crazy direct price increases, there may be a mad dash to add-on by some. However, I think at $200+ per point at many resorts, a lot of people are priced out. Will this affect resale prices? Possibly. I never cared about direct other than the effect it has on resale in the event I want to sell.

Here was my conversation with an agent at a resale company in late 2015:
Me: What is the difference between direct and resale DVC points?
Agent: Not a lot. You can't use them for cruises or to trade into hotels in the Disney Collection which almost no one does anyway because it is a terrible deal.

That conversation after January 19th:
Me: What is the difference between direct and resale DVC points?
Agent: You can't use them for cruises or to trade into hotels which almost no one does anyway because it is a terrible deal. Also, you are not entitled to any membership extras or discounts unless you buy 25, strike that, 75 points directly from Disney. Also, you can trade into 13 other resorts at 7 months. However, you cannot use those points for the new resort, Riviera, or any other future resort. You can only use them at your home resort and the 13 others I said earlier.

As you can see, there is now a HUGE departure from how things used to be just a few short years ago. Our points are worth less. They have less years to use them, they have more restrictions, and the whole system is changing how it is used starting with Riviera resale. Again, I have no idea whether the market will reflect this fact, but they are worth less no matter how you look at it. The fact that the current 14 properties' points can still exchange into other resorts at 7 months isn't a new thing. It's just one more thing being taken away.

You used to be able to purchase a small add-on from Disney and be afforded all the perks as a member to make the restrictions not apply to you. That is now gone with this change. Only the points you purchase directly from Disney will be able to be used at 7 months into ANY resort. You can still get the perks/discounts, but you cannot use any resale points after 1/19 at Riviera, Reflections, so on and so forth. This is a huge departure from things as we know them.

 

[KAT4DISNEY]

Once they announce the crazy direct price increases, there may be a mad dash to add-on by some. However, I think at $200+ per point at many resorts, a lot of people are priced out. Will this affect resale prices? Possibly. I never cared about direct other than the effect it has on resale in the event I want to sell.

Here was my conversation with an agent at a resale company in late 2015:
Me: What is the difference between direct and resale DVC points?
Agent: Not a lot. You can't use them for cruises or to trade into hotels in the Disney Collection which almost no one does anyway because it is a terrible deal.

That conversation after January 19th:
Me: What is the difference between direct and resale DVC points?
Agent: You can't use them for cruises or to trade into hotels which almost no one does anyway because it is a terrible deal. Also, you are not entitled to any membership extras or discounts unless you buy 25, strike that, 75 points directly from Disney. Also, you can trade into 13 other resorts at 7 months. However, you cannot use those points for the new resort, Riviera, or any other future resort. You can only use them at your home resort and the 13 others I said earlier.

As you can see, there is now a HUGE departure from how things used to be just a few short years ago. Our points are worth less. They have less years to use them, they have more restrictions, and the whole system is changing how it is used starting with Riviera resale. Again, I have no idea whether the market will reflect this fact, but they are worth less no matter how you look at it. The fact that the current 14 properties' points can still exchange into other resorts at 7 months isn't a new thing. It's just one more thing being taken away.

You used to be able to purchase a small add-on from Disney and be afforded all the perks as a member to make the restrictions not apply to you. That is now gone with this change. Only the points you purchase directly from Disney will be able to be used at 7 months into ANY resort. You can still get the perks/discounts, but you cannot use any resale points after 1/19 at Riviera, Reflections, so on and so forth. This is a huge departure from things as we know them.

I'm going to continue to dissent on the bolded part - not the part about the less years, that's always been a given of the system - but the song of resale restrictions hurting the value of our contracts was sung before the other 2 restrictions too - most especially the 2011 ones. From the very first one, in my head I kept saying that I didn't see it. I didn't post it because there were a lot of people with far more timeshare experience claiming the doom and gloom. Many also predicted the decline of the 2042's starting anytime for 8-10 years. But, what continually rattles around in my head is exactly what DVC would have to, but cannot, remove - the location of the majority of their timeshares. Other systems don't have their timeshares sitting smack in the middle of the "magic" so to speak. And these do not sell to people who aren't interested in Disney. No, not all buyers look at the economics, in fact apparently the majority do not. But there are enough that do that have kept the resale market very good and unless everyone suddenly stops caring about money that won't change.

If you buy the "Magic" of the club then yes, this will affect you.
If you buy the magic of staying onsite for less than Disney deluxe hotels then you'll still buy DVC resale when compared to DVC direct. I don't know what point the resale will settle at but with direct pricing increases we should be able to thank DVC for them as the Magical 14 Resort resale can maintain a better core value vs direct sales fluff.

2042 points were always going to expire in 2042 and wouldn't have been able to trade after that so those that buy to own there won't really care. The later 9 resorts, 7 that are at WDW, will still have some of the very best locations as well as the larger resorts that allow a little flexibility in booking. DVC has averaged a new resort approx every 2 years and that's been with a few quick hotel conversions that they are most likely running out of opportunities for. So, by the time the 2042 resorts end DVCII might have resorts that number equal or exceed the remaining 14. Direct by that time? Yeesh. Maybe it's the Riviera owners who will try the existing locations and then decide they want to own there as well to guarantee 11 months? We'll see what we learn when Riviera info is available.

Don't get me wrong - I've enjoyed perks and discounts etc. but if I wasn't either getting larger accommodations for similar cost or else saving money over hotel rooms that I wanted to stay in then I wouldn't own DVC. My analysis is built on the thought that I'm not the only one who thinks that way.

The bigger question for me is how long will a WDW have enough value for the park tickets/dining/merchandise increases?

 

[Bing Showei]

2042 points were always going to expire in 2042 and wouldn't have been able to trade after that so those that buy to own there won't really care. The later 9 resorts, 7 that are at WDW, will still have some of the very best locations as well as the larger resorts that allow a little flexibility in booking.

The thing about this is that under the previous resale conditions, when the 2042 resort ended, an owner at CCV, with 26 years left on their contract would have a bevy of new resorts (at the current rate of resort building, an additional ~10) that they could offer a resale buyer should they decide to sell their contract after 25 happy years of ownership.

With the new rules, the end of the 2042 resorts, two of which offer the best location for Epcot/DHS, will have a far greater impact on the resale value of that contract than it did prior to the change. There will be new resorts next to Epcot, DHS, MK, AK that grandfathered/direct buyers will be able to exchange into, but halfway through ownership, that CCV contract will not have the same value it holds today.

It boggles my mind whenever direct owners celebrate the restriction of resale buyers as if it adds new value to their purchase. Even if not them, their heirs, who may not even want to go to Disney again will be in a much worse off place to offload that fancy direct CCV purchase because of this change.

 

[TexasChick123]

I'm going to continue to dissent on the bolded part - not the part about the less years, that's always been a given of the system - but the song of resale restrictions hurting the value of our contracts was sung before the other 2 restrictions too - most especially the 2011 ones. From the very first one, in my head I kept saying that I didn't see it. I didn't post it because there were a lot of people with far more timeshare experience claiming the doom and gloom. Many also predicted the decline of the 2042's starting anytime for 8-10 years. But, what continually rattles around in my head is exactly what DVC would have to, but cannot, remove - the location of the majority of their timeshares. Other systems don't have their timeshares sitting smack in the middle of the "magic" so to speak. And these do not sell to people who aren't interested in Disney. No, not all buyers look at the economics, in fact apparently the majority do not. But there are enough that do that have kept the resale market very good and unless everyone suddenly stops caring about money that won't change.

If you buy the "Magic" of the club then yes, this will affect you.
If you buy the magic of staying onsite for less than Disney deluxe hotels then you'll still buy DVC resale when compared to DVC direct. I don't know what point the resale will settle at but with direct pricing increases we should be able to thank DVC for them as the Magical 14 Resort resale can maintain a better core value vs direct sales fluff.

2042 points were always going to expire in 2042 and wouldn't have been able to trade after that so those that buy to own there won't really care. The later 9 resorts, 7 that are at WDW, will still have some of the very best locations as well as the larger resorts that allow a little flexibility in booking. DVC has averaged a new resort approx every 2 years and that's been with a few quick hotel conversions that they are most likely running out of opportunities for. So, by the time the 2042 resorts end DVCII might have resorts that number equal or exceed the remaining 14. Direct by that time? Yeesh. Maybe it's the Riviera owners who will try the existing locations and then decide they want to own there as well to guarantee 11 months? We'll see what we learn when Riviera info is available.

Don't get me wrong - I've enjoyed perks and discounts etc. but if I wasn't either getting larger accommodations for similar cost or else saving money over hotel rooms that I wanted to stay in then I wouldn't own DVC. My analysis is built on the thought that I'm not the only one who thinks that way.

The bigger question for me is how long will a WDW have enough value for the park tickets/dining/merchandise increases?

Make no mistake, your points no longer carry as much value starting on 1/19 should you go to sell them even if the price doesn't reflect that. There is a difference between price and value. This doesn't matter if you never plan to sell. Those of us grandfathered in won't see a difference in our usage except for the new point reallocation. However, you have to use more points to book the same room starting in 2020 pretty much across the board. I know there are exceptions, but I have yet to see someone say, "This reallocation actually helps me!" even though someone, somewhere was helped.

Should you go to sell the points, the new buyer can no longer use your points to book at the new resorts. This is change that is most similar to the 2011 restrictions in scope but not in value. I imagine that the concern in 2011 was that resale points that were previously completely indistinguishable from direct now had a distinction starting in 2011. From what I understand, the vast majority of owners were not using their points for the Disney Collection or to book cruises, so this was not a huge change, but it did change how points could be used.

On the flip side, a lot of us (most of us???), do like to try out different resorts. Telling someone that s/he can try out only certain resorts at 7 months not including the new ones is a blow. Furthermore, telling a resale buyer at Riviera that s/he can only use the points at Riviera is different from all other points currently in the system. It seems like a small change now because this is only going to affect Riviera stays in the next year. Then Reflections will open, and now you have 2 resorts where you cannot use your points as a post-1/19 resale purchaser. When the 3rd new resort is announced, now you have 3, and on and on. All any of us can do is guess what is going to happen. I think Disney is hedging their bets because a recession is on the horizon. That's partially what all the increases are about (tickets, points, direct pricing) in addition to all the new construction going on. They want to weather the storm and remain as unscathed as possible. This is just an extension of that. Multiple guides have told people the reason for this new restriction is to "reign in" or "lessen the competition with" the resale market. They probably aren't all telling the same lie despite their untrustworthiness at times. I'm sure there was a meeting where all the changes and reasons behind the changes were discussed with the guides. I cannot stress this enough, as a current owner, there is no benefit to me for my points to sell for less via resale should I need to sell them. I think this is the most significant change DVD has done to date with regards to resale value. I bet if you could get a resale broker on the phone who would be honest with you, s/he would tell you that they are very concerned.

 

[KAT4DISNEY]

The thing about this is that under the previous resale conditions, when the 2042 resort ended, an owner at CCV, with 26 years left on their contract would have a bevy of new resorts (at the current rate of resort building, an additional ~10) that they could offer a resale buyer should they decide to sell their contract after 25 happy years of ownership.

With the new rules, the end of the 2042 resorts, two of which offer the best location for Epcot/DHS, will have a far greater impact on the resale value of that contract than it did prior to the change. There will be new resorts next to Epcot, DHS, MK, AK that grandfathered/direct buyers will be able to exchange into, but halfway through ownership, that CCV contract will not have the same value it holds today.

It boggles my mind whenever direct owners celebrate the restriction of resale buyers as if it adds new value to their purchase. Even if not them, their heirs, who may not even want to go to Disney again will be in a much worse off place to offload that fancy direct CCV purchase because of this change.

I'm celebrating nothing. I'm considering if it means a sudden crash - or even much of a change at all. And I give greater value to CCV having VGF, PVB, BLT and VGC to trade into vs unknown resorts. Disney shows no history of knock it out of the park resorts and that's what would have to be coming. If they do that? Then I'll reevaluate my analysis.

Make no mistake, your points no longer carry as much value starting on 1/19 should you go to sell them even if the price doesn't reflect that. There is a difference between price and value.

One thing that I always took absolutely from DVC's notice is that there were no guarantees of any more resorts.

So, yes, the "value" of my contracts now actually doesn't change because currently there is no new resort nor did I count on any. Whenever polls are done of what or how many resorts one has stayed at it's very few that every state they've stayed at all of them - and that's on these DVC centric boards. I'd still put a much higher value on a resale contract after Jan 19th that could trade to 14 resorts than anything new from DVC. Maybe higher.

The 2020 point chart is an important thing but different than the resale restrictions. In the end - that's the one that decreases value for me, not the resale restrictions.

 

[Bing Showei]

I'm celebrating nothing. I'm considering if it means a sudden crash - or even much of a change at all. And I give greater value to CCV having VGF, PVB, BLT and VGC to trade into vs unknown resorts. Disney shows no history of knock it out of the park resorts and that's what would have to be coming. If they do that? Then I'll reevaluate my analysis.

That was in no way directed at you, Kathy. I should've been more clear about that.

I was referring to other owners who seem to be besides themselves that DVCMC is "finally doing something" to fix some imaginary problem that resale owners are causing. I was referring to this guy....
"Oh yeah. So glad I bought direct. Take that resale scourge!"

Yeah, that guy. And his smug little dance.