DVC RESALES
DVC RESALES

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Old 05-02-2013, 08:02 AM   #31
theguda
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Quote:
Originally Posted by Minniesgal

I wouldn't call being sellable for $500 having residual value.
is $500 higher than $0? Of course it's residual value. But $500 was just an arbitrary # I picked. Someone buying that contract for $1000 would still give them value and give you $1000 back. The point is...you guys are saying the contracts are worthless to anyone else but the original owner (not true) and there is no residual value (not true).
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Old 05-02-2013, 08:09 AM   #32
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You missed the point of that statement, the BWV contract might be worth something to you in 15 years as you already own it but no-one is going to pay you to take it off your hands.
Precisely what I was saying...........

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Again...not true. I don't know why this is hard to accept...but people will buy anything if it saves them money. Why do you think people stand in line for hours on Black Friday...or join websites like Slickdeals or Fat Wallet?
Tell you what...I'll buy any contract with 5 years remaining for $500 and make a small fortune renting the points....and so would all of the DVC rental point brokers. Anyone who tries to sell their DVC contract will never have a problem doing so. There will be plenty of people willing to buy it (either to rent the points out or to save $ on their own vacation). These contracts are never ever "worthless" and will always have a market for rental and resale. They will always have value not only to the current owner...but also to anyone who wants to rent points OR someone who would like to buy the contract to realize the savings until it expired.
I almost went analytical on you, but then decided I am done. 2 weeks ago buying DVC was foolish, now you are the foremost mentioned expert on all DVC economics, a Kreskin of DVC.

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Originally Posted by theguda View Post
is $500 higher than $0? Of course it's residual value. But $500 was just an arbitrary # I picked. Someone buying that contract for $1000 would still give them value and give you $1000 back. The point is...you guys are saying the contracts are worthless to anyone else but the original owner (not true) and there is no residual value (not true).
$500 bucks in 10 years? worth about $2.83 cents today, good luck with your points, hope you enjoy, I am done with this thread
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Old 05-02-2013, 08:31 AM   #33
theguda
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Quote:
Originally Posted by fmer55

Precisely what I was saying...........

I almost went analytical on you, but then decided I am done. 2 weeks ago buying DVC was foolish, now you are the foremost mentioned expert on all DVC economics, a Kreskin of DVC.

$500 bucks in 10 years? worth about $2.83 cents today, good luck with your points, hope you enjoy, I am done with this thread
Don't get mad because I'm proving to you that your contract isn't worthless in 15 years. I'm actually doing you a favor. The #'s I'm using in my example are TODAY'S numbers. They assume you bought the contract decades ago. Smh

I can see now how you'd mistakenly think your contract would become worthless. I look forward to buying contracts from others who feel the same in 15 years. I'll make a fortune buying these "worthless" contracts and renting the points for profit. A great investment.
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Old 05-02-2013, 08:45 AM   #34
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As with most anything, the contracts will be worth what someone is willing to pay for them at the time the owner wants to sell.

As long as WDW remains a place people want to visit, the contracts will have some value. IMO, the value of the contract will depend on the rates Disney charges for on site lodging as well as the number of contracts for sale. Both factors will be important!

Those who want to stay on site, will be able to compare doing that with the price of a contract. There will be some who see only a few years remaining as a plus. The end date was a plus for us when we bought - less of a long-term financial commitment to pay for a luxury.
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Old 05-02-2013, 09:49 AM   #35
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Originally Posted by theguda View Post
Again...not true. I don't know why this is hard to accept...but people will buy anything if it saves them money. Why do you think people stand in line for hours on Black Friday...or join websites like Slickdeals or Fat Wallet?
Tell you what...I'll buy any contract with 5 years remaining for $500 and make a small fortune renting the points....and so would all of the DVC rental point brokers. Anyone who tries to sell their DVC contract will never have a problem doing so. There will be plenty of people willing to buy it (either to rent the points out or to save $ on their own vacation). These contracts are never ever "worthless" and will always have a market for rental and resale. They will always have value not only to the current owner...but also to anyone who wants to rent points OR someone who would like to buy the contract to realize the savings until it expired.
In my opinion, you get yourself into trouble when you use words like "never", "always", and from a previous post, "guarantee". DVC is a timeshare. It has an expiration date. It is subject to ever increasing maintenance fees and an unstable point rental market with a less than generous history. And finally, it is controlled by Disney and their ability to make changes with the swipe of the pen. What I'm saying is that there are WAY too many variables to make any assumption beyond what is guaranteed...the right to book lodging at your home resort. To me, banking on anything else from an investment (or even a vacation) standpoint is too risky.

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I wish i would have bought a few months ago...but after looking at historical #'s I'm happy to pay $68 for a stacked BWV contract. I could be wrong and prices could drop...but it looks more likely that we've just exited a bottom period in the market
I'm a bit nervous here, and I'll tell you why. Just as you used the numbers to convince yourself that DVC was a bad option a few weeks ago, you are now equally as vocal about using the numbers to convince yourself that it's a good investment. The problem is that they are the same numbers, and yet you are using them to draw two polar opposite conclusions.

I'm curious, and I ask this genuinely and not to insult you, how did you come to this change in thinking?
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Old 05-02-2013, 09:54 AM   #36
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Originally Posted by CarolMN
As with most anything, the contracts will be worth what someone is willing to pay for them at the time the owner wants to sell.

As long as WDW remains a place people want to visit, the contracts will have some value. IMO, the value of the contract will depend on the rates Disney charges for on site lodging as well as the number of contracts for sale. Both factors will be important!

Those who want to stay on site, will be able to compare doing that with the price of a contract. There will be some who see only a few years remaining as a plus. The end date was a plus for us when we bought - less of a long-term financial commitment to pay for a luxury.
Excellent points
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Old 05-02-2013, 10:07 AM   #37
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Originally Posted by ELMC

In my opinion, you get yourself into trouble when you use words like "never", "always", and from a previous post, "guarantee". DVC is a timeshare. It has an expiration date. It is subject to ever increasing maintenance fees and an unstable point rental market with a less than generous history. And finally, it is controlled by Disney and their ability to make changes with the swipe of the pen. What I'm saying is that there are WAY too many variables to make any assumption beyond what is guaranteed...the right to book lodging at your home resort. To me, banking on anything else from an investment (or even a vacation) standpoint is too risky.

I'm a bit nervous here, and I'll tell you why. Just as you used the numbers to convince yourself that DVC was a bad option a few weeks ago, you are now equally as vocal about using the numbers to convince yourself that it's a good investment. The problem is that they are the same numbers, and yet you are using them to draw two polar opposite conclusions.

I'm curious, and I ask this genuinely and not to insult you, how did you come to this change in thinking?
No insult taken at all. I say that I wish I would've bought a few months ago because I could have bought at a lower price point.

As for what changed my mind on owning... It was two things:

1) Despite what many say I do view DVC as a quasi investment. The extra points I have on my contract each year will be rented to offset the upfront cost of the contract. Eventually the profit I make in rent will overtake the cost of the contract and from that point on I will be in the black. So from a financial standpoint it does make sense to purchase and recoup my initial costs by renting extra points. Some think the gap between MF's and rent will eventually close. I don't think that will happen. The more I researched and looked at numbers like historical maintenance fees, historical resale prices, etc. it made me believe that there is an opportunity to profit off extra points.

2) I go to disney every year and i love Epcot and the food and wine festival. To me, being pretty much guaranteed a room at BWV during F&W has a huge value to it. I am in control of the booking and I don't have to rely on finding someone to rent points from that can book 11 months out.

Also...I get to debate with you guys!
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Old 05-02-2013, 10:15 AM   #38
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I personally agree that our DVC will not be worthless - even during the year of expiration, barring any unforeseen disasters, but this (see below)?

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...These prices aren't going back down. They're going to keep rising...

...Those who wait will pay higher prices in the future...
The nature of a "recession" and the damage that it inflicts is this: Most people don't see it coming. Do you think the people who sold the past 2 years were hoping to sell at "rock bottom" prices? No - no they didn't. Bottom line - nothing is guaranteed and resale prices could drop like a stone after GF or they could continue to rise. We just don't know.

Terri

Last edited by permavac; 05-02-2013 at 10:18 AM. Reason: typo
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Old 05-02-2013, 10:20 AM   #39
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Originally Posted by permavac
I personally agree that our DVC will not be worthless - even during the year of expiration, barring any unforeseen disasters, but this (see below)?

The nature of a "recession" and the damage that it afflicts is this: Most people don't see it coming. Do you think the people who sold the past 2 years were hoping to sell at "rock bottom" prices? No - no they didn't. Bottom line - nothing is guaranteed and resale prices could drop like a stone after GF or they could continue to rise. We just don't know.

Terri
It's good to see someone else understands that these contracts will always hold value.

As for your 2nd comment...you are correct. No one knows FOR SURE what will happen in the future. I just think there is a better chance that prices will rise instead of decrease and the recent low prices are the exception...not the rule. Could I be wrong? Absolutely. But I think I'll be right.
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Old 05-02-2013, 10:28 AM   #40
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Originally Posted by permavac View Post
We just don't know.

Terri
This sums it up perfectly.

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Originally Posted by theguda View Post
It's good to see someone else understands that these contracts will always hold value.
The value in a DVC contract is in its use and in what someone will pay you for it. So it doesn't matter if there is opportunity for profit in a contract with 10 or 15 years left, if no one will pay you for it then the resale value is zero. That being said, you will still be able to use it or profit from renting points (if such a situation exists). To speculate that this will be the case, however, is too risky IMO.
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Old 05-02-2013, 10:29 AM   #41
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Originally Posted by theguda View Post

1) Despite what many say I do view DVC as a quasi investment. The extra points I have on my contract each year will be rented to offset the upfront cost of the contract. Eventually the profit I make in rent will overtake the cost of the contract and from that point on I will be in the black. So from a financial standpoint it does make sense to purchase and recoup my initial costs by renting extra points. Some think the gap between MF's and rent will eventually close. I don't think that will happen. The more I researched and looked at numbers like historical maintenance fees, historical resale prices, etc. it made me believe that there is an opportunity to profit off extra points.
Here's where I'm confused. Your initial analysis then compared this option to other investments and decided that it was a losing proposition. So is it the combination of investment component and enhancement to your vacation experience that changed your mind? Because from a sheer investment standpoint, the numbers haven't changed.
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Old 05-02-2013, 10:51 AM   #42
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Originally Posted by Minniesgal View Post
You missed the point of that statement, the BWV contract might be worth something to you in 15 years as you already own it but no-one is going to pay you to take it off your hands.
A simple example: Someone needs 400 points for a vacation and they are looking at staying at DVC.

Renting points that year costs $12/point which makes the renting costs = $4,800.

If someone can buy those same point including any closing fees plus have enough time to make the booking for a discount to that rental price of $4,800, then for some people it would be worth it even if that was the last points left on the contract.

It only never become worth it when there are no savings, ie rental rates are lower than MF+closing costs or Disney has some big discounts on their rooms.
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Old 05-02-2013, 10:57 AM   #43
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A simple example: Someone needs 400 points for a vacation and they are looking at staying at DVC.

Renting points that year costs $12/point which makes the renting costs = $4,800.

If someone can buy those same point including any closing fees plus have enough time to make the booking for a discount to that rental price of $4,800, then for some people it would be worth it even if that was the last points left on the contract.

It only never become worth it when there are no savings, ie rental rates are lower than MF+closing costs or Disney has some big discounts on their rooms.
Exactly true! I think this makes owning DVC different than other timeshares. As long as the area hold value, the timeshare will, and WDW planned well to control it's surrounding environment.
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Old 05-02-2013, 11:21 AM   #44
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No insult taken at all. I say that I wish I would've bought a few months ago because I could have bought at a lower price point.
I have not ran the numbers and analyzed every resale transaction, but I think the pervceived "lower" prices a few months ago are being overhyped. Disney raised direct prices, resale followed suit and buyers are giving sellers what they want in fear of ROFR. Most of the contracts being ROFR'd are loaded ones with mediocre offers. If you offer a fair price (not what the seller is asking for) consistent with a few months ago, I think you have a fair shot at passing ROFR. Heck, some of the resale prices lately have been approaching the Direct price! The main thing I see different in the resale market today is only what the seller is asking for... just my two pennies!
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Old 05-02-2013, 11:34 AM   #45
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It only never become worth it when there are no savings, ie rental rates are lower than MF+closing costs or Disney has some big discounts on their rooms.
Exactly
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