Will a Rental Crackdown Reset DVC Resale Prices?

[crvetter]

Change of dates would make no sense to restrict only that of the primary name on the account.

Additionally even the primary name could possibly be granted on a very limited basis like 1 time ever few years or something to allow for extenuating circumstances.

In the end would make zero sense to have a full rebook when changing dates except when a date overlapped with the 11 month date possibly if you are trying to attack walkers. It would make sense to first curtail rentals though and seeing if that stopped the walking.

I’m jumping in late here. But there is a strong valid reason to allow for name changes without limits. That reason is because of DVC themselves. I like to book my 2 week vacations as separate weeks at 11 months that way at 7 months I can more easily book a different room. However, if you book with the same lead guest there have been instance where DVC sees them as a continuing stay and combines them. This severely limits my ability to more easily split stay at 7 months.

Another very simple reason would be I book a room (say a tower studio) for a family member. I can’t be lead guests on both rooms but at 11 months I can’t be 100% sure that family member can get the required visa to visit the US. So I might not want to cancel the room but offer it to a different family member instead (these would be all as gifts/free). Given lower occupancy rooms I can exactly be on both, nor would I be able to if I had another room at the same time. This scenario isn’t in vagrant violation of any rule with DVC and explicitly allowed by the POS (it says guests of the owner).

So in the above scenarios a limitation on lead guest changes very strictly limits my personal use and enjoyment of DVC. Which change contracts that explicitly limit an owner’s use and enjoyment of a real estate property isn’t usually looked so kindly by the courts (when the contract explicitly has allowed for it, and they don’t enforce anything differently). Unfortunately in HOAs, which your home resort is very similar to one, you can’t claim an interpretation of a rule years down the line counter to the one you’ve had in place. The courts are very strongly against that, which is why expect DVC introduced that new language (and they could as the sole voting member to the other associations maybe). Though any changes would be hard if it changes anyone’s right of personal enjoyment and use. Everyone bought into the same system (educated or not) so the footing was potentially equal. But DVC changing rules to be dracaenas again would be a direct bait and switch from what we all bought (not a lack of education by the buyer).

I do sympathize with people that can’t get what they want. But that’s DVD over promising those cheap rooms, no stopping of walking is going to make them easier. Because that walker has 100s (if not 1000s) of non-walkers wanting to take it. I personally think incremental (in agreement with you) change is better stop commercial owners, which is very explicitly forbidden in the POS for every resort ever sold. Problem is how do you define commercial, I think that’s probably pretty easy, they literally are declaring business income on it to the IRS so DVCMC could sue for that (not DVD since they aren’t the same) but it would come out as a cost to the association if they did so because it’s the association enforcing the associations rule, so owners want to front that cost?

 

[New Mouse]

We bought two AKV contracts but were never able to secure a Studio, 1 BR or 2 BR Value in October. We go that time every year, so we are well aware it is busy, but it turned out to be impossible. We have other points we can use for SAP so we sold them.

To this point, Disney guides actively advertised this value room as a perk as well to save points.

 

[CWTC]

But that’s DVD over promising those cheap rooms

I think this is a huge part of the problem - guides saying “you can get this room for 9 points a night” which sounds great in theory but doesn’t translate to reality but leads people to buy a minimal amount of points. We have acquaintances who love WDW and came back from a trip to tell us they bought direct AUL points because they could use those points to stay at AKL club level or stay in a BWV room for 9 points a night.

 

[tom1944]

But also one of the great things is you are buying it for personal use. If the violation of that rule leads to commercial use that diminishes the experience for enough people taking steps to insure the experience for them is not unreasonable.

 

[Robbie Cottam]

The IRS rule is puse is once you use it over

But also one of the great things is you are buying it for personal use. If the violation of that rule leads to commercial use that diminishes the experience for enough people taking steps to insure the experience for them is not unreasonable.

The rule say family non owner family members is personal use…. So I don’t see a violation there…..
if you’re trying to argue DVD is going to call letting my kids use my points as commercial use, well that will be an interesting dicussion

 

[MerlinandtheMouse]

The only thing that stops me from buying a DVC contract is the fact that I can rent direct from an owner. Did the math and it didn't make sense to buy. If I didn't have an option to rent from an owner, I would probably buy, cause it would still be cheaper then booking direct with Disney, but much higher then renting points.

Disney is very much hoping this is what happens with stopping commercial renters or people just go back to spending cash prices. And actually, you’re paying $18-22/pt for renting where owners, even with financing, are paying about $12-16/pt. There would be less benefit as an owner to rent if we didn’t also make something from the process. If you use it, buying a DVC membership will pretty much always give you the best price.

 

[zavandor]

For AKV Club, AKV Value, and BWV Standard in particular, demand far exceeds supply.

IMO, the only way to solve this is to reallocate points and make these high-demand rooms more expensive.

For example, if a BWV Standard View was only 1 point per night less than a Garden/Pool View Studio, you'd see nearly all these problems go away.

Instead, a BWV Standard View Studio is 9 points for a weeknight in January, while a Garden/Pool View is 15 points. 6 points per night is a huge difference!

Change the point charts so that a BWV Standard View Studio is 13 points per night while a Garden/Pool View Studio is 14 points. Do that and complaints that "I cannot get the room I want" would mostly disappear.

My understanding of the law and the official documents is that this is not allowed. A reallocation can only rebalance point within the same unit to balance demand over the full year, not to address demand across different unit sizes.
They've done it in the past but, since the 2020 original point chart was rolled back, they've not done it anymore. Let's say they risk being questioned in court if they try to do it again and they might not be willing to risk it.

 

[tx911]

You do have an equal chance … just out walk the walkers ….

Let me see if I have this straight.

Everyone books at 11 months with no walking = equal opportunity (not guarantee) to book rooms.
Everyone walks their reservations = equal opportunity to book rooms.

vs. our current situation:

Some people walk reservations while most wait until 11 months = advantage to the walkers

In other words, to have fair and equal opportunity to books rooms, every single owner must walk reservations, which we all know is a somewhat cumbersome process over many weeks or months.

I've heard all the arguments in favor of walking. Still don't like it.

 

[lowlight]

Let me see if I have this straight.

Everyone books at 11 months with no walking = equal opportunity (not guarantee) to book rooms.
Everyone walks their reservations = equal opportunity to book rooms.

vs. our current situation:

Some people walk reservations while most wait until 11 months = advantage to the walkers

In other words, to have fair and equal opportunity to books rooms, every single owner must walk reservations, which we all know is a somewhat cumbersome process over many weeks or months.

I've heard all the arguments in favor of walking. Still don't like it.

It’s simple.

Everyone has an equal chance to book rooms, it’s just some people have more of an equal chance than others.

 

[davidhr]

I agree it doesn’t make sense to do it, but it also doesn’t make sense to start making a whole bunch of rules that penalize owners from making and changing trips either.

So, if demand is too high then the best solution to curb walking or spec renting of high demand rooms is to rebalance the point charts which is, IMO, DVCs responsibility within a points based system.

I see. I’m also against adding rules that will limit modifications. That’s why normally I’m against these proposed changes.

I also think they should do something about spec renting. I have no issues with walking, but if it has to go to solve the renting issue, I’m in.

The most discussed solution is to limit modifications, and I’m totally against that.

The other solution that I quoted was the re-balance. That won’t hurt me in any way. In fact, it might improve my ownership immensely if by some way they reduce the points for a 1 bedroom.

But then that’s my point. Just because that solution benefits me, doesn’t mean it’s fair to others. A lot of owners with less points now will see a decreased value in their membership. That’s why I don’t think they should do that. I think the system we have now is the lesser of multiple evils.

So, because we’re all humans, these discussions are always the same. Different groups proposing modifications that will help them and against modifications that will hurt them.

 

[David K.]

Commercial Owners is not something I'm worried about. Disney cracked down on this years ago.

Can you elaborate on this? What's your definition of commercial in this context? Wal-Mart can't own contracts?

 

[Genie+]

No one is stopping grandma from adding owners

For certain situations I am sure Disney can give a waiver under certain circumstances

This avenue is one I always thought had the most potential with the least bother to owners. Not exact, I’m sure DVC has a much better idea how to proceed. This could be the road they choose to go down though.

If contracts are never repeating names 50% or more of the time, easy enough for the member to explain. Grandma’s family has high likelihood of having already once joined a trip or name sharing. As long as one of those people is on a reservation, it is not included in the non-repeating names. She probably wouldn’t even get flagged to begin with.

As far as taxing resources, this type of thing would be only a fraction of a fraction of transactions. First you have only a fraction of memberships crossing any line to begin with, second it’s only after long term batches of reservation happen that the account get addressed.

Change to the industry only needs a few examples. They don’t need to catch ALL the commercial rentals, just need a few extremely high confidence examples of wrongdoing. If those accounts do not communicate an explanation, send cease and desist notices. Don’t even bother with existing reservations. Go after the next reservations made and immediately notify renter and rentee of potential breech of contract. That happening over a few months would get picked up in the DVC community, and likely change common advice for securing a rental to include confirmation of being legit in the contracts.

I dunno… but I think we’re about to find out over the next few years.

 

[tom1944]

The rule say family non owner family members is personal use…. So I don’t see a violation there…..
if you’re trying to argue DVD is going to call letting my kids use my points as commercial use, well that will be an interesting dicussion

I am sure there is a process than can cover that.

 

[Nabas]

My understanding of the law and the official documents is that this is not allowed. A reallocation can only rebalance point within the same unit to balance demand over the full year, not to address demand across different unit sizes.
They've done it in the past but, since the 2020 original point chart was rolled back, they've not done it anymore. Let's say they risk being questioned in court if they try to do it again and they might not be willing to risk it.

Disney can change point charts all they want. However, the total number of points allocated to a resort cannot change.

What Disney was called out on a few years ago was the lockoff penalty. They changed the point charts so the booking a Studio and one-bedroom cost more points than just booking a two-bedroom. Since most lockoff rooms are booked separately, Disney was effectively (intentionally or not) squeezing more points out of DVC members, allowing Disney access to more DVC rooms.

After several DVC members discovered this and reported it, Disney adjusted the point charts so that the total number of points allocated to a two-bedroom was about the same as a Studio and one-bedroom.

Disney is fully within its legal rights to change point charts as they see fit, as long as the total number of points does not change.

 

[zavandor]

Disney can change point charts all they want. However, the total number of points allocated to a resort cannot change.

What Disney was called out on a few years ago was the lockoff penalty. They changed the point charts so the booking a Studio and one-bedroom cost more points than just booking a two-bedroom. Since most lockoff rooms are booked separately, Disney was effectively (intentionally or not) squeezing more points out of DVC members, allowing Disney access to more DVC rooms.

After several DVC members discovered this and reported it, Disney adjusted the point charts so that the total number of points allocated to a two-bedroom was about the same as a Studio and one-bedroom.

Disney is fully within its legal rights to change point charts as they see fit, as long as the total number of points does not change.

The original 2020 point charts did three things:

1. reallocate across sessions, this is allowed and they actually later did it again
2. increase the lockoff premium
3. reallocate across units (for example, they decreased bungalows and cabins and increased the other units)

They haven't done 2 or 3 since then.
DVC gave this as an explanation about the rollback: "due to members feedback", but they also said only a couple dozen people complained. How likely is that the Disney corporation rolled back a change that would earn them millions every year just because 24 people complained? I think it's very unlikely, so they might have been unsure what they tried to do was legal or at least were not sure they could win if challenged in court.
Given that the 2020 point charts had a reallocation across units and after they rolled it back they haven't tried again, I tend to take this as a demonstration that it's not allowed.
But, they've explicitly included in the CFW POS the possibility to reallocate across units. I am not sure if it's because of the different underlying structure (trust versus deeded ownership of the units) or if they've changed their mind about the older resorts as well. However, the fact they've written it doesn't mean it's legal. The VGF POS includes the possibility to increase the lockoff premium and yet here we are.

 

[kboo]

However, if you bring the point-per-night of two closer together, then the smaller (and significantly fewer in number) Value rooms become much less desirable. If, for example, a Standard View rooms costs only 1 more point per night than a Value room, then it's not a big deal to have to settle for a Standard View when you don't get a Value room.

Supply and demand. When something is really cheap, most want that more than something that is very similar but costs a lot more.

The other thing I realized, while thinking about all of this, is that expectations matter. Everyone here (still the educated few) say not to buy AKV "for" the value or club level rooms but just to treat them like a bonus when you do get them. And even if it were possible to rebalance across room categories (I don't care to know whether it's possible or not), I know my personality would still like to crow that I "won" a competition to get the lower point value room. Probably less so now that we have more than enough points.

And, having stayed in an AKV value 1br before, there's a reason why they are so much less - we had a fine view, but the room was definitely smaller. Having checked that off my DVC bucket list, I don't need to buy AKV points to try at 11 months or bother to waitlist. If I'm switching at 7 months I want the savanna room.

And back to expectations - and at 7 months I don't expect to get the hard-to-get room views anyway. If I'm only going to Aulani once, I will plan to book oceanview, and I am going to work those points and extract all the value I can from them (i.e. enjoying the view, scanning for pool chairs and texting DH where there are openings, lol)! It's all a matter of perspective.

What Disney was called out on a few years ago was the lockoff penalty. They changed the point charts so the booking a Studio and one-bedroom cost more points than just booking a two-bedroom. Since most lockoff rooms are booked separately, Disney was effectively (intentionally or not) squeezing more points out of DVC members, allowing Disney access to more DVC rooms.

After several DVC members discovered this and reported it, Disney adjusted the point charts so that the total number of points allocated to a two-bedroom was about the same as a Studio and one-bedroom.

I seem to recall recently looking at Riviera (?) a resort and the standard lockoff v. dedicated was a significant point difference. The bathroom setup in a lockoff is better for 2 families, and can sleep 1 more person - which is setup like VGF (but VGF may not have the lockoff premium).

I believe you are 100% correct! We bought in 1996 and I don't even think we had a PC at home back then. I had my big OKW binder (still have it) and I would look through all the pages with floor plans etc and decide what I wanted. I then looked at my checkbook-like register to see what we had for points and called. After reserving points I would make a note of resort, villa and points and deduct on my register. Very antiquated but I don't ever remember NOT getting what I wanted LOL!

My parents bought into RCI many many years ago and I remember flipping through those books to see where we wanted to go. I'd point to the luxe Hawaii resorts and my mom would be like, yeah, not happening; those get booked up by the owners.

 

[MICKIMINI]

Okay, so I did check out a few DVC *reservation mill* type companies (or whatever they are) and holy smoke! I had no idea they had grown to that level of rentals. DVC doesn't care if grandma allows her grandkids to use her 200 points or even rents them IMO. It is no wonder we don't have a snowball's chance in you know where of getting any type of value or low cost villa! It is a mill, churning out reservation after reservation, day after day.

Now DVC no doubt is not happy about losing a cut of that pie, however they have to realize it has the potential to lessen the chance of an owner getting what they paid for and hoped they *might* have a fair chance at getting. Nothing fair about these bots or whatever they are!

 

[kboo]

Going back to the OG question:

The resale contracts would have gone for sale anyway, it's not that the number of contracts for sale would change. But I'd hope and expect to see more loaded contracts, contracts with banked points, more variety to choose from, and those contracts are worth more! So I am going to go back and change my answer. I don't think it'll change resale prices because the number of contracts for sale won't change, and the ones for sale very well may be worth more.

 

[Sandisw]

I‘m not convinced but still looking into all the wording. So far-

“5. First Come, First Served Reservations. Reservation requests for DVC Resorts are taken on a first come, first served
basis. All Vacation Homes are reserved on a space-available basis. To request a reservation at their Home Resort, Club
Members may call Member Services or make a reservation online via the DVC Website no earlier than eleven (11) months prior to the desired check in day for a reservation of up to seven (7) consecutive days after the desired check in day.

6. Home Resort Priorities and Reservations at Other DVC Resorts.
a. Home Resort Priority Period.
1) From eleven (11) months through and including eight (8) months in advance of their desired check in day for
a reservation of up to seven (7) consecutive days after the desired check in day, Club Members have priority
access to make reservations at their Home Resort. During the Home Resort Priority Period, only Club
Members who have Ownership Interests at the Home Resort and who are using Home Resort Vacation Points
will be able to request reservations at their Home Resort.”

-the contracts are going out of their way to say things like desired checkin day.
There’s not a right to start booking sooner, so in no way does the ability to walk need to be preserved.

Why even bother explaining 12 and 13 month priority windows for Special Seasons Preference Lists if the system intends a way for owners to access this themselves, as below:

10. Special Season Preference Lists. Because of high demand for certain DVC Resorts or during certain periods, DVC
Operator may, but is not obligated to, establish Special Season Preference Lists at any one or all DVC Resorts. The purpose
of the lists is to provide all Club Members with opportunities to make reservations at high-demand DVC Resorts or during
specific high-demand periods. Club Members will receive adequate notice of the establishment of any Special Season
Preference Lists. All reservation requests that include a day covered by a Special Season Preference List are subject to the
following rules:
a. Club Members are added to a Special Season Preference List on a first come, first served basis by calling Member
Services. If more than one Special Season Preference List is established, either at a single DVC Resort or at
multiple DVC Resorts, then Club Members may sign up for each list separately. However, an Ownership Interest
may only be represented once per Special Season Preference List. Each Special Season Preference List is
administered independently of any other Special Season Preference List.
b. DVC Operator may institute minimum stay requirements for any Special Season Preference List. Reservation
requests that include a Use Day covered by a Special Season Preference List are subject to such minimum stay
requirements.
c. DVC Operator may impose limitations on the number of reservations allowed per Club membership. Reservation
requests that include a Use Day covered by a Special Season Preference List are subject to such limitations on
the number of reservations per Club membership.
d. Member Services may begin contacting Club Members on the Special Season Preference List up to fifteen (15)
months before the designated special season. Club Members will be contacted in the order that their Special
Season Preference List request was received by Member Services.
e. If a Club Member accepts a reservation offered by Member Services from the Special Season Preference List, the
Club Member will be removed from that DVC Resort’s Special Season Preference List after receiving a confirmed
reservation. Club Members will also be removed from the Special Season Preference List if they confirm a special
season reservation received through a cancellation. If a Club Member declines a reservation offered by Member
Services from the Special Season Preference List the first time it is offered, the Club Member’s name will remain
on the Special Season Preference List for one (1) additional year (if applicable).
f. The second time a Club Member declines a reservation offered by Member Services from the Special Season
Preference List, the Club Member’s name will be removed from that DVC Resort’s Special Season Preference List.
Club Members who wish to remain on the same Special Season Preference List must submit a new request to
Member Services. Member Services will add their request to the bottom of that DVC Resort’s Special Season
Preference List.
g. If a Club Member cancels a confirmed reservation made through a Special Season Preference List, the Club
Member’s name will not be returned to that same list. Club Members who wish to remain on the same Special
Season Preference List must submit a new request to Member Services. Member Services will add the Club
Member’s request to the bottom of a Special Season Preference List.
h. Special Season Preference Lists are not subject to the four (4) month Home Resort Priority Period. Special Season
Preference Lists are subject to a one (1) month Home Resort Priority Period. Therefore, during the thirteenth (13th)
month in advance of their desired check in day, Club Members have exclusive access to reservation requests for
Special Season Preference Lists at their Home Resort. Only Club Members who have Ownership Interests at the
Home Resort and who are using Home Resort Vacation Points will be able to request reservations at their Home
Resort for reservations that are the subject of a Special Season Preference Lists. Club Members who are using
DVC Vacation Points to request reservations at a DVC Resort that is not their Home Resort and that are the subject
of a Special Season Preference Lists may begin requesting reservations twelve (12) months in advance of their
11
desired check in day. All other Home Resort Priority Period rules apply to reservations made off of a Special
Season Preference Lists.
i. Member Services, in its discretion may institute a lottery system for selecting Club Members from a Special Season
Preference List to receive a confirmed reservation and impose other limitations and restrictions as it deems
appropriate.”

I will admit the word desired has an implication that is when you want to go.

But, it also says that it’s first come first serve and so if you go in on your 11 month window for your trip and rooms are gone, then that is a nature of the program.

It also doesn’t give DVC the authority to decide who has a valid reason for booking and changing, even if they do it right away and who does not.

So, I still contend that the current home resort rules are being followed, especially if you go in at 10 months and 23 days and get your room without an issue.

As already mentioned, the easiest way to help with the excessive demand to cut down on walking is to make the points difference between the views.

Do that, and no more big reason for walking, no reason to implement change rules and penalties for the membership.

And, I contend that is what DVC should do because their first priority is balancing as best they can

 

[eandt]

Whose points are the ‘rental mills’ actually renting out?