DVC resale changes coming!?!

[Nikisha421]

wow I'm so late this is news to me and an eye opener...

 

[tjkraz]

I agree with both of you here. ROFR won't dramatically effect market price. Like you said ROFR didn't help BWV go from $85 to $65 in just 4 years, the market did that. However, if the current value is $65 ROFR will, in theory, keep it close to that range (i.e. I wouldn't be able to get it for $45).

In this example, $45 isn't a market price...it's an outlier. It's the result of an uninformed seller--or a terribly desperate seller--not realizing that the points should command a higher price, combined with a buyer looking to take advantage.

The market price will eventually drop from $65 to $60...$55...$50 and lower. DVC will use ROFR to gobble up the outliers as it sees fit. But when the overall market is unwilling to pay a certain price, offers will fall and DVC will be forced to adjust its ROFR thresholds accordingly.

Since ROFR has been discussed, any theories as to why OKW has had far more ROFR enacted than any other resorts?

IMO, it's entirely due to the 15 year extension. DVC buys back the '42 contracts and resells them as '57s. In doing so, DVC is ridding itself of the dues burden on those additional 15 years of ownership.

They may not be netting the additional $15-25 which DVC used as a price point when selling the extensions, but that's water under the bridge. Now it's about damage control--minimizing the number of points they will be forced to carry in another 29 years.

 

[kkolbusz1]

Lets not forget someone already paid full price direct from Disney for any resort, its their decision for whatever reason they need to sell. Someone buying resale is taking over the yearly dues and Disney still makes that money every year.

 

[Deb & Bill]

Lets not forget someone already paid full price direct from Disney for any resort, its their decision for whatever reason they need to sell. Someone buying resale is taking over the yearly dues and Disney still makes that money every year.

But dues are limited to actual costs, plus the administrative costs fee. So Disney isn't make a lot of money on DVC once it is sold.

 

[kkolbusz1]

But dues are limited to actual costs, plus the administrative costs fee. So Disney isn't make a lot of money on DVC once it is sold.

But its as if we're just taking over. They already made that money. What would disney care. They exercise that right by rofr.

 

[Chuck S]

But its as if we're just taking over. They already made that money. What would disney care. They exercise that right by rofr.

Because DVC would rather sell a new contract and make the direct profit. If you buy a resale, Disney in a sense loses the direct profit.

It is much like buying a new home directly from a developer. The developer makes money selling new homes. Say Ricky and Lucy buy a home from the developer.. The developer makes money on that home. Then say Fred and Ethel like Ricky and Lucy's home, but Ricky and Lucy want to move. So, rather than Fred and Ethel buying a home directly from the developer, they buy Ricky and Lucy's home, the developer has, in essence, lost the sale and profit of a home to Fred and Ethel.

 

[Dean]

Lets not forget someone already paid full price direct from Disney for any resort, its their decision for whatever reason they need to sell. Someone buying resale is taking over the yearly dues and Disney still makes that money every year.

DVD makes no money on a resale and it actually potentially costs them a retail sale. DVCMC makes the same amount of money (12%) that they would have made anyway.

 

[BWV Dreamin]

Curious. How would it work if one owned a restricted contract but then wanted to extend the life of the contract past 2042?( If the opportunity to extend was offered). Would there be an additional fee charged to extend and then have all direct benefits?

 

[z28wiz]

Curious. How would it work if one owned a restricted contract but then wanted to extend the life of the contract past 2042?( If the opportunity to extend was offered). Would there be an additional fee charged to extend and then have all direct benefits?

I wondered the same thing regarding okw

 

[Dean]

Curious. How would it work if one owned a restricted contract but then wanted to extend the life of the contract past 2042?( If the opportunity to extend was offered). Would there be an additional fee charged to extend and then have all direct benefits?

No one knows that would be talking. It's possible only qualified contracts could be offered extension or the fee could be higher for non qualified or it's possible they would retain their pre-extension status. They could tie it to a retail purchase. The possible variations are many. I think we can guarantee it won't be cheap for resale non qualified buyers.

 

[Tdisney]

I would like to put my two cents in on this as I started another thread when disney first decided to take away the "perks" when buying resale. I have not spoken to him about this in some time but I have a friend that owns a real estate law firm. I never forwarded him the contract of DVC but explained to him that Disney was taking away the "perks" when buying resale. I explained to him what the "perks" were. But he told me a few things and gave me several comparisons that he was involved in. First of all, just because it is in a contract, even written by Disney, does in no way make it right or completely legal. Larger companies with more money and bigger lawyers then disney have lost in a court of law when being judged by a jury of your peers. So just because it is in a contract that disney can strip away your "perks" doesn't mean it would hold up in a court of law. Second, it doesn't matter what you call them, "perks" , if it was part of an original contract when you bought it, it should not be able to be removed. Example : A developer builds a condo with a hundred units, a pool and fitness room, covered parking. When you bought from the developer your condo included access to the pool, fitness room and a covered parking space. In the contract however was that the developer could remove access to the pool, fitness center and covered parking when he deemed. Now the developer was only able to sell 50 of the condos. It has been a few years and people are wanting to resell their condo. However to dissuade people from buying the condo resale and not from him, he decides that if people buy resale they would not get a covered parking space. In turn their condos were devalued because of the removal of "perks". So guess what happened. Class action lawsuit. Even though it took several years and a lot of money tied up. The developer lost in the end. So would it be beneficial to sue disney over this, on an individual basis probably not. Not unless it started to devaluate your contract points to the extent that you could not sell them. A 10,000 to 15,000 dollar contract that would only sell for 7,000 to 5,000 is not that much money in the long run. And not worth the hassle to the individual. But for a lawyer that might get a large percentage of the difference on a whole might be a different story. It might be harder to prove that disney has wronged if they said for everyone wether you buy from disney or resale that you lose the perks in say 5 years. But just remember, that just because it is disney and in a contract does not necessarily make it right o legal.

 

[Dean]

I would like to put my two cents in on this as I started another thread when disney first decided to take away the "perks" when buying resale. I have not spoken to him about this in some time but I have a friend that owns a real estate law firm. I never forwarded him the contract of DVC but explained to him that Disney was taking away the "perks" when buying resale. I explained to him what the "perks" were. But he told me a few things and gave me several comparisons that he was involved in. First of all, just because it is in a contract, even written by Disney, does in no way make it right or completely legal. Larger companies with more money and bigger lawyers then disney have lost in a court of law when being judged by a jury of your peers. So just because it is in a contract that disney can strip away your "perks" doesn't mean it would hold up in a court of law. Second, it doesn't matter what you call them, "perks" , if it was part of an original contract when you bought it, it should not be able to be removed. Example : A developer builds a condo with a hundred units, a pool and fitness room, covered parking. When you bought from the developer your condo included access to the pool, fitness room and a covered parking space. In the contract however was that the developer could remove access to the pool, fitness center and covered parking when he deemed. Now the developer was only able to sell 50 of the condos. It has been a few years and people are wanting to resell their condo. However to dissuade people from buying the condo resale and not from him, he decides that if people buy resale they would not get a covered parking space. In turn their condos were devalued because of the removal of "perks". So guess what happened. Class action lawsuit. Even though it took several years and a lot of money tied up. The developer lost in the end. So would it be beneficial to sue disney over this, on an individual basis probably not. Not unless it started to devaluate your contract points to the extent that you could not sell them. A 10,000 to 15,000 dollar contract that would only sell for 7,000 to 5,000 is not that much money in the long run. And not worth the hassle to the individual. But for a lawyer that might get a large percentage of the difference on a whole might be a different story. It might be harder to prove that disney has wronged if they said for everyone wether you buy from disney or resale that you lose the perks in say 5 years. But just remember, that just because it is disney and in a contract does not necessarily make it right o legal.

Terminology does matter to a degree. Of question are things not included in the contract, sales materials, POS, etc. None of those issues are on the table. We have not only Disney's info to draw from but that of a much larger timeshare experience. Bigger companies than DVD/DVC (Marriott, Bluegreen & Wyndham esp) have made far more drastic but similar changes over the years without significant issue. We're talking fringe benefits that could be removed for all owners tomorrow without recourse. VIP systems have also stood the test of time and other lawyers. I doubt your friend would be willing to offer the opinion that you attribute to them in the situation in question and would submit that timeshare law is about as far from what most lawyers know about as could be postulated.

 

[Tdisney]

"Fringe benefits" from all owners is one thing but to single out those that did not purchase directly is another. Another example he gave me but has really nothing to do with real estate is when the car companies tried to make the warranty non transferable.

 

[Dean]

"Fringe benefits" from all owners is one thing but to single out those that did not purchase directly is another. Another example he gave me but has really nothing to do with real estate is when the car companies tried to make the warranty non transferable.

As I noted, many companies have done this successfully. It's no different than when your Airline changes their FF program which they also tier for different groups. IMO you're grasping at straws on this one. It's been 3 years since the change and no successful challenge as of yet. Essentially you're saying it would be illegal for Disney to treat one member different from another but the reality is it's done EVERYWHERE you do business from the car dealership to the local grocery store. Is anyone here willing to put their neck (and money) on the line to challenge the issue?

 

[awilliams4]

I went the resale route as I could not justify BLT at $160 vs resale around $95. Yes the wait is killing me, yes I want to make my reservation now, yes it is more work but to me the extra costs of direct were just too much. My humble opinion only.

That is a big jump over the past 33 months. We bought direct, BLT, at $96 per point in June 2009. Got 10 25 point contracts. That is one benefit of buying direct.

 

[luckyman_apd]

That is a big jump over the past 33 months. We bought direct, BLT, at $96 per point in June 2009. Got 10 25 point contracts. That is one benefit of buying direct.

I paid $95 for BLT resale last year. If the difference wasn't so great and I could have bought direct at $96, I certainly would have. But $165 is absolutely ludicrous, and even more insane is $130 for a resort closing 18 years sooner!

 

[Tdisney]

As I noted, many companies have done this successfully. It's no different than when your Airline changes their FF program which they also tier for different groups. IMO you're grasping at straws on this one. It's been 3 years since the change and no successful challenge as of yet. Essentially you're saying it would be illegal for Disney to treat one member different from another but the reality is it's done EVERYWHERE you do business from the car dealership to the local grocery store. Is anyone here willing to put their neck (and money) on the line to challenge the issue?

Yes you are correct but the difference is it is devaluating what you own as compared to Disney. If Disney said ok as of July 1 2013 any one who buys DVC will not have access to the concierge collection is one thing but to say only if you buy from Disney even though the contract possessed by the seller has access to them is different. Again I am not a lawyer and I think no one would really stick their neck out because it is not cost effective to hire a lawyer to try and gain 5 to 10 thousand dollars back. However if a lawyer saw that because of this, resale contracts were devalued as a whole several millions, then it might be. So could disney say ok every one except for John Do gets access to the concierge collection just because Disney wants it that way ? I am sure they could but would that hold up in a court, I doubt it. As long as he hasn't done anything wrong.

 

[Peepster]

In 2001 we went to hear the Disney spiel concerning DVC. At that time they wanted us to buy in, I believe, at Beach Club (yes, I could be wrong). We had fallen in love with VWL and wanted to own there but we were told no points were available.
Found out we could get them resale, told our DVC guide that and again asked if any points, even at a higher price, were available through Disney. When we were told no we began to purchase small resale contracts. To those who have referred to some resale buyers as cheap I would like to point out that some of us are just not abundantly wealthy but love vacationing at WDW. Still, we kept in touch with our Disney guide and said if any small contracts came up for VWL we would be interested. We were never contacted. We now have enough points to be satisfied and boy, we spend a lot of our disposable income with the Mouse...above and beyond our points. And I suspect most DVC'ers do spend a lot of money on property, regardless of where they purchased their points.
First, I'm surprised to hear that others have purchased small contracts from Disney. Second, why does all the money we've spent on property for the many vacations we've already taken and plan to take seem to be excluded from the equation?
Doesn't the resale market keep the Disney market from being astronomically priced?
Guess I must be pretty ignorant. (as evidenced by lack of ticker below)
Auntie Peep

 

[Deb & Bill]

... Second, why does all the money we've spent on property for the many vacations we've already taken and plan to take seem to be excluded from the equation?
Doesn't the resale market keep the Disney market from being astronomically priced?
Guess I must be pretty ignorant. (as evidenced by lack of ticker below)
Auntie Peep

I think the resale market makes the direct market high. Otherwise, Disney would be selling DVC like gangbusters, not really having to market it at all.

 

[carlbarry]

Yes you are correct but the difference is it is devaluating what you own as compared to Disney. If Disney said ok as of July 1 2013 any one who buys DVC will not have access to the concierge collection is one thing but to say only if you buy from Disney even though the contract possessed by the seller has access to them is different. Again I am not a lawyer and I think no one would really stick their neck out because it is not cost effective to hire a lawyer to try and gain 5 to 10 thousand dollars back. However if a lawyer saw that because of this, resale contracts were devalued as a whole several millions, then it might be. So could disney say ok every one except for John Do gets access to the concierge collection just because Disney wants it that way ? I am sure they could but would that hold up in a court, I doubt it. As long as he hasn't done anything wrong.

OK, as a lawyer, I have to put in my 2 cents LOL. The contract with DVC says they can eliminate a bunch of stuff--the AKL and AKV contracts even say that there might not be savannas at some time. Think what THAT would do to the value of the contracts, especially if they decided to build where the savannas are.
Unless it is forbidden by law, DVC can put in the contract anything they want. I am also a Wyndham owner, and Wyndham keeps taking away benefits; when I first bought in we were allowed to transfer points (vacation and housekeeping) between members. That right is now gone.
So the idea that a timeshare company would be prevented from taking away rights that are included in the contract that they have the right to eliminate, and be prevented just because "it's not nice" is dreaming. DVC has good lawyers who know how to draft a contract!