More Rental Concerns

[ripleysmom]

Dean, DVC also states that renting points for commercial purposes is NOT okay.

Renting all of your points every year, to me, could and should be construed as a commercial purpose. I know I would certainly feel as though I was in violation of the agreement.

Personally the thing that bugs me the most is the "every man for himself" mentality.

Kimberly-Lucas and Ripley's Mom

 

[Firefighter Mickey]

Ok, I own 600 points across 3 resorts. It used to be that we could easily use those points, but because of a change in job and family situation, the last few years we've not been able to use but maybe 200 each year. Since it seems foolish to just let these points go to waste, and they are costing me a lot in maintenance each year (and not ingoring my original investment costs), I rent them out. In a few years I'm hoping we'll be able to use all 600 points each year, but it might be 5 years away, and given the cost increases in purchasing DVC points, I'm not willing to sell off my investment - it makes a lot more sense financially for me to "hang on" to it.

So, people see me renting 400 points each year, maybe more because of banking and borrowing, and suddenly I'm a bad person???

Gosh, I hope I get lynched with new rope. I hate it when people use old rope.

 

[Dean]

DVC includes in at least 3 places specifically stating it's ok to rent points and it's listed in a very specific and understandable way. In one place they make a generic, vague statement about not using DVC as a commercial venture with no explanation, definition or clarification. That seems a little one sided to me and the ones that look at those sections and see the commercial usage item and assume that you can only rent for your maints fees or give it away, have rose colored glasses or wishful thinking.

As for what what one owners owes another, I'd say follow the rules in place and be courteous to all. In my opionion that would not preclude members that rent their time from being in good standing or even nice people. And as I've stated many times, DVC could not truly legally prevent renting what another owns. I guess we must agree to disagree, but that's ok. If we can't disagree on this one and still be friends, then stand opposed. LOL.

Dean

[This message was edited by Dean on 03-06-01 at 07:25 PM.]

 

[drusba]

What we often confuse is two different issues: (a) Is renting legally allowed and to what degree?, and (b) Should owners not engage in it because of perceived harm to others?

The first is the legal issue, the second the moral one. Renting is expressly allowed. The "commercial purpose" restriction talks about persons who repeatedly rent to the extent they are engaging in a commercial enterprise. My view of that is mainly that you can rent unless all you are doing is buying points for the purpose of renting (persons who do that likely have something to be concerned about). Persons who use many of their points, rent out others to cover dues and make a some extra bucks are not in the regular business of renting points. In any event, there is not much of a restriction and it does not say you are barred from renting "Christmas" or other prime times, or 11 months in advance. In other words if you object to renting like that and believe the solution is for DVD to "enforce" existing rules, then the proposed solution won't work or happen because the existing rules allow it. As I have stated before, I disagree with Dean's conclusion that DVD could not legally have restricted renting because legally they probably could have imposed a number of restrictions. But they chose not to.

Moreover, it is not something Disney could easily change. Persons who bought based on rules stated at the time have a right to rely on them. DVD can make changes to rules but it cannot legally do so if it is material to the interests granted to members; changing the renting rules most likely would not be allowed.

Views on the moral issue can be enforced but not by legal measures. For example, renting seems to be mostly an internet phenomenon; those who want to do a lot of it could not easily do so without an internet market. The rent/trade board on this site perhaps provides the best avenue for point rental along with e-bay (which probably has more risks). The rent/trade board is like a national marketing center for those who want to rent. Shut it down and you would probably put a big crunch into the rental enterprises that exist. Of course, it could probably start up on another site that does not have as many viewers but you could advocate shutting those down to.

In other words, if you want to reduce renting, you should advocate the end of the available marketplace. Thus Pete (poor Pete if anyone follows what I am saying) should be the object of your protests to get him to close down the rent/trade board. He should be the focus of any venom.

Personally, I am not advocating harrassing Pete. Also, from what I have seen neither side, the pro-renters nor the anti-renters, can really muster a majority for their position (this is beginning to sound like some other moral issues). Moreover, you likely could not even muster a majority of the anti-renters because many of them believe renting and the rent/trade board is OK as long as it is just people renting extra points and not trying to take prime times; but to prevent the type of renting you do not like you must eliminate the market for the kind you do.

Possibly what we need is a poll--see who would vote for no renting, partial renting, shutting down the rent/trade board, or other possible categories (such as should Dean be tarred and feathered -- just had to throw that in). It would be interesting to see the percentages on either side.

 

[kem330]

In defense of Ripley's mom's and PamOKW, I believe when DVD figures how many memberships to sell the bean counters figure in a certain amt of members will bank, exchange, trade, etc. So if all these points are rented instead of used otherwise, that throws this delicate balance off. Also previous discussions on this issue have suggested that members renting should advertise only that they have points to rent, and then request dates based on the individual renters request instead of blatantly taking prime weeks away from members. Some members can't book at 11 mos for a variety of reasons. And sorry i have to ask micky firefighter- why did you buy 600 points? Did you perhaps buy more than you needed to cover the cost of your membership through renting? Certainly this makes good financial sense for you but does appear a tad commercial. Please don't take offense, it may not be true in your case, but I'm bringing up the point because for some members it probably is true. I have no clue if this really is a problem or not. But I have to say in principle I have a problem with points consistently being rented solely at peak times by members. (notice I qualified that statement)I did try to rent from someone before we bought our resale, and they were willing to check the dates, they had not already reserved the time. Again I think this is a much fairer way of doing business

 

[spruce]

Disney could have sold their timeshare as a traditional timeshare. Meaning you buy a fixed week during the year in a fixed unit. Another traditional timeshare aspect is that you own it forever instead of a right to use lease which for DVC expires in 2042.
What Disney did is set up a points based system which allows all owners the same access to the available units. READ THAT AS: All owners the same access to the available units.
This points based system with its flexability is a great thing but the one thing I was most concerned with when I bought.
How do I get my reservations? By using my 11 month booking window. I have always gotten what I wanted.
Do I rent my points...no, would I rent my points...if I had to or wanted to.
If the flexability of the points system and those that work within that system(by taking full 11 month advantage) lock you out of getting what you want then maybe next time you ought to use the 11 month window or buy a fixed timeshare week.
Timeshares are rented by non-owners all the time, either at DVC or any other timeshare in the world. Stopping people from renting, selling, giving or whatever their own property will never happen and should never happen in a free market.

I do understand the disappointment of not being able to secure the reservations you want and yet see people renting the week you want to go to non-members, but hey....that's the way a points based timeshare works. Using your booking windows or getting a fixed week is your only solution. I don't think changing our contractural documents with DVC which allows rentals is the answer or could even be done....Wow, I didn't think I had this much to say about this...remember this is my opinion and is not intended to flame anyone.....spruce

Offsite 87,92,97,00
CBR 95
DI 98
Vero 98
BWV 98,99,00
OKW 99x2,00,01
DCL 98,01

 

[spruce]

Firefighter Mickey....they are your 600 points to do with as you see fit. You are not in the business of selling points just renting the points that you are unable to use because things changed in your life. Forget about anybodys opinion. Wait till they find themselves in the position of losing points that they can't use and see if their tune changes. And, I wish we had 600 points....spruce

Offsite 87,92,97,00
CBR 95
DI 98
Vero 98
BWV 98,99,00
OKW 99x2,00,01
DCL 98,01

 

[Richyams]

This is a tough question. I am basically in agreement with Dean. I feel that we do live in a free country and you are free to do with your property as you wish.

I also fell strongly about living up to agreements and contracts. While renting is explicitly allowed, renting out as a business is implicitly prohibited with the "commersial" reference.

I like to enforce the spirit of the contract. I think that the spirit of the contract allows renting and forbids buying for the purpose of renting.

I do feel Disney owes us a fudiciary responsibility of looking into and sanctioning those that are in conflict with the spirit of the contract. I think that renters that rent a significant portion of their points each year should be at a small disadvantage in acquiring reservations. I think that people that rent as a commercial venture should be forced to forfeit their points. I think that if a renter does not declare the rentee as a "renter" they should be sanctioned, forfeiting those points sounds reasonable.

How do we determine a "commercial" venture. I threw out a possible rule of thumb of 1/2 the points whould be used by family or friends. Is that fair? I am not sure, the previous poster seems to fall into, what I would consider, a non-commercial venture. Yet he fails my 1/2 test.

I don't know, in a perfect world, I would say that for reservations made for the purpose of the owner staying and as a matter of circomstance, he can't go, even Christmas day is fair to rent out. This type of thing shouldn't happen more then once in ten years. All other reservations made for the purpose of renting should be made at ten months....I think that the home resort advantage is fine to use to rent....lets lock out those VBers....only kidding, but I do think that 10 months would be fine. Never SSPL, but ten months is fine.

How many points? A pattern of rservations and usage that is obviously commercial?? I think these things should be looked into by DVC, I believe they have a duty to do that.

"From each according to his ability, to each according to his needs", Karl Marx, pretty sick, huh?

 

[Doctor P]

Several people have noted that DVD explicitly allows renting. All I can find in the documents is language that implies that renting is allowed. Can somebody help me with an explicit statement that renting is allowed? (BTW, I am not arguing that renting should not be allowed...just trying to get on the same page with everybody). I agree that much of the problem would go away if sites like the rent/trade board were regulated, but there is a rule that DVC could enforce that is in the documents--members must notify MS that the reservation they are making is for a renter. This is in the documents and I suspect that it is not followed. A very simple rule would be: no reservation made through SSPL or the home resort period may be converted to a rental reservation without cancellation and rebooking. I'm sorry, but I think that DVC owners should be given preference to use the DVC network resorts before renters are given such a privelege. I know there could be problems with such a policy, but, I repeat once again, it left a very sour taste in my mouth to be shut out of the BWV SSPL for 2001 and then see reservations being sold for that time prior to even the 11 month window--that simply is not fair nor is it the intent of DVC IMHO. BTW, the right to use one's property is never absolute, nor is there a problem with DVD/DVC making and enforcing a no rental rule even after the fact. Don't know for sure about Florida, but this has happened and survived legal challenges twice with respect to condominium associations with which I have been associated (I didn't like that it happened, but they were well within there rights to change the rules as long as they did it within the conditions of the declarations, etc.--so I expect DVC could do this too)

[This message was edited by Doctor P on 03-07-01 at 09:11 AM.]

 

[PamOKW]

No where in DVC documents will it say you can rent "points". It does say that points have absolutely no value and are only the means by which reservations are made. It does say membership in DVC is for personal use. It does say you can share your membership and receive compensation. It does say they are for personal use. It warns several times about not depending on the ability to receive compensation for allowing others to use your reservations. It warns against trying to compete with Disney and explains that when compensation is received the person using the reservation is not entitled to the same benefits as a member. All in all I agree that it is a grey area and one that is difficult for DVC to enforce.

A lot of DVC is based on trust in Disney and their ability to run a resort operation. I am just suggesting that I hope they are aware of the increased amount of members who are running resort booking operations rather than making personal use of their points. (Personal use could include allowing others to use their reservations and to receive compensation. We are talking about bringing Mom & Dad along to stay in a studio and accepting $200 from them.)

Pete, of course, is free to do as he likes. He also had very good intentions in setting up the rent/trade board as a place for members to help each other out and that is how it was used in the beginning. If it's going to be used as a place for commercial rental and attempts to up the price then Pete should be receiving a percentage of the rental income. He is providing a real service for these people, allowing them to run a business that would otherwise be quite difficult.

The defense that we all have equal access and can book at the 11 month window is kind of a red herring. The beauty of DVC is that it is flexible and does not require booking at 11 months. I'm not sure if we've reached that point yet, but if we are to compete with a large percentage of rental agents (which is what you are if you are renting more than 150 points per year)then we will have to book at 11 months. That's not the way the system was originally set up and it's not the way it has worked for nearly 10 years. I feel too many commercial rentals will throw it out of whack.

The other problem with the majority of these rental advertisements is they are for Sunday-Thursday. This lets the renter keep the cost low enough to compete with Disney. It also contributes to the problem of under utilizing Friday-Saturday, massive check-in backlogs on Sunday that members do not like, and an inability for members who want an entire week to book it in one shot. It may help push DVC to adjust the point chart to balance out the weekday/weekend points which may disappoint members who purchased exactly what they need for stays.

Saying everyone has equal access is like saying everyone has equal access to any big show. The scalpers just happen to call sooner. I'm not saying it has become a problem yet. I just think a red-flag should go up and DVC should look into the situation and see what if any effect it could have on the operation of the DVC system for all of its members.

[This message was edited by PamOKW on 03-07-01 at 08:20 AM.]

 

[Tinker Bell]

This issue does matter!!! The behavior of people whose sole/primary purpose is to maximize their financial return from ownership will "crowd out" members who just want to enjoy a vacation. Clearly, this effect increases as the number of owners with a commercial focus grows. President's week is a high profit week to rent. Should members from the Northeast that want to book during the school vacation have to compete with profit maximizers? Sure they both have the same "opportunity" to get the ressie, but is the playing field level? Imagine the profit maximizer with a phone bank and hired temporary help dialing for dollars to get the premium spots!!! If it isn't happening already, it will happen eventually. DVC has to be protected from commercial interests or the whole system will break down.

Tinker

 

[CRobin]

Pam - thanks for this thread; excellent interchange of ideas on a clearly polarized topic.

Some thoughts....

As owners, DVC does impose some restrictions (regulations) upon us (11/7 month ressie window, banking windows, cancellation clauses). My assumption is that these were thought through, considering the benefits of the owners, yet preserving DVD's right to not take a bath on an unoccupied property at the last moment. Seems like we all have learned to live with these, and consider them for the most part to be fair and just.

Here's a "what if" (and this is a different twist on Rich's 50 % rental maximum)....

Cut back the window on ressies in the name of anyone not on the deed to X months (7,6 5, take your pick, make it seasonal if you want), but if the owner is not making the reservation in his name, no home resort priority. And no changing then name on a ressie booked outside that window. If you want to cancel, cancel.

While this approach would curtail our right to employ our 11 month home resort window to reserve for family / friends, I for one would sacrifice it, betting that I could still get second / third choices within the restricted window, and, quite frankly, if I'm booking free rooms to my inlaws and they won't accept anything than BWV preferred, well, they have an option - CRO.

If one wants to propose rule changes, they need to be easily understood and enforceable. This one is; photo id is req'd at check-in, renter, family, or friend. The current "you inform MS that the ressie is for a renter" is not.

I don't think this ties the hands of someone with excess points, because he has to manage unloading those points no matter what, it just tightens down the time frame somewhat. It certainly does put the squeeze to the guy who bought solely to make a buck (or $ 10,000) on Christmas week.

I like the idea of a poll.

Grand Floridian 1994
Yacht Club 1996-1999
Beach Club 2000
Old Key West 2001

 

[PamOKW]

Tink, you've got what I'm trying to say. It hasn't been a problem, it may not be a problem, but there is definitely increasing activity in the sale of reservations. I think DVC owes it to the members to look at it and determine how to handle it. What I've learned about DVC is they aren't stupid (they are Disney after all) and chances are they may already be doing this.

 

[Tiggeriffic]

This is a difficult topic. I personally agree that there should be no problem with a person renting out a portion of their points each year or all of their points every once in a while. However, the question comes down to where is the dividing line between what should be okay and what shouldn't.

Unfortunately, DVC doesn't spell out in CLEAR language where that line is. Some people have suggested that its okay to rent out to family and friends. Unfortunately, I don't see how DVC could make this distinction between personal use and renting out.

The only way that I could see them being able to distinguish is if there was a rule that people listed on the deed had to use the points a certain percentage of the time. I don't know what this would percentage should be, but I'll give an example just for clarity sake. Say, that the listed owners had to use 50% of the points for their own use within a 3 year period. This would allow the complete renting of 1 1/2 years points every three years or half of your points every year. Now, I'm not advocating this as a rule, just saying that it would have to be something as specific as this to be clear.

I do believe that the renting of points as a commercial venture could become a problem. I can easily envision a person reserving the most desirable times and or units,say standard view Boardwalk or GVs, and then renting them out. Now, you can say that this is fine because they can do what they want with their points, but I believe that it stresses the system because this person is monopolizing those times at which they can get the best return for their money and that this will reduce the chance that non-renter can get what they want.

Take an extreme example, of someone calling and reserving all of the GVs at Boardwalk or OKW for Easter week. These are a scarce resource. Is it right that someone should be taking these away just to make the biggest return on their money?

Personally, I know I don't have enough points that I would ever plan on renting them out. However, I would certainly like to be able to rent them out if for some reason I couldn't go for a year or two. Currently, I don't see what DVC can do unless there is a change in the rules that is agreed to by the members.

 

[Firefighter Mickey]

So far, no one has presented any positive proof that a) Rental activity is increasing, and b) that this supposed increase in activity has hurt the membership in general.

A couple of things I've noticed about the rent/trade board - yes, it is active, but is that activity a result of an actual increase in people renting points, or is it simple a result of the fact that DVC now has some 65,000+ members? Or, is it simply a result of more people thinking there's a bargin in renting and are looking for points to rent? A really quick look at the R/T board shows non-members looking, members looking for a handful of points to complete a reservation, people saying they have a few points available, and occasionally someone with a lot of points available.

Another thing; with the possible exception of 1 or 2 instances, I've not noticed people frequently making specific vacation dates available (except maybe on e-bay). Usually it's just raw points; which means that in most cases people renting are not using the 11 month window and are more equitably (if that's the word people want to use) competing with everyone else. In most of the cases where I've seen specific dates available, it looks to me like the reservation is a result of a change in plans.

Truthfully, what amazes me about this discussion every time it comes up (and it seems to be one of those that keeps coming up again and again) is how many people think that they should be able to control what I do with my points. I feel that I am in compliance with the contractual agreement that I signed with DVC. DVC apparently feels the same way, because they've been letting me rent points. DVC and MS are not clueless about rental activity. DVD wasn't clueless about this when they created the setup to begin with. I mean, have people really read the public disclosure documents? Those things talk about everything, down to the smallest detail. If DVD thought that renting points was going to be an issue, then I'm sure they would have had very explicit language in the POS about renting.

Another thought. If the system is so fragile, that people renting points are going to impact it, then the membership has more to worry about than the apparent handful of people with big blocks of points that are being rented. I would say that the system is not nearly as fragile as some who would have us believe that the sky is falling. DVC managed to make it thru the end of 1999 and 2000 with lots of people borrowing all of their points from 2000 into 1999 to make one last use of the free park passes and the whole insanity with people wanting to be at WDW for Y2K. DVC managed to do this without suspending banking/borrowing - if the system can survive that type of an onslaught, then I think it can survive a few people renting points.

 

[ripleysmom]

My biggest problem with the renters is when they scarf up the prime weeks and GVs and then rent them out for outrageous prices.

Grabbing a reservation that is difficult to get and making money off of it is like scalping. It's the same as when you finally get through at 9:05 on the ticket line only to be told that the concert is sold out. The next day, you see the ads from "ticket brokers" listing seats at that concert.

Just because we accept this as a way of life doesn't make it right IMHO.

Kimberly-Lucas and Ripley's Mom

 

[drusba]

As to Doctor P's question, I don't have the documents with me but there are several places where the documents state that the rooms can be occupied by and reservations made on behalf of the "owners," their "guests" and their "lessees." The last is a legal term that has only one meaning--a person who is renting from you. The documents also provide that an owner is required to notify MS when the owner is renting (that one was actually added in 2000). There are also provisions that require the owner to include in any lease agreement with a non-member a statement that the non-member will be subject to the same rules and regulations as the owner and if not included it is deemed to be contained in any such agreement.

 

[kem330]

Just an apology to mickey firefighter- I should not have used your situation as an example- I got carried away by the debate. Dsruba and Spruce make compelling points. But in my personal opinion, I agree with PamOKW, Dr. P, CRobin and Tink. The suggestion that ressies for guests (unless accompanied by member) be given a restricted time seems a reasonable solution.I would hate to lose our ability to rent, and I understand that we don't want to jeopardize this privilege. Perceived abuses are the concern here.

 

[Doctor P]

There was a missing word (which I have corrected now!) in my previous post. I am not advocating that renting be prohibited--just wanted to clarify that!

 

[Firefighter Mickey]

Thanks, but it really isn't necessary to apologize to me; I was not offended by your example.

Speaking for myself, I plan on fighting any attempts by other members to try and take away my rights with regard to how I use my points. Creating a 3rd class of membership simply because I need to rent more than some arbitrary limit of points is something that I find offensive. I pay my dues just like everyone else. DVC allows me to rent, and as was pointed out, know when I'm renting, and they've not had a problem with it.