DVC plans to target commercial renters

[AstroBlasters]

All true; just general sweeping back of napkin math for demonstrative purposes. You CAN certainly make a business out of it if you really do try and scale-- we've touched on that upthread and as you pointed out the above strategy works quite well and I believe is a point where DVC is looking to actively curtail now.

Yes, stock market can be MUCH higher (and lower). Last year SP500 is over 20% up. Last ten years 11% Last 20 9% -- so pretty good and consistent if in it for the long run by doing NOTHING aside investing it and not touching it.

You could also look at 2000 to 2012 where it would have gotten you a near 0% return. So, you never know….

 

[nalababybear]

You could also look at 2000 to 2012 where it would have gotten you a near 0% return. So, you never know….

So true. Market can be fickle. So can Disney and DVC board.

The one thing of the general market -- it's up and to the right over time.:

Timeshare - depreciating one that eventually completely vanishes.

Period (start-of-year to end-of-2023)	Average annual S&P 500 return
5 years (2019-2023)	15.36%
10 years (2014-2023)	11.02%
15 years (2009-2023)	12.63%
20 years (2004-2023)	9.00%
25 years (1999-2023)	7.18%
30 years (1994-2023)	9.67%

 

[DVCPAT]

Great question.

#1 - Why hold? It's a long term commitment with a bi-modal usage pattern.

-Young with young families. then Grandkids with expanded families. There's that valley portion when it's Disney Adult travel and typically lower point usage before picking up again in real spades with the grandkids.

-Why sell and pay brokerage fees when you rent to bide the time and a relative financial push to bide the time?

#2 - Margins matter in business. Yes, you CAN make this a business. There's proof there already. Just above is the template to that.

Disney eventually closes the loop holes and it is against the rules. I wouldn’t want to be unloading large DVC contracts when Disney decides to enforce the rules. The rise in rack rates have enticed the small DVC owner to rent points which will cause Disney to stop commercial renters.

 

[nalababybear]

Disney eventually closes the loop holes and it is against the rules. I wouldn’t want to be unloading large DVC contracts when Disney decides to enforce the rules. The rise in rack rates have enticed the small DVC owner to rent points which will cause Disney to stop commercial renters.

There's really no loopholes. Disney holds all the cards.

They have allowed a permissive environment for large scale commercial usage. It appears they are now actively trying to reduce this.

If Disney makes TOO much change that impacts members to a not want to bide their time between generations and long term usage.....that's impacting the DVC value proposition for many who are holding for the long run to which DVC ownership really is about.

Disney can upset that balance to their own peril. They make the rules, and DVC owners will adjust accordingly.

If it doesn't make sense to float, people will sell. They do in all the other timeshares and they hold 10% (or less) of direct sale value. If DVC wants to join those ranks -- they can certainly do it. I don't believe they want to.

 

[Brian Noble]

A Wyndham type solution looks interesting to me because I don’t think it would bother most people here.

I think it would - so let’s agree to disagree

In practice, the rank-and-file Wyndham owners at TUG are neutral-to-positive on the Owner Priority list---mostly because it does not impact them at all, and partly because it gives the impression that Wyndham cares about owners using their ownership for vacations. There are a handful of people who really don't like it. Most of those people rent at scale, but a few have more "legitimate" gripes.

I don't see any reason why it would play out differently for DVC, but the proof is in the pudding, hypotheticals, etc. etc.

 

[nalababybear]

In practice, the rank-and-file Wyndham owners at TUG are neutral-to-positive on the Owner Priority list---mostly because it does not impact them at all, and partly because it gives the impression that Wyndham cares about owners using their ownership for vacations. There are a handful of people who really don't like it. Most of those people rent at scale, but a few have more "legitimate" gripes.

I don't see any reason why it would play out differently for DVC, but the proof is in the pudding, hypotheticals, etc. etc.

Disney can accomplish the easy changes like you mentioned upthread by notification of high volume renters to stop it and divest because future reservations deemed commercial usage by x and y and z contracts will be cancelled without further notifications.

Disney has full authority to do that today and there are some indications of this happening, like AUL.

If I were Disney I'd be doing this gradually too to each high volume seller and tag specific contracts a few at a.time and force the sales and not overwhelm the market purposefully.

The sellers themselves may do it voluntarily, but I doubt it until they decide to exit the market completely and dump everything in a firesale. We don't see that yet.

This would be very different from the multiple proposed processes above which i belive diminishes the current product and value of DVC. Others may view it differently. Ultimately it's Disney's decision. We just do or die.

 

[lowlight]

What’s worse- one high volume (10k points) point renter or twenty lower volume (1k points) point renters that rent out 80% of their points on prime units and use 20% for personal use?

I think going after the low hanging fruit is the smart first move, but both of these owners are a problem to the overall health of DVC. The second segment is the one that has flown under the radar for a long time.

 

[nalababybear]

What’s worse- one high volume (10k points) point renter or twenty lower volume (1k points) point renters that rent out 80% of their points on prime units and use 20% for personal use?

I think going after the low hanging fruit is the smart first move, but both of these owners are a problem to the overall health of DVC. The second segment is the one that has flown under the radar for a long time.

Whatever impacts Disney's bottom line.

Both have been quite open. Disboards has an entire subforum for rentals. Not exactly hiding.

 

[HyperspaceMountainPilot]

Yes, there appears to be some who might be deemed to be professional renters using this site to do rentals -- the one in the post you mention has apparently been a member of this site since 2010, but I cannot find any posts made by him beforel 2022, and since then all of his posts on this site have been for doing rentals. I have seen others on this site who are similar, e.g., one poster joined in 2002 and historically has posted little over the years except posts to do rentals.

There is a lot of discussion about how the internet and social media made renting easier and more prevalent, but this post (for some reason) made me realize that post-COVID (and COVID closures) also probably made a LOT of owners first time renters as they had to unload a lot of points and perhaps after realizing how much they could get for rentals, some of them decided to start gaming the system for profit and sharing that advice/experience with their fellow DVC owners. I bet most of us here have seen people talk about buying 2x as many points as they need “so the points cover my dues” — which may then shift into renting for profit when you realize it’s only a little harder to book a BCV studio reservations at $25/pt than it is to book 1bed villa reservations at $18/pt, etc. Perhaps others decided to stop going when their children grew older and if they bought 20 years ago are very happy with a consistent return of $20/pt… I don’t think individually they compare to large commercial rental operators, but is there are collectively thousands of them, it can definitely skew the whole system.

 

[eticketplease]

It’s fun to read this DIS thread from 2007 that discusses renting DVC points.

https://www.disboards.com/threads/is-renting-out-your-dvc-for-profit-legal.1513498/

Good Read now to find the thread from 1991 when this started

 

[AstroBlasters]

So true. Market can be fickle. So can Disney and DVC board.

The one thing of the general market -- it's up and to the right over time.:

Timeshare - depreciating one that eventually completely vanishes.

Period (start-of-year to end-of-2023)	Average annual S&P 500 return
5 years (2019-2023)	15.36%
10 years (2014-2023)	11.02%
15 years (2009-2023)	12.63%
20 years (2004-2023)	9.00%
25 years (1999-2023)	7.18%
30 years (1994-2023)	9.67%

That is assuming you buy and hold. Someone renting probably wants the ongoing cash flow and is not reinvesting the money back into the business.

You are also analyzing a period of time that could be called the “internet productivity boom” combined with a “post Cold War Rules Based System” that was very favorable to the United States.

Developed counties have declining populations, extreme debt levels, heightened wealth inequality, extreme political polarization, and are becoming more anti-free trade/globalization…. things that did not exist during the periods you are referencing….

I’m not doom and gloom, just want to make sure we are putting the timeframes in some context.

 

[nalababybear]

There is a lot of discussion about how the internet and social media made renting easier and more prevalent, but this post (for some reason) made me realize that post-COVID (and COVID closures) also probably made a LOT of owners first time renters as they had to unload a lot of points and perhaps after realizing how much they could get for rentals, some of them decided to start gaming the system for profit and sharing that advice/experience with their fellow DVC owners. I bet most of us here have seen people talk about buying 2x as many points as they need “so the points cover my dues” — which may then shift into renting for profit when you realize it’s only a little harder to book a BCV studio reservations at $25/pt than it is to book 1bed villa reservations at $18/pt, etc. Perhaps others decided to stop going when their children grew older and if they bought 20 years ago are very happy with a consistent return of $20/pt… I don’t think individually they compare to large commercial rental operators, but is there are collectively thousands of them, it can definitely skew the whole system.

Very true. Just like eBay and stubhub revolutionized the resell market,

FB and Disboards both make it very easy to connect potential matches.

It does create a secondary market for Disney where folk are okay with the 3rd party to save 30-40% off rack rates of Deluxe level Disney experience. That's why looking at moderate resorts and their availability is where rentals are roughly priced at and their occupancy.

If those are impacted, that's when Disney will act to curb the practice; otherwise Carry on would be the order of the day.

 

[MICKIMINI]

True. I guess I’m just spoiled by what DVC has made possible for us. I couldn’t imagine that much time in a studio. I need my washing machine.

We moved quite a bit to get the best "mileage". We stayed for two weeks in May and the other three in October. Our son and DIL stay in a studio (hey, it's free). We did have a lot of extra points from those new contracts so we did not suffer very much. I'm big on having a W/D too!

Edit to say it was way too much WDW for us. We had planned to stay 6-8 weeks in the fall during retirement, but that experiment changed our minds. Anyone thinking about it should test drive it first. We built a house with room for family to have their own space and spend our time in NH with them. It's not the end of DVC for us, we just enjoy our mountain view and hot tub here (kind of a mini-Wilderness Lodge look) more than dealing with airports, rental cars etc LOL!

 

[Spivey378]

Yes…. the commercial renters seem very worried…

https://www.disboards.com/threads/2-800-aul-blt-poly-points-to-rent-transfer-starting-at-20.3959190/

People are saying that he has to rent all of his points because he can no longer be out in the daylight. Still makes it to Midnight Magic though.

 

[Dracula]

People are saying that he has to rent all of his points because he can no longer be out in the daylight. Still makes it to Midnight Magic though.

Besides the daylight, the other thing he fears is the contract expiration date. What good is immortality, if the contracts disappear so soon?

 

[ShaneDJ]

Besides the daylight, the other thing he fears is the contract expiration date. What good is immortality, if the contracts disappear so soon?

You have 2,800 points and you are renting out all of them??

 

[AstroBlasters]

You have 2,800 points and you are renting out all of them??

I would point out that he is taking requests for rentals based on people looking to book a room for vacation and NOT booking up the hardest to get rooms and renting out spec rentals.

So whether he owns the points or someone else owns the points those points will get used in the system.

Having rented from people on DISBoards and rented to people on DISBoards, I have no issues whatsoever with this business practice.

 

[Sandisw]

What’s worse- one high volume (10k points) point renter or twenty lower volume (1k points) point renters that rent out 80% of their points on prime units and use 20% for personal use?

I think going after the low hanging fruit is the smart first move, but both of these owners are a problem to the overall health of DVC. The second segment is the one that has flown under the radar for a long time.

I guess it will really come down to what DVC decides is an owner using the membership as a commercial enterprise.

The statements at the meeting did not indicate they are going after the lower point owners.

 

[GoingSince1990]

People are saying that he has to rent all of his points because he can no longer be out in the daylight. Still makes it to Midnight Magic though.

The fact that I almost never see a minimum point amount stipulation in these threads renting out huge numbers of point makes me think that DVC is not enforcing even the 20 reservations per year rule. Because if they were, you would think that someone renting out 2800 points would be careful to specify a minimum of at least 140 points per rental, which would keep the number of reservations to 20 or less.

 

[Phatscott25]

The fact that I almost never see a minimum point amount stipulation in these threads renting out huge numbers of point makes me think that DVC is not enforcing even the 20 reservations per year rule. Because if they were, you would think that someone renting out 2800 points would be careful to specify a minimum of at least 140 points per rental, which would keep the number of reservations to 20 or less.

Probably a law of averages thing. They're willing to accept a smaller point reservation knowing they'll get larger ones as well.