Most Economical DVC resort

[Jack_Sparrow_NJ]

I think to make this a little more accurate you need to decide on a “typical” family during a “typical” stay and what the points required would be. A family of five staying for a week in July for example.

 

[E2ME2]

I think to make this a little more accurate you need to decide on a “typical” family during a “typical” stay and what the points required would be. A family of five staying for a week in July for example.

Therein lies the rub! Typical is not an easy description. When it comes to DVC, there is not a one-size-fits-all solution, and that's the beauty of it. Your value on DVC will vary based on your unique criteria (family size/ages/budget/time of year/preferred location, etc) The good news is that the "point" system is very flexible. 7 Month reservations are still achievable, in which case (as my guide said a few times) "a point is a point", no matter where you buy in. The value is in how, when, and where you use those points. If you are a planner, and enjoy thinking about and planning for vacations years in advance, as I do, this is a very interesting & flexible timeshare to belong to. But it does require some planning ahead, which some people can't do as easily, or maybe have restricted travel windows due to school/work limitations. Even for those folks, if they have a preferred location, they can buy in at that resort and be pretty safe with the 11-Month window reservations! I think its a great system, and I used to be very Anti-Timeshare. I had some horrible experiences with other NON-DVC Timeshares that had turned me off, but I'm glad I finally looked into DVC!

 

[Spartan86]

Thanks to you both for posting your calculations. When we were considering DVC I had a file with probably 50 Excel sheets divided by resort - we only considered a few - with projections at various price points (resale) and annual dues growth - Too much Friday procrastination time available I guess Anyway, it helped to visualize the estimated real cost over time and was eye opening (watering) to say the least. It didn't largely steer or change our decision from what we thought we'd do, but it helped me to "see" how dues play out over time. I agree, too many variables for a one size fits all, but we can each tweek the calculations to see what we need. Or see what we want .

 

[BillPA]

the lowest cost would be the resort you will want to stay in most, having the lowest cost resort that you "hate" is not saving you anything. Buy where you want to stay, in the long run it's the dues that will cost you the most.

 

[Spartan86]

the lowest cost would be the resort you will want to stay in most, having the lowest cost resort that you "hate" is not saving you anything. Buy where you want to stay, in the long run it's the dues that will cost you the most.

Sage advice Bill. In that vein I'd say my sheets helped me quantify, a bit anyway the "what are you willing to pay for that" part of the decision of where to purchase. IOW how much more, or less would 11 month access to XXX vs XXX resort cost?

 

[BillPA]

You should also look at how many points will be needed for the unit size and time of year you will go most often. You will find a resort that may cost more will require less points for the same unit size/date and in the end cost less. It's not an easy calculation, so go with a resort you would most likely enjoy staying at and don't worry about a few $$$ more or less. Good luck with which ever you pick.

 

[mustinjourney]

It is pretty amazing even in my 10, 15 and 20 year calculations SSR is always #1. The compounded 6.5% on annual dues over my 10 year period was a nice catch

your spreadsheet doesn't take into account the value of the contract after 10 years -- in other words -- what you could sell the contract for and recoup. That would need to be subtracted out from the final cost.

also -- typical time value of money comments on initial purchase price -- it's not a simple cost divided by number of years left on contract...unless you have a 0% return on capital.

 

[KAT4DISNEY]

your spreadsheet doesn't take into account the value of the contract after 10 years -- in other words -- what you could sell the contract for and recoup. That would need to be subtracted out from the final cost.

also -- typical time value of money comments on initial purchase price -- it's not a simple cost divided by number of years left on contract...unless you have a 0% return on capital.

Agree. Regarding the calculation on the purchase price itself it has more basis in if one were keeping it for the life of the contract. For 10 year calculation you need to know what the future sales price would be. And what’s happened so far is nothing I heard anyone predict.

Barring knowledge whether some resort might increase more than another one could just look at the resort dues ordering and if using at 7 months booking the one with the lowest dues is the lowest cost and will be going forward as long as it stays lowest cost. One could look at resale price trends to try and predict if a resort shows it lags behind or is a leader but that’s really going to be unpredictable. If 11 months then you have to at least consider how many points a room requires for booking because it isn’t equal across all resorts.

 

[KAT4DISNEY]

FWIW I long ago created a worksheet that looks at room point requirements and cost when booking with points at the same resort. Setting aside AKV Value rooms SSR is still the most economical and with the standard view rooms it’s pretty unlikely to change any time soon. Then AKV standard. Then OKW and the SSR premium. That’s during Dream season in a studio. 1brs are SSR standard followed by OKW then BWV standard. Then with 2 bedrooms you actually have SSR standard view “costing” less than all 1brs except for their own 1brs, OKW and BWV and AKV standard views! Things vary a bit season to season with BWV standards being right in the mix but these are what you find in the middle of the road so to speak.

 

[Dean]

You can make the answer say about anything you want with different assumptions and factors. That said, often these type of calculations assume options that may not be true in 10-20 years and that's part of the risk. They also tend to ignore the time value of money which will favor the cheaper options going in. Then there are the options that would allow one to own less points to accomplish the same stays and options that one could use that are cheaper and accessible no matter where you own, like OKW usage.

Personally I would include the TVM/Opportunity costs and a 3.5-4% increase in dues. I'm not sure I'm OK with assuming any real value in 10 yrs, esp for HHI or VB. I'm certainly not OK assuming an increase in value the next 10 yrs like we've seen the last 10 years. Historically I've done calculations on various resorts. With those thoughts, SSR will be the cheapest long term, BLT second and OKW 2057 will be fairly close. At 10 years it's dependent on resale price and options, risky for HHI & VB. Actually HI & VB subsidized are likely to be the cheapest. Assuming WDW is the goal, SSR will be the best value. Considering usage, SSR used for standard, AKV for value and BWV for standard will likely come out ahead if you buy the lower points.

Ultimately it's still an expense with significant cost and long term risk and one needs to be able to afford both to participate.

 

[MrInfinity]

Do you own? Or are looking to buy? Wondering if the analysis has enhanced your decision or reaffirmed your choice? Nothing terribly surprising jumps out at me from your Total Cost rankings... the offsite resorts are still cheapest, non-deluxe locations next, followed by prime locations at the top. Even on a 10-year time frame, the decision is still going to be dominated by desire to get into a location over buying something because of cost, and we see that reflected in the prices. I do agree you're understating the higher end properties by not counting the time value of money. You should really times each total contract price by 1.6 (1.05^10) or whatever % you estimate. It won't shift the rankings much, but it will increase the cost spread.

Also I don't see the point to dividing Cost/Pt by the Years Left when you're only considering short-term ownership. Sure Poly has 48 and BC has 24. You conclude $3/yr for Poly and $6/yr for the BC but really you have to put up the FULL amount no matter which one you buy, and the price is basically the same ($147 vs $153). So to conclude Poly is ranked 3rd in cost/yr but BC is ranked 15th because you're amortizing the Poly over years you don't intend to own it is somehow flawed.

 

[zavandor]

You conclude $3/yr for Poly and $6/yr for the BC but really you have to put up the FULL amount no matter which one you buy, and the price is basically the same ($147 vs $153). So to conclude Poly is ranked 3rd in cost/yr but BC is ranked 15th because you're amortizing the Poly over years you don't intend to own it is somehow flawed.

But in 10 years time there is good chance the Poly will be worth more or less the same while the BCV will have 13 years left, so it's not unreasonably to think it'll be worth $60 less.
Everything save inflation or economic downturn.

 

[Mumof4mice]

But in 10 years time there is good chance the Poly will be worth more or less the same while the BCV will have 13 years left, so it's not unreasonably to think it'll be worth $60 less.
Everything save inflation or economic downturn.

In 23 years, Poly will still be worth something, while the 2042 resorts will be worth exactly $0.

 

[Cyberc1978]

Personally I would include the TVM/Opportunity costs and a 3.5-4% increase in dues.

To me the TVM would not apply as I would have spent the money on vacations anyway. Also I dont invest my money and banks in my country dont give any interests. So if I just had the money in my bank account they would loose value compared to inflation.

 

[Cyberc1978]

In 23 years, Poly will still be worth something, while the 2042 resorts will be worth exactly $0.

While I agree that in 2042 the value will be $0. IMO in the years leading up to 2042 the value will be in the ballpark of $19(OTUP or whatever cost pp renting is demanding) - dues x remaining years.

 

[Mumof4mice]

While I agree that in 2042 the value will be $0. IMO in the years leading up to 2042 the value will be in the ballpark of $19(OTUP or whatever cost pp renting is demanding) - dues x remaining years.

Agree. $19(OTUP or whatever cost pp renting is demanding) - dues - closing cost averaged over remaining years x remaining years. At some point it will become not worth the hassle for the seller and the buyer. I'm interested to see when that might be.

 

[Wakey]

I think if you want to stay at WDW in the most economical way on DVC, SSR will for the foreseeable future be the best 'bet', but too many variables to be absolutely sure.

 

[zavandor]

While I agree that in 2042 the value will be $0. IMO in the years leading up to 2042 the value will be in the ballpark of $19(OTUP or whatever cost pp renting is demanding) - dues x remaining years.

The maximum resale value will be: ((OTUP - dues) * remaining years) - closing costs

As we get nearer the expiration, for many it may not be worth the hassle to do all the resale process to get just a few years of use. We also don't know which kind of restrictions DVC might put in place for the last few years (cancel banking? Limit borrowing?). I think when the contracts will have 2-3 years left they'll be unsellable.

 

[Dean]

In 23 years, Poly will still be worth something, while the 2042 resorts will be worth exactly $0.

And leading up to that they'll be likely lower than zero at some point in that they'll represent liability with out resale value and it's possible the dues will be more than OOP would be.

To me the TVM would not apply as I would have spent the money on vacations anyway. Also I dont invest my money and banks in my country dont give any interests. So if I just had the money in my bank account they would loose value compared to inflation.

That's a personal choice you've made but from a financial principles standpoint it still holds. I do not believe you would have spent all of the money applicable (up front and dues) on vacations in the first few years of ownership. The way I look at it is for resale I assume half as bank interest (MM, CD's) and half as long term investment dollars. That averages out to around 5% looked at on the whole in my view right now with 2% CD's and 8% long term. For retail I'm more 1/3 short term and 2/3 long term so I assume more like a 6% return. Still I don't participate in the thinking that I'll spend it because I wouldn't have made anything on it anyway, I want to be a better steward of what's been entrusted to me than that. I want value, real and significant value, when I'm spending that much money and making that much long term commitment. But certainly value runs further than just the financial aspects.

 

[KAT4DISNEY]

While I agree that in 2042 the value will be $0. IMO in the years leading up to 2042 the value will be in the ballpark of $19(OTUP or whatever cost pp renting is demanding) - dues x remaining years.

The maximum resale value will be: ((OTUP - dues) * remaining years) - closing costs

As we get nearer the expiration, for many it may not be worth the hassle to do all the resale process to get just a few years of use. We also don't know which kind of restrictions DVC might put in place for the last few years (cancel banking? Limit borrowing?). I think when the contracts will have 2-3 years left they'll be unsellable.

The value will still be how it compares to paying cash for a room directly from Disney to stay in similar accommodations onsite. Dues and closing costs will be factors in the calculation but not the basis of value. I think that's often the flaw in deciding the value of the 2042 resorts and why some have been surprised at their rise in prices after trying to use a straight line depreciation.