Will a Rental Crackdown Reset DVC Resale Prices?

[hilltopper152]

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.

Stopping of point walking is much harder then just competing for tough reservations which are the minority. Only reasonable thing I see is DVC working to counter bots which they have been unable to do across all their IT. I strongly vote against all flexibility and dynamic aspects of being a owner so somebody thinks they have a shot at booking CCV studios during Christmas. It's just not the majority.

 

[Unclelude]

I can with just 200 points hold onto a Tower Studio for 3 weeks some seasons and have the intention of just keeping the last week once the modification restriction is limited (just keeping adding days).

I was recently stalking for a tower night in April... After a refresh, the entire first week of April appeared! (Not my day).

After a couple of minutes, I thought "daaang, I should grab that!" ... Went back in and it was gone. Didn't last 5 min.

I thought it was another stalker that grabbed it or maybe wait-list... but... maybe it was a commercial-rent-o-bot?!!???!

<PITCHFORK OUT>

Down with the bots!!! Down with the bots!!!

 

[kboo]

Obviously resale values are going to be negatively impacted when (if) you remove commercial renting—you’re reducing the demand and absolute buying power in the marketplace while also adding contract supply.

not necessarily - the same contracts are being sold. Just that loaded ones are more likely to find their way to the resale market rather than being bought by a flipper, stripped, and put on the market as stripped until [year+1]

Commercial renter/strip and flip:
1. commercial renter buys loaded (200 pt) contract at instant sale price of P-20 ($20 pp discount to what they'd sell for on the resale market). This might be worth it to a seller who doesn't want to deal with offers, negotiations, ROFR, etc.
2. Commercial renter takes 3 years (2023 banked, 2024, 2025 borrowed) of points and makes 600 points worth of reservations charging $20pp = $12,000 to the CR. now the effective cost to the CR of this contract is P-80 because they saved $4000 at the initial purchase and netted another $12,000 in rental $$.
3. Commercial renter puts stripped contract on the market for P (price per point)
Say P = $150 (average price per point for that resort) and assume no transaction costs, time value of $:

The original seller gets = $130 x 200 = 26,000
CR pays 26,000 but:
Gets $12,000 in rental $
Puts on the market as a stripped contract at P. Even with heavy negotiating, say they sell at $140, that's $14,000 in profit! (plus we know even the stripped contracts sell for more than the "instant sale" price)

A savvy seller could strip their own contract, say renting 400 points at $18pp and get $7,200, and then sell their contract for $150pp, or even at $140 pp they'd get 28,000, for a total of $35,200.

Or the seller could sell their fully loaded contract at $160 even though it could sell for more and is worth more (because the market undervalues loaded contracts), they'd get $32,000. The new buyer has a choice of renting out the banked points because they can't use them - on this board, $15 pp would go super fast, and the seller will now have paid $145 pp ($3000) for those points (but easily passed ROFR at $160 pp)

As individual owners, I don't see how/why we are squabbling over the "morality" and ethics of walking reservations when individual owners on both sides of a resale transaction would benefit from stripping/flipping being reduced.

More loaded contracts for sale, more options for buyers and sellers. More variety to choose from.

 

[Hubalorian]

But it's not first come first serve if you go in at 11 months prior to your desired travel date (and "no earlier" than that, based on the plain language in the contract you read) and rooms are gone because someone effectively booked them 2 months earlier and then walked the reservations up to your date. It's one thing to say "well, we all jumped on at 8:00 and i just wasn't fast enough", but that's not the case.

The system only becomes "fair" when a new member tries to follow the process prescribed in the POS, is repeatedly denied the room of their choice, on their desired travel date, then (hopefully) finds out through whatever source, that for those dates they need to do this thing called "walking", which essentially means that at 11-months, you're really 2 months too late.

Now, I don't have a problem with walking, per se, (although I'd like it better if people didn't need to find out about it the hard way), but I do see the ease with which it can be abused and used to secure large percentages of the most desirable rooms by commercial owners using thousands of points and bots.

In that scenario you should also advocate for only being able to book one day at a time in the name of having equal shot at exactly 11 months. If myself and four others book all four rooms for the week of spring break at exactly 11 months out starting the Saturday before, that doesn’t leave any room for the people who wanted to start their stay on Sunday, or Monday because all of the rooms had already been filled.

I don’t love walking either but I don’t see how placing limits which may or may not be fair to all members solves the problem. It may make it more equal, more fair to some, but not fair to all.

I think the first step is to limit those who may or may not be taking advantage of the renting/ buy strip flip philosophy.

 

[DonMacGregor]

In that scenario you should also advocate for only being able to book one day at a time in the name of having equal shot at exactly 11 months. If myself and four others book all four rooms for the week of spring break at exactly 11 months out starting the Saturday before, that doesn’t leave any room for the people who wanted to start their stay on Sunday, or Monday because all of the rooms had already been filled.

I don’t love walking either but I don’t see how placing limits which may or may not be fair to all members solves the problem. It may make it more equal, more fair to some, but not fair to all.

I think the first step is to limit those who may or may not be taking advantage of the renting/ buy strip flip philosophy.

I should have put "fair" in quotes. I only used that term because it's thrown about so loosely around here. "Fair" often seems to be whatever set of circumstances or interpretation of the rules is most beneficial and best reflects how some of the posters on these threads want to use their specific points.

 

[Hubalorian]

I should have put "fair" in quotes. I only used that term because it's thrown about so loosely around here. "Fair" often seems to be whatever set of circumstances or interpretation of the rules is most beneficial and best reflects how some of the posters on these threads want to use their specific points.

That’s when it becomes tricky in determining what’s “fair”. We are in this situation because as DVC evolved it seemed like for many years, they decided to cut and paste the language in one contract to the next. When more people who have different priorities, budgets and travel time are added, the more complex the “fairness” of the booking window becomes.

My main point, is any change in how reservations are obtained will not create “fairness”. It may or may not create equality in the booking experience, may or may not increase/decrease fairness to some or all, or it may or may not add an added layer of frustration to booking the vacation.

 

[Hubalorian]

delete.

 

[Sandisw]

But it's not first come first serve if you go in at 11 months prior to your desired travel date (and "no earlier" than that, based on the plain language in the contract you read) and rooms are gone because someone effectively booked them 2 months earlier and then walked the reservations up to your date. It's one thing to say "well, we all jumped on at 8:00 and i just wasn't fast enough", but that's not the case.

The system only becomes "fair" when a new member tries to follow the process prescribed in the POS, is repeatedly denied the room of their choice, on their desired travel date, then (hopefully) finds out through whatever source, that for those dates they need to do this thing called "walking", which essentially means that at 11-months, you're really 2 months too late.

I will agree to disagree I don’t care who got the room when we are allowed 11 plus 7 days. Thst is the exact meaning of first come first serve.

At 8 am, 11 months out, anyone who wants to try for a room is eligible for any and all rooms that are left.

Heck, anyone can hold rooms that they may or may not use, taking them away from someone else who knows 100% their dates.

Where does it stop in micromanaging when and why someone is booking? We can debate that walking is more unfair than those who can’t book at 8 am due to life reasons, but of the result is the same, reasons don’t matter.

Where I do agree is with DVC stepping in to change the rules if they. So feel they have the info that too much abuse is going on…
which is what many of us have always said,

I’ll just leave it at that.

 

[miTnosnhoJ]

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

Walmart can own contracts for the purpose of providing vacations to valued employees. Walmart can own contracts for promotional purposes with valued suppliers or customers. But WalMart cannot make a business out of renting points to the general public. This is prohibited in the DVC legalese.

 

[GrumpyInPhilly]

I'm starting to consider buying SSR, just to have that lovely welcome home feeling of being able to get exactly what I want, whenever I want, at 11 months.

And I did just that in Dec. (already owned @ BCV)

 

[sndral]

Special Season Preference Lists may begin requesting reservations twelve (12) months in advance of their
11
…

Interesting sentence, as written it suggests that if they impose special season protocols I can request to be put on the list at 12 months +11 months = 23 months before my desired vacation, I’m a planner, but almost 2 years ahead of time .

A reservation cannot be split across Use Years.

For example, if you have a December Use Year but want a 7 night vacation to start November 28, it’s my understanding that you have to book this as two separate reservations.

We have a Dec. use year & normally go in Dec/Jan, but had to use up banked points last year so went in late Nov./early Dec.. I booked my November days at 8 AM online right at 11 months, at 9 AM I called member services & they added my December days to my November days - so a vacation crossing your use year can be booked as one reservation by member services but not online by you. It was a very long phone call. I called a second time a few days latter to add on the 4 additional nights we were staying - I wasn’t sure if I could modify to add them online so I didn’t bother trying.

I’m not sure if the big rental sites are in fact walking reservations, but who can/cannot walk & for how long is unequal based on which use year you have. For example, for those wanting a Dec. stay, Feb. use years have a 6 month head start over someone who has an August use year & folks w/ a December use year (the most common use year) can’t walk a Dec. stay at all.

I was a teacher and I can tell you that I could not take the time to book at 8 am when students were there.
…

That problem is easily fixed by opening the online booking window at midnight+1 minute. Personally, being on west coast time, I’d be much happier booking my vacation online at 9 PM my time rather than how I book now, getting up at 4:30 AM to be ready to book at 5 AM my time. DVC opening the window at midnight might make me happy but I’m betting it would make some east coast folks unhappy that they have to stay up so late.
This falls into the personal issues category in my mind, much like the grandma in a rest home hypothetical. Change always impacts some positively, some negatively, & some not at all. Since I’m not making a profit by renting my points, any changes made to end widespread commercial renting shouldn’t impact my bottom line & I’ll adapt to any inconvenience caused by the protocols created to end for profit renting. Plus, if it is effective, I should have a better shot at getting the reservation I want at my home resort at 11 months because the professional renters can no longer grab those time slots which I think is a good thing.

 

[Sandisw]

Interesting sentence, as written it suggests that if they impose special season protocols I can request to be put on the list at 12 months +11 months = 23 months before my desired vacation, I’m a planner, but almost 2 years ahead of time .

We have a Dec. use year & normally go in Dec/Jan, but had to use up banked points last year so went in late Nov./early Dec.. I booked my November days at 8 AM online right at 11 months, at 9 AM I called member services & they added my December days to my November days - so a vacation crossing your use year can be booked as one reservation by member services but not online by you. It was a very long phone call. I called a second time a few days latter to add on the 4 additional nights we were staying - I wasn’t sure if I could modify to add them online so I didn’t bother trying.

I’m not sure if the big rental sites are in fact walking reservations, but who can/cannot walk & for how long is unequal based on which use year you have. For example, for those wanting a Dec. stay, Feb. use years have a 6 month head start over someone who has an August use year & folks w/ a December use year (the most common use year) can’t walk a Dec. stay at all.

That problem is easily fixed by opening the online booking window at midnight+1 minute. Personally, being on west coast time, I’d be much happier booking my vacation online at 9 PM my time rather than how I book now, getting up at 4:30 AM to be ready to book at 5 AM my time. DVC opening the window at midnight might make me happy but I’m betting it would make some east coast folks unhappy that they have to stay up so late.
This falls into the personal issues category in my mind, much like the grandma in a rest home hypothetical. Change always impacts some positively, some negatively, & some not at all. Since I’m not making a profit by renting my points, any changes made to end widespread commercial renting shouldn’t impact my bottom line & I’ll adapt to any inconvenience caused by the protocols created to end for profit renting. Plus, if it is effective, I should have a better shot at getting the reservation I want at my home resort at 11 months because the professional renters can no longer grab those time slots which I think is a good thing.

Except that midnight plus one minute still could be a time where someone is in a job that doesn’t allow them to book…since owners live all over the world…

The point is that no matter when online booking opens, there will be owners who can not book right at that time…which means they will be at a disadvantage to every other owner who can…nothing DVC can every do that makes it fit perfectly with every owners personal situation.

Even going to day by day booking, which stops walking, would still not help the owner who can’t book when the window opens. Now, I think if they have bots doing booking and DVC shuts that down, then maybe we will see some difference…

But, I would bet a lot of money that no matter what, those AKV value rooms will still go within seconds pretty much all year round.

 

[sndral]

Walmart can own contracts for the purpose of providing vacations to valued employees. Walmart can own contracts for promotional purposes with valued suppliers or customers. But WalMart cannot make a business out of renting points to the general public. This is prohibited in the DVC legalese.

Walmart can own up to the max points cap - which is 8000 I think - I’m guessing that not many of Walmart’s valued employees, suppliers, and customers will get free vacations.
The new rules are targeting [pun intended] those who get around the max cap by creating LLCs & trusts & the like.

 

[GrumpyInPhilly]

Very late to this conversation and it's constantly being updated faster than I can read it. Haven't seen talk of this, but could a guest certificate system work to curb excessive renting? Like if the owner or associate member is not listed as a guest on the reservation, then you're allowed say 2 free guest certificates per UY and any additional guest certificates would cost money (perhaps more expensive to make them cost prohibitive, the more guest certificates you use?). Ultimately, I see this as an annoyance for Disney that they don't want to solve, but if money is being thrown their way, I feel they're more motivated to "solve" the problem.

 

[sethschroeder]

Just stop the bots.

As others have posted, there is technology available to do that, technology that would result in only a minor inconvenience to Members.

There really isn't any system that I know of that can't be beaten by a bot with a tiny amount of investment. Which these companies would easily have the incentive of beating. Even things like text codes can easily be worked around if needed.

Why not just change the rule to the owner of the points are required to use the points for a personal stay at least 50% of the time over a 3-year period.

If you own 100 points you need to use 150 or more over 3 years If you own the points as an LLC, the members listed have to be on the reservation and check in.

Its not written in the contract so would only work for new contracts. Additionally DVC has no issues selling to trusts and to companies they just dont want them taking it and renting them out commercially.

 

[sethschroeder]

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 is a system issue so it just needed to be corrected.

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.

Again system issue just need to be corrected.

So in the above scenarios a limitation on lead guest changes very strictly limits my personal use and enjoyment of DVC.

Nothing is limited they just need to update the system to correctly deal with those two scenarios.

If the 2nd example breaks some other rule than that needs to be addressed and called out so not sure if its there because its not allowed for you to have two rooms per the contract.

 

[sethschroeder]

Disney is probably looking at every third party rental as lost revenue.

Personally I think Disney is waking up to how they opened themselves up to legal issues with no enforcing the contracts that are in place. Its the same with the point chart adjustments. These are things that member services need to make a best effort of enforcing.

Otherwise if Disney allows someone to blatantly rent points commercially and not trying to stop them at all how can they say other parts of the contract are written in stone if challenged.

 

[Sandisw]

Very late to this conversation and it's constantly being updated faster than I can read it. Haven't seen talk of this, but could a guest certificate system work to curb excessive renting? Like if the owner or associate member is not listed as a guest on the reservation, then you're allowed say 2 free guest certificates per UY and any additional guest certificates would cost money (perhaps more expensive to make them cost prohibitive, the more guest certificates you use?). Ultimately, I see this as an annoyance for Disney that they don't want to solve, but if money is being thrown their way, I feel they're more motivated to "solve" the problem.

IMO, that changes the rules for personal use, which I don’t think they can do without a vote from owners.

Right now, there is nothing in the POS that defined an owner staying and their guests differently, so they can not limit how many reservations you can book for yourself or others…

What they can do is hold owners accountable when they believe that a membership is being used for commercial purposes. So, I am not sure that anyone who has friends or family using points outside of two times per UY would be a reasonable definition that its commercial renting.

 

[GrumpyInPhilly]

I might be doing the "math" wrong (someone please correct me if I have), but I think a FEB UY would provide the most walking advantage for a December reservation.

On March 1st, you'd be able to book for the following February 1st and walk the reservation forward to that December without crossing UY. I think you wouldn't be able to take advantage of booking a January reservation in February, because that would have you crossing UYs as you moved it forward.

JAN UYs don't exist. Otherwise JAN would allow for an even longer walk for a December reservation.

Again, someone please jump in if I've completely botched the logistics of this.

Hi fellow Grumpy. I was just thinking the same thing right before reading your post since I have a Feb UY and Mar is right around the corner.

 

[crvetter]

Walmart can own up to the max points cap - which is 8000 I think - I’m guessing that not many of Walmart’s valued employees, suppliers, and customers will get free vacations.
The new rules are targeting [pun intended] those who get around the max cap by creating LLCs & trusts & the like.

Well they can own more than 8000 it's just at that point upper management needs to authorize that. Overall the tricky thing with DVC is that we own Deeded Real Estate and they have allowed renting but not commercial renting. Back when they opened OKW they never envisioned how big it would get, and they never changed the language for this as new properties opened. I actually think the trust based product is probably just a way for them to skirt around some laws that are in place for deeded real estate purchases vs the trust which is probably treated very differently. A lot more can be done then when you don't actually own the real estate but own the right to use the real estate.