First RIV resale contract sold for?

[KAT4DISNEY]

Astonishing is the correct word. The math does not make sense on these contracts, yet people continue to buy. This reminds me a lot of the housing market from 2002-2007. A few years ago I was all over these boards saying the prices for DVC exceeded the value proposition. The prices then continued to rise. It's a little unbelievable, but eventually something is going to change. DVC pricing is, in my opinion, a bubble, and we all know what happens to bubbles. With the housing market it took a recession for the bubble to pop. In this case we have expiration dates. Regardless, we all know what is going to happen, it is only a matter of time.

I think the math does more or less still make sense. Just not as great as it was. The comparison is the DVC room vs an onsite cash price for a Deluxe room. In this case you should be comparing BCV to the costs of a room at BC. Those prices have risen right along with the contracts. If you plan to keep to the end and don't want to hope and wait and stalk for special prices it works. Eventually that sunk cost is going to have to go down and that time is coming soon because it won't compare. It's better to buy SSR and book at BCV of course. If you can.

 

[ELMC]

I think the math does more or less still make sense. Just not as great as it was. The comparison is the DVC room vs an onsite cash price for a Deluxe room. In this case you should be comparing BCV to the costs of a room at BC. Those prices have risen right along with the contracts. If you plan to keep to the end and don't want to hope and wait and stalk for special prices it works. Eventually that sunk cost is going to have to go down and that time is coming soon because it won't compare. It's better to buy SSR and book at BCV of course. If you can.

Interesting. I agree with a lot of what you say here but I'm wondering why you compare to cash prices and not rental rates. I'd love to hear your thoughts on that.

Regarding cash prices, the cost of a point at BCV (assuming a conservative $140 resale price and today's dues) is $13.46 per year. Depending on the time of year, points requirements, and possible promotions, the difference between a cash room at Beach Club and the DVC cost can be very thin. But your point regarding the work and risk involved with stalking promotions is a valid one. Another reason why I choose to use rental as the comparison. That's how I come to the conclusion that the math doesn't make sense.

 

[RaymOOOnd]

Until recently I thought of the shorter contracts as a lesser asset. Now, with the relentless attacks on resale, rising dues, etc, I've begun thinking of them as a shorter (rather than longer) liability.

For example, if I buy BCV/BRV/BWV I know I won't be stuck paying dues for 20 extra years if I'm tired of using it and nobody wants to buy it from me.

 

[mustinjourney]

Interesting. I agree with a lot of what you say here but I'm wondering why you compare to cash prices and not rental rates. I'd love to hear your thoughts on that.

Regarding cash prices, the cost of a point at BCV (assuming a conservative $140 resale price and today's dues) is $13.46 per year. Depending on the time of year, points requirements, and possible promotions, the difference between a cash room at Beach Club and the DVC cost can be very thin. But your point regarding the work and risk involved with stalking promotions is a valid one. Another reason why I choose to use rental as the comparison. That's how I come to the conclusion that the math doesn't make sense.

A lot of people don’t look at renting points as equivalent to owning. You have to line up an owner well in advance of 11 months for BWV/BCV for food and wine, and there’s a good chance you’ll be paying $18+ per point now. And that price will likely just continue to go up.

Bottom line, with renting, you don’t have much control. That’s a big deal for a lot of people.

 

[Momtomouselover]

When I made my spreadsheets for comparison I used room rates with a 30% discount (in general I don’t stay onsite if only rack rates available). Renting points just doesn’t offer any flexibility and I need that at this time in my life. I know DVC isn’t entirely flexible but you can still cancel within your first 8 months and bank if need be (or move dates if you can).

I would consider buying Riv at $100 or $75 but only a smaller contract.

 

[CarolMN]

Until recently I thought of the shorter contracts as a lesser asset. Now, with the relentless attacks on resale, rising dues, etc, I've begun thinking of them as a shorter (rather than longer) liability.

For example, if I buy BCV/BRV/BWV I know I won't be stuck paying dues for 20 extra years if I'm tired of using it and nobody wants to buy it from me.

IMO, there are quite a few who agree with you.

Many of the long-time owners who are older (60's, 70's +) are fortunate enough to have enough disposable income to travel. We consider the shorter commitments to be superior to the 50 year contracts. I do not want to leave an obligation to my heirs, who may not want or be able to afford annual Disney vacations. Nor do I want to saddle an administrator with the task of renting or selling my interest. If the contracts are worth "close to zero" when we no longer travel, so much the better!

 

[Drewferin]

In looking at the Fidelity website the Dec 125 point RIV contract must have fallen through since the price was reduced to $160 a point and is now available... Interesting...

 

[denecarter]

The two contracts on Fidelity asking $170 will be more telling. One is “sale pending” while the other is still available.

There’s no telling what the agreed price is yet on the “sale pending”. This spring, I bought an Aulani contract through Fidelity. The asking price had been $98, but I got it for $85. But the “sale pending” listing had the $98 price.

 

[Drewferin]

It is no longer a sale pending contract.

 

[Madame]

It is no longer a sale pending contract.

Is it sold or back to for sale status?

 

[DGHProp]

Until recently I thought of the shorter contracts as a lesser asset. Now, with the relentless attacks on resale, rising dues, etc, I've begun thinking of them as a shorter (rather than longer) liability.

For example, if I buy BCV/BRV/BWV I know I won't be stuck paying dues for 20 extra years if I'm tired of using it and nobody wants to buy it from me.

Also the ones that bought resale and can use it at all 14 resorts even if it has a shorter contract in my opinion is a better deal than where the resales are heading with the new resorts coming online. Like you said shorter contract and can booked at 14 resorts...win win and who knows if Disney decides to offer an extension...might be a better win.

 

[KAT4DISNEY]

Interesting. I agree with a lot of what you say here but I'm wondering why you compare to cash prices and not rental rates. I'd love to hear your thoughts on that.

Regarding cash prices, the cost of a point at BCV (assuming a conservative $140 resale price and today's dues) is $13.46 per year. Depending on the time of year, points requirements, and possible promotions, the difference between a cash room at Beach Club and the DVC cost can be very thin. But your point regarding the work and risk involved with stalking promotions is a valid one. Another reason why I choose to use rental as the comparison. That's how I come to the conclusion that the math doesn't make sense.

That's a good point. It was a personal requirement. I've never been a good renter prospect as I need more flexibility so my own comparison is to onsite cash deluxe rates. I'd actually go offsite or to a moderate next before a rental with no cancellation possibilities because of my work requirements.

Looking at rentals though I'd put BCV rental rates in the $16 - $18 range although you could find them for less I'm sure but maybe not consistently. So if you definitely want to stay at BCV it still fits under the cost you apply to it. Plus it gives you control of the reservation, cancellation options and if you did decide to sell you might get some money for it depending on when that was.

 

[ELMC]

That's a good point. It was a personal requirement. I've never been a good renter prospect as I need more flexibility so my own comparison is to onsite cash deluxe rates. I'd actually go offsite or to a moderate next before a rental with no cancellation possibilities because of my work requirements.

Looking at rentals though I'd put BCV rental rates in the $16 - $18 range although you could find them for less I'm sure but maybe not consistently. So if you definitely want to stay at BCV it still fits under the cost you apply to it. Plus it gives you control of the reservation, cancellation options and if you did decide to sell you might get some money for it depending on when that was.

What you've basically described here is something that oftentimes fails to show up in all of the analyses that we perform on here, and that is the value of ownership. I'd be hard pressed to put a number on it, but there is something to be said for the ability to log onto the website, book a reservation, and then be able to modify it as you see fit over time.

 

[ELMC]

... and who knows if Disney decides to offer an extension...might be a better win.

I think there is a zero percent chance that Disney offers an extension, at least on BWV and BCV. If I were a DVC executive I would have a dart board in my office with the BWV point chart on it. 10 points for a studio during Food and Wine Festival is the steal of the century. I bet they can't wait to remodel and resell that resort at an exorbitant price while at the same time adding 50% more points to the booking requirements. They are sitting on a literal pot of gold with those two resorts.

 

[suemom2kay]

I think there is a zero percent chance that Disney offers an extension, at least on BWV and BCV. If I were a DVC executive I would have a dart board in my office with the BWV point chart on it. 10 points for a studio during Food and Wine Festival is the steal of the century. I bet they can't wait to remodel and resell that resort at an exorbitant price while at the same time adding 50% more points to the booking requirements. They are sitting on a literal pot of gold with those two resorts.

I don’t agree with this at all. It would cost $$$$ to reinvent BWV & BCV and then they would competing against DVD’s own new properties. In addition 10 point studios are only standard view at Boardwalk Villas. There are many more Garden/Pool, Boardwalk, and Beach Club studios which are 15/16 for most of Fall which is right in line with the other legacy resorts.

Is it a possibility that they won’t offer an extension? Sure, but definitely not ZERO percent. I think it is very likely they WILL offer an extension as that is EASY money without a lot of money needed to pour into major construction and lose out on revenue while the resort goes through this transformation. Lots of variables can and will happen before that decision is made.

 

[ELMC]

I don’t agree with this at all. It would cost $$$$ to reinvent BWV & BCV and then they would competing against DVD’s own new properties. In addition 10 point studios are only standard view at Boardwalk Villas. There are many more Garden/Pool, Boardwalk, and Beach Club studios which are 15/16 for most of Fall which is right in line with the other legacy resorts.

Is it a possibility that they won’t offer an extension? Sure, but definitely not ZERO percent. I think it is very likely they WILL offer an extension as that is EASY money without a lot of money needed to pour into major construction and lose out on revenue while the resort goes through this transformation. Lots of variables can and will happen before that decision is made.

That's exactly my point. The points charts are right in line with other legacy resorts such as SSR, OKW, AKV, etc. But these are two resorts perfectly positioned between two parks...one which just had a huge expansion and the other with year round festivals and is also going through a major renovation. There is no reason why BCV or BWV should be anywhere near those other resorts in points requirements. Look for the new point charts to rival BLT, VGF, PVB, and DRR.

An extension might be easy money, but it's also small money. They're going to be able to increase the points requirements by 50% easily and sell those extra points (as well as the original amount) for crazy high prices. There's no way they turn down that big of a payday just to avoid some construction costs.

Let's touch base in 2041 and see who was right.

 

[suemom2kay]

Let's touch base in 2041 and see who was right.

Will do!

I’m not saying your prediction is impossible, I just think it is way too soon to predict.

 

[ELMC]

Will do!

I’m not saying your prediction is impossible, I just think it is way too soon to predict.

Perhaps, but what fun is waiting? I also realize I'm being a bit hyperbolic when I say zero chance. Maybe 1%.

 

[Bearval]

Astonishing is the correct word. The math does not make sense on these contracts, yet people continue to buy. This reminds me a lot of the housing market from 2002-2007. A few years ago I was all over these boards saying the prices for DVC exceeded the value proposition. The prices then continued to rise. It's a little unbelievable, but eventually something is going to change. DVC pricing is, in my opinion, a bubble, and we all know what happens to bubbles. With the housing market it took a recession for the bubble to pop. In this case we have expiration dates. Regardless, we all know what is going to happen, it is only a matter of time.

These are the properties that are going to get crushed resale price wise when a recession hits regardless if it is as bad as 2007/2008. No one is going to be paying these high prices for a resort that has ~ 20 years left. These contracts will sell but at a much lower price and DVC will not use ROFR in a recession since they do not want to have to pay the maintenance fees and they also might be restricted in using ROFR since they may not be allowed to own over a certain percentage of the resort. They are not going to be buying back properties they cannot sell.

 

[The Jackal]

I think there is a zero percent chance that Disney offers an extension, at least on BWV and BCV. If I were a DVC executive I would have a dart board in my office with the BWV point chart on it. 10 points for a studio during Food and Wine Festival is the steal of the century. I bet they can't wait to remodel and resell that resort at an exorbitant price while at the same time adding 50% more points to the booking requirements. They are sitting on a literal pot of gold with those two resorts.

DVC sets the season points for resorts, September and October are traditionally a slower time for attendance at WDW, hence the lower point values for all resorts. It is a busy time for DVC due to lower point values. While there is the option of walking to HS, I doubt many people do it. People want to stay there because it has a lower point chart. Increase it 50% will change a lot of people’s minds. Small resorts and low point rooms seem to have the highest demand year round in DVC.