The resale process: From the seller's point of view

[rangermom]

We are contemplating selling our GCV contract to purchase Copper Creek. We don't utilize our GCV points to the max and how we vacation Copper Creek will work great for us and we love the resort. We have only stayed at the GCV twice since it opened.

So my questions for people that have been the seller's in the resale process:

1. How long does the process take? I know it all depends on when your receive an offer, but this is more wanting to know the experience once an offer is received.
2. How does the money from the sale affect our taxes if we immediately purchase a new contract?
3.Has anyone done this type of sell and purchase and if so, did you feel that it was worth the effort and time.
4. Does anyone have experience in selling their GCV contract? I keep hearing from people that GCV are in high demand and will be picked up quickly. This is a 125 pt contract with a use year September.

Part of me wants to jump in and try it, but the other part extra headache we don't need. TIA!

 

[wnielsen1]

As far as taxes go, you would have a capital gain if you sell for more than you bought (extremely likely for VGC). An option to reduce or defer taxes might be to try a section 1031 like kind exchange. If it is possible, that will require you to jump through certain hoops though so you would want to set that up before you do any buying or selling. Your next step is to talk to a tax advisor to see what your options are.

I'll let others answer on your other questions.

 

[supersnoop]

1031’s only apply to investment properties. You can adjust your cost basis by the amount of capital expenditures in the annual maintenance fees.

 

[Noelle]

Hi,
We just sold a 80 point VGC contract over the past month. It was kind of a special situation in that we literally only bought the contract in December when our guide told us there was no way to get points in time for the price increase. Ultimately, Disney did get the points we wanted in time but we had already entered into this resale agreement. All of our points are in the same UY and we made the decision to buy the direct points and then sell the resale points.

Answer for #1 - When we purchased the contract, we placed our bid on December 19th and points were loaded into our account by February 9th. We had the holidays in between and our sellers took some time getting their documents back. Selling it, we contacted the Timeshare Store on February 12th. It was listed on February 15th through their email and I was called at 7:15 am (we are on the west coast) that day saying that it was sold for full price. Disney waived ROFR on February 27th and we closed three days ago.

Answer for #3 - A couple years ago, we sold our SSR contract to buy VGF direct from Disney. It was the right decision for us because we loved staying at the Grand Floridian and always said that if there was a DVC built there we would buy. We really did not enjoy SSR - nice place, just not our cup of tea. We did sell the SSR contract at a price that allowed us to fully recoup what we had spent on it and a slight profit (minimal at best after commission) so buying the VGF points didn't feel too painful even though we knew were were losing some money in the whole deal overall. It's really a personal choice about where you want to stay and what you feel comfortable doing for it. It was worth it to us. I have enough points to book a studio, 1 or 2 bedroom at the Grand Floridian and not worry about fighting for it. (except maybe the studio pending the season.)

Answer for #4 - the contract that we bought I believe has a rare use year - February. It was 80 points with 80 +9 banked points for 2018 and all of it's points going forward. We bought it for $160 per point and sold it for $200 per point. Part of that increase in cost was due to Disney's direct price increase and then I believe the other factors were that it was a small contract with a rare use year and all of it's points. I would say use one of the resale tracking sites and see what is currently listed and comp out what you have. Then talk to a broker and see what they suggest listing it at. From there, you'll know how much people are getting for a contract similar to yours and you can calculate what the whole process will cost you.

 

[PatMcDuck]

Thanks for this info "You can adjust your cost basis by the amount of capital expenditures in the annual maintenance fees"

We are selling our BCV right now, I think we bought for $68 (or 70? I forget right now) and sold for $130.... I am not sure I know all those maintenance fees going back 17 years or so. But I will try to figure that out!

 

[kms75]

I'm in the middle of the process in selling by GCV contract. I originally listed with one company and wasn't happy, so moved it to another company that I felt has been more engaged with me. It was listed on 4/9, I had an offer on 4/15, it was sent to ROFR on 4/16 and passed on 5/3. Right now just waiting for estoppel and closing paperwork. I'm not sure how long after closing the funds are transferred to me, but have been told it could take up to two weeks.

 

[chalee94]

Thanks for this info "You can adjust your cost basis by the amount of capital expenditures in the annual maintenance fees"

We are selling our BCV right now, I think we bought for $68 (or 70? I forget right now) and sold for $130.... I am not sure I know all those maintenance fees going back 17 years or so. But I will try to figure that out!

He didn't mean *all* of the maintenance fees, just the tiny part allocated for capital expenditures. And you really should be running this by an experienced tax professional before you file anything...