Offer Price
 

How much wiggle room is there in resale prices? If someone is asking for $XX per point is it insulting to offer $XX-10?

No, not anymore than it is insulting for someone to ask $XX+10 over any halfway realistic price. Do your research to figure out what the contract is worth, and use that as your guide. What someone asks is completely and totally irrelevant. If reject it outright, no big deal, just move on to the next contract. There is always another.

It is possible to price your offer too low -- either because the seller is insulted or because they think you're not a serious prospect.

I think the advice above is sound -- price your offer where you think it should be. I wouldn't low-ball it way below what you would pay after researching.

When I was selling I had someone offer $7-8 less than we were asking. We had our contract priced right and that was an unreasonable offer. I told the broker not to counter-offer.

That same seller came back the next day $1 lower than we were asking (which was within my selling range), but I declined because I didn't think they were serious. I thought they were just "kicking tires" and I could see them jerking us around throughout the sales/closing process.

I sold the contract that same day for the same price they offered and the sale went through smoothly.

Quick response: if you don't feel comfortable offering significantly below asking then just wait for better listings. Eventually something will come along. It took me only 2 months to get my "great listing" but I grabbed it within a couple hours of Fidelity posting it. So you'll have to be aggressively watching the sites each morning. Or you'll have to do a ton of offers and get rejected continuously. Those are your two options.

Longer response: I just asked this same thing a couple months ago and I've made 3 offers in the past two months that were rejected and I finally got an accepted one Monday so here's my advice:

Know the value of the contract going in. One of the threads on here has the price per point of a ton of contracts for each resort (not sure which thread it is, I think it's one of the ROFR threads). I dumped that info into Excel for the two resorts I wanted (AKL and VWL) and I calculated the average price for a non-stripped, non-loaded contract at my point level (200-400). So for AKL I calculated $65 and VWL $58. For fewer points the price per point would be higher.

I was looking for a "fair deal" not a "great deal". So when I made my offers I simply adjusted those figures for any banked points and offered fair value. I told the agent that I believed these were fair offers so I didn't want a counter-offer, just a yes or no answer. I got rejected 3 times and the 4th time a VWL 200 pt with all 2011, 2012 came online at $55 so I just offered full price and offered to pay closing and MFs and I still think I got a great deal. A rejected offer I sent in was $58 on a VWL for 250 points Dec all 2012,2013 pts so the deal I landed was better than the offer I made that got rejected.

There's no rhyme or reason to it, don't over think it. Just make fair offers and be patient.

As a follow up, those three contracts I made offers on are all still sitting out there and I doubt they'll sell at their listing price, but that's the seller's problem, not ours.

Part of the trick is having enough data to accurately determine the fair price. Based on what I see on the ROFR thread I believe the average sales price of a contract like this is $XX-5, with a typical range of $$ XX-8 up to $$ XX+2.
The extreme case (recently) is one that sold for $$ XX-12.

This contract has UY that is 2 months earlier than I really want, so I don't want to offer full price... But if I can get a good deal..

I would be happy to pay $$ XX-5 for the use year I want. This contract is a different use year than I want, but I might

What I have noticed is that if a contract is offered for a very high price, way over the average value, it's because the seller owns money on it and he doesn't want to loose money. The same is true sometime if the contract is priced oddly, like 53.60$.
It's better to avoid those contracts, no room for negotiation.

Sometimes a contract appears to be priced oddly per point because it is being priced for a round number overall (e.g., $10,000 for a 175 point contract).

I agree with most posters that you see what other's are asking and what's being ROFR'd. Then you can make an educated offer.

We were in the market for a 175-225 point contract at Hilton Head Island - I found the perfect contract on a marginal resale listing site.

We had been shopping for months - had one close call purchase with an agent that turned about to be a horrible agent, a liar, and not trustworthy to the buyer or the seller. I know for a fact that the agent was NOT representing the seller well - she had NO idea how DVC worked!

Anyway - I am so GLAD that contract didn't work out!

We ended up making an offer on another contract that was $15 below the seller's asking price, they countered back at $1.85 higher than our offer price - we accepted immediately and made our first reservation the day the points landed in our account!

I have yet to see another contract sell for what we paid - as a matter of fact, I have seen contracts ROFR'd for MORE than what we paid, with fewer points loaded in the contract!

It really surprises me what some contract sell for, and what others get ROFR'd for. I know for a fact that DVC had ZERO inventory for our UY for HHI at that time, because we tried to buy direct when we got frustrated after nothing else was available on the resale market and they said we would be placed on a waiting list that was currently over 6 months long....yeah.... like we are going to wait 6 months to pay twice as much?! :furious:

SO anyway - back to the OP - offer what you want to pay, you never know why someone is selling. In all reality, it doesn't matter if you offend the seller - they have something they want to sell on the market, and once again - you never know why someone is selling!

I know if I went to sell, and wasn't really in a hurry to sell, I would put my contract on the market for $10 more than what I actually wanted in order to get what I did want - that way, the buyer would feel like they got a great deal...when in the end, I got what I wanted - AND they got what they wanted.

Look at the resale contracts online, you can tell which sellers ascribe to the same philosophy.... they are priced higher than most of the others on the market. Then again, you can also tell the sellers that REALLY don't want to sell - they have their contracts stripped, with potential closing dates 7 months out from their posting. That seller really isn't interested in selling today or in any hurry to receive cash from their sale....especially if they are willing to wait 7 months for payment!

The right contract IS out there - as PP's have said - patience, and research - they will get your through to the right contract!

I would say don't get too hung up on price. All contracts have different pros and cons, number of points, stripped vs loaded, preferred UY, price, etc.

Study the ROFR thread, decide what and where you want to buy and how much you want to spend and start making offers.

It took us 4 tries to get a BWV contract at the price we wanted. We decided ahead of time what we wanted to pay and knew that going in.

We were in no rush and figured at some point, we would find a seller who would agree that what we wanted to pay was a "fair" deal for them as well.

So, go in with what you would like and the worst that happens is no and you move on to the next one.

However, I would not necessarily take that same approach if the contract seems to be the "perfect" one and losing it would be disappointing. In that case, I might give some extra thought to my offer.

Good luck!

Also, there's generally less wiggle room on smaller contracts (< 100 points) ...

In fact, if you see a smaller contract with what you REALLY want (home resort, UY, not stripped - or even loaded), it's probably best to offer the asking price (even if it's a little more than you want to spend - unless it's totally unreasonable) - and do it fast (they can go in a matter of hours, if not minutes ...)

Good luck!

Decide what you want and what you want to pay using the variables of number of points, home resort, points availability and completed sales prices. If you want to get the best deal possible, be more aggressive in offering a little lower and waiting for the right contract. If you want to be done with it, you might offer a little more and be less restrictive on the contract specifics. Remember that each point present or not present has a value as does UY to a degree and that the dues are calculated by calendar year, not UY. For example, if you bought now and got 2012 Dec UY points and paid all of the 2012 dues, you'd be overpaying on maint fees to the tune of 11/12 of the fees. I wouldn't be afraid of stripped contracts but the price discount often isn't enough to justify the loss. Usually a loaded contract (all banked, all current and all future points) is the best value. Don't assign much of any value dollar wise to banked or borrowed points.

Asking prices are all over the place so in many ways they are irrelevant. Know the actual selling prices range for the resort and contract size you want and base your offer on that and how close to the "best price" you want to get. Make adjustments for banked or borrowed points and if currnet years dues are fully paid.

Lots of contract out there if you are looking for 150 or more so if your offer is not accepted or you do not get a counter offer, move on to the next, it is a buyers market

I had a similar experience to JimMIA.
I listed at $XX, buyer offered $XX-3, I offered to meet them in the middle $XX.5, they came back at $.5 less than my counter. I said thanks but no thanks. I figured if .50 cents was that critical they probably couldn't afford DVC in the first place. I sold the very next day to someone else for what the first buyer wanted to pay.