Are the prices too low?

[Kurby]

to book the Studio and pay cash at Wilderness for 7 nights in September costs $2855 but only takes 116 points so if you are getting them at $10 per point you've only paying $1160 for the same room saving almost $1700 which is a hell of a lot of money - but even at $14 per point it's $1624 which is still saving $1230.

Why all the math? i confused as to why points are going so cheap. a cash paying guest is is told they could save $1000 on the same studio would snap it up and they would be paying $16 per point - but if you go to the rent board and say points for rent $16 pp - you'd get slammed for charging way too much.

are people under estimating the value of the points?

maybe i'm missing something since i just started looking into renting our points and no i'm not trying to make a living off my one time possible rental of 210 points but it just seems a little low - does it devalue the resorts?

please - i'm not trying to start an argument here - i was just going over some of the numbers last night after reading a bunch of threads on the rent board i'm just very curious as to how the $10 per point came to be.

 

[MILLZ]

ever snce i became a member i couldnt believe how low the renting of points is. I mean it would be cheaper to rent than become a member but part of the reason there is a lot of risk involved but other than that i dont no why they are so low i would never rent them for so cheap.

 

[dianeschlicht]

And your observation is EXACTLY why I think it is not a good deal to buy points and rent them out. NOt worth the hassle for such a small return.

 

[simzac]

And this is why non members are always looking to rent points. They have figured out how great of a deal they are getting.

 

[crisi]

There are a number of reasons why the price to rent will always be significantly lower:

1) You are dealing with a private individual and not with Disney, this does carry risk
2) Cancellation policies are very different for a DVC rental - more risk
3) DVC rooms are different, and IMHO, not as good as Deluxe rooms (some DVC members like them better - but since they added a fridge to Deluxe rooms - a DVC studio is a worse deal for most families because of the pull out.)
4) No Mousekeeping
5) Finding a member to rent from, making rental arrangements, is more effort than calling CRO or booking online.
6) The rental customer is different from the CRO customer. People booking DVC rentals are often looking to "get a Deluxe resort at moderate (sometimes even close to value) rates." People booking Deluxe resorts through CRO are just looking for Deluxe resorts and are willing to pay more.
7) The DVC rental market has a number of suppliers with very low initial costs and a number of suppliers only really interested in recouping dues. As long as SOME people are content with $10 per (which is not a bad margin if you bought your OKW points at $58 - or if you are only trying to cover your $4.50 dues because you aren't going to use your points this year) there will be points available at that rate, and the expectation will be there that points are available at that rate. (We have seen movement toward $12). Its going to be hard for anyone who wants $14 or $16 to compete when someone else will occationally offer their points for $9 to get rid of them.
8) And let me say this again, you are dealing with a private individual and different cancellation policies.

I think renting is a cool way to recoup costs if you have a year or two where you can't use your points. But its a poor business deal - the margin isn't there. And I think if points do go up in price, the demand will diminish as renters move back to moderates.

 

[Chuck S]

DVC was not designed as an income generator for members, but rather to give us the ability to rent occasionally when we couldn't use all of our point. Even at $10 per point owners will recover dues and their initial purchase price on the points.

Remember, also, that as renters "compare" renting to reservations through CRO, and they don't perceive it as much of a value without daily housekeeping services...they want a full hotel services from your rental...and housekeeping is $30 per day minimum, now. Plus if they want extra towels, another $6.

I think rental prices will bump to a $12 to $14 average price during this year, depending upon the economy.

However, if I rented, given I paid $51.50 average for my points, $10 would be fine with me, though I have no intention of renting. And this hold true for many owners, that purchased under $85 per point.

 

[dianeschlicht]

DVC was not designed as an income generator for members, but rather to give us the ability to rent occasionally when we couldn't use all of our point. Even at $10 per point owners will recover dues and their initial purchase price on the points.

Remember, also, that as renters "compare" renting to reservations through CRO, and they don't perceive it as much of a value without daily housekeeping services...they want a full hotel services from your rental...and housekeeping is $30 per day minimum, now. Plus if they want extra towels, another $6.

I think rental prices will bump to a $12 to $14 average price during this year, depending upon the economy.

However, if I rented, given I paid $51.50 average for my points, $10 would be fine with me, though I have no intention of renting. And this hold true for many owners, that purchased under $85 per point.

I totally agree, Chuck. I have not rented, and don't intend to unless I ever end up in a situation where I can't use points before they expire. Since I have about 5 years ahead of point usage mapped out....that's not likely to happen anytime soon!

 

[wildernessDad]

My current cost per point ratio is under $10 per point for both VWL and AKV, including any interest paid.

I do feel that renters are undervaluing points when they charge 10, 11 dollars per point.

What do you think they are worth per point?

 

[calypso*a*go-go]

Boy, I wish I had a dollar for how many times this subject comes up!

Yes, the points are valued too low. But everyone has different circumstances as to why they are renting out their points and how badly they need the money.

But the real gist of this is no one can dictate to others what to do with their points. So even though a large percentage of members feel their investment is being de-valued due to rental transactions, there's not a whole lot than can be done about it except get frustrated.

 

[Deb & Bill]

As long as someone is asking $12 a point, someone will ask $11 a point to undercut them and make sure their points get sold. Or if someone is asking $11 a points, someone will ask $10 a point. You get to a level where no one wants to go any lower unless it is a firesale and you really don't see to many of those any more.

 

[Mamiamjo]

The rental market will always be significantly lower than rack rate. Even most people renting a deluxe room are using some kind of discount (does anyone really pay rack rates?). As a base price you realy need to use the "discounted" rates isntead of rack rates. Due to all the things mentioned above (risk, cancellation policies etc.), if the price gets too close to the rate they can get (with discounts) from Disney, people will rather rent from Disney directly.

 

[momba#9]

I'd agree with Crisi.

If I were going to rent points from a member(which I'm not) it would have to be at a good savings. If not, I'd rent from Disney and book a Deluxe.

Sorry but I'm not comfortable renting on either side of the equation, out or in. I'll use my points and if need be I'll try for a discount through DVC on a cash room. One time of getting burned by a scamer and all of the savings would be gone not to mention a vacation ruined.

The market dictates price so I'll say the price is where it needs to be. If everyone could get $14/pp I'm sure they would be.


Mike

 

[mikron]

I have no problem getting $11.00 if I need to rent points, for 2008 I am going to $12.00 per point and don't expect a problem. If you watch the board post at $11.00 per point gets as many hits as ten or nine. Renters know the savings and need to make reservations when available, a dollar more or less doesn't matter to them.

 

[Deb & Bill]

I'd agree with Crisi.

If I were going to rent points from a member(which I'm not) it would have to be at a good savings. If not, I'd rent from Disney and book a Deluxe....

Likewise, if I were going to rent points (heaven forbid!! We need all we can get!), I'd want to make sure I was compensated for my trouble in making the reservation and make sure I got my payment in a timely manner. Some of those on the R/T Board can really be needy at times.

 

[calypso*a*go-go]

I think the biggest problem is people that wait too long before they realize they won't be using the points themselves. By that time they've gone past some of the banking deadlines and understand very quickly that they're going to lose a whole bunch of points if they don't do something with them quickly. And, of course, one of the worst things you can do (IMHO) is include the information in your post that they are expiring soon...that automatically brings in low-ball offers because there are people that read the Rent/Trade Board on a daily basis looking for "fire sales". What's really sad is some of the worst offenders of this are fellow DVC owners that were looking to transfer points in on the cheap-cheap and rerent them for a higher amount. For the most part, I think the new restrictions on transfers have put an end to some of that madness.

 

[Chim Chiminy]

I have watched the R/T board off and on.
I feel the prices are too low, definately undervalued but that is just my opinion.

Renting for more than $10 per point can be done....it just takes patience.

I recently rented a res. for $14 a point and am happy with that. I had one person say it was more than they had hoped to spend, so I just didn't bother to respond.
Even at that price it was a bargain, a savings of over $700 for the timeframe from Disney for a 5 night stay at BWV.
Getting a definate, ready to commit renter took a couple weeks, but I just hung in there and held firm to the price.

 

[BillPA]

I think it's just that many owners don't have any concept of the value of money or the value of what they purchased. I bought for my pleasure not to give some stranger a real bargin and my expense. JMHO

 

[Starr W.]

I bought for my pleasure not to give some stranger a real bargin and at my expense. JMHO

Thanks Bill!

 

[ChefMickey]

I don't think they should go for less than $15/pt or at least half the total of CRO rates. Or somewhere in that neighborhood, whatever that averages out to. I hate the ones that say "willing to pay". And as someone else said, you should never tell anyone they are expiring. Definite LOW-BALL offers.

 

[DizWacko]

I don't think they should go for less than $15/pt or at least half the total of CRO rates. Or somewhere in that neighborhood, whatever that averages out to. I hate the ones that say "willing to pay". And as someone else said, you should never tell anyone they are expiring. Definite LOW-BALL offers.

Why is so hard to understand that the market dictates the price of points on the open rental market? A few people might agree that they SHOULD pay more based on comparable rooms at retail rates.. but thats not what the market dictates given the risks and benefits.