New Definition of Rental Activity?

[Sandisw]

What’s your definition of ‘resale’? They are points that are resold. You don’t buy them from Disney as you buy ‘new’ points that no one has owned before.

Resale contracts are contracts bought from someone other than the developer.

Contracts bought from a developer are brand new contracts created for that specific owner, deeded to a specific unit.

 

[LoveToDisney]

Just to clarify, points bought from DVD are not resale points, even if DVd takes back via foreclosure or RoFR.

They go back into the pool of points to sell, original contract voided, and are no different than what they were before anyone ever bought them.

DVD does continue to sell points at all their resorts, but that action doesn’t turn them into resale as any points you buy direct are developer points.

Not too sure that’s exactly true for the SOLD OUT resorts. Long ago when we wanted to add points to our BWV contract and talked to our advisor, they came back with the correct number of additional points we wanted but it was broken up into several small contracts because that’s what they had available from ROFR…she said I would have to wait longer if I wanted it all together. Since Disney was still paying all closing costs at the time, we took the small contracts. Because we bought thru Disney for our additional points, they seamlessly become just a subset of the total number which is really nice so you are right that the points act exactly like “new” points when bought thru DVD…the difference is they are still in the “contract blocks” from original purchaser if all they have is small contracts.

 

[MICKIMINI]

There is such a tiny *profit* made on rentals for most people (not talking the big guys)! If you pay $10 per point for MF's and rent at $19-20, that is a gross of $9-10 per point. Assuming most owners are at least in the 20% tax bracket, that lowers the *profit* down to $5 or less per point. If the average rental is 150 points (a guess) that is only $750 or less after taxes. This doesn't count what you paid for the points to begin with!

Hardly a money maker for someone just trying to salvage points due to a family health issue or scheduling conflict. Stuff happens. I really don't believe DVC is going after the casual renter.

 

[DonMacGregor]

Not too sure that’s exactly true for the SOLD OUT resorts. Long ago when we wanted to add points to our BWV contract and talked to our advisor, they came back with the correct number of additional points we wanted but it was broken up into several small contracts because that’s what they had available from ROFR…she said I would have to wait longer if I wanted it all together. Since Disney was still paying all closing costs at the time, we took the small contracts. Because we bought thru Disney for our additional points, they seamlessly become just a subset of the total number which is really nice so you are right that the points act exactly like “new” points when bought thru DVD…the difference is they are still in the “contract blocks” from original purchaser if all they have is small contracts.

Even though we buy "points", those points represent a fractional percentage interest in a particular "Unit" at a particular resort. Units typically aren't rooms, but some combination of multiple rooms. Because contracts are deeded real estate interests, the fractional interest all has to come from the same unit.

Say Disney is ROFR'ing contract's at OKW, for example. They might get back 25 points from Unit 1A, and 100 points from Unit 5C, and 50 points from Unit 3C. A total of 175 points. Even if you came along and asked DVC to sell you 175 points, and even though DVC just ROFR'd 175 points, they can't be combined into a single contract because they come from different Units and would represent an ownership share split between three units and they can't do that. Therefore they'd have to sell you three separate contracts. One of the long-debated reasons why DVC might decide to ROFR a particular contract has been because they see a Unit that they know they can easily combine with what they already have into a bigger contract.

They can't combine units in a new direct contract either, but they have so many points available, and can declare a new Unit when whatever they are selling starts to get low, that it's "never" an issue.

 

[heynowirv]

There is such a tiny *profit* made on rentals for most people (not talking the big guys)! If you pay $10 per point for MF's and rent at $19-20, that is a gross of $9-10 per point. Assuming most owners are at least in the 20% tax bracket, that lowers the *profit* down to $5 or less per point. If the average rental is 150 points (a guess) that is only $750 or less after taxes. This doesn't count what you paid for the points to begin with!

Hardly a money maker for someone just trying to salvage points due to a family health issue or scheduling conflict. Stuff happens. I really don't believe DVC is going after the casual renter,

There is such a tiny *profit* made on rentals for most people (not talking the big guys)! If you pay $10 per point for MF's and rent at $19-20, that is a gross of $9-10 pernt to put out of bus point. Assuming most owners are at least in the 20% tax bracket, that lowers the *profit* down to $5 or less pera point. If the average rental is 150 points (a guess) that is only $750 or less after taxes. This doesn't count what you paid for the points to begin with!

Hardly a money maker for someone just trying to salvage points due to a family health issue or scheduling conflict. Stuff happens. I really don't believe DVC is going after the casual renter.

I agree with that on who Disney wants to go after. It's the buyers who want to be rental agencies (undeclared of course) that they want to put out of business.

 

[Sandisw]

Not too sure that’s exactly true for the SOLD OUT resorts. Long ago when we wanted to add points to our BWV contract and talked to our advisor, they came back with the correct number of additional points we wanted but it was broken up into several small contracts because that’s what they had available from ROFR…she said I would have to wait longer if I wanted it all together. Since Disney was still paying all closing costs at the time, we took the small contracts. Because we bought thru Disney for our additional points, they seamlessly become just a subset of the total number which is really nice so you are right that the points act exactly like “new” points when bought thru DVD…the difference is they are still in the “contract blocks” from original purchaser if all they have is small contracts.

In your case, they had to do that because what they had available to sell were assigned to different units. You did not take on the previous owners contract because those are null and void when they are bought back.

Your contracts were still new contracts, with different numbers attached to them and developer points.

 

[Robbie Cottam]

Just to clarify, points bought from DVD are not resale points, even if DVd takes back via foreclosure or RoFR.

They go back into the pool of points to sell, original contract voided, and are no different than what they were before anyone ever bought them.

DVD does continue to sell points at all their resorts, but that action doesn’t turn them into resale as any points you buy direct are developer points.

Can we call the points DVD sells at sold out resorts experienced points rather that resale ?

 

[Sandisw]

Can we call the point DVD sells at sold out resorts experienced port rather that resale ?

Hahaha. I just like people to have an idea of what happens because I think using the same terms can confuse people.

It’s why when you buy points from DVD you get all the benefits.

 

[Grumpy by Birth]

Just to clarify, points bought from DVD are not resale points, even if DVd takes back via foreclosure or RoFR.

They go back into the pool of points to sell, original contract voided, and are no different than what they were before anyone ever bought them.

DVD does continue to sell points at all their resorts, but that action doesn’t turn them into resale as any points you buy direct are developer points.

True. I was making a comparison that they are "like" resale points because Disney bought them (via ROFR) from an owner and then "resells" them to someone else. As you said, Disney then gets to convert those previously owned points back into pristine, new, direct points and sell them at full price as a direct contract with full benefits as if they were never pre-owned.

 

[grahf1234]

Meanwhile, it’s become harder to book the most desirable dates —whether low point rates or holiday breaks—for home resort owners (and nearly impossible for SAP points users) to book more than a few nights at a time. Yes, it pushes some of us to just blow more points on $$$ categories but others get frustrated with the system and stop buying points or sell their contracts. One of the major reasons I am not considering VDH at this time is that I suspect availability will suck once it sells out, even within the home resort window.

Totally agree with this. Recently bought in, and even with all the research I did prior, I had no idea how competitive things get at popular times even at 11 months out.

If a major portion of direct sales are made by pre-existing owners, then having those booking difficulties must not be good for business. I know we’ve also stopped thinking about any add-ons for now since I’m afraid it’ll be a repeat experience of what I just went through doing my first reservation, just with even more points/money on the line and the potential for yet a bigger disappointment/frustration.

If indeed commercial renters are causing this much strain, to me personally I’d much rather be able to get more out of my points reserving what I want than having a robust rental market that I can potentially utilize to rent out my little sum of points.
If it’s a binary choice either be able to rent or have better availability to use my points I’d pick the latter.

 

[MerlinandtheMouse]

If indeed commercial renters are causing this much strain, to me personally I’d much rather be able to get more out of my points reserving what I want than having a robust rental market that I can potentially utilize to rent out my little sum of points.
If it’s a binary choice either be able to rent or have better availability to use my points I’d pick the latter.

Very much agree with this. We can’t know the real numbers of how many reservations are booked by commercial renters but it is more than a little suspicious there are so many of those super difficult to get rooms available on the rental market all the time.

And it’s not like we can even point to it just being that there’s more DVC members now than there has ever been. There maybe merit to that argument for availability at the 7mo mark but at 11mo the amount of people vying for reservations at AKL or CCV should be pretty stable. And as a newer member, my personal experience is too short to say for fact, but it seems to be the general consensus from my readings that bookings have become more difficult in recent years.

Maybe the simple answer is that more people just want to book at certain times of the year now than they did before but I’m not sure I buy that as the whole picture. I’m aware it won’t resolve the whole issue but even if it frees up 5-10% of the rooms, that’s 5-10% better of a chance than I had before.

 

[theMoreDisneytheBetter]

I’d love to know how the web bot does it.

 

[DL1WDW2]

DVC has a simple way to track these transactions because the reservations are always in a numerical order . If I was using a bot they all would show transactions that reflect this quickly and clearly for DVC to determine this commercial activity
. Seems like an easy way to limit it to only so many per year and track the abusers In these types of transactions.

Currently I have 5 small reservations with only my name on the reservation as one guest in room .
I will eventually call member services to add family but this could technically be a bunch of reservations I might decide to rent . I guess that would help differentiate abusers also.
We are innocently using just 1guest/1room to check and grab quickly to not lose availabiliity but it might look suspicious to an automated system monitoring activity…?
Would that be a concern for me ? I have never rented and never will .
Has anybody ever received a letter of warning along with clarification of rules?

 

[theMoreDisneytheBetter]

There is a world of difference between 5 reservations where you stay on all and potentially hundreds, especially if you add “Jim smith, Jane smith, and Joe smith” to “Janet smith” and the 4 of you travel together frequently.

 

[Sandisw]

I have deleted several posts that were discussing a website that is in our boards filter. You may not discuss, in anyway, information from a site in our board's filter. That includes sharing what you see there. If the site can not be shared, then neither can specific information you are finding on that site.

 

[DL1WDW2]

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[kneely58]

The following is an excerpt from the new CFW Master Declaration:

View attachment 830702

It doesn't appear to be in the new POS (yet), but there is now at least one resort with a less ambiguous definition of commercial activity, and it specifically addresses a pattern of renting confirmed reservations (not just points) or frequent occupancy by others of such reserved accommodations. Note also, it says a "pattern" of renting reserved accommodations, not "frequent" renting. @Sandisw @Brian Noble

Also interested in the "creating, maintaining, or frequent use of a rental or resale website" language...

Thoughts?

This language is not new. Here are Section 12.1.2 and 12.1.3 of the Riviera Declaration (which are consistent with the CFW Declaration), for example:

12.1.2 Except as expressly stated in this Declaration otherwise, use of Vacation Homes or the Common Elements commercial purposes or any purposes other than the personal use described in this Declaration is expressly prohibited.

12.1.3 The Association, through the Board or the Management Company, shall be the sole determiner of any use or activity that does not constitute personal use or constitutes commercial use. For example, the Board or Management Company may conclude that an Owner is engaged in a commercial enterprise as a result of a pattern of rental activity of reserved Vacation Homes or frequent occupancy by others of reserved Vacation Homes, other than an Owner or the Owner's family, use of regular rental or resale advertising, maintaining a rental or resale website, or frequent purchase and resale of Ownership Interests whether in the name of an Owner or those related to such Owner.

 

[DonMacGregor]

This language is not new. Here are Section 12.1.2 and 12.1.3 of the Riviera Declaration (which are consistent with the CFW Declaration), for example:

12.1.2 Except as expressly stated in this Declaration otherwise, use of Vacation Homes or the Common Elements commercial purposes or any purposes other than the personal use described in this Declaration is expressly prohibited.

12.1.3 The Association, through the Board or the Management Company, shall be the sole determiner of any use or activity that does not constitute personal use or constitutes commercial use. For example, the Board or Management Company may conclude that an Owner is engaged in a commercial enterprise as a result of a pattern of rental activity of reserved Vacation Homes or frequent occupancy by others of reserved Vacation Homes, other than an Owner or the Owner's family, use of regular rental or resale advertising, maintaining a rental or resale website, or frequent purchase and resale of Ownership Interests whether in the name of an Owner or those related to such Owner.

Sounds like everyone can go back to complaining about walkers then, and commercial renting can continue unabated. Carry on!

It does appear they they expanded the language beyond "owner" to include "partnerships" and "trusts", and unless it's in another paragraph, it looks like they added the "or through the use of entities, partnerships, or trusts; or the acquisition of a number of such interests in excess of the amount of the maximum permitted ownership whether in the name of an Owner or those related to such Owner or through the use of entities, partnerships, or trusts' language.

 

[kneely58]

Sounds like everyone can go back to complaining about walkers then, and commercial renting can continue unabated. Carry on!

It does appear they they expanded the language beyond "owner" to include "partnerships" and "trusts", and unless it's in another paragraph, it looks like they added the "or through the use of entities, partnerships, or trusts; or the acquisition of a number of such interests in excess of the amount of the maximum permitted ownership whether in the name of an Owner or those related to such Owner or through the use of entities, partnerships, or trusts' language.

True, I meant the portion underlined in the original post is not new. I've attached a redline against the CFW Master Declaration's provision. The language in CFW"s main Declaration is the same as Riviera's.

 

[DonMacGregor]

True, I meant the portion underlined in the original post is not new.

Yea. I'm surprised none of the usual POS/Master Declaration gurus didn't pick up on that. I just started the thread to keep the other CFW thread from getting clogged up like a middle school toilet. I can't be bothered reading either of the documents to that level of detail, so I just assume that if others say it's new, it must be new.