DVC Resales take effect end of today! 3/18/11

[TomandRobin Senior Member Find all posts View Profile Close TomandRobin]

Today marks the beginning of the resale rules for purchases of DVC contracts on the secondary market.

After today, resales are no longer treated equally as direct buy purchases.

[gandalf252002 Senior Member Find all posts View Profile Close gandalf252002]

As a non DVC owner, what exactly will the difference be?

[mdurette Senior Member Find all posts View Profile Close mdurette]

It is my understanding you will now only be able to use the points for DVC resorts only.

[TomandRobin Senior Member Find all posts View Profile Close TomandRobin]

It is my understanding you will now only be able to use the points for DVC resorts only.

Correct.

No point use towards cruises, Disney hotels, RCI, etc.....just DVC resorts.

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

The rci membership is not being taken away.. DVC owners will still be able to exchange their timeshare usage with an exchange system, either RCI or an independent system such as SFX.

New resale buyers will not be able to exchange DVC points for stays at Disney properties that are not DVC Resorts. This includes cruises, hotel stays, and experiential vacations. These were never a good value anyway- so their loss should not have a big impact other than being used in the developer's sales tactics as a way of discouraging unsophisticated buyers from comparing developer pricing to resales.

In fact, what this change may actually do is encourage more DVC owners to sell quicker than they did in the past. One trend that was always consistent, is that as children became teens- the magic of the pixie dust lessened and staying at Disney became less attractive to families. As their DVC usage lessened, many owners would pool points to use for Disney cruises. This would often extend their DVC ownership period by approx six years as they vacationed elsewhere and simply used their points for a cruise by banking and borrowing to accumulate all their points into that middle year. Around the time of that second cruise is when many would decide to sell (this can be seen by the DVC contracts on the resale market that are either full of unused banked points, or depleted and stripped of the future point which often tells you whether they took that cruise or not!)..

Without that cruise option, I expect that there will be a distinct shortening of the average lifespan of a DVC owner and we'll actually see a larger number of new DVC resorts come into the secondary market at a faster rate.

DVC owners have always had a tendency to "trade up" into more adult oriented timeshare programs with destinations catering to empty nesters. Hilton and Marriott have always benefited greatly from this transition. With the change to RCI- I'd expect Hilton to now gobble up the lion's share of those who outgrow Disney.

[chriskre Super Moderator Find all posts View Profile Close chriskre]

DVC owners have always had a tendency to "trade up" into more adult oriented timeshare programs with destinations catering to empty nesters. Hilton and Marriott have always benefited greatly from this transition. With the change to RCI- I'd expect Hilton to now gobble up the lion's share of those who outgrow Disney.

Some of us never outgrow Disney.

[bnoble Senior Member Find all posts View Profile Close bnoble]

It is my understanding you will now only be able to use the points for DVC resorts only.

As Rich points out, not quite---you can still use them for RCI, as well as the BVTC options (Club Interwest, etc.) What you *can't* do is waste your points on bad-value "internal" exchanges into DCL, ABD, or Disney-owned hotels.

Frankly, I think DVC has done resale purchasers a favor here. If you want to cruise, take a guided tour or (shudder) stay in a hotel, you can rent the same number of points out, use the proceeds to buy what you want, and have money left over.

[longtimer Senior Member Find all posts View Profile Close longtimer]

Any chance this means that the cost of DVC resales will come down? That would make sense because the resales are being touted as "less valuable." Of course, that may be off-set by DVC buying up more resales in their ROFR.

[mdurette Senior Member Find all posts View Profile Close mdurette]

I have been a long time looker at DVC resales.
I am hoping that this will bring down the cost a bit - to me what they took away has no value anyway.

[bnoble Senior Member Find all posts View Profile Close bnoble]

I thought it would have no impact on pricing. However, there was a great rush to the exits---a lot of inventory at the big reseller sites turned over. So, someone cared about them, even though I too think the options had no value.

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

I actually think in the short term, prices may bump slightly but will decline again in the future unless Disney becomes aggressive again on ROFR.

What the "deadline" did accomplish is to push those considering buying resale to go ahead and sign contracts. This gobbled up many of the lower priced listings on the market. With Disney initiating another price increase for developer sales, this could encourage those sellers still on the market (and those new listings coming into the market) to initially price higher.

On the flip side, sales in the near short term may decline drastically. Again- many potential buyers were "hurried" into their purchases, so it may take some time before the buyer pipeline fills back up.. With less buyer activity, listing prices should drop again within about 6 months.

However, all this conjecture goes out the window if DVC starts exercising right of first refusal again which would push and maintain higher prices. It would be the perfect time for them to put some money into buybacks as the might get more price control bang for the buck in the upcoming market.

[bnoble Senior Member Find all posts View Profile Close bnoble]

I wonder what their cost of development is though. I have a sneaking suspicion it would be cheaper to build new, and that would also be easier to market. The differentiations to me suggest they have thrown in the towel on trying to prop up prices through ROFR---the market has gotten to the point that it is so large that they'd need a fairly substantial pool of capital to move the needle. They might have decided that capital is better invested elsewhere.

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

Great points.. With the decline in new construction due to the economy, their developments costs are probably as reasonable as they can be..

[rodbil7 Junior Member Find all posts View Profile Close rodbil7]

I currently own 200 points at Bay Lake Towers and that is not enough to stay at MK view and I am looking to add to my points but I rather just pay the maintenance, because of the resales out there I don't see the value of paying the upfront cost. I would be willing to add 400 points and just pay the maintenance. I don't even care if I can use it for hotels and cruises anyways cause its a waste of points, but I guess that will never happen. So I guess I just keep what I have. first time posting

[rikkis_playpen Diamond Club Contributor Find all posts View Profile Close rikkis_playpen]

There are two ways to accomplish your goal.. You can either purchase a resale contract to give you the additional points you need each year- or if this is just a one time reservation you can simply purchase a one time point usage from another DVC member. DVC still allows a one time transfer each year to and from one member to another. However- be aware that current market for rental points is between $10. to $13. per point. You won't find someone willing to accept just the m. fees.. I pay $10. per point and it's been difficult to find owners at that price for some time now..