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Old 02-08-2013, 09:04 AM   #1
MedicGoofy
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Pro's/Con's of purchase

Good Morning All

So I have been contemplating buying into DVC for about the past year. I recently went on a cruise and went to the presentation (first one). And I know, in these, they will only give you the great point, none of the down. So I am hoping that those of you who have boughten into DVC could enlighten me, on both positive and negative.

I have read a lot of posts here, breaking down the points value and how it may cost wise be worth it depending on the type of Disney vacation you take. What I haven't seen anything of, is the cost effectiveness IF you take a non Disney vacation. One place that I have wanted to go, Aruba. They have places to go there. And I know how overly expensive it is to travel there, as well, as a single person.

The other thing I'm having a hard time processing, is that it may not be cost effective in the end. With Disney vacations. But I'm trying to figure that out. If I buy in, I'm only 30. If I used this for 30 years, how could it NOT save me money in the end. I know I can get rooms on discount, or the dining plan. BUT, if I'm not having to even pay for the room, just the transportation, tickets and food, how would it still not save money??

I am hoping that some of you can enlighten me to my questions
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Old 02-08-2013, 09:32 AM   #2
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Keep reading, using DVC points for anything other than staying at a DVC resort is not cost affective and has it's own restrictions and availability issues.

Disney advertises these uses as a sales enticement, the fine print says "subject to availability".

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Old 02-08-2013, 09:39 AM   #3
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Originally Posted by disneynutz View Post
Keep reading, using DVC points for anything other than staying at a DVC resort is not cost affective and has it's own restrictions and availability issues.

Disney advertises these uses as a sales enticement, the fine print says "subject to availability".

Bill

I have been reading. Lots. And am getting great info. My one big question remains the cost effectiveness, that some say it isn't worth it if........ And, staying somewhere not Disney owned. I'm not understanding this, and would love a REASON why it's not cost effective. I'm not worried about the subject to availability, as I can travel whenever I want. Pick a time and I can make it work. BUT, would like to know, what's the actual issue with it.
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Old 02-08-2013, 10:00 AM   #4
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In a sense you are paying for the room because you have to pay the annual maintenance and you also payed for it by buying the points.
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Old 02-08-2013, 10:27 AM   #5
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You can look at the exchange points for Aruba. Typically you get a better bang for you buck though using the DVC points at DVC resorts. You also have to pay a $95 fee for booking an exchange. Most people feel it is a better value to rent your points and then take that cash and pay for Aruba that way and that you will come out ahead over doing an exchange.

If you are buying DVC to mainly stay at DVC and maybe once in a blue moon do an exchange, then I say it may be for you. If you are planning to stay at Disney occassionally and travel to other resorts more often, then another timeshare system would probably work better for you.
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Old 02-08-2013, 10:31 AM   #6
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Quote:
Originally Posted by MedicGoofy View Post
I have been reading. Lots. And am getting great info. My one big question remains the cost effectiveness, that some say it isn't worth it if........ And, staying somewhere not Disney owned. I'm not understanding this, and would love a REASON why it's not cost effective. I'm not worried about the subject to availability, as I can travel whenever I want. Pick a time and I can make it work. BUT, would like to know, what's the actual issue with it.
Some people wait 2 years for a RCI exchange that never comes through. RCI has over 5000 resorts but Disney has only given DVC trades access to less than 500. DCL has had black out periods for DVC exchanges.

It's usually not cost effective because you pay a premium to use points for those stays plus an added $95 booking fee.

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Old 02-08-2013, 10:39 AM   #7
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Quote:
Originally Posted by MedicGoofy View Post
I have been reading. Lots. And am getting great info. My one big question remains the cost effectiveness, that some say it isn't worth it if........ And, staying somewhere not Disney owned. I'm not understanding this, and would love a REASON why it's not cost effective. I'm not worried about the subject to availability, as I can travel whenever I want. Pick a time and I can make it work. BUT, would like to know, what's the actual issue with it.
There is not just a one time cost. On top of purchasing the points initially, you pay an annual maintenance fee of around $4-7 a point for this year. And the fee goes up every year.

So on top of the initial price I paid for my points (we have 325 at two different resorts), I will be paying another $1750 this year in maintence fees which is a slight increase over last year's fees.

And using your points for anything other than DVC is not really cost effective. The value of your points is extremely low for what you are getting for them. You don't get full access to all the RCI resorts, just a smaller selection of them. They are not always available to you (you have to wait until an owner at the resort you want to book wants to book DVC). And you may need to put a request in with DVC for an RCI resort more than a year out. You may need to be very flexible with when you go.

We bought our initial points direct from Disney in 1997 at OKW. We paid $50 a point direct from Disney. That is how much they have increased the price in the last 15 years. That's a bigger increase than inflation. And when they start selling Grand Floridian villas, those are expected to be in the $175 per point range.

In 15 years, we have used points outside of Disney twice. Once for the four night Disney Cruise (and this was in 2000 when the number of points weren't so high and they were a little more available on booking dates). We wouldn't cruise again on points because we can get so much more at WDW in a DVC resort than we get on a cruise ship. We also booked the Contemporary, but those weren't even our points. We bought distressed reservation points from another member for $6 a point and booked the South Wing Bldg at the Contemporary. Every other stay on points has been in a DVC resort.
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Old 02-08-2013, 10:41 AM   #8
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Quote:
Originally Posted by MedicGoofy

I have been reading. Lots. And am getting great info. My one big question remains the cost effectiveness, that some say it isn't worth it if........ And, staying somewhere not Disney owned. I'm not understanding this, and would love a REASON why it's not cost effective. I'm not worried about the subject to availability, as I can travel whenever I want. Pick a time and I can make it work. BUT, would like to know, what's the actual issue with it.
There are lots of timeshares you can buy for pennies on the dollar on Ebay and whose MFs are far less than DVC.

DVC is an expensive timeshare to buy into and the MFs are expensive too.

Like PP said, of the 5,000 RCI resorts, DVC members are only allowed to trade for a small fraction. And most of the time you will be trading down in resort quality from DVC (and paying $95 for the privilege of doing so).

My advice (as a 30-year-old who bought into DVC last year) is to buy enough DVC points (resale) for your Disney vacations every year or every other year. And look into some of the non-Disney timeshares for trips outside of DVC.

P.S. I love Aruba, we're doing 5 nights at Disney, followed by 7 nights in Aruba for our honeymoon!
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Old 02-08-2013, 10:58 AM   #9
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Quote:
Originally Posted by MedicGoofy View Post
If I used this for 30 years, how could it NOT save me money in the end. I know I can get rooms on discount, or the dining plan. BUT, if I'm not having to even pay for the room, just the transportation, tickets and food, how would it still not save money??
I am going to challenge two things in this statement. The first is your assumption that the dining plan will save you money. If you analyze the numbers you will find that for the majority of users it is actually MORE expensive to use the DDP, not less. If you get "free" dining with a package discount this could possibly be a savings, but in order to realize that savings you will need to pay full price for lodging and tickets, which can erode some or all of the savings depending on where you stay and your party size.

The second point is that even with DVC you will still have to "pay" for your room in the form of annual maintenance fees. Over the life of the contract, annual fees can make up more than 80% of the total cost of DVC. So please don't think that the room is paid for once you purchase your DVC contract, even if you pay for it in cash.

DVC can save you money in the long run if you are disciplined with your vacation habits (which many of us on here have admitted to not doing). Take a look at the long term costs of DVC and then compare that to your next best alternative for lodging (typically booking with a discount code or renting DVC points). That will tell you when, and if, you will save money by purchasing DVC.

Good luck!
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Old 02-08-2013, 11:05 AM   #10
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Quote:
Originally Posted by MedicGoofy View Post
What I haven't seen anything of, is the cost effectiveness IF you take a non Disney vacation. One place that I have wanted to go, Aruba. They have places to go there.
the thing with trading out - you are typically trading a high cost timeshare for a cheaper option.

i own DVC and another unbranded timeshare that i bought for $1 off ebay.

i have seen options on II to trade my $1 timeshare (annual dues of about $340) for one of the marriotts in aruba. including exchange fees, my cost for the week runs about $500-ish.

you're talking about taking 160 DVC pts that you paid how-much-for upfront plus a $95 trade fee plus over $750 in annual dues to get a similar aruba trade?

how much would the timeshare you are trading for cost - upfront costs and annual dues? you would almost always be buying a lexus to trade for a low-end chevy. buy DVC to use for DVC - if you want to travel elsewhere, take some time and look into other options to do that...

Quote:
The other thing I'm having a hard time processing, is that it may not be cost effective in the end. With Disney vacations. But I'm trying to figure that out. If I buy in, I'm only 30. If I used this for 30 years, how could it NOT save me money in the end.
would you really stay in the same type of rooms...would you really go to wdw as often...if you didn't own DVC? if you don't own DVC, you might opt to take a smaller vacation closer to home if things get tight. DVC pts might push you into choices you would not have made, if you were not committed to the Mouse.

if you buy an SSR resale for $60 per pt, you might save money. if you buy aulani at $140 per pt and higher annual dues than SSR, the math changes. if you need to finance and have to add interest charges on top of that, the math changes a little more.

what do you expect annual dues to be in 10 years? for some timeshares, you can rent them with cash for less than owners pay in annual dues. if demand for OKW stays goes down and my annual dues go up considerably, i might wind up paying more for my stays on points, than a cash customer.

there's a lot to consider. take your time.
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Old 02-08-2013, 12:54 PM   #11
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Quote:
Originally Posted by MedicGoofy View Post
I have been reading. Lots. And am getting great info. My one big question remains the cost effectiveness, that some say it isn't worth it if........ And, staying somewhere not Disney owned. I'm not understanding this, and would love a REASON why it's not cost effective. I'm not worried about the subject to availability, as I can travel whenever I want. Pick a time and I can make it work. BUT, would like to know, what's the actual issue with it.
What do you mean by "cost-effectiveness"?

That owning DVC will save you money vs ... ?

DVC is primarily set up to save you money vs. paying cash for WDW rooms under certain conditions:

(1) You visit WDW at least every other year (and certainly at least every 3 years)

(2) You stay at on-site Deluxe (or at least Moderate) resorts, and

(3) Your travel patterns (time of year, length of trips, etc.) does not let you consistently take advantage of WDW "deals" that could save you money.

And even #3 is a "maybe", because at best you can probably save a maximum of about 40% off the room rack rate (either a straight discount, free dining, or some combination of savings ...)

But a DVC "bonus" is that you will be staying in a room (at least a Studio) that is bigger and has more amenities than a "standard" room.

For all other uses, if you convert the number of DVC points needed into dollars (say using the rental rate of $10 per point - or whatever the amortized cost of your DVC points are over the life of the contract), you'll see that it would cost less - usually considerably so - to pay cash for those options than to use DVC points.

So to get the biggest bang for your buck - use DVC points at the DVC resorts, and pay cash (or get a different timeshare, as some have suggested) for other vacations ...
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Old 02-08-2013, 04:46 PM   #12
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Quote:
Originally Posted by MedicGoofy View Post
I have read a lot of posts here, breaking down the points value and how it may cost wise be worth it depending on the type of Disney vacation you take. What I haven't seen anything of, is the cost effectiveness IF you take a non Disney vacation.
There are several reasons why DVC is not a good vehicle for non-DVC vacations. Other posters have touched on them, but I'll try to put them all together for you:
  • Initial cost -- DVC is an expensive timeshare to purchase in the first place. Even buying resale, you would have to pay at least $8,000 for enough points for a typical exchange (160 points @ $50 per point). You can purchase other timeshares, in very fine systems, that will give you much better options -- both within their timeshare system, and with RCI and/or II exchanges -- for less than $1,000 including all closing and transfer costs.
  • Annual cost -- In my example above, if you buy 160 points @ $50 for $8,000 and expect to keep the timeshare 30 years, your acquisition cost works out to about $1.67 per point.

    If you figure your annual dues will average about $6 per point per year, the cost of one point in one year is $7.67. $7.67 X 160 for an exchange + the $95 fee = $1,321.67. Most places, you can get a cash room less expensively than that...and not have the ongoing financial obligation.
  • VERY limited resorts within DVC -- DVC only has 11 resorts, and only the WDW DVC resorts offer any unique advantages, IMHO. So to do anything else, you are forced into the strange world of timeshare exchanges. The importance of DVC's very small size as a system is hard to overstate. DVC gives you great options onsite at WDW -- nowhere else.

    By comparison, Wyndham (one of those that can be bought very cheaply on eBay) has the following:
    • Hawaii: 11 resorts to DVC's 1...and all 11 of them are better located than Aulani.
    • California: 8 resorts to DVC's 1
    • Florida: 16 resorts to DVC's 8
    • SC: 9 resorts to DVC's 1.
    • Total: about 90 resorts, compared to DVC's 11.

  • VERY limited options outside of DVC -- As others have noted, DVC currently trades through RCI. I'm not sure of the exact numbers, but I know DVC offers fewer than 600 RCI resorts, and RCI has something over 4,000 resorts (the true number depends on how you count them). While 600 may sound like a lot of resorts, it's really not. It is a very limited selection. And when you are limited that much, your actual availability is going to be pretty sparse.

    Most other timeshare systems who trade through RCI offer the full spectrum of RCI exchange opportunities...and that includes the ones you can buy for a buck on eBay.
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Old 02-08-2013, 06:33 PM   #13
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I haven't traded, I don't think the current cost of an RCI trade is too bad, but if it is a resort that charges an "all inclusive" resort fee in addition to just the trade points, those particular RCI resorts are usually a better deal with cash.

Cruises, ADV by Disney, and other non-DVC Disney resort trades are not a good value, but I'm glad to have that option just in case I do want to trade out some day...but if I were to purchase today, I would probably look at resale over direct from Disney, I'd be willing to give up the non-DVC trade options for a decent price.
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Old 02-09-2013, 01:17 PM   #14
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I haven't traded, I don't think the current cost of an RCI trade is too bad...
I agree -- for those who already own DVC and aren't planning to use their points at WDW.

I would never advocate anyone purchasing DVC using RCI exchanges as even a partial justification. To me, that's a whole different animal than occasional use by someone who is already an owner.

It's probably unlikely that a DVC/RCI exchange is going to yield a comparable unit to a DVC villa. You might get lucky, but most of the time you'll be trading down, and that is true of any timeshare exchange...not just DVC.

However, if you already own the points and are facing expiration, a downgraded exchange is not the worst thing that can happen. And sometimes, it can actually work well. We did such a Wyndham/RCI exchange in October. The place we stayed was far below Wyndham standards, but it was spacious and clean, and the staff was very gracious and accommodating. The big plus for us was that the timeshare we exchanged into was just 3 miles from my DW's uncle's house. That location made it an ideal exchange...for us...for that family-visit trip.

Like with a lot of things, what one person values in one situation may be very different from someone else.
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